1. 4943475-104775Case Study #1- Blackberry 116205060960 MKTG 1102 October 22, 2009 Anne Marie Webb-Hughes Set 1K Jesse Aldridge Claire Gaigal Sunny Ling Matt Human Crystal Thorleifson Problem: The main problem faced by RIM is how they are going to adjust operations and modify product strategies in order to gain and sustain a technological advantage over competitors in the increasingly evolving smart phone market while maintaining sales in the now fluctuating economy.Key Findings: One year ago Blackberry's only competition was the iPhone. Now, with the ever increasing demand for Smart phones other dominating companies are entering the market. Research shows that the Palm Pre is now available and the Google My Touch will be available come 2010. Google stocks are at +19.94 as of October 17th, RIM's are at -1.43 Apple's at -2.51 and Palm sits at -0.36. The stock prices show that most of the competition is very close but Google definitely has a competitive edge and is a trusted name. Blackberry is the second most popular Smart phone for 2009 just behind the iPhone, representing 21% of the worldwide market. As of May 2009 there were a total of 28.5 million subscribers and revenue rose to 3.53 billion from 2.58 billion in 2008. There are currently five different Smart phones made by RIM; the Curve, Bold, Pearl, Tour, and the Storm. Each one has a depth to target a different user. All the phones are updated regularly to cater to people's ever changing wants and needs. The new Storm 2 will be coming to North America for 2010. It is faster, holds more data, has a sleeker appearance, and carries more applications and music. StrengthsWeaknessesOpportunitiesThreatsRIM is currently at the top of the market with high consumer demand for their productsThe Blackberry is not very multimedia friendly which is what greatly appeals to younger consumersTo better establish the RIM brand, especially within their business professionals and corporations marketWe live in a market of ever-changing technology and it is often difficult to continuously update products to meet these changes1357630-14605There is a large breadth of devices available; such as the Blackberry Bold, Curve, Tour, Storm and PearlHaving such a large range of breadth and depth as RIM does could cause brand confusion for current and potential costumersThe ability to grow within their established brand. People already recognize RIM's products and their services, and because of their good products and brand maturity people are willing to be loyal to the brandNew innovations are always being released by RIM's competitors RIM has an established clientele consisting of businesses and professionalsRIM is currently operating with an out of date Internet browser that is slower than that of the competitionConsumers changing taste as to what is popular in today's market makes it difficult to always appeal to their target marketThe Blackberry has an established sleek design that is easily recognizable There is a large diversity of Smartphone products such the Palm, Google, and iPhone. Smartphones are becoming more and more popular; two years ago there were only two smartphones Blackberry and the iPhone, now more companies have come out with their own Smartphone devices RIM is very fast on finding out what consumers what and what is popular in the market in order to update their devices with the current trends Target MarketThe primary target market that RIM's Blackberry devices appeal to are the business executives; consumers who need to remain informed when out of the office and receive instant email or message updates from co-workers. RIM is now trying to appeal to the younger
gadget geeks
by updating their devices with the newest and best technology. Alternatives Alternative 1- Expand Breadth and depth of Blackberry line Advantages Appeals to everyone and caters to more target markets More types of personalized phones can meet favour with more users of different age groups and of different countries, capturing more potential consumers to hit their target markets. · Brand dominance Reinforce and enhance the value of the BlackBerry brand, plat forming its' matures perspective in the future markets. A strong brand name can create a sales advantage and effective promotion, consumers will be more confident of trying the new variety of blackberry phones. · Ability to gain an advantage over competitors on a variety of levels Appealing to a wider range of markets, ensuring each potential buyer has a choice of which blackberry phone best suits their needs, therefore enhancing their competitiveness and monopolization of the market. Disadvantages · Confuse people with number of available blackberry products – could create hesitation A wide variety of phones to sell will cause consumers’ confusion about which phone they really need. If consumers cannot easily make their decisions, they might hesitate or leave in frustration, unlikely to return. · Lose product recognition If blackberry has extremely segmented phones , similar products to competitors' ones will be unavoidable. Then consumers will have trouble distinguishing blackberry phones from other brand’s phones. · Could spread product innovation too thin which might lower overall product quality which might cause the loss of established clientele Segment products too thin might cause a reduction of quality in each kind of phone. The supplies of the best selling phones might be unable to meet the clients’ demands. Alternative