Table of Contents

Executive Summary......................................................................................................................... 2 Key Findings .................................................................................................................................... 2 Problem Statement ......................................................................................................................... 2 Target Market ................................................................................................................................. 3 BlackBerry SWOT and Competitive Analysis .................................................................................. 3

Evaluation of Alternatives Alternative One ............................................................................................................................... 4 Alternative Two.5 Alternative Three .....5 Implementation and Plan of Action6

Appendix 1...8-19 Works Cited.....20-22

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BlackBerrys Rise in Brand Power The Duelling Market Strategies of RIM versus Apple
EXECUTIVE SUMMARY The mobile communications market has been a battleground as several companies have tried to gain market share over the past ten years. The big players in the North American market have been Research in Motion (RIM) and Apple. RIM has enjoyed dominance in the business and professional user market with their BlackBerry, while Apple has held the majority of the market in the consumer area with the iPhone. Apple may be RIMs most visible competition in North America but on a global scale neither company holds the biggest share of the mobile communications (smartphones) market instead Nokia is the global leader in smartphone sales. A large percentage of RIMs revenue comes from outside Canada; they are a Canadian company competing globally. (See figures 1.1- 1.6 in the appendix 1)

Key Findings Visionary Marketing Group has studied the current smartphone offerings in North America and the world, the global market share each of the key players hold, the stock market value of these companies over the previous year, and consumer trend predictions of industry critics. Today, most consumers have adjusted to the new phone technology. In our market evaluations, we have assumed that the average mobile communication user will become more technically competent.

Problem Statement What product strategies can RIM use to gain a larger share of the global mobile communications market?

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Target Market The BlackBerry name has good brand equity. Maintaining favour among the business users will continue to be RIMs strength in the market place. Widening their target market to win over a larger share of the consumer market will be RIMs challenge.

Blackberry SWOT and Competitor Analysis RIM is known globally with a clientele base of approximately 14 million. An extremely strong brand loyalty along with extensive product lines and features has made for a noticeable dominance in the business professionals market. RIM stock has experienced a sufficient amount of growth and is currently a top competitor in the mobile communications market. In North America, business savvy professionals prefer the use of BlackBerry because of the products business oriented features and the BlackBerrys secure information transferring ability. As with any company, there are some areas in which RIM requires improvement. BlackBerrys main focus has been business oriented and has made for a decrease in the features of the entertainment and consumer side of things. Their browser speed could be faster in comparison to other smartphones and the price of a BlackBerry comes with a hefty price tag. The attempt and failure to pioneer a touch screen resulted in negative feedback. RIM has two definite competitors that pose a threat in the mobile communications industry: Apple and Nokia. Apples iPhone has experienced tremendous sales and popularity in North America, while Nokia is the leading provider of cellular phones in the European and Asian markets. While BlackBerrys main focus has been on the professional aspect, Apple has experienced tremendous success in the consumer market. Apple focuses more on being a portable entertainment/mobile phone device. There are extensive product lines for Apple such as iTunes, apps, and movies. These enable Apple to appeal to all demographics interested in the entertainment market. Nokias experience has been long recognized in the mobile phone market establishing them as the current world leader. Their premium products allow for relatively lower pricing than the BlackBerry and iPhone and, therefore, their phones appeal to more demographics.
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Overall, all three competitors each hold their valued shares in the mobile communication market by their offered features and brand dominance. The market for Mobile phones seems to hold an unlimited amount of promise and opportunity for whichever company can keep up with the latest advancements and achievement in technological trends. (See figures 1.1- 1.6 for market share analysis and figure 1.8 for the full SWOT in the appendix 1) EVALUATION OF ALTERNATIVES Alternative One: Macro Strategies Product and Customer Excellence Summary Keep the customer happy and loyal by providing an excellent product with the features they appreciate. One strategy to sustaining a large portion of the customer base is by offering product excellence. Blackberry was the pioneer in the business networking and wireless applications market. BlackBerry is a trusted name in the smartphone industry. RIMs largest customer is the US government (CIO). They chose the BlackBerry due to its superior security features, therefore, maintaining security superiority will be a key strategy for maintaining and gaining customer loyalty. Refining and perfecting the current product line by responding to customer requests for more entertainment features, a simpler user interface, WIFI ability, a better business application and a larger keyboard would keep the current customers happy and would entice other customers to buy.

