Marketing
Issue No. 41 - June/July 2008
The lessons from phone marketing
by Dr David Corkindale and Dr David Corkindale
A recent edition of The Economist magazine noted that Japan is probably the world’s most important source of technology and makes most of the important components in the world’s mobile phones.
The i-Phone’s most expensive bits are made by Japanese companies, for instance. Also, 25% of Japanese people access the Internet solely from their mobile phones and many change their phone annually. Sales of handsets last year were around 50 million in a market where there are 100 million phone service subscribers.
Nevertheless, in spite of having advanced technology and phone infrastructure systems and a large market of eager buyers, Japan does not feature as a world leader in the mobile phone market - tiny Finland does.
How do we explain this and what marketing lessons can we draw?
Don’t be too customer-driven
The telephone companies in Japan call the shots – they are the immediate customers for the phone manufacturers and dictate the features and performance requirements to them.
Consequently, the manufacturers know what the operators demand but not necessarily what the segments are and what consumers in the segments really want.
Also, because of a big market at home, most of the manufacturers do not venture overseas and so have not had experience of, or learning from, having to compete with world-leading brands.
Intent focus on the home market means Japanese mobile phones are designed to Japanese standards, not world standards. To sell phones overseas would require the manufacturers to design and make special versions which means that they cannot benefit from economies of scale or the learning curve cost-reduction effects.
If they try to enter overseas markets they do so at a cost and price disadvantage. The requirement for Japanese phones to operate with kanji characters doesn’t help either and their phones lack the smart software that gives world-standard western phones such high usabil...
