Army Institute of Business Administration

Savar Cantonment, Dhaka

Term Paper on

‘Marketing research of Motorola: Why Motorola

failed?’
Course Code: MKT 4707

Course: Marketing Research

Submitted to:

Mahbub Morshed

Lecturer

Submitted by

Shafiul Bashar Shanto

ID – B6190B0027

Batch – BBA 6

Submission Date: 15th June

 Marketing research of Motorola:

Why Motorola had failed?

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a large number of restaurants
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at their doorsteps. It a global
food
ordering platform active in
many cities and countries with
a large number of restaurants
from
where customers can choose
their food from. Also it has a
large number of active riders
in its
business whose who delivers
food to the customer’s
doorsteps
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business that helps consumer

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to order food online through
the
Foodpanda’s mobile app or
website and receive their food
at their doorsteps. It a global
food
ordering platform active in
many cities and countries with
a large number of restaurants
from
where customers can choose
their food from. Also it has a
large number of active riders
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business whose who delivers
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Foodpanda is a food delivery e
business that helps consumer
to order food online through
the
Foodpanda’s mobile app or
website and receive their food
at their doorsteps. It a global
food
ordering platform active in
many cities and countries with
a large number of restaurants
from

7|Page
where customers can choose
their food from. Also it has a
large number of active riders
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business whose who delivers
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business that helps consumer
to order food online through
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website and receive their food
at their doorsteps. It a global
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ordering platform active in
many cities and countries with
a large number of restaurants
from
where customers can choose
their food from. Also it has a
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business whose who delivers
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business that helps consumer
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Foodpanda’s mobile app or
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a large number of restaurants
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Abstract: This research intensively focuses on the reviews and analyzes the marketing research of
Motorola and how it grew to high level and the reasons for the failure of Motorola in the International

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market and also to figure out the problems and issues related to the downfall of Motorola mobile. Using
traditional narrative literature review and secondary sources, we reviewed and analyzed the historical
transformation of Motorola's core business. We further research among people to know about their
thinking on Motorola mobile. Therefore, we add to the literature a bundle of the lessons learned that
chronologically explain how Motorola failed to create and sustain competitive advantages, particularly
in the Smartphone market. We concluded that the problem at Motorola was not the lack of innovation,
but rather, it was the lack of a precise technology forecasting, and misunderstanding that the needs in
smartphone market were not just about demonstrating a mobile phone that makes calls, texts and
connects to the web, but also the platform that operates all these functions together. Since Motorola's
brand name is recently back in the market through a newly licensed firm (HMD Global), we further
discuss how likely the new Motorola's smartphones will possibly compete and plausibly succeed in a
very well-established market.

Key points: Marketing research, Motorola, failure of Motorola

Table of Contents
1.0 INTRODUCTION...........................................................................................................................4
1.1 Background..................................................................................................................................4
1.2 Rationale:....................................................................................................................................4

2.0 LITERATURE REVIEW................................................................................................................6

2.1 Concept of marketing research....................................................................................................6
2.2Literature gap...............................................................................................................................6

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3.0 RESEARCH OBJECTIVES............................................................................................................6
4.0 METHODOLOGY..........................................................................................................................7
5.0 ANALYSIS AND FINDINGS........................................................................................................8
5.1 Demographic Analysis.................................................................................................................8
What is your age group?....................................................................................................................9
5.2 Frequency analysis....................................................................................................................10

6.0 DISCUSSIONS.............................................................................................................................13
6.1 Strategy......................................................................................................................................13
6.2 Technology...............................................................................................................................14

7.0 CONCLUSIONS AND RECOMMENDATIONS.........................................................................16

7.1 Conclusion.................................................................................................................................16
APPENDICES.....................................................................................................................................19
Appendix 01: Survey questionnaire.................................................................................................19

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1.0 INTRODUCTION
1.1 Background

Motorola, Inc. was an American multinational telecommunications company based in

Schaumburg, Illinois, United States. After having lost $4.3 billion from 2007 to 2009, the
company split into two independent public companies, Motorola Mobility and Motorola
Solutions on January 4, 2011. Motorola Solutions is generally considered to be the direct
successor to Motorola, Inc., as the reorganization was structured with Motorola Mobility
being spun off. Motorola Mobility was acquired by Lenovo in 2014. Motorola's wireless
telephone handset division was a pioneer in cellular telephones. Also known as the Personal
Communication Sector (PCS) prior to 2004, it pioneered the "mobile phone" with DynaTAC,
"flip phone" with the MicroTAC as well as the "clam phone" with the StarTAC in the mid-
1990s. It had staged a resurgence by the mid-2000s with the RAZR, but lost market share in
the second half of that decade. Later it focused on smartphones using Google's open-source
Android mobile operating system. The first phone to use the newest version of Google's
open-source OS, Android 2.0, was released on November 2, 2009 as the Motorola Droid (the
GSM version launched a month later, in Europe, as the Motorola Milestone).

