how blackberry raised and then fallen

1. Malaviya National Institute of Technology Jaipur
Department of Management Studies, Session 2016-17
A Case Study on Blackberry
Submitted by:
Nidhi Dwivedy
Peeyush Paul
Himanshu Agrahari
Manish Gupta
Sujeet Kumar
Shubham Tripathi
Submitted to:
Dr. Reeta Singh
Assistant Professor
Dept. of Management Studies, MNIT

2. Introduction
● Classic example of product life cycle
● Longevity of product life cycle depends upon the composition, saturation and other
economic factors of the respective industry. The other very important factor which this
case study aims to highlight is the choice.

3. ● The choice is referred to measures or the steps which any firm is bound to take at every
single level of the product life cycle.
● The most important and crucial decisions are usually taken at the first stage as well as at
the last and the most decisive stage of the life cycle.
● As recently as 2009, BlackBerry was named by Fortune magazine as the fastest growing
company in the world, with earnings exploding by 84% a year. Times have changed. Since
2009, BlackBerry’s stock price has collapsed by a vertigo-inducing 90% to under $7 at its
low point last summer.
● Instead of coming out with latest technology and bouncing back in the competition, it
decided to refine its products and present the best of the best in front of the world after a
long break.
● Blackberry faces not only a stiff competition but it also faces a threat of losing its patented
technologies and solutions to its mighty rivals which have been constantly bringing new
and updated substitutes for aging Blackberrys.

4. HISTORY
• Research In Motion(RIM) was the parent company, founded in 1984.
• First wireless data technology developer in North America.
• By 1990, it had sales more than a million dollars – started getting into
hardware industry.
• From 1991, started developing its own softwares for its wireless
technologies, like wireless e-mail.

5. HISTORY
• Listed on Toronto Stock Exchange in 1997 – raised more than 115 million
USD.
• First BlackBerry device(BlackBerry 850, a paging device) introduced in
1999.
• Earned 25,000 customers from this device.
• Listed on NASDAQ Stock Exchange in 1999, raised more than 250 million
USD.

6. Business model
• Porter’s five force model
for smartphone industry
Intensity of Rivalry
•Product attributes like features and
design can be quickly imitate or
encounter with better quality or
advance specification, like camera,
touch screen resolution, processor
and storage, connectivity and even
software bundle
Bargaining Power of Supplier
•Majority of Hardware used to produce
a smart-phone is same, like ARM
architecture processor, same storage and
gorilla glass screen
•Relative concentration fall into
competitive as equal many buyer to
supplier
Threat of Substitute
•Tablet is likely to substitute smart-phone as
it share similar interface, functionality and
apps
•Cross price elasticity is high, maily from
featured phone. Consumer may only need a
featured phone with basic call and text.
Bargaining Power of Buyer
•Consumers have a lot of choice
available in the market
•Switching cost is low
•Many suppliers are providing
varied features and apps
•Many buyer to suppliers increases
the bargaining power
Threat of New Entrants
•The fixed cost of R&D on software and
hardware
•Loyalty for patents and other intellectual
property rights
•Need for good talent and manpower
•High initial investment is required

7. • Till 2007, company had strong market share with share prices peaking
at USD$ 236 per share
• Blackberry substantially underrated and certainly did not anticipate
the competitive threat posed by smartphone technology.
• For Blackberry, its own phones stood as highly differentiated with a
very specific but large and successful market.
• Failure to identify, react and adapt strategically to the disruptive
innovation of iphones led to Blackberry’s loss of its strategic position.
• Blackberry began to produce its own smartphones.
• However, they met mediocre consumer reviews in both its
unimpressive technical features and software experience.
• Could not outsource and rely on the competencies of other
experienced developers, such as Google Android

8. • Blackberry entered new emerging markets with price centric approach.
• They achieved short lived competitive advantages.
• But Asian companies with cheaper phones entered these markets.
• In 2010, it purchased QNX and entered tablet based market with QNX based
tablet, Playbook.
• Playbook again met negative reception and represented a commercial flop
for the company, as it was over-priced, relative to its performance and
technical capabilities.
• Customers were unwilling to switch from competitors.

9. Company changed some strategy
• It shifted its focus from mass consumer market with smartphones
towards niche market with its product offerings.
• It targeted enterprises and focussed on enterprise services.
• Released enterprise service 12.
This strategic shift hold promise for various reasons:
1. Initial success of Blackberry at its inception, was on built on its
security and relevance within an enterprise context.
2. Security is becoming much more of a pressing issue in recent times,
with the latest headlines revolving around cyber-attacks of various
degrees.
3. It was looking via a focus of developing and expanding many of its
popular services (eg. blackberry messaging service).

10. Marketing mix- Target Market Segment
• Segmentation:
1. Occupation based
• Business professionals
• People who are wiling to pay more for newest product that