Nokia 3310: Just a mobile phone or more?
Do you think Nokia 3310 is going to be the volume driver for the brand? Think again.
So, we are nearing to the launch of the legend — Nokia 3310 and if we go by the definition of “hype” — this device has garnered much more attention, that what you can ask for. And that have prompted me to write this post. Thanks for joining discussion and I appreciate if you can share your thoughts at the end.
Every one of us is aware that Nokia (now HMD) considers Feature phones very seriously and since I have worked with Nokia earlier, I have felt the passion of this brand for entry-level customers. I can proudly say that no other brand takes entry level keypad phones business as seriously as Nokia. They invested in it, they invented it. And what can be the better phone, to begin with other than iconic 3310? The device which is one of the top selling mobile phone worldwide with sales of more than 128 million units over the years.
Why Nokia 3310 only? Why not any other phone?
There were many other phones from Nokia which went to become star sellers. Nokia was never short of phones, which have not only registered impressive sales but changed the way we use mobile telephony. They changed our habit and they changed our world — these are Cityman (1987), 5110 (1998), 9110 (1998), 7110 (1999), 3310 (2000), 8210 (1999), 3210 (1999), 7610 (2001), 6310 & 6310i (2002), 3650 (2002), 6810 (2004), 7600 (2004), N90 (2005), 8800 (2005), N93 (2006), N95 (2007), E71 (2008) and 808 Pure View (2012). These were the models, which have earned millions to this company and most importantly won the trust of consumers. I have not mentioned a couple of windows phone like Lumia 1020 since they are out of context here.
Any of these devices deserves comeback if we are talking about retro phones market and prospective gains but most of them are no more relevant in our market. As I am dealing very closely with mobile phone market, I can say that not a single N series phone can get you even 10k units sales if they launch again in India with similar form factor — just because they are not based on Android. Symbian OS do not have many apps, which today’s consumer is longing for like Instagram, Square, Slack, Uber — imagine a smartphone without them. Liking and loving N-series phones is a different matter and buying it is different. So, now the focus is on the traditional feature phone market. A very stronghold of Nokia. Without a single rupee spend in marketing in India during the year 2016, still, the brand has retained 9% volume market share in feature phone market in India. Nokia team (now HMD team) has still got the grip over the distribution and having access to close to 90,000 outlets in India.
Why today you want to buy Nokia phone? Because the brand has proven track record. Many of you may not even have used it but still, you carry regards for the quality, which this brand have offered. Comeback stories always revolve around your successful past, your actions which earned you respect and seems Nokia 3310 fits the bill. Nokia 3310 was launched in all countries, where Nokia used to have legitimate setup. Nokia 3310 was world’s top selling till now before Apple dethrone it. Nokia 3310 was sold more than 128 million units. There were people whose life saved by this phone. This phone have taken bullets in many wars, street fights and saved people’s life. There are people who proudly flaunt their 3310 which they are using years after years. Which other phone have garnered so much media coverage? Perhaps none. And thus Nokia 3310.
But, Nokia 3310 is not only launching in the old avatar — it is launching with bare minimum specifications which today’s customer is expecting in entry level feature phone — it has got the 2MP camera, it has got a MP3 player, it has got 2.5D 2.4-Inch display and a legendary talk-time capacity. This phone is much different from old 3310. Nokia does know that feature phone market is not growing by volume but it is important to have a flagship in this market — phone which you desire. Putting everything together, Nokia 3310 is now India’s costliest feature phone. To add the zing, Nokia have gone ahead and planned to have customized covers for the phone. You can design the outer body yourself. There is a lot more similarity the way Nokia is launching 3310 in India and Vespa launched their scooters recently. Colorful, Stylish, Retro and still carrying old values & glorious history.
Many markets have started accepting pre-booking for Nokia 3310 and retailers are very optimistic about this phone but I have a different opinion here, seeing the changes in the Indian market in last 2 months — post-Nokia’s announcement of 3310 launches. And these announcements have nothing to do with 3310 launch fear.