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The handset division (along with cable set-top boxes and cable modems) was later spun off
into the independent Motorola Mobility. On May 22, 2012, Google CEO Larry Page
announced that Google had closed on its deal to acquire Motorola Mobility. On January 29,
2014, Google CEO Larry Page announced that pending closure of the deal, Motorola
Mobility would be acquired by Chinese technology company Lenovo for US$2.91 billion
(subject to certain adjustments). On October 30, 2014, Lenovo finalized its purchase of
Motorola Mobility from Google.

1.2 Rationale:
Motorola started in Chicago, Illinois, as Galvin Manufacturing Corporation (at 847 West
Harrison Street) in 1928 when brothers, Paul V. and Joseph E. Galvin, purchased the
bankrupt Stewart Battery Company's battery-eliminator plans and manufacturing equipment
at auction for $750. Galvin Manufacturing Corporation set up shop in a small section of a
rented building. The company had $565 in working capital and five employees. The first
week's payroll was $63. Beginning in 1958, with Explorer 1 Motorola provided radio
equipment for most NASA space-flights for decades, including during the 1969 moon
landing. A year later it established a subsidiary to conduct licensing and manufacturing for
international markets. Motorola created numerous products for use by the government, public
safety officials, business installments, and the general public. These products included cell
phones, laptops, computer processors, and radio communication devices. In 1998, Motorola
was overtaken by Nokia as the world's biggest seller of mobile phone handsets.

The company's first products were battery-eliminators, devices that enabled battery-powered
radios to operate on household electricity. Due to advances in radio technology, battery-
eliminators soon became obsolete. Paul Galvin learned that some radio technicians were
installing sets in cars, and challenged his engineers to design an inexpensive car radio that
could be installed in most vehicles. His team was successful, and Galvin was able to
demonstrate a working model of the radio at the June 1930 Radio Manufacturers Association
convention in Atlantic City, New Jersey. He brought home enough orders to keep the
company in business.

The research paper will be completed using 7 chapters. The first chapter will show the
attractiveness and effectiveness of marketing research with rationale, and background
information. The second chapter will identify literature review and literature gap. The third

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chapter will state the four objectives of the research that will be formulated to reach the aim.
The fourth chapter will explain the methods that were applied in the research. The fifth
chapter will show the research on customer thinking about Motorola. The sixth chapter will
analyze the findings of the research and determine how Motorola has fallen in the global
market strategy. The seventh chapter will summarize the research and given some
recommendations for Motorola to come back into the market and reestablish its market
position.

2.0 LITERATURE REVIEW

2.1 Concept of marketing research
Philip Kotler (1994) defines the marketing research as the function that links the consumer,
customer, and public to the marketer through information-information used to identify and
define marketing opportunities and problems; to generate, refine, and evaluate marketing
actions; to monitor marketing performance; and to improve understanding of the marketing
process. Marketing research specifies the information required to address these issues, designs
the methods for collecting information, manages and implements the data collection process,
analyzes, and communicates the findings and their implications. Briefly it is a systematic
design, collection, analysis, and reporting of data and findings relevant to a specific marketing
situation facing the company, allows management to make the changes necessary for better
results through adopting a proactive approach. Therefore, if a company wants to know what
type of products or services would be profitable it should make a market research.
Furthermore, a comprehensive research will enable the company to know about the product
imperfections (if there are) and to know if it has been able to satisfy customers’ needs. It
attempts to provide accurate information that reflects a true state of affairs. Due to market
research the company can formulate a viable marketing plan and estimate the success of its
existing plan.

2.2Literature gap
Motorola had failed, But there’s a huge controversy in the topic as per Jaakko Aspara, Juha-
Antti Lamberg, Arjo Laukia, Henrikki Tikkanen, (2011) the top level management is highly
responsible for the reason. On the other hand another study by N. Ramachandran claim that
their strategy and making a deal with Nokia is the biggest mistake to make their business
down.

