The performance of BlackBerry

Introduction

The report analyses the performance of BlackBerry smartphones with the intention of brand building regarding the Keller's theoretical framework. A critical reason why BlackBerry chosen as the example case is BlackBerry smartphones just launched for 10 years, conversely its growth rate is the highest when compared with other brand in the same market (Canalys 2009). There are many advantages about Keller's models including describing the way to create competitive advantages in customers' minds and the way to establish loyal relationships with customers. Building an intense brand, concerning to the Customer-Based Brand Equity model, consists of four steps. All steps have equally an importance and involvement on each other in term of size and scope. The first step is to stress recognition of the brand with customers and the position of brand in clients' mind with specific goods, and even services or customers' requirement. The second step is to keep firmly the brand meaning in customers' minds through the strategic connection between tangible and intangible brand promotions. The third step is to draw the suitable responses of customers out to brand identity and brand meaning. Finally, the fourth step is to improve customers' brand responds to strong, not stable loyalty linkage between customers and the brand. These steps can be able to provide both company's existence and being potential in their market. Furthermore, this report would be analysed by SWOT analytical theory which includes its Strengths helping achieve the organisatoinal objective, Weaknesses being harmful to accomplish its goal. In case of external conditions, there are Opportunities helping to succeed its objective and lastly Threats being able to damage its objective. When both Keller's models and SWOT analysis are integrated, they provide significant macro and micro perspectives. This enables the company to produce brand strategies that maximise profits and brand equity in the long run. What is more, this report also contains a questionnaire, BlackBerry survey, related to the Keller's Brand-Building Blocks. This is able to identify the relationships between Consumers and BlackBerry about the salience, performance, imagery, judgments, feeling and resonance. In order to understand consumer behavior, leading to improvement the way the company apply their marketing strategies, measure and manage brand equity. This improve the brand design, appraisal of combined marketing activities.

Background

Research In Motion (RIM) is a leading smart phone company in the worldwide communications market. RIM launched BlackBerry used by millions of people all over the world. For 10 years of BlackBerry's existence in the market, the success of BlackBerry is quite high. BlackBerry also support users in every place to connect to specific people, information, media and the internet.

BlackBerry's revenue growth is one of the successes of the company to be proved by its fastest growing brand of 84% from $6 billion in 2008 to $ 11 billion in 2009 (RIM annual report 2009). In term of its marketing and distribution, RIM keep expanding the availability of BlackBerry products and services via extension of distribution channels in North America and around the world. Nowadays, BlackBerry smartphones have approximately 475 distribution channels, in over 160 countries all over the world. RIM's products are underlined values of innovation, quality and efficiency. There is the growing number of BlackBerry customers from the graph in table 1 (in Appendix ). In the present situation, Nokia, RIM, Apple and HTC cover over 80% of the smartphones market between them. The overall scenery of global smart phone market, there was an increase in smartphone consumption by 3.9%in worldwide market over the two years quarter 3 in 2008 to the same period in 2009. The largest smartphone maker has still been Nokia dominating the worldwide smart phone market share. While there is a huge growth both RIM and Apple, especially RIM's growth rate at 41. From the Canalys' survey shows RIM's position in the UK and Germany is a strong leader. However, Apple is ahead of Microsoft in the minds of UK decision makers and better acceptance among business consumers. In contrast, RIM has a sustained superior position in the UK and North America, also has a strong growth in both the Middle East and Latin America with winning difficult market conditions. This led to support the demand for RIM's new products through specific marketing promotions and campaigns in each country.

The growth of the smartphone market tends to benefit all of the big names companies in the smart phone area. There has also been the number of competition and pressure in the marketing environment. According to the improvement of iPhone's performance in 2008, iPhone 3GS has a better feature and more affordable through the cheaper price. This is the frightening competitor of RIM, whereas the marketing environment is totally changing from Google's Android to Operating System (OS) will have the vital role in supporting the phone makers have competitive advantage in the market. In term of Marketing Mix strategies, which contains the significant fundamental factors, will accomplish the firm's objectives by using product, price, promotion and place. Firstly, product strategies rely on product design, packaging, branding and support services. For example, BlackBerry's smartphones put powerful favorite entertainment such as audio, video, gaming and music, also including social network, connecting consumers' interest via internet which have Wi-Fi built in. Secondly, the pricing strategy assesses the price of product charged. According to focusing on the quality, the price is more little expensive than the other, however, less than iPhone. Consumers do perceive BlackBerry as a valuable smartphone. The third is a promotion strategy. For example, developing the product's message such as BlackBerry stresses in its slogan about its strong connection capacity through "Connect to everything you love in life...with BlackBerry" messages. Lastly, distribution strategies, As a result of expansion of its distribution channels and using different marketing strategies in each country, there is the success in growing number of the demand in BlackBerry's products.

