When Blackberry first entered India in 2004, it strongly focused on the enterprise customers. But over time, the brand realised that a large part of the growth in the entire smart-phone market was beginning to happen in the non-corporate segment that largely comprised of the youth.
The Challenge
Thus the first challenge for Blackberry was to reach out to this new segment. So in 2008, Blackberry decided to move beyond its niche market and target consumers beyond corporate users; to also include consumer users. In this pursuit, the brand started to shed off its corporate suit image to get into comfortable pants.
But there came the second big challenge for the brand: how to target the mass consumers without losing its premium cult image. As Krishnadeep Baruah, Director Marketing, Research in Motion (Blackberry) puts it, “It was a big question for us. We were very strongly entrenched into the enterprise segment and the biggest fear for us was if we expanded our market into the consumer side of the segment how would the brand equity get affected?
Krishnadeep Baruah, Director Marketing, RIM India (Blackberry)
How would the aspirations for brand Blackberry change?”
The other set of challenge was to adapt Blackberry’s current offering (both in terms of handsets and services) to suit the needs of the new set of consumers.
Strategy and Initiative
But before we share Blackberry’s strategy, here is an interesting thought on strategy by Baruah: “As a marketer it is easy for us to look back and say what the strategy was. But, I want to confess that not everything is clear and laid on a paper when we move into new businesses segments, new markets and consumer segments. But what is important is that we have a very clear goal about where we want to move and that drives the thought process and actions. And when we look back it helps to connect the dots and realise how we achieved what we did.”
The two-fold strategy that Blackberry adopted was: Segment the market and approach each segment through different product franchises suitable to the aspirations of these different consumers.
For the segmentation part of the strategy, Blackberry relied on perceptual mapping of consumers and came up with three target segments defined as: Assured Achievers, Independence Seekers and Community Traditionalists. These consumer segments were defined by Blackberry in terms of their key traits and key mobile considerations, based on the demographic, socio-economic, psychographic and behavioral patterns. For instance the key traits of the Assured Achiever is a strong work ethic, recognition for their skills is important, a need to be on top of their work and life etc. The key mobile consideration for this set of consumers is found to be Email and office connectivity and a strong need have latest device as perception is very important, besides others. When translated in pure marketing terms: Community traditionalists is the consumer segment that has entry level Blackberry users, Assured Achievers fall in the mid segment and Independence seekers are at the top end.
Based on this segmented approach, Blackberry reworked its strategy in the Indian market on the all the 4Ps of marketing: Product (& Services), Pricing, Place (or distribution) and Promotion Blackberry targeted the three segments through three different set of product franchises: Blackberry Curve (for entry level smart phone users or Community traditionalists), Blackberry Torch (mid level or Assured Achievers) and Blackberry Bold (for top end or Independence seekers). This way Blackberry had three different products at three different price points. This segmented approach and a different product franchise for each segment helped Blackberry to reach the mass consumers without losing its cult or pre-mium image amongst the top consumers. As Baruah says, “The big worry for us was how will our existing target audience (the high end users) react to the change in the brand. That’s where the product franchise or segmented approach system worked for us. With the Bold series, we could still maintain the higher end consumers and with Curve series we could make Blackberry accessible to the youth who always aspired to own the brand but could not have it as it was not affordable for him.”
And the segmented approach was applied on the services front too. So earlier Blackberry had just one Full Services pack for every user; but to target the mass market and young consumers, the brand reworked its strategy and came up with tiered service plans for the three target segments. While it continued with full Blackberry Plans for high end users, it also launched more economical plans: the Email & Instant Messaging/BBM Plan, BBM Only Plan, Daily/Weekly and Prepaid Plans. These plans reduced the monthly cost for the users and thus lured a lot of young consumers to the brand. Baruah shares a key insight that led to this tiered service plan strategy, “An interesting insight with the Young consumers was that they didn’t have a problem buying the device as it was a gift by their parents or relatives in most cases. But it was the monthly service charge that went from their pocket money and was stopping them to have a Blackberry.” But with prepaid plans like Rs 15 a day, the services became very economical for the youth and the young segment opened up to the brand.
Apart from the Product and Pricing strategy, the Positioning of brand Blackberry was another key challenge.
Baruah reveals that upon research they found out that Blackberry had a very serious image attached to it. To bring in a fun element to the brand and target a larger audience, Blackberry repositioned itself as a brand, which young people could associate with.
And in this process, the company rightly pushed its Blackberry Messenger (BBM) service. Baruah shares, “The other big tool that we realised was BBM. In 2008 end and 2009 beginning, we realised the adoption of BBM started and that collided with the tide of social media adoption in the country, so the timing worked really well for us.”
On the distribution front, Blackberry moved from the Carrier Retail Outlets (eg. Vodafone, Airtel or any other service provider’s retail outlet) only model to a mix of multi-brand outlets (65 per cent of its distribution network), Organised Retail Outlets (25 per cent of its distribution network)and Carrier retail outlets (10 per cent of its distribution network).
Apart from that, Blackberry has also opened 800 exclusive retail outlets across 35 cities. Baruah offers that the idea behind opening exclusive Blackberry outlets is to ensure a good experience of the product at the point of decision making. “It is an important part of reaching out to the consumers,” he adds.
Results
These strategies have really helped Blackberry to reach a wider audience. The brands’ market share has been on an upswing. According to a Cyber Media Research, Research In Motion’s market share in the Indian smart phone market was a meagre three per cent in 2008. It shot up to eight per cent in 2009 and 13 per cent in 2010.
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