Two- Expand product depth while maintaining product breadth Advantages Developing the established phones allows for increased attention towards advancements and improvements in technology that RIM and its product developers are already intimately acquainted with from their previous experiences. Building on established products allows for easier and more accurate statistical analysis and feedback. Consumers will be familiar with established products, allowing them to provide instant feedback on improvements made to updated models of the same phone. RIM will be able to view where they stand on their product life cycle and make accurate and appropriate adjustments. Disadvantages There could be limitations as to how far the current product line could be developed before an entirely new style of smartphone is required to maintain product standards and competitiveness within the ultra – competitive and fast paced smartphone market. No new smartphones would be developed, which may not attract those not satisfied with the style and design of the current product line. Alternative Three- ReBrand Blackberry as a whole Advantages · Whole new market Confronting the change in the market, rebranding Blackberry will create the opportunity to not only understand the characteristics and needs of prospects in the new market but also find out the threats they will face and plan a new marketing strategy to counter them accordingly. · Whole new image To rebrand Blackberry is to inject renewed life into an old brand by bringing new consumers and a new market. · Whole Phone line can be changed, allowing for creative improvements Rebranding Blackberry can get rid of the old and inferior phones and input technology in researching and developing new phones, building up the brand’s innovative spirit and maintaining technological leadership in the market. Disadvantages · Lose established clientele and trust Rebranding Blackberry will lose many original clients’ trust and loyalty. Some of them who don’t like the new style of phones will switch to competitors product. · Lose brand recognition The rebranding may confuse consumers who may not identify the new phones with the old ones because they are unaware of the rebranding process. · Lengthy rebuilding process Rebranding will take on many risks, such as technological uncertainties which will follow. It will take time to research and develop new brand phones. They may lose competitive market shares they already hold while their competitors develop a better, more efficient and sometimes less expensive product. Solution- Alternative 2 Faced with one of the most competitive, sought – after markets in today’s consumer society, RIM must undoubtedly come up with a solution to maintain its share in the market. Our proposed solution is that RIM maintains its product breadth, while expanding the depth of its product base as technology advances and the competition dictates. In doing this, RIM maintains its current product selection, which is an ample one that appeals to all smartphone users and their different requirements. What RIM must do is expand on these established phones, not create new ones. They must adhere to the 5 phones they have developed so as to reduce product confusion. This practice is already evident with the development of the Blackberry Storm 2. It is an updated, improved version of the original Blackberry Storm. This maintains consumer recognition, as consumers will recognize the Storm by name and already be reasonably acquainted with its key features. It improves on the Storm brand, improving on aspects of the product that fell short in its first release. By paying attention to the needs of consumers as well as advancements in technology, RIM will continue to produce recognizable and reliant products of the highest degree of quality Implementing the Plan In order for RIM to stay ahead, or even catch up, in this market they must expand on product capabilities and services. The following is a step by step analysis of the plan that should be implemented: 1) First RIM needs to limit or even halt the amount of resources being used to create new Blackberrys for the time being. Five smart phones are more than enough to compete in this market. Apple, Google, and Palm are only offering one phone. 2) Next those resources should be switched over into development of applications and services for the 5 established smartphones. Currently, there are only approximately 2,500 applications available for Blackberry whereas iPhone has around 100,000. This is a huge gap and for those “gadget geeks” looking for multimedia compatibility, iPhone is currently looking more desirable. 3) With all available resources geared towards product depth, Research In Motion should then be able to create an extensive variety of applications and services that can appeal to an enormous target market. 4) These new products will make Blackberrys more effective and close the gap of differences between them and Iphones. Research In Motion can focus a majority of advertising and marketing towards promoting these new applications. With the proper marketing at the proper time in the proper place Research In Motion will have huge success with this program. The use of all marketing mediums should be used such as radio, television, newspaper, viral, and most importantly internet. Some of these applications and services will be offered for free while the more sophisticated ones will come with a fee.