PESTEL analysis of mobile phone manufacturer Nokia

Nokia Corporation is a Finish communications based company which concentrates on nomadic telephone engineering. It focused on the cardinal growing countries of wire line and radio telecommunications. It has about 65,324 employees ‘ worldwide and gross revenues web that spans about 150 states. Nokia Corporation generated more than half of its gross revenues in Europe, a one-fourth in the Americas, and about 22 per centum in the Asia-Pacific part.

Nokia ‘s history began in 1865 in Finland. In 1937, Verner Weckman was named President of one of Nokia Corporation ‘s initiation companies.

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In 1998, Nokia became the universe ‘s largest Mobile phone manufacturer and

their market growing continues with new devices that enable high-velocity Internet,

Mobile online gambling and multimedia maps.

When nomadic phones foremost came out on the market, the theoretical accounts were really simple with the best engineering being SMS messaging. The following engineering progresss were progresss such as: MMS, Internet, camera phones and picture recording equipments.

When Nokia phones were foremost introduced, they needed a batch of advancing and advertisement because they were non recognized plenty to sell based on their quality and offers to their consumers, so this is where Nokia spent the biggest measure of money advancing their goods and set uping their trade name as a leader in the communications market.

Since 2000, Nokia has efficaciously carried out the universe ‘s first WAP service in China. Nokia ‘s success continues with Nokia 6650, the company ‘s first 3G nomadic telephone and the start of new epoch in nomadic gambling with the first N-gage device in the 2003.

In 2005, Nokia introduced the celebrated N-series and instantly sold a big figure of phones.

In 2006, Olli-Pekka Kallasvuo became the new President and CEO of Nokia.

In 2008, Nokia ‘s three nomadic device concern groups and the supporting

horizontal groups were replaced by an incorporate concern section, devices and


There are legion environmental factors which can impact the concerns in an economic system. The external factors are events that occur outside of the company and are non under the control of the company. They include:


Economic environment

Political environment

Social environment

Technological environment

Political environment:

These refer to authorities policies, ordinances and legal issues in the state of operation. For illustration, employment Torahs, revenue enhancement policy and authorities stableness. Political determinations can impact on many of import countries for concern such as the instruction of the work force, the state wellness and the quality of the economic system substructure such as the route and rail system.

Economic environment:

Economic factors regard as how the economic system impacts a concern in footings of income, involvement rate, rising prices, revenue enhancement policy, authorities disbursement, and general demand. For illustration:

•Higher involvement rates may set off investing because it borrowing is more dearly-won.

•A strong currency could do exporting harder because it could raise the monetary value in footings of foreign currency.

•Inflation may impact higher pay demands from employees and addition costs.

•Higher national growing of income may increase demand for a house ‘s merchandises.

Social environment:

Changes in societal tendencies can impact on the demand of a house ‘s goods and the handiness and acuteness of persons to work. It includes the criterion of life, faith, manner, civilisation, instruction etc. For illustration ; vino is illegal in some societal, cultural and spiritual states. Besides, the ageing population has an affect on demand. For illustration, demand for sheltered adjustment and medicine has raised where as demand for playthings is diminishing.

Technological environment:

Technological factors see how the fast the gait of alteration in production procedures and merchandise progress impact a concern. Technology can minimise costs, better quality and lead to betterment. These developments can assist consumers every bit good as the organisations supplying the goods. For illustration, new finds and innovations such as: MP3 participants, laptops, on-line gaming and high definition TVs. Online shopping, saloon cryptography and computing machine aided design are all engineering promotions to the mode we do concern as a consequence of better engineering.


Rivals refer to rivals in concern, as for clients or markets. It consists of trade name competition for similar goods. For illustration, Pepsi and Coca Cola, Sony and Philips, etc. Besides utility merchandises for illustration, gasoline and CNG, tea and java etc.

These environmental factors affect the Nokia Corporation in the undermentioned ways:

Political environment:

Legal restraints, such as 3G, must be considered because many concerns plan to do a net income so they may be tempted to mislead their clients about pricing, merchandises ‘ quality and the handiness of their goods. Besides, they may seek to cut disbursals by utilizing lower quality stuffs in their merchandises, such as weaker resources for Nokia instances and batteries. Besides some companies may put out their waste in ways that harm the environment without guaranting high criterions of hygiene and safety in the workplace. Including, mercantile establishment shops, which are illegal and can do legal jobs for companies.

