Brand discovery, incremental sales open up for Nokia phones through marketplace strategy
- 02 August, 2021 11:11
Building direct engagement with customers while bolstering brand discovery and sales through a two-pronged marketplace approach is the aim of the game for HMD Australia after a rapid-fire technology investment.
Like many brands facing the abrupt shutdown of physical retail stores last year, HMD lacked a direct commercial relationship with prospective end customers. HMD Global is a relatively new but sizeable business operating in more than 50 countries. Since 2016, it’s been the global licence holder for Nokia phones, running the Nokia.com domain and selling a new generation of Nokia mobile devices and accessories. It does this via a traditional model of distributors, who then sell on products to retailers and carriers.
“Those retail doors were shutting, and the ability for customers to discover us digitally instead of in-store became a high priority,” HMD head of marketing A/NZ, Johan Palsson, told CMO.
A global ecommerce strategy quickly became critical. With a highly trafficked website in Nokia.com, HMD already had the foundation to make this happen, and the global entity chose BigCommerce to realise its vision.
However, with the Australian market down the priority list, the local HMD team was going to have to find another way if it wanted to act quickly.
“We didn’t think it needed to be that involved or complicated, you can start an ecommerce site with very little infrastructure,” Palsson commented. “I was also thinking beyond ecommerce, what HMD Global was doing with the Nokia brand and as a wider business. I’d been in the business for six months when this happened and saw the opportunity to go beyond ecommerce. Over the last three years, we have been amassing customers, even though they were not directly via our own channel, but they were using our phones globally.
“We also have an app, My Phone, which is a Nokia app sitting on every handset. Globally, this now has 45 to 50 million users.”
This thinking led to a partnership with online marketplace platform provider, Marketplacer. The approach being taken is three-fold. Firstly, to realise direct-to-consumer sales via ecommerce on the Nokia.com local sub-domain. Secondly, to increase availability of the Nokia product catalogue through third-party marketplaces. The third and arguably most disruptive phase is to create an owned global marketplace extending well beyond the Nokia offering and create a new revenue stream for HMD Global.
“We opted for a crawl, walk, run approach. The crawl was selling on Nokia.com; walk was selling the Nokia product catalogue on eBay, Myer and other marketplace platforms. Then phase three, the run phase, was mapping out what it would look like to power and marketplace a shoppable function within the My Phone app on our devices,” Palsson explained.
In January, Palsson’s team turned on a direct-to-consumer channel using the Nokia.com front-end and Australian sub-domain, introducing a cart and the ability to take payments in 12 weeks. To do this, Marketplacer’s platform was integrated into the existing Contentful front-end on Nokia, allowing consumers to shop Nokia phones and some bundles. The semi-headless integration through an API ensures the process looks like Nokia to the end, where the Marketplacer cart takes an order and payment, then connects back to local distributor, Ingram Micro, for pack and dispatch.
“That allowed us to start having direct conversations with consumers on our website,” Palsson said. “Because of that physical retail shutdown and loss of those assisted sales environment, we noticed if people did their own searches on phones and Nokia, they’d come directly to us as well as places like Amazon. If they were interested in Nokia and were able to purchase there and then… we’d see a big uptake.
“All of a sudden, we had opened up a discussion with a different set of customers that wouldn’t necessarily discover us in retail.”
Popular products include feature phones, along with entry-level Nokia 2.3 smartphone devices. HMD has also seen customers return and discover accessories not ranged in traditional retail channels. Importantly, it’s also allowing HMD Australia to have direct connection to the customer.
“When we sell a phone in Officeworks or JB Hi-Fi, we don’t really have ongoing opportunity to speak to them unless they register via the app or via email. They’re really the retailer’s customers,” Palsson said.
“Once we were able to work with things like pre-order using Marketplacer, we could run campaigns where you could go to JB Hi-Fi or Officeworks website, pre-order for a product release, then we could have a redemption model on our own website. It was another way to bring people into our CRM and redeem with their details. Then we can have an ongoing conversation about upgrades, new releases, news from Nokia and so on.
“It was a way to help us gather customer data and have a more meaningful conversation.”
HMD is now on the cusp of the bigger end game, which is to bring to life an HMD marketplace. Palsson said Marketplacer provides the ability to send a Nokia product catalogue into the proposed marketplace and also point into the My Phone app.
“We can curate a range with other vendors to start selling many other goods potentially, like smart home devices, Fitbits or complementary products that go with mobile phones,” he said. “We’d like to bundle these with HMD services like HMD Connects or Enable, which are software services going around the smartphone. In our marketplace, we can control how we position that from brand perspective outside the Nokia domain.”
Palsson said the initial market is likely to be Europe, where HMD is well known and where the logistics and dropship are easier. But he’d like to see a trial in Australia after that.
The rise of third-party digital marketplaces
Meantime, the local opportunity is connecting into other Marketplacer customers operating their own marketplaces, such as Myer, where Nokia is currently not ranged.
“To do that traditionally, we’d need to buy fixtures, provide live demo units across store network. It’s an expensive entry point. Now Myer operates a marketplace and we are both Marketplacer customers, we can sign up as a seller on that platform and flick our product catalogue straight into Myer’s ecosystem. That allows us to be part of the whole marketing machine of Myer One, gift cards and more,” Palsson said. The debut of Nokia on Myer’s marketplace is due within weeks.
“It’s a fairly inexpensive way to open up a channel and test something.”
Another retailer in Palsson’s sights is Woolworths, which is also launching a marketplace, Woolworths Everyday. The pair have struck an agreement, with tests now underway and the debut due in September.
“We can put Nokia handsets into that ecosystem, where they are not ranged in the traditional sense. We know how many people go to the Woolies site to do grocery shopping. We could be there offering our lower-priced, high-quality mobile phones,” Palsson said.
“This way we connect with the ecommerce and digital marketing teams and look to cross-promote via our respective catalogues. It becomes a flywheel of product catalogues going back and forth, doing all that through a single checkout, which makes it seamless for the end customer.”
Palsson said Myer and Woolworths are obvious choices when looking at Nokia’s representation in Australia.
“One thing we know is that while the Nokia brand is well known, the awareness globally and in Australia of our latest products is low,” he said. “This is a quick way from a marketing point of view to put our brand in front of a lot of eyeballs and people. It’s a journey to discovery even if they don’t buy. It’s an easy way to turn on awareness and showcase product in another channel with a brand message. And it’s a way to add products or have online-only colours.”
Palsson said it’s also considering using the eBay connector that comes out of the box for Marketplacer customers. Web hooks and APIs ensure data is integrated into HMD’s global CRM to ensure data visibility in one place.
Results
With the Nokia.com ecommerce site turned on locally, Palsson reported incremental sales as a quick win. Nokia’s latest 5.4 model is selling faster than expected, and the team sees plenty of untapped opportunity to drive sales online.
“Once we turn on those other marketplaces it will grow, but that awareness will be even more important potentially,” he said.
The long-term game is what’s possible via the My Phone app and an HMD marketplace.
“They [global executives] weren’t keen on another system, but when we presented the cost and scalability, they were taken aback with what we can do,” Palsson said. “It’s a long-term growth and commercial model that goes beyond Nokia phones and could be an operation in its own right.”
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