Advantages 1) Maintain their cutting edge business technology 2) Keep the current customers loyal 3) Gaining new customers Disadvantages 1) Increased costs of research and time to refine the product 2) Perfection may never be possible. Constant change may be necessary 3) Competition will be fierce

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Alternative Two: Creating a New Product Line Summary In order to appeal to the more fun, entertainment seeking market, RIM could introduce a brand new line to their existing BlackBerry line of smartphones. The new WildBerry product will look and perform differently, creating interest in the targeted demographics. Various apps and merchandise tied to the WildBerry would create a new revenue stream. Adding a new product will widen BlackBerrys product line.

Advantages 1) The new product will create a fresh image to target the consumer market, and separate RIM from its known business reputation. 2) The name WildBerry is appealing and easy to remember. The blackberry reputation will encourage customer acceptance of the new line. 3) Chance to offer new features and styles -New design and applications will ignite excitement in consumers. Disadvantages 1) Extra costs for creating and marketing 2) Balancing Promotion. Finding the right balance of marketing between the two different lines will be challenging 3) Challenge of differentiating the new product from the BlackBerry having consumers recognize new attributes and features associated with the new line.

Alternative Three: Strategic Alliance and Developing a New Use Summary In order for RIM to gain a larger share in the smartphone market, RIM could follow the trend of what the consumers are looking for by adding more value to their products. Strategic alliance with a complementary company could create a new use for BlackBerry and would reposition BlackBerry to the introduction and growth phase of the product lifecycle without

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losing current customers. The creation of a wireless and contactless payment method built into the smartphone would enable consumers to pay for products or services without swiping a credit card, signing or carrying cash.

Advantages 1) We are becoming a cashless society. This alliance strategy allows RIM to benefit from the cashless trend. (See figure 1.7 in appendix 1) 2) This strategy may reposition the life cycle of Blackberry to the introduction and growth phase. (See figure 1.8 in appendix 1) 3) This technology will be copied by competitors but RIM has the security reputation required to assure customers. Disadvantages 1) Adoption of the new payment method may be slow 2) The attraction of the value added product will be copied by the competitors 3) If the partnership fails, RIM will be damaged

IMPLEMENTATION AND PLAN OF ACTION Chosen Solution: Alliance and Developing a New Use Summary While all of the proposed marketing strategies would serve RIM well, Visionary Marketing Group believes that the strategic alliance and developing a new use (alternative #3) would have the most significant results relative to costs. Visionary Marketing Group suggests a partnering with an established service supplier specializing in mobile payment methods. AirCharge is such a company and already has a relationship with RIM. The implementation of this strategy would begin immediately and could have the BlackBerry Airwave available within a year. The creation of a wireless and contactless

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payment built into the smartphone would enable consumers to pay for products and services without carrying a credit card or cash.

Implementation process Visionary Marketing Group believes the diffusion of innovation on this product would be rapid. The concept development, product development, and market testing have been done by competitors and complementary companies. The combination of BlackBerrys security reputation, communications ability, and new convenience would make this next RIM product an indispensible must have for everyone.

Step 1- Payment Transfer The technology to transmit payment information already exists and is available to merchants as a BlackBerry App (appworld). Step 2- Prepare phone The technology to imbed credit card info in a cell phone already exists. Reverse engineering could be used to identify the technology required (reghardware). Step 3- Form an alliance The BlackBerry name is associated with the security of information. If RIM could partner with an equally reputable credit payment supplier such as Aircharge , both companies would benefit. Customers would embrace this new technology quickly when two trusted companys become partners. Step 4-Offer product in North America Launching the product in North America with a high profile ad campaign focusing on BlackBerrys security features would appeal to the careful consumer. Launching the product with an ad campaign focusing on carefree and all in one feature would appeal to the fun consumer. Step 5- Offer product to the world Once the product is established and accepted in North America, RIM could launch the product globally.
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Appendix 1
Figure 1.1

Worldwide Smartphone market share in 4Q07

33% 51% 5% 11% Nokia RIM Apple Others

Source: http://www.gartner.com/it/page.jsp?id=910112

Appendix (continued)

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Figure 1.2

Worldwide Smartphone market share in 4Q08

29%

41% Nokia RIM

11% 19%

Apple Others

Source: http://www.gartner.com/it/page.jsp?id=910112

Figure 1.3

Worldwide Smartphone market share in 2Q08

33% 47% Nokia RIM Apple 17% Others

3%

Source: http://www.gartner.com/it/page.jsp?id=1126812

Appendix (continued)
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Figure 1.4

Worldwide Smartphone market share in 2Q09

24% 45% Nokia 13% RIM Apple 18% Others

Source: http://www.gartner.com/it/page.jsp?id=1126812

Figure 1.5

US Smartphone market share in Jan to July 08

7% 10% RIM 53% 24% Apple Palm Samsung Motorola 6%

Source: http://weblogs.baltimoresun.com/business/appleaday/blog/2009/02/smartphone_sales_in_us_up_68_ p.html Page 11 of 23