Methodology

The attention of this preliminary study was the Keller's four steps of Brand Building and focused on the perceptions of changes in customers' behavior that could be attributed to the setting marketing strategy. A detailed questionnaire was aimed at determining the influences of decision making on buying the smartphones. Sixteen questions were used to identify the impact variables. These are shown in Table 2. The two first tasks of questionnaires asked about the detail of respondants such as their age and gender. Second, three questions asked about the salience of smartphone use such as when you think of Smartphone, what brand can you think of and what kind of features that affects your decision, when you are buying the new phone, one of these questions specified BlackBerry namely how frequently do you hear of this slogan "Connect to everything you love in life, with Blackberry. We were concentrated on the possible impact of BlackBerry's performance to develop in the future and included two questions like when you hear "BlackBerry", what are the features that you think of " BlackBerry™" and compared with other Smartphone, how well does BlackBerry™ satisfy the basis needs of smart phone?. Thirdly, we asked about its imagery that how well do the following words can describe "BlackBerry™". We were interested in the impact of consumers' judgments included two questions that asked about BlackBerry's quality and customers' consideration like How well do the following words describe the "quality of BlackBerry™" and If you are a BlackBerry user, Would you recommend BlackBerry to other. Furthermore, there were two questions that asked about the feeling of BlackBerry's users such as Does BlackBerry make your life easier and feel elegant. Eventually, there were three questions that asked about the resonance like the relationship between consumers and community, engagement and loyalty in the brand such as does BlackBerry make you feel well-connected with others who use BlackBerry, are you interested in learning more about BlackBerry and can you live without BlackBerry. The questionnaire was sent by Kent mail to the Kent business postgraduate students 54 of whom have done the questionnaire.

Keller's Customer-Based Brand Equity (CBBE) Model

All steps in Keller's CBBE model has involved with customer (existing and potential). First step is brand identification; providing a special product category and customers need in order to related the brand with customers mind. The second step is created the meaning of the brand by linking tangible and intangible brand to customers mind. The third step is the reaction of the customer with brand identification and brand meaning. The last step is the creation of customer's loyalty to the band by converting the brand response.

Brand identity

Brand Salience: to occur the right brand identity has related to brand salience.

Brand salience is link to the view of customers' consciousness of the brand. Brand awareness is relevant to the capabilities of the customer to remember a brand. It is more than the truth that customer saw a brand very often or they can remember a brand's name, but brand awareness also relate to the connection in customers' memory between the brand and brand name, logo, symbol. In general, brand awareness is the process to make sure that customers got the right ideas of the product and service category, which company competed.

Key criteria for Brand Identity

Depth and breadth can be defined as key dimensions of brand awareness. Depth of brand awareness relevant to how often or easily that customer can remember the brand. Meanwhile, breadth of brand awareness is relevant to ranging of a consuming condition in which the brand appear to customers' mind. However, the proper link between depth of brand awareness and breadth of brand awareness are needed in order to create brand salience and it need to be done in the right time and the right place.

Brand Meaning

In order to establish brand equity, brand salience is important in the first step. Building brand meaning is involved creating a brand image. Brand meaning can divided in to two types: brand performance and brand imagery.

Brand Performance is about how the products meet the functional need of the customers. Brand performance has five important types of characteristic and benefit: primary characteristic and secondary features, product reliability, durability and serviceability, service effectiveness, efficiency and empathy, style and design, price

Brand Imagery is dealing with the external attribute of products and services and the ways that brand try to meet the customers' need in both psychological and social need. Imagery refers to intangible view of the brand, which many different types can relate to a brand that can be emphasis four categories of them: user profiles, purchase and usage situations, personality and values, history, heritage and experiences

Key criteria for Brand Meaning

Strength, favorability and uniqueness are the important dimensions, which characterized brand image and brand meaning. According to the result of these three dimensions are provide the optimistic of brand responses. In order to establish brand equity, strong, favorability and uniqueness of brand associations are needed. It is a challenge for the marketer to build a strong, favorability and unique associations, but it is important to crate customer - based brand equity. In generally, strong brand created strong, favorability and unique brand connection with customers.

