Blackberry Smartphone, BlackBerry Messenger and BlackBerry enterprise services are used by millions throughout world and Blackberry is the flagship brand of Research In Motion. 2011 will never be counted as a good year in the history of Blackberry as they have seen 75% drop in share price of the company and global blackout of their services. Still this company has 75 million customer base globally and that is a big number. RIM position clearly states the dynamics of the market in which RIM operates and this market is indeed always in phase of transformation. The only difference is that during late nineties and early part of this century this transformation was slow and now the rate of transformation is aggressive.
what are those dynamics of market and inside RIM went against this extraordinary company.
Apple changed the dynamics
I-PHONE was a pure innovation in terms of a concept. The thought of a phone without a keyboard and it is the screen that will serve the purpose of keyboard was a paradigm shift in the smart-phone industry. Touchscreen were present but the concept of a Smartphone without keyboard and stylus was revolutionary. It was as innovative as RIM thought of putting a qwerty keypad on a phone.
The execution of the I-Phone as a concept was so effective that overnight the product of another companies like Nokia, BlackBerry became an obsolete product. It took a very good amount of time for Blackberry to accept it. I-Phone created a gap and they claimed that this is a Smart-phone and every one agreed. I-Phone transformed the perception of a customer regarding what a Smartphone can be and this gap was big enough for Black Berry.
I-PAD was again a pure innovative concept like bill gates concept of one computer on each desk and it full filled the imagination of giving enormous computing power in the hand of a human being which he can keep with himself all the time. The acceptance of this product by the market is a pure evidence that we can imagine the way human being will use computer will be completely different.
The two products mentioned above made by Apple were pure disruptive innovation and it forced all Smartphone manufacturer to change their perception of Smartphone and follow the path which is set by Apple. Two iconic companies RIM and Nokia were the biggest victim.
Competition: The culture of RIM has never been competitive, rather it is based on innovation. Make innovative product and be the first mover in the market. If we will see in the history of RIM they have never faced competition in the market because what ever product they made was an innovation. Suddenly Apple comes and made two pure conceptualized innovative products back to back and changed the dynamics.
Suddenly RIM faces which they have never faced in their whole history and that is competition. Apple forced RIM to make a product like I-PHONE and I-PAD and literally RIM doesn’t know to how to do better in competition and it is visible from the product RIM made to compete with I-Phone. They are not bad products but they were not competitive enough.
Android OS , another competitor who slowly but steadily rose the path towards leadership role. Samsung electronics, HTC, Sony Ericsson, Motorola(Google has bought Motorola) and LG also choose android as the major OS platform for their smartphone and Tablets. All the companies which adopted the android platform were able to at-least compete with apple and produce extraordinary results i.e Samsung electronics.Apple and Android both innovative and resourceful eroded the market capitalization of Blackberry in an amazingly fast way.
BlackBerry Trap: BlackBerry Smartphone brand is typically based on four pillars and they are BB messenger, BB enterprise services, BB smart-phone and USP of security. The perception of a smart-phone changed so dramatically that it caused a degradation in the Blackberry smart-phone brand and naturally it caused the degradation of four pillar. The brand which took RIM to such great height in reality when face competition acted like a trap because it didn’t allow RIM to see beyond it and particularly on following aspects.
- beyond qwerty.
- giving too much importance to security. Security can be of too much important to financial institution and investigative agency but you can’t sell a product to a teenager by telling them that it is secured. RIM completely lost this market and it is only recently they are trying to woo these teenagers.
- Very poor execution of all the screen touch models as RIM doubts screen touch effectiveness.
- Blackberry app world was launch in 2009 and it has roughly 10000 application.
- Branding it as a business phone.
Lack of innovation: RIM was the company who were pioneer of wireless data services and from there they became a company making Smartphone. Literally opportunity to become a Smartphone manufacturer came to them because of the market in which they were operating and they grab it. This opportunity can be considered as same where Amazon has made an enormously success-full Tablet Kindle-fire. Somewhere RIM forget their own principle that if you will not eat your lunch at breakfast then someone else will eat it and it happened. In the world of technology you are a leader till the you are first mover as innovator, cannibalize and again an innovator.
Email became a commodity: RIM basically was in a very advantage place in the early part of last decade because they were working extensively on developing two-way gateways for an email on a device and it was a concept and product way ahead of all the other products available in the market. This advantage they have in the market only brought the opportunity to enter in the market of Smartphone. The point on which RIM faltered was
- E-Mail became commodity. RIM enormous growth was basically based on E-Mail but somehow they failed to realize that e-mail has become a commodity and they literally failed to capture the pace of Internet and Social Media and integration. Smartphone became the catalyst which caused enormous rise in creation and sharing of wireless data on Internet and all of it happened so fast only in a span of five years that no one even thought that it could happen and that’s why Blackberry literally never made any effort from their side on hardware and software front to handle this enormous stride. Blackberry was never ready for the second phase of wireless data revolution.
- Failed to capture the mindshare of emerging market because of their business phone brand and response time was very late to change it at-least in Indian market as we have observed it.
In 2009 the share prices of blackberry was $75 and market capitalization was $43 billion and in 2011 only RIM lost 75% of the market share. We think that RIM will survive and they will make a strong comeback also but this period through which this company is going through will sure make a great impact on their culture of innovation, operation and branding.
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