Appendix (continued)

Figure 1.6

Total general purpose card outstandings in 2008 ($972.73 billion)

5% 7% 8% 12% 15% 4% 3% Chase 24% Bank of American Citi American Express 22% Capital One Discover Wells Fargo HSBC U.S. Bank

Source: http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debtstatistics-1276.php

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Appendix (continued) Figure 1.7

Impact of the Innovation Continuum

Cash payment style is the traditional payment method style but debit and credit card payment style has become more and more common. MasterCard then come up with a unqiue payment style called MasterCard Paypass. MasterCard Paypass is an easy way for consumers to buy goods without swiping and signing a card. (From Textpage page 268)

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Appendix (continued) Figure 1.8

Generational Cohort and Comparison

Blackberrys demographic is between generation X and Y. Generation X and Y believes in killer life and lifestyle. They are able to multitask and they are familiar with technology.(From Textbook page 90, 92)

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Appendix (continued) Figure 1.8

Product Life Cycle and Characteristics

Most Blackberry products such as Blackberry Curve, Blackberry Pearl and Blackberry Bold are in their Growth and Maturity stage. Based on wired.com report, Blackberry Storm is currently in its Introduction stage and there are 1 million units sold within 2 months. Consumers ability to adopt new products are stronger and time needed is shorter.(From Textbook page 283)

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Figure 1.9 Full SWOT Analysis for Apple Strengths Extensive product line(itunes, apps, music, movies) Great customer experience, care and satisfaction All in one gadget(levelling app, accounting app, calculating app, etc) Apple is a very successful company. The Company posted record revenue of $10.17 billion

and record net quarterly profit of $1.61 billion, or $1.78 per diluted share. These results compare to revenue of $9.6 billion and net quarterly profit of $1.58 billion, or $1.76 per diluted share, in the year-ago quarter. Gross margin was 34.7 percent, equal to the year-ago quarter. International sales accounted for 46 percent of the quarters revenue. Apple sold 2,524,000 Macintosh computers during the quarter, representing nine percent

unit growth over the year-ago quarter. The Company sold a record 22,727,000 iPods during the quarter, representing three percent unit growth over the year-ago quarter. Quarterly iPhone units sold were 4,363,000, representing 88 percent unit growth over the year-ago quarter. has the opportunity to extend new products to them

Weakness faulty products Ipod Nano Screen, Battery life and Battery

Opportunities Profit might increase because of pressure from the music industry itself. Many of these

companies make more money from iTunes (i.e. downloadable music files) than from their original CD sales. Apple has sold about 22 million iPod digital music players and more than 500 million songs though its iTunes music store

Threats Substitutions Microsofts Zune, Creative Labs Nomad and other digital media devices Technologies changes rapidly
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Global Recession Being pressure by music industry, increased price on music download might decrease the

profit pressure on Apple illegally downloaded music in the US continues to grow

Figure 2.0 Full SWOT for Nokia Strengths Premium products Well-known in Europe and Asia E series desktop like platform(easier to use because its similar to a desktop computer) Best in class battery life last longer without charging Product extension Nokia Booklet 3G up to 12 hours battery life, ultra thin 2cm and built

in 3G wifi Nokia and Siemens merged Nokia and Microsoft alliance Leading in smartphone market share

Weaknesses Product design targeted towards mature audience Smartphone market share declining because its lack of functionality Although leading in cellphone market, sales are heavily based on low-end cellphones rather

than smartphones Not much complementary apps, goodies E series - Business sector but not as strong or well-known as blackberry Not well-known in North America

Opportunities Merged of brands - Nokia and Siemens - gain more market shares and demographics
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Alliance of brands - Nokia and Microsoft - might lead to more product or software

development

Threats Global recession Although its leading in market share currently, competitors like RIM and Apple continued to

gain market share while Nokia is losing market shares Trend of cellphone changing smartphone Tariff - import and export taxes

Figure 2.1 Full SWOT for BlackBerry Strengths Strong brand entity Extended products lines Pioneer in business market 14 million people use their products fastest growing company in the world Dominance in business professionals market Strong viral marketing Extremely strong in customers brand loyalty 50% of US Smartphone market in Q1 2009

Weakness Product storm is not pioneer in consumers market Devices are not simple to use Life cycle of Blackberry at its maturity stage Some products are not consistence with their vision Position themselves towards business professionals only
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Canadian company may be perceived as conservative company Products browsing speed is not as fast as iphones Lack of customer care Complementary services just started, lot of faulty functions