Brand Responses

Brand responses are relevant to the feeling or attitude of the customers that they respond to the brand. Brand responses can be differentiate through brand judgment and brand feelings.

Brand Judgment

Brand judgment is focusing on the evaluations and opinions of the customers with the brand. There are four types of brand judgment: brand quality, brand credibility, brand consideration, and brand superiority

Brand Feelings

Brand feelings refer to the emotion of the customers that respond to the brand, which have six important types. The first type is warmth; relevant to the feeling of calm, which brand makes customers feel that the customers may feel sentimental, loving or sympathetic to the brand. The second is fun; customer may feel entertain, happy, joyful, etc. The third is excitement, refer to the feeling of exciting which the brand bring to its customers that will makes they feels sexy, smart, cool. The fourth type is security; this feeling will exist when the brand deliver the emotion of safety, convenience, comfort. The fifth is social approval, will exist when customers have a positive feeling with the brand. The last type is self - respect, which can occurs when the brand deliver the feeling that makes customer feel good with them self.

Brand Relationships

Brand relation is the last step of the model, which emphasis on the basis of relationship that customers have with the brand. Brand Resonance can be divided into four groups.

The first group is behavioral loyalty refer to the repeatability purchase of the customers. The second group is attitudinal attachment is refer to customer's opinion and feeling that they have with the brand. The third group is sense of community, which refers to the identification that the brand delivers to customers through social activities. The final group is active engagement is refer to period that customers voluntary to invest their resources on the brand such as time, money, etc.

In order to create brand resonance it is important that the marketer need to create the proper salience, breadth and depth of customer's awareness.

SWOT Analysis

The SWOT analysis is the method to evaluate an organization and environment around the business. It provides useful information about company's resources and abilities in competitive environment where company operates. It is the analysis of internal (Strengths, Weakness) and external (Opportunities, Threats) environment that important for company's strategic planning process.

Aim of SWOT Analysis

The aim of SWOT analysis can list as followed:

  1. To disclose business's competitive advantages.
  2. To analysis business profitability and research and development of business's product
  3. Evaluate the problems that will happen when business operation.

SWOT analysis will give the overall situation and also provide the important factors that will affect business. SWOT analysis can use for planning business strategies, career development, problem solving, etc. In order to achieve the effectiveness of SWOT analysis business need to provide a sensible weakness and strengths. Moreover, the analysis should base on both current and future situation of business and also linked with business competitors, which business need to compare its strengths and weakness with them to create the competitive advantage.

By using SWOT analysis business can focus into its strengths and opportunities to build up the competitive advantage over its rivals, while weakness and threat factors can be used as tools to improve its strategies.

Application of Keller's CBBE model

Brand Identity

As an aspect of customer awareness, this indicates customers' ability of recognition and recall of a brand. Apparently, BlackBerry is an easily memorized brand name. With series of symbolic designs, such as buttons on the device, 'track ball' in the middle, and built-in QWERT keyboard, BlackBerry made a triumphant brand symbol for potential and existed customers. Furthermore, at the functional level, BlackBerry provides extraordinary experience by push e-mail, internet faxing and other information services.

According to the survey (Appx.2 Q4 Page14), 13 in 54 samples would think about BlackBerry while mentioning smart phone, hence the brand achieved comparatively salience both in depth and breadth of brand awareness.

Brand Meaning

Brand meaning is made up by two dimensions of brand perceive in customers' minds.

For one is brand performance, refers to ways of brand meet customers' functional requirement. Firstly, based on the responds from group of students (Appx.2 Q5 Page14), BlackBerry is regarded as a various function, convenient, and social acceptable product by respondents. Nearly half of the respondents claimed this brand as various functional. Its primary character which is one of BlackBerry's salespoint, push mail service, is only mentioned by one of the 54 samples. Secondly, reliability and durability are obviously comparative weakness for the brand, only 11.8% and 17.6% of samples lay their acknowledgement on these aspect. Thirdly, RIM is famous for its sufficient software and specific service for enterprise called 'BlackBerry Enterprise Server', which provides integrated mail service into a company's e- mail system with series of software. As the result of respondent scope, this salience is not well covered in the survey. Fourthly, BlackBerry has its unique design and style with an appreciably high cost, that one third of students surveyed approved of expensive, 24 percent even considered it strongly agree. (Appx.2 Q5 Page14)

For another is brand imagery, deals with the abstract impression of a brand, thus it describes a brand's intangible aspect. First, Blackberry is designed for business application and social connection, hence the main user group are organizations and personal consumers with large social network. According to the survey, (Appx.2 Q8 Page15) above 3 fourths of the respondents agree with a description of social network to BlackBerry, of which one fourth strongly agree. Second, the main data transfer was generated from business communication. Third, as the personality and values of the brand, innovation and social network are both accepted by respondents.