The factors which can go against Nokia 3310 are —
Indians are evolving and going beyond 2G network
Jio Effect Reliance Jio have changed habits again. Offering free voice calls for the lifetime has prompted many to adopt smartphones. Jio’s push was more effective as they have brought down 4G smartphones prices further down and now in India — you can buy a 4G smartphone starting from Rs.3000 (less than $50). So, when you are using a 4G smartphone along with Jio sim, you are not only adapting a new lifestyle but you are also saving a lot of money as you are no longer required to pay for your voice calls in India. Unfortunately, Nokia 3310 do not have the 4G capability and I can see that this model will not be able to capture essential value-seeking customer base now.
Rise of WhatsApp
As per the govt estimates, India has the population of 1266 million. let us remove 2 age groups a) 0–7 years and b) 65 years and above — we have about 848 million population. Let’s assume that they are the one who uses mobile phones extensively. Now by the end of Feb 2017, WhatsApp have announced that they have now 200 million users. That means that still feature phone market is quite large but Nokia 3310 do not have WhatsApp support. WhatsApp growth is another threat to 3310 as in November 2016 WhatsApp was having the user base of around 160 million and in just 3 months post — just after Jio launch they got 40 million more users.
Aggression of Counterparts
Lava Mobiles have just introduced Lava Connect M1 — which is priced just lower to Nokia 3310 at Rs.3,499 but with the 4G capability and WhatsApp support. The model is doing fantastic and the company is not able to meet the demand. In fact, we have sold huge numbers of this model from our site — OnlyMobiles.Com Frankly, I have never estimated that we will be able to sell a good quantity of this phone which can be considered as expensive if we consider the price. But customers often prove your estimates wrong.
Micromax is also gearing up in this segment — and going to launch Bharat 1 — which is going to carry the price tag of about Rs.2000. You can use 4G sim along with another regular 2G sim and can enjoy free voice services of Jio.
Jio is also reportedly planning to launch a feature phone which can work only with their sim card and can be priced as low as Rs.1000.
Itel and other such brands are already aggressively pushing their portfolio starting as low as Rs.699. You can even find keypad phones at an amazingly low price as Rs.499 from unheard brands.
But I am pretty sure, Nokia team knows much more than us and they must have factored all these. I do not expect a huge supply of this phone and certainly, they do not want to stuck with unsold inventory, especially they know that how hard it is to liquidate irrelevant models.
But again, we have customers among us who still want a good keypad phone for themselves as the smartphones are always short of our battery expectations. They have customers who want to gift a durable phone to their loved ones who are feeling more comfortable with keypad phones. There are always customers who just want a phone with quality assurance, where Nokia fits the bill. And there is where Nokia 3310 has got customers. I am pretty sure, the initial response to this phone is going to be great but the real struggle for sales for this phone might start after 2–3 months of the launch. Again, I am having belief that Nokia will always keep the supply lower than demand to ensure that the hype lasts longer.
But the metal of the brand will have a real test when they will introduce their smartphones and only post-August 2017 we will come to know if the business expectations are getting achieved or not. I am sure that initial hype will ensure “sold-out” label on retail shelves for at least 3–4 months. Also, we must note that Nokia has never released sales numbers for their online sales conducted in China. But Nokia is banking on regular software update and stock Android experience. The latest Nougat update is the proof that Nokia is taking commitments quite seriously. Customers who have gone for brands who were great value for money but not providing updates are now at the receiving ends as customers are evolving and becoming more demanding.
Business has changed since last time Nokia saw volume in the smartphone segment. Marketing costs have increased. Brands are literally financing the purchases via Bajaj Finance or Home Credit — offering zero down payments, zero interest EMI options. But the good part is HMD is with lean inventory. They have Foxconn who is world’s largest smartphone manufacturer. Foxconn has tried earlier also to get into consumer business via InFocus but they failed. I am sure, Foxconn will also leverage their expertise in Just-In-Time inventory. HMD or Nokia have learned a lot from their mistakes or I would call it “Error-of-Judgement” and I wish them all the best.