Opportunities More competitors lead to more sub segmentations and sub markets 92 % of revenue is outside of Canada

Threats New products coming from competitors such as Apple, Nokia, sony ericsson and other

smartphone companies Global recession Some see Blackberry as Crackberry its an addiction and it will damage brand identity Trends in consumer market change rapidly Technology advances rapidly

Figure 2.2 PEST Analysis Political -Companies purchasing zoning permits -Leasing land -Trade restrictions -Internet restrictions -Medical regulations

Economic -Recession -Rise and Fall in household income

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-Fluctuation of Canadian dollar

Social -Demographics (ie. Age) -High-tech society trends

Technological -Transformation from simple cell phone to complex smart phones -Advancements in social networking -Innovative models -Product reliability -Digital standards

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Works Cited
Armstrong, Kotler, Cunningham, Mitchell, Buchwitz. Marketing: An Introduction. Second Canadian Edition: Pearson Education. Forbes. (2009). A Brief History of BlackBerry. Retrieved October 16, 2009, from http://www.forbes.com/2009/08/17/rim-apple-sweeny-intelligent-technologyblackberry.html Ganapato. Priya. (January 28, 2009). Reviled by Reviewers, BlackBerrys Storm Rages On. Retrieved October 21, 2009, from http://www.wired.com/gadgetlab/2009/01/blackberry-stor/ Gartner (March 11, 2009). Gartner Says Worldwide Smartphone Sales Reached Its Lowest Growth Rate With 3.7 Per Cent Increase in Fourth Quarter of 2008. Retrieved October 21, 2009, from http://www.gartner.com/it/page.jsp?id=910112 Gartner (August 12, 2009). Gartner Says Worldwide Mobile Phone Sales Declined 6 Per Cent and Smartphones Grew 27 Per Cent in Second Quarter of 2009. Retrieved October 21, 2009, from http://www.gartner.com/it/page.jsp?id=1126812 Geer. David. (January 28, 2009). Technology is turning a communication device into a payment system. Retrieved October 21, 2009, from http://www.creditcards.com/credit-cardnews/cell-phone-contactless-credit-card-1273.php K. Hercules. (May 4, 2009). BlackBerry overtakes iPhone as top selling smartphone in U.S. Q1 2009. Retrieved October 21, 2009, from http://business2press.com/2009/05/04/blackberry-overtakes-iphone-as-top-sellingsmartphone-in-us-q1-2009/ CIO. (2009) BlackBerry Battle: RIM/NTP Patent Case Takes New Turn. Retreived October 21, 2009, from
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http://www.cio.com.au/article/320200/blackberry_battle_rim_ntp_patent_case_takes_ne w_turn Tofel. Kevin. C. (March 11, 2009). Winners and Loser in the Smartphone Market: Q4 2008. Retrieved October 21, 2009, from http://jkontherun.com/2009/03/11/winners-andlosers-in-the-smartphone-market-q408/ Wilcox. Joe. (November 5, 2008). Apple Fiscal 2008 by the Number. Retrieved October 21, 2009, fromhttp://blogs.eweek.com/applewatch/content/corporate/apple_fiscal_2008_by_the _numbers.html Woolsey. Ben. and Schulz. Matt. (September 10, 2009). Credit card statistics, industry acts, debt statistics. Retrieved October 21, 2009, from http://www.creditcards.com/credit-cardnews/credit-card-industry-facts-personal-debt-statistics-1276.php ZDNet. (2009). Five reasons Goodle Android smartphones will beat iPhone, BlackBerry, WinMo. Retrieved October 16, 2009, from http://blogs.zdnet.com/gadgetreviews/?p=8126 Zeiler. David. (February 9, 2008). Smartphone sales in U.S. up 68 percent in 2008, iPhone sales up 101 percent. Retrieved October 21, 2009, from http://weblogs.baltimoresun.com/business/appleaday/blog/2009/02/smartphone_sale s_in_us_up_68_p.html IE Market Research Corp. (2009) 3Q.2009 South Korea Mobile Payment Forecast, 2009 2013: Gross transaction value of mobile payments in South Korea will reach $1.54 billion in 2013. Retreived October 21, 2009, from http://www.marketresearch.com/map/prod/2433692.html Wikipedia. (2009) Osaifu-Keitai. Retreived October 21, 2009, from http://en.wikipedia.org/wiki/Osaifu-Keitai www.computerworld.com

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www.rim.com http://appworld.blackberry.com/webstore/content/340 http://www.reghardware.co.uk/2009/03/09/orange_barclays_nfc/

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