From the above, BlackBerry gained reputation from its competitive products. Most of samples agreed that BlackBerry did well comparing with other brand, but it still too distinctive to satisfy majority potential customers, in other words, it is too professional and commercial for personal costumers.

Brand Responses

This concept refers to the way which customers respond to the brand, contains two aspects-brand judgments and brand feelings.

In the brand judgment perspective, brand quality, brand credibility, brand consideration and brand superiority from customers' opinions are included. Concluded from the feedback, 42 in 54 people considered the quality of BlackBerry is above moderate level (Appx.2 Q9 Page15). While few people regard BlackBerry as a reliable product, considering the scope of respondents, only few of them have experiences using BlackBerry, hence the results are mainly based on imagination. What's more, almost one quarter of the respondents regarded BlackBerry on top of their consideration (Appx.2 Q3 Page14). Eventually, the brand distinguishes with other brands by sufficient support of social communication and group costumers.

Considering the brand feelings, nearly 80% of users feel well connected with other customers, meanwhile all the users feel it makes life easier at certain level (Appx.2 Q10 Page16), and 8 out of 14 customers even felt the brand made them elegant.

Concluded from this chapter, BlackBerry achieved a comparative success as it supposed to. However, the reliability and durability of products should be well improved.

Brand Relationships

Which also known as brand resonance, refers to the final relationship between customer and product, including behavioral loyalty, attitudinal attachment, sense of community and active engagement.

According to the results from the survey (Appx.2 Q10 Page16), 10 of 14 users would like to learn more about BlackBerry, above 70% of users more or less depend on it to an indispensable level, and the proportion of people who would recommend it to others is 71.4%. On the other hand, BlackBerry established its proprietary way of message named 'BlackBerry Messenger' (aka BBM), which created a platform for users' communities and groups. Finally, there are also partners with contract helping RIM with innovations of new software.

On the whole, BlackBerry is a product with high brand relationship. Customers are maniacally purchasing and making use of their device.

Recommendations

Using the conclusion from above, a pyramid is produced on the basis of Keller's CBBE model.

As a market leader on business communication, BlackBerry's achievement is obviously outstanding, however in order to gain a comprehensive reputation in whole smart phone market, it still have to pay much more attention on personal consumers. Beginning with creating awareness on personal market, cutting down price is a good choice while providing entertainment functions. What's more, although the slogan 'Connect to everything you love in life, with Blackberry' is considering and attractive, only limited potential customers have seen the message, hence a wider promotion should be established.

SWOT analysis

SWOT analysis is a popular tool applied during strategic management process, because it provides an overall view through scanning external and internal environment (quick MBA, 2007). A holistic overview of Blackberry will be discussed in details with respect its strength, weakness, opportunity and threat.

Strength:

High market share provides Blackberry a good platform for future development. Table one shows that Blackberry occupants market shares with 20.6% only after Nokia with 39.7% though (see appendix table one). The good financial situation of the company is undoubtedly another advantage for its future development, for instance, its account base grew by almost 80% in 2009 because of the stronger sales (Financial annual report, 2009).

In terms of Blackberry the product itself, it has tremendous advantages. Our research shows that 49.9 % participants responded that Blackberry has various function and majority of participants agreed that Blackberry has good quality. The design of the keyboard layout is as functional and convenient as that of computer, which attracted many consumers.

Keller (1993) points out that powerful brand create meaningful images in the minds of customers. The marketing share and its long branding approaches have successfully enhanced it reputation and brand effect. In return, a strong brand image and reputation enhances differentiations and has a positive impact on consumer behavior (Gorden, et al, 1993, McEnally and de Chernatony, 1999, cited from Kuhn, K., Alpert, F. and Pope, N. K. LI. 2008). Our survey proved that 24.5% participants said that they will think of blackberry when they think of Smartphone. 63.0% responded that they are satisfied by Blackberry compared with other Smartphone brand.