In 2000, the UK Government started to accept commands from 13 companies who wanted to run a license to sell next-generation nomadic phones. It raised & A ; lb ; 22.47, a orderly amount to anybody.

However, the companies began to decline paying the immense sum of money for the licenses. The UK auction was structured so that each challenger command was planned to be a certain per centum higher than the old command. This out of the blue resulted in the size of commands beef uping sky high at a rate of over 150 unit of ammunitions of command.

Environmental and ethical factors:

Some concerns see net incomes as more valuable than a strong ethical codification and this can run behavior and concern behavior. Some unethical patterns are illegal and companies can non go involved in them. However there are besides some patterns that are legal by jurisprudence but are considered extremely unethical by the devouring public. Companies who take on in these patterns can lose a batch of market portion if they are caught. For illustration, decorative proving on animate beings is legal, but some of the general populace are n’t happy about it and boycott. Because of this companies, companies must be really cautious about how they conduct themselves.

Nokia have managed to be reasonably environmentally friendly and have non offended the general populace in any manner. They have been really cautious about this and therefore, this is one of the many grounds they are a popular trade name of nomadic phones.

Technological environment:

In the communications market, engineering is most likely the most of import factor that companies like Nokia have to take into history. They must maintain up to day of the month with all the newest technological progresss, such as camera and picture phones, if they intend to obtain the biggest market portion and maintain in front of their rivals, such as Sony and Panasonic.

Now, the following coevals of nomadic telephone ( 3G ) known globally as IMT, has been entirely designed to transport package informations. Speech is merely treated as a peculiar information application. 3G systems will enable the terminal user flexibleness in the traffic channel, deliver multiple services with differing bandwidth petitions, and at the same time if needed. Bluetooth will back up enhanced 2nd coevals every bit good as 3G systems in the rescue of a broad scope of services. With the development of such wide capablenesss, it will be instead alluring to do usage of the 2.5 and 3G systems to back up every new application and even some of the old 1s excessively.

Economic environment:

Nokia accounted for 90 one per centum of GSM camera phone gross revenues globally in 2002 while Samsung accounted for 20 four per centum of CDMA camera phone gross revenues worldwide in 2002.

While observing the highly limited visibleness, Nokia expected 2009 industry nomadic device volumes to worsen 5 % or more from 2008 degrees, which they were right about.

Nokia has modified its Internet services market focal point to the countries of music, maps, media, messaging and bet oning. Nokia estimates these targeted parts of the Internet services market will be more or less 40 billion Euros in 2011. In December 2007, Nokia estimated that the entire Internet services market would be about 100 billion Euros in 2010.

Social environment

About 50 million nomadic phones have now been registered in the UK, harmonizing to the latest statistics doing the nomadic the most successful consumer merchandise of all time existed.

Unfortunately, although nomadic phones are used for great intent, they have besides triggered a rise in offense.

However, the good intelligence is that the service suppliers have at span managed to use methods forestalling stolen phones from being used of all time once more. This should take to a high bead in the offense figures.

In footings of the per centum of families describing holding a nomadic phone for

personal usage, wireless entree reached 71 % in 2006 in the US. This rose from 59 % in 2004, with the greatest additions concentrated in the lower and in-between income



With all this engineering available in the communications market, it is

clear that Nokia will hold tonss of competition, these competitions include:

Sony Ericsson, Samsung, Motorola, Siemens, and Panasonic.

With all of these competitions in the market Nokia must remain in front of

the competition by runing successful selling schemes. To make this, Nokia

must concentrate on selling schemes. At present, Nokia are the

universe ‘s best selling phone company. Nokia strengthened its lead as the Number 1 marketer in the market during 2000 with cargos lifting 60 per centum over 1999. Some of the company ‘s success was accredited to a strong 2nd half in 2000 when 50 nine per centum of gross revenues occurred.

For illustration, Virgin Mobile entered the Canadian market utilizing the Bell Mobility web. The market has grown and continues turning strongly, and the well-known willingness of consumers to alter service suppliers means that a new entrant offering competitory monetary values or service characteristics could be successful.

In decision, Nokia mobile phones work as an first-class channel for consumer

response. With nomadic phones as the response channel, trade names can make a relationship with new client and current clients. Mobile phones have benefited concern and persons by supplying needed information by cut downing cost, minutess and clip for sellers.

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