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3.0 RESEARCH OBJECTIVES
The research aims at investigating the market research of why Motorola has failed despite it’s
such a huge recognition. The objectives of the research are-

 To understand the concept of marketing research.

 To analysis the attitude of people’ towards the Motorola mobiles and reasons for
failure
 To evaluate the preference level of Motorola mobiles among the consumers 
 To assess the reasons behind the failure of Motorola Company.
 To figure out the problems and issues related to the failure and downfall of Motorola
mobiles.

4.0 METHODOLOGY
Research onion has six layers and each layer illustrates different stages of research. They are-
philosophy, approach, strategy, method, time horizon, data collection, and analysis (Goddard
& Melville, 2004).

Figure 1: Research onion

Source: (Goddard & Melville, 2004)

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Generally, two research designs are followed to solve marketing research problems-
exploratory research design and conclusive research design. Conclusive design is followed
for solving and finding the conclusion of a problem that has theoretical background whereas
exploratory design is followed for solving a new research problem (Snyder, 2019). This
research is required to determine the impact of influencer marketing on consumer buying
decisions so the appropriate design is conclusive (Chawla & Sodhi, 2011). The positivism
philosophy is used in this research as the problem is objective. Realism philosophy required
personal observation which was impossible due to the large population and pragmatism is
also not appropriate because the variables of this research are well defined (Noor, 2008). So,
the positivism philosophy was the right one to use. Three methods can be followed for
completing research which is- qualitative, quantitative, and mixed. When the variables are
not well-defined, the qualitative method is used and, in this method, a small group of
respondents is required (Ørngreen & Levinsen, 2017). Here, this is objective research and the
variables are well-defined. So, data was collected from a large population following the
quantitative method.

Seven research strategies can be used for completing a research- ethnography, archival,
survey, action, case study, grounded theory, and experiment. The population was large so an
online survey strategy was followed to collect the responses of the respondents. Close-ended
questions were selected for the online survey. Two sources are used for data collection-
primary sources and secondary sources (Ketchen Jr & Bergh, 2006). For quantitative
research, data can be collected from both of these sources but in this matter, there were not a
lot of secondary sources so, the researcher collected data from primary sources through an
online survey. Four sampling methods are followed for conducting research such as- simple
random sampling, systematic sampling, stratified sampling, and cluster sampling method
(Baker, 2000). Among the four methods simple random sampling method is used in this
research as the respondents are chosen randomly, each of them has the possibility of being
selected Singh, 2006). This research can be done following the longitudinal time horizon or
cross-functional time horizon. The budget was limited and respondents of the same set were
not interested to participate so it followed a cross-functional time horizon (Snyder, 2019).

5.0 ANALYSIS AND FINDINGS

5.1 Demographic Analysis
Gender of the participants

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 Gender Percentage

Male 60%

Female 40%

Age group of participants

Age group Percentage

15-18 5%

18-24 30%

24-30 60%

30-40 5%

What is your gender?

What is your gender?

40% Male
Female

60%

Figure 2: Gender of the participants

The research has included both male and female respondent to get diversified responses
because people of different genders have different thinking styles and point of views. In this
research the percentage of female was 40% and the percentage of male participants was 60%.

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What is your age group?

What is your age group?

5% 5%
15-18
18-24
30% 24-30
30-40

60%

Figure 3: Age group of the participants

The research has involved the participants who belong to generation Y (24-30 years old) and
generation Z (15-24 years old) because they are the target customers of Motorola and the
researcher have more acceptability to the people of these age groups.

5.2 Frequency analysis

1: How do you take the purchasing decision of your Mobile phone?

Figure 1: Response of Question 1

The researcher asked the respondents how they take their purchasing decision when it comes
to buy a mobile phone. 39.3% responses to tech influencer and 28.6% to self decision. So it
can be said tech influencer are creating a lot interest among people as they are inspired
enough to buy Mobile phones.

2: Have you heard about Motorola?

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Figure 2: Response for question 2
The 2nd question was whether the respondents have heard about Motorola or not and there is
all positive responses. That means Motorola was quite familiar to people; every aspect of
people have heard about it.
3: Did you ever use a Motorola mobile?

Figure 3: Response of Question 3

The participants were asked if they used Motorola mobile.About 96.4% participants
responded “yes”. It is clearly said that Motorola was a brand that everybody used with such
a confidence.
4: Which made Motorola unique to you?