Blackberry strongholds the conception of FMA (first mover advantage) (Roll, 2009), under which, Blackberry introduced mobile email function. This function is compatible with corporate market segment requirements. Blackberry has been regarded as the market leaders in Smartphone's since 2002 and it is still a strong competitor in mobile market.

Weakness:

Blackberry targets businessman and organizations as their priority, however, this policy does not fit current economic situation and pressures from competitive competitors from other Smartphone providers. On one hand, mobile market was shrinking due to recession; on the other hand, blackberry's function is not as competitive as iphone.

Blackberry marketing communication is not effective and efficient, as the research shows that 48.1% of participants never heard of its slogan. From this point, Blackberry fails to integrate marketing communication.

Opportunity:

With the trend of globalization, mobile is becoming an indispensible communication tool. Therefore, Blackberry could expand its market to globe extend, for example, countries such as China or India are all potential consumer market. Also Blackberry could shift its labor and operational sources on those countries to be cost-effective. Also the established brand could assist its global expansion.

Simultaneously, this trend also promotes business to business corporation strategy. There are more chances to corporate with other IT businesses seeking to win-win solution. Merger and acquisition are open for future possible development direction. The advanced IT industry offers great technique helps for its future innovation.

Threat:

Like any other business, Blackberry is always facing fierce competition, under the perfect competition market structure. Direct competitor is iphone from Apple Company. Its large couch screen, slim and handy outfit with music player, internet browser, good quality digital camera and built-in GPS have far outcome Blackberry so far. Other competitors are from Nokia, Motorola, Samsung and Sony Erickson. 22.6% of participants would think of Nokia which is not far from the 24.5 % responses from Blackberry according to survey question three.

However, economic crisis is the biggest threat to Blackberry currently. On one hand, reduced income, redundancy and inflation would shift the demand line left, as Strategy Analytics (SA) predicts that global mobile phone market ill shrink 9 % in 2009, which is the first decline since 2001 due to the economic slowdown and its impact on consumer spending. On the other hand, consumers are getting more and more price-sensitive under the financial situation. (Reuters UK, 2009)

Counterfeit places huge threaten to the brand and its future development. A report of Blackberry-counterfeit-in-Vietnam put it that RIM Group's CEO - Jim Balsillie would be shocked by the counterfeit product line and speed in Vietnam (VietNamNet Bridge, 2009). Vietnam is not alone as much as the counterfeit problem for Blackberry, other mobile like fake Nokia seized in Hongkong worthy of 600.000 (Patrick, 2008) and iphone clone claimed rock solid 99% is selling crazy. Counterfeit phenomenon serious damages the brand and consumer's confidence on the product, therefore it poses huge danger to its brand image.

Recommendations

There is still a long way to go for Blackberry, undoubtedly, Blackberry is still the mobile giant and competitive market holders, but changing external and internal environment both require the organization to take effective changes for future development.

Firstly, innovation is the soul of any IT related products. Innovation is not is not just outside design changes, but more from its function aspect, after all, people buy it because of its function. Blackberry is suggested to maintain its FMA, however, it needs support from innovation. Only through consistent innovation can the company keeps pace with rapid changes from IT and market demand.

There is also necessity to adjust Blackberry's market communication approaches. The current promotion strategy is obviously not impressing consumers. Integrating market communication requires well combination of advertisement, public relationships, sales and personal sales. It is recommended that Blackberry should be more considerable in promotion activities, watching the budget on one hand and emphasis return on investment on the other hand. Expansion scale of promotion could be focus on Asia market instead of traditional European countries. However, caution needs to be taken with respect to the local culture. In other words, the advertisement or any other communication approach could be tailor-made to fit the local taste but maintain the brand which conveys core message from its business strategy.

Expending its product ranges is another recommendation for its future development. Blackberry could change from single mobile product to other related products such as MP3 player; recorder, radio, components and more mobile accessorize products.

Conclusion

Indubitably, RIM's triumph in smartphone market is extraordinary as a ten-year-history company. Its capitalization value rocketed from 96million (1999) dollar to 42 billion (2009), during the last year, revenue of the company was nearly doubled. Meanwhile the brand itself set up a strong acknowledgement during its major customer group, and also comparative awareness during potential user.

On the other hand, considering the recovery of general economic environment and the movement of its competitors, improvement focusing on personal entertainment should be valued. This could be accomplished by promotions related to personal users and developing recreation applications. What's more, enlarging product variety is better for personal customers' acceptance.

Compared with its latent biggest competitors Apple and HTC in personal consumption market, obstacles ahead is still arduous difficult.

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