The mobile market in India is currently worth Rs 35,946 crore and is growing at 14 per cent year on year. Samsung is now the No 1 brand in the country, having overtaken Nokia after notching up 47 per cent growth last year. Indian brands such as Micromax, Karbonn and Lava have also made inroads into the market, mostly at the expense of Nokia.

The big change in the market has been the growth of smartphones with people increasingly happy to shell out a little extra for it.

India is now the third largest smartphone market in the world with 9 million units sold last year. This accounts for 15 per cent of the total mobile phone handsets sold; the remaining 85 per cent being feature phones. In the smartphones category, phablets (screen size: 5 to 6.99 inch) now account for 30 per cent.

The other big changes are reduction in the prices of fast 3G wireless technology and the expected launch of 4G on a national scale. Riding on these changes, data consumption is expected to grow and this will, in turn, fuel the growth of smartphones. This is also supported by trends in the US, where 62 per cent of mobile subscribers use smartphones as of Q2 2013.

Smartphone market-share Samsung leads the smartphone market share with 26 per cent and Micromax is a close second with 22 per cent.

According to IDC, local smartphone brands now account for over half of all smartphones sold in India.

The Indian smartphone market is highly price-sensitive; in fact, around 70 per cent of the devices shipped are priced at Rs 14,000 or lower and 67 per cent of the devices cost Rs 10,000 or less.

Nokia in India Nokia was one of the first handset companies to enter the Indian market in the early 1990s and the brand became almost generic to cell-phones. Its hold on the Indian market was far stronger than in the international space.

This was particularly because India’s mobile phone market grew at a scorching pace in the early 1990s.

This was when Nokia started one of its largest manufacturing facilities in India.

However, along with the rest of the world, Nokia lost its leadership position in India as well, unable to capitalise on the smartphone trend.

Current range of phonesFeature Phones

Number Series : These are basic feature phones in the Nokia portfolio. These are models such as 106, 207 and 515.

Asha Series : These are also features phones but the differentiating factor is that the phone comes pre-installed with popular apps.

The memory and processing power are better than in the number series handsets.

This series competes with feature phones from Indian manufacturers such as Micromax, Karbonn, and Lava as well as foreign phone-makers such as Samsung and LG.

Smartphones

Lumia Series : This is the smartphone sub-brand from Nokia.

The models go from 520 to 1020, each differentiated by processing speed, cost and other high-end features. It is based on the Windows OS.

The fall in Nokia’s market share is possibly one of the most analysed and written about cases and analysts believe Nokia lost share because of a combination of reasons:

Feature-rich and competitively priced products from global majors such as Samsung, LG and Sony at the top end.

Entry of feature-rich but cheap Chinese handsets under local brands such as Micromax and Karbonn, at the lower end

Inability to find a universal platform, like Android, for its smartphones.

This, analysts feel, will hound Nokia much longer and much harder as the market continues to shift to smartphones from feature phones.

Current Situation Facing competition and erosion from all sides, Nokia responded by cutting the prices of its feature phones and introduced the feature-rich Asha range. It jettisoned its OS for smartphones in favour of Windows OS in mid-2011 with the launch of Lumia range.

The high-profile launch of the Lumia and subsequent marketing pressure have, however, not really resulted in a reversal of fortunes for Nokia.

In early September 2013, Microsoft bought over Nokia’s handset business, which has raised even more questions on Nokia than it has answered.

(The author, an alumnus of IIM Ahmedabad, runs a marketing consultancy in Chennai, Brand Vectors. This is a case prepared by the author and not an industry review. Figures used are from secondary research sources and used only as inputs for respondents to devise strategy. The author does not claim to have first-hand information from any of the companies mentioned here.)