Due to the speed of technological advances nowadays, it is increasing difficult for anyone to predict the marketing strategy for an electronic device. As for telephones today, they are becoming more and more sophisticated in both capabilities and application of these capabilities. A potential buyer is nevertheless confronted with decisions – cordless or non-cordless, caller ID or no caller ID and so on. Well, by analyzing this market through an economist’s point of view, the quality of product almost always grow directly according to price.
To analyze the 1999 phone market fully using the neoclassical approach, many factors would have to be discussed. As discussed in the Time article by Katie Hafner, “Everything but a Dial: Phone Choices”, telephone prices ranges are related to their capabilities. The amount of consumption of these various goods solely depends on the price and the utility that consumers receive from purchasing the product. When deciding to purchase a telephone, a consumer would most likely to separate telephone capabilities into different categories first and then choose from a selection of phones that best suit their needs (their utility). The amount of goods sold by a company would depend on the price of the phone and how it competes with other companies in the market. Therefore, in order to effectively market a new line of telephones, the capabilities of a telephone and its price must be taken into consideration. First, a research must be done on consumer preference and what population it would be served. Empirical data must show a significant number of demand for a specific capability before the production is run (ex. whether if there are enough couch potatos in United States that desire a telephone which is integrated into a remote control for the television). Second, the price of the new product must be competitive in the market. By comparing the new line of product to its competitors, the price should be set at a level that is weighted according to its unique functions. Henceforth, it is with these above factors in consideration that a company will be able to do business more successfully.
Since this is not a perfect world, consumers do not have perfect information about the products they have purchased. In addition, there are important issues that the neoclassic theory of consumer demand failed to address above. The neoclassic theory of consumer demand cannot predict the demand for new products and explain the theory of ‘want creation’ through advertising and effective marketing.
Tommy Jones begged, pleaded, and hoped beyond hope for that new touch screen phone that would immediately move him up the social ranks at his school. His wish was granted on Christmas morning. He was rewarded with that sleek, black phone with 4G capabilities. Two months later the next phone in that series is out, an exact clone of the orginal with the most moderate changes, and suddenly Tommy’s phone is obsolete. There was no great improvement when compared to the old model, no; the corporation knows that it will sell, no matter how small the improvement. This model of constant obsolescence has become the norm in the economy today; companies reap profits with mediocre products, completely uncaring of the consumers. To put the economy back in the hands of the consumers, a system of deregulation must be enacted to allow the marketplace to be run once again by consumer interest.
Ring! Ring! Hello. Every second billions of cell phones calls occur across the globe. Cell phones have made it so that humans can communicate with each other at ease. Since the telephone’s invention in 1876, it has made human communication easier and added to the convenience of life. Being able to talk to a person that is hundreds, or even thousands of miles away has enhanced our forms of communication. However, when the invention of the first telephone came about, it was only for the elite and required enormous and heavy equipment in order for it to be operable, thus many did not own one. Telephones became major in the 1900s; and eventually a new innovation, the cellular phone, came about in 1973, but still a handful of people did not rely on them, or care for them. The first cell phone was of considerable size and was not available for everyone until around 1992. There are close to 6.8 billion cell phone subscriptions currently and most phones are considered smart phones, cell phones that integrate email, internet, and apps on a touch screen handheld device. The volume of subscriptions of phones are rapidly growing. With the
BA#v=onepage&q=price%20of%20cell%20phone%20in%201980s&f=false Chowdhury. R. Evolution Of Mobile Phones: 1995 - 2012. (n.d.). Retrieved from http://www.hongkiat.com/blog/evolution-of-mobile-phones/ MobiThinking. Global mobile statistics 2013 Part A: Mobile subscribers; handset market share; mobile operators. (n.d.). Retrieved from http://mobithinking.com/mobile-marketing-tools/latest-mobile-stats/a#subscribers Poole. I. History of Mobile Phone. (n.d.). Retrieved from http://www.radio-electronics.com/info/cellulartelecomms/history/mobile-cell-phone.php UMTS World. History of UMTS and 3G development. (n.d.). Retrieved from http://www.umtsworld.com/umts/history.htm WorldMapper. Cellular Subscribers 1990. (n.d.). Retrieved from http://www.worldmapper.org/display.php?selected=333
Telecommunications gained mainstream attention in the early 90’s; however the initial key market was business men and women, who used their phones whilst being on the move and so allowing them to communicate with their companies with ease. Though in the modern era, telecommunication went through segmentation in the market trends, and now in this day and age it would be difficult to find someone who does not own some form of mobile technology. Many phone providers battle to provide the best service for their customers (Figure 1).
Mobile is the first order priority device for access because people are connecting with others, finding entertainment, and doing business—all with smart phones. The prices of mobile phones are never over $1,000 in today’s world. They are affordable and accessible. As the result of the changes the worldwide and national business environment has undergone, people own 1-2 cell phones on average. However, the mobile markets in US seems to have been saturated.
