NOKIA AND KODAK.

TWO CASES OF MARKETING STRATEGY FAILURE AND

THE REASONS FOR THEIR INABILITY TO SUCCEED.

In this paper the failure of two advertising strategies that did not yield the desirable outcome
will be examined. Both strategies involved careful planning and extensive teamwork, yet they
did not prove successful in the market as expected. The two companies that did not prove
successful in their campaigns were Nokia and Kodak.

THE CASE OF NOKIA AND HOW ITS MOBILE PHONES FAILED TO RESPOND TO
THE MARKET DEMANDS
The sales of Nokia mobile phones nearly collapsed between 2007 and 2015 whereas in the
years before that the company was a pace-setting mobile-phone maker. (​Tuomo Peltonen,
2019) ​
The obvious explanation was that Apple and Android had beaten Nokia. Yet, in reality
the reasons were more complicated.
Although Nokia spent lots of money on research and development of new models this
investment did not bring the results desired regarding the sales of its products.
One major reason for this was the fact that Nokia did not place much emphasis on the
software in the mobile phones. Having excelled in the hardware part for years, Nokia's
executives failed to realize the importance of the applications and the software in the new
smartphone era. "Nokia was paying too much attention to hardware and not enough to
software – its engineers were real gurus at building highly innovative mobile phone designs
but lacked the software known-how to fuel those devices. The software and apps were
literally the backbone powering up these phones even back then, and Nokia grossly
underestimated the importance of software." (Sam Davtyan, 2016)
Furthermore, there was Nokia's advertising strategy lacked value proposition. Nokia could
not make clear in its ads what its phones did better than IPhones and Android smartphones.
"The Lumia is one such example which was almost a complete failure, even though it was a
good phone by mobile and manufacturing standards. Unfortunately, it did nothing special and
added no value. It was badly positioned from a marketing standpoint and delivered no clear
message except for “here is a smartphone that works and does what every other phone does”.
There was no catchy market slogan. The value proposition was sorely missing." (Sam
Davtyan, 2016)
It could be said that Nokia got trapped into its own past success and underestimated its
competitors, that is Apple and Android. So, it was late to catch up with them in the market
and produce the innovations and new features the buyers had learnt to expect. It was also late
to turn from a Symbian platform to a viable alternative. "The late shift from the Symbian
platform to alternatives is illustrative, both with regard to not grasping in time that the
technical life cycle of Symbian came to an end, as well as not putting all efforts, resources
and capabilities in developing a viable alternative." (Bouwman, Harry et. al, 2014)
In a nutshell "Management decisions, dysfunctional organisational structures, growing
bureaucracy and deep internal rivalries all played a part in preventing Nokia from recognising
the shift from product-based competition to one based on platforms." (Yves Doz, 2017)

HOW KODAK MISSED THE OPPORTUNITIES IN DIGITAL PHOTOGRAPHY

Kodak was founded at the end of the 19th century and soon became a successful brand name.
Its popularity and power in the market kept rising until the mid 1980s. At that point
consumers started turning to Fuji, whose color film was fairly cheaper. Kodak created a
digital camera but was unable to see in time that photography was heading towards a social
sharing trend, Smartphones took the lead and people started sharing photos through social
networks. As in the case of Nokia mentioned above, Kodak did not prove ready to grab the
opportunities and see the new trends and needs as they arose. Its strategy makers did not
realize soon enough that online sharing was the new business so as to invest in it. "Kodak
created a digital camera, invested in the technology, and even understood that photos would
be shared online. Where they failed was in realizing that online photo sharing was the new
business, not just a way to expand the printing business." (Scott D. Anthony, 2016)
Again, similarly to Nokia, Kodak reacted in a complacent way, resting on the laurels of the
past, unable to see that Fuji was a competent competitor that could grab a large part of the
target market. Kodak was slow in innovation and transformation and, as it seems, did not do
enough market research. "The organization overflowed with complacency. I saw it, maybe in
the late 1980s. Kodak was failing to keep up even before the digital revolution when Fuji
started doing a better job with the old technology, the roll-film business." (John Kotter, 2012)
In a few words: "Kodak acted like a stereotypical change-resistant Japanese firm, while
Fujifilm acted like a flexible American one." (Sharifah Khairin Syed Mohd Ali, 2016)
Slowness in action, lack of agility, hesitation to make revolutionary changes and adopt highly
imaginative policies, trying to maintain the quo instead, all this cost Kodak the leadership in
the market Eventually Kodak filed for bankruptcy in 2012.

LESSONS TO BE LEARNT FROM THE TWO COMPANIES ADVERTISING

STRATEGY FAILURE
In both companies failure to dominate the market and make their products successful there
can be found some strategic mistakes. These are:

Complacency and slowness to respond to the real needs of the market.

Risk aversion and fear of radical, revolutionary innovation.
Inability to embrace new ideas and make pioneer changes.
Lack of intuition in management decisions.

These mistakes proved crucial and undermined their success, eventually leading them to flops
and forcing them to change their course after these huge failures.

References:
1. Case Study 4: The Collapse of Nokia’s Mobile Phone Business: Wisdom and Stupidity in
Strategic Decision-making, Tuomo Peltonen, 2019
https://www.researchgate.net/publication/326691715_Case_Study_4_The_Collapse_of_Nokia's_Mobi
le_Phone_Business_Wisdom_and_Stupidity_in_Strategic_Decision-making

2. How Nokia Failed to Nail the Smartphone Market, Bouwman, Harry et al. 2014
https://www.researchgate.net/publication/265637998_How_Nokia_Failed_to_Nail_the_Smartphone_
Market
3. The Strategic Decisions That Caused Nokia’s Failure, Yves Doz,2017
https://knowledge.insead.edu/strategy/the-strategic-decisions-that-caused-nokias-failure-7766

4. Top 5 Marketing and Business Mistakes Nokia Made That You Shouldn’t, Sam Davtyan, 2016
https://www.solopreneurs.co/top-5-marketing-business-mistakes-nokia-made-shouldnt/

5. Barriers to Change: The Real Reason Behind the Kodak Downfall, John Kotter, 2012
https://www.forbes.com/sites/johnkotter/2012/05/02/barriers-to-change-the-real-reason-behind-the-ko
dak-downfall/#3161f03569ef

6. Kodak’s Downfall Wasn’t About Technology, Scott D. Anthony, 2016

https://hbr.org/2016/07/kodaks-downfall-wasnt-about-technology

7. Kodak Strategic Management (Strategic Blunder) Case Study, Sharifah Khairin Syed Mohd Ali,
2016
https://www.slideshare.net/SharifahKhairinSyedM/kodak-strategic-management-strategic-blunder-cas
e-study