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Figure 4:Response of Question 4
The fourth question was the uniqueness of Motorola to the participent.There were 27
responses; among them maximum people(55.6%) think that hardware was the unique feature
of Motorola.

5: Which thing do you want to evaluate in Motorola?

Figure 5: Response of Question 5

In this question the researcher asked which was the one thing that the participate want to
evaluate in Motorola. About 60% believe that there should be a change in the configuration
of Mobile.Others believe that Motorola should evaluate user system and promotional
activity.
6: What is the big mistake of Motorola?

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Figure 6: Response of question 6
The reseacher asked what the big mistake Motorola has done.Among the 28 responses,57%
people think that the backdated overlook was the biggest error,while 39.3% responded to
deal with Nokia was the biggest mistake for Nokia.
7: Will you ever buy a mobile from Motorola?

Figure 7:Response of Question 7

The 7th question was if the respondant will ever buy Motorola phone. The answer in the
positive approach was 48.1% and in negative approach ,it was 51.9%. That means maximum
people don’t want to buy Nokia mobile now.
8: Would you recommend Motorola mobile to your friends?

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Figure 8:Response of question 8
The last quiry was if the participate would recommend the Motorola mobile to their friends,
and surprisingly 63% reliped as “No”,they would not recommend Nokia to their friends to
buy it.This shows us that Motorola is loosing the interest in their buying decision.

6.0 DISCUSSIONS
We will take use the 3 primary lenses which enable the process to analyze where Motorola
possibly went wrong.
6.1 Strategy
Motorola's market decline started when Blackberry used its server software to help
corporations more securely use mobile devices for instant communications amongst
employees. The mobile phone transitioned from a consumer device to a business device, and
Blackberry quickly grabbed market share as Motorola focused on trying to defend RAZR
sales with price reductions while extending the RAZR platform with new gimmicks like
additional colors for cases, and adding an MP3 player (called the ROKR.) The Blackberry
was a game changer for mobile phones, and Motorola missed this disruptive innovation as it
focused on trying to make sustaining improvements in its historical products.

Of course, it did not take long before Apple brought out the iPhone, and with those thousands
of apps changed the game on Blackberry. This left Motorola completely out of the market,
and the company abandoned its old platform hoping it could use Google's Android to get
back in the game. But unfortunately, Motorola brought nothing new to users and the Android
shift gave it no market benefits, so its market share dropped too nearly nothing.

6.2 Technology

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The mobile phone business quickly overtook much of the old Motorola 2-way radio business.
No electrician or plumber, or any other business person, needed the old-fashioned radios
upon which Motorola built its original business. Even police officers used mobile phones for
much of their communication, making the demand for those old-style devices rarer with each
passing quarter.But rather than develop a new game changer that would make it once again
competitive, Motorola decided to split the company into 2 parts. One would be the very old,
and diminishing, radio business still sold to government agencies and niche business
applications. This business was profitable, if shrinking. This organizational machination did
nothing to improve any part of Motorola, but the reason given was so leadership could
"focus" on this historical "core" market. Even if it was rapidly becoming obsolete.

6.3 People

the budget smartphone segment is currently ruled by the likes of newly-emerged Realme and
Beijing-headquartered Xiaomi - with Samsung now joining the budget segment with 'Galaxy
M' series.

According to Anshika Jain, Research Analyst at Counterpoint Research, "The competitive

landscape has changed significantly in the last year. We saw key players gaining share while
smaller brands exited the market as competition intensified."

"There has been a sporadic growth of brands in the online space, while Moto continued with
its limited push despite increasing competition. The push should have increased according to
growing competition," noted Kawoosa.

In 2017, Motorola opened its "Moto Hubs" in the country as competition among the top
smartphone manufacturers shifted to gain offline space, but to no avail.

6.4 Redrafting strategies

The mobile phone business was put out on its own, and lacking anything more than an
historical patent portfolio, with no relevant market position, it racked up quarter after quarter
of losses. Lacking any innovation to change the market, and desperate to get rid of the losses,
in 2011 Motorola sold the mobile phone business - industry creator and former market share
leader - to Google. Again, the claim was this would allow leadership to even better "focus"
on its historical "core" markets.

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But the money from the Google sale was invested in trying to defend the old market and
outdated technology, which was clearly headed for obsolescence. Profit pressures intensified
every quarter as sales were harder to find because customers had alternative solutions
available from ever improving mobile technology.

