Case Study
Promoting an Alternative to the Smartphone
The Australian mobile phone market is one of the strongest in the world, showing substantial growth and continuing to expand steadily as late adopters purchase phones. Any global trends are likely to be mirrored in this market.
It is the next stage in the development of the mobile phone market that has the industry buzzing. A Nielsen Research report shows that, while statistics on mobile phone ownership are difficult to accurately predict because at least 20 per cent of Australians own more than one phone, it is known that at least 86 per cent of Australians own a mobile phone. Phones with an advanced operating system are referred to as smartphones while those without a touch screen and advanced operating system are called feature phones. Telstra’s Research Director, Foad Fadaghi reported that ‘More than 50 per cent of Australians have a smartphone, so we are now looking to the second half of the population, that don’t have the economic means, and are relying on “hand me downs” and things like that. That market has really gravitated towards lower end products’. Fadaghi indicated that there is a market for lower price-point phones and plans. Market leader Apple iPhone has shown little interest in pursuing this market, while Samsung with the Android operating system has some lower-priced products.
It came as no great surprise to junior account manager Daniel Knights, a keen marketer who constantly updates his knowledge of mobile communication devices, that a new competitor would eventually enter the mobile phone market. He was delighted when Geoffrey Bowll, Managing Director of Starship Advertising, offered him the opportunity to prepare a fully integrated promotion campaign to launch a new mobile phone developed by a Chinese manufacturer that would retail at about half the price of the smartphone devices currently being sold by Apple and Samsung. The new phone would have a touch screen but limited capabilities for video and data downloads. He knew the main users of the lower priced ‘feature’ phones were likely to be the very young who had been given ‘hand me
downs’ and were connected on pay-as-you-go plans, males in the 45–65 age group and those who had owned their mobile phone for a considerable period. More research was needed to provide insights into this campaign.
He started to plan the task in hand. He knew that a fully integrated promotional plan was essential for this market and the target audience was most likely different to the target market. Younger consumers relied on their parents to make the purchase and they needed to be informed and convinced about the product. This would mean communicating with at least two distinctly different audiences. Likewise, to reach the non-phone users and the more senior groups such as the 45–65-age cohorts, would mean that besides reaching these distinct groups, the campaign would need to involve those who provide advice and influence their decision making.
He pondered on the list of media that might be required for this diverse audience and realised that besides traditional TV, print ads, brochures, radio, in-store retail, ambient (taxi, train and billboard) and shopping-centre promotions, the campaign would need to reach those already online with mobile devices who currently use the web to search for information. This cohort currently use their phones, tablets and computers and source information from social media such as Facebook, Youtube clips and online banner advertising. The task offered Daniel the opportunity to demonstrate the breadth of his promotional management expertise and he welcomed the challenge.
Questions for Discussion
1. Help Daniel define and estimate the market by setting out an analysis of the possible target markets and target audiences. Both of these need to be prioritised for the phone manufacturer.
2. What key messages would be conveyed and how would you ensure that it is fully integrated across the audiences so that there is a consistent story being conveyed to each audience?
3. Try to estimate the reaction from the current phone manufacturers. Are retailers required for this product introduction? If retailers were to be used as information providers, how could this message be coordinated?