The purpose of this research paper is to analyze the cell phone and computer market and how microeconomics can help to ensure a company’s success in today’s day and age. This paper will use microeconomic models and how they pertain to real-world situations and their impact to an organization, decisions of individuals and their relations to microeconomics and effective business decisions.
Cell phone manufacturers and service providers are at the core of the cell phone industry. These corporations are integral from their research and development endeavors to interactions with the consumer and the marketing of new products. The companies that control such factors of cellular phones are very numerous, so it is difficult to address all the cell phone manufacturers and service providers. However, we have focused largely on only the most significant cellular companies namely in the U.S. marketplace, although many have global ties. Collectively, companies around the world have the same goals in mind – to create desirable cutting-edge technology and to increase consumer satisfaction with hopes of generating sales, and thus profits.
There is a slowdown in sales of mobile handsets, in some markets like the UK, as the mature part of the product lifecycle is reached. Customers are exposed to a barrage of different images and messages by mobile phone companies, as the competition gets tougher. Vodafone appeals to new customers and aims to keep its existing ones by emphasising the uniqueness of the brand.
The changes in the technological can influence many part of societies. When the AT&T Company introduce their new product and services which is wireless and wire line technology will effects occur primarily through the new products, processes, and materials. Thus, changes in technological also often can achieve higher market share and earn higher return because, newly emerging technology from AT&T could derive competitive advantages. For example, internet today becoming more remarkable capability to provide information easily, quickly, effectively, and also can create more value for customer in the future and to anticipate future trends.
Supporting material/specific details: different factors come together when it comes to selling a phone, author Gerry Purdy states that one of the primary four influxes of selling a phone is: “Technology innovation –the degree of innovative technology that has been incorporated into the handset and the degree it’s made useful to the user. Technology alone without any way to make use of it gets a lower score.”(Purdy p.1).
"While practically everybody today is a potential mobile phone customer, everybody is simultaneously different in terms of usage, needs, lifestyles, and individual preferences," explains Nokia's Media Relations Manager, Keith Nowak. Understanding those differences requires that Nokia conduct ongoing research among different consumer groups throughout the world. The approach is reflected in the company's business strategy:
Under the circumstance that the mobile phone industry entered the 3rd generation, Nokia faced competition from both macro level and industry level. For the macro level, the government encouraged competition among the operators and handset manufacturers by giving digital licenses to new entrants. As a result, the mobile phones became more sophisticated, for example, the cameras and the games in the mobile phone. For the industry level, which can be analyzed by the Porter’s Five Forces, (lecture )Nokia was facing threat of new entrants, competitive rivalry and the bargaining power of buyers is increasing as well. As the government encourage completion between the handset manufacturers, there are several new entrants from different countries enter this industry, such as Apple from USA, Samsung from Korea. These new entrants compete with Nokia in both smartphone segment and basic phone segment. Some of them even constructed “ecosystems”, which they could integrate the services and applications quickly, in order to produce the phone in just two days. For the bargaining power of buyers’ aspect, they do not need to rely on the only operating system Symbian. They can choose Windows mobile launched by Microsoft, Android launched by Google and Ios launched by Apple, in addition, basically all of them are better than Symbian (Amiya, 2010). The buyers could choose any
Every company wants to understand why people decide to buy its products or others. Firstly, we have to understand why people buy certain kind of product. People buy products because they need them. A need is activated and felt when there is a sufficient discrepancy between a desired or preferred state of being and the actual state. (Engle£¬Blackwell and Miniard. 1995. p407 ) For example, when you feel hungry, what you needs is some food. It is very important for marketer to understand the needs of consumers. All the consumers may have the same needs, but the ways which they satisfy what they need are different. Here is a example, Chinese people would choose rice when they feel hungry, whilst British people may choose bread to satisfy their needs.
The pricing strategy will start out rather high for this product upon its release in order to draw a more selective crowd such as the upper class members of the urban society. Once the product has succeeded within this market there will be a development of additional variations of the product which will allow for certain models, with less features, to be sold at a lower price point in order to attract the members of society who are less willing to pay the high asking price for the top of the line version of the
In 1990, Nokia Mobile Phones (NMP) was the smallest of the five business divisions of Nokia, with annual sales of $500 million and 3,051 employees. Jorma Olilla, the new president of NMP, in the same year led the division to become the world's second largest manufacturer of mobile telephones after Motorola in just a year and half later. Motorola and NEC, the close third competitor, were the dominant players with a combined 33 percent global market share, compared with NMP's share of 13 percent. During this period, the main customers of mobile phones were business users who could afford the high prices. The everyday consumers were not overly attracted by these high prices and limited functional phones. Despite these limitations, the cellular market was growing rapidly, which brought more Asian producers into the competition. To make the matter worse, there was much proprietary technology and equipment required for analog standards around the globe. The emergence of digital technology provided a hope for a uniform communication standard. As a result, NMP had to make a difficult decision regarding which technology to commit significant resources to.