As the historical market continued to weaken, and leadership learned it had under-invested in
innovation while overspending to try defending aging solutions, Motorola again cut the
business substantially by selling a chunk of its assets - called its "enterprise business" - to a
much smaller Zebra Technologies. The ostensible benefit was it would now allow Motorola
leadership to even further "focus" on its ever smaller "core" business in government and
niche market sales of aging radio technology.

6.5 Wrong decisions

This ongoing "focus" on its "core" has failed to produce any revenue growth. So Motorola
has been forced to undertake wave after wave of layoffs. As buildings empty they go for
lease, or sale. And nobody cares, any longer, about Motorola. There are no news articles
about new products, or new innovations, or new markets. Motorola has lost all market
relevancy as its leaders used "focus" on its "core" business to decimate the company's R&D,
product development, sales and employment.

Retrenchment to focus on a core market is not a strategy which can benefit shareholders,
customers, employees or the community in which a business operates. It is an admission that
the leaders missed a major market shift, and have no idea how to respond. It is the language
adopted by leaders that lack any vision of how to grow, lack any innovation, and are quickly
going to reduce the company to insignificance. It is the first step on the road to irrelevancy.
6.6 Results
According to Counterpoint Research, Motorola India's smartphone shipments declined 70 per
cent year-on-year (YoY) in 2018. The brand sunk from sixth spot in 2017 to 12th in the
market in 2018. "Motorola shipments declined due to the competitive product portfolio of
Realme and Xiaomi. Motorola did not refresh its portfolio as compared to other Chinese
players which were offering better specifications at competitive prices,

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7.0 CONCLUSIONS AND RECOMMENDATIONS
7.1 Conclusion
On the basis of this Study it is understood that the role of Stephen Elop is the contributing
factor in the failure of Motorola as a company. The conspiracy theory states that even though
Stephen Elop came from Motorola but against all the ethical rules of professionalism but he
continued to make decisions which were beneficial for them. The argument is supported by
the facts and statistical data given in the paper on how Nokia went on a downward spiral after
Stephen Elop joined as the CEO. His decisions of only carrying the Android in all of their
phones did no good for the company’s performance in the business. The sales of Motorola
dropped over the period of his tenure which eventually led Motorola being sold to Lenovo.
So the research in this paper digs deeper into the role of Stephen Elop is the downfall of
Motorola. We wonder what would have been if Motorola would have embraced Android as it
is the biggest smartphone operating system in the world by far. Soon after being sold to
Microsoft, ousted employees are on the look for investors to manufacture same quality
hardware devices with a variety of Operating Systems other than . Despite its strong position,
Motorola lost out to new entrants who emerged as the mobile industry converged with
adjacent digital industries. The company did not only fail to beat these new entrants in bring
market leading innovations to the market in a timely manner, but also failed to respond
appropriately to threats posed by the innovations produced by its new competition.

7.2 Recommendation
After a scan of the internal and external environment we can clearly understand the current
and future competitive environment of Motorola. In addition, the following recommendations
may help Motorola to maintain their competitiveness vis-à-vis key competitors.
 Retain dominance in developing markets by reshaping the Motorola Brand.
 Create the perfect mobile solution for the corporate world by leveraging Motorola
solutions as well as solid finance.
 Research in Motion is a simple target for the two giants,
 Apple and Samsung have no specific interest or strength to react to this “niche”
attack.
 By entering the corporate world, Motorola will be able to attract developers that are
interested in selling high value applications to organizations.

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REFERENCES

https://www.forbes.com/sites/adamhartung/2014/08/06/motorolas-road-to-irrelevancy-
focusing-on-its-core/?sh=354ce93b442a

https://www.123helpme.com/essay/Marketing-Research-Literature-Review-166276

Jaakko Aspara, Juha-Antti Lamberg, Arjo Laukia, Henrikki Tikkanen, (2011),"Strategic

management of business model transformation: lessons from Nokia", Management Decision,
Vol. 49 Iss: 4 pp. 622 – 647

N.Ramachandran(2012) A study on Motorola failure in the global market and consumer

preference level towards Nokia introduction of the study

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APPENDICES
Appendix 01: Survey questionnaire
SL Questions

01 How do you take the purchasing decision of your Mobile phone?

02 Have you heard about Motorola?

03 Did you ever use a Motorola mobile?

04 Which made Motorola unique to you?

05 Which thing do you want to evaluate in Motorola?

06 What is the big mistake of Motorola?

07 Will you ever buy a mobile from Motorola?

08 Would you recommend Motorola mobile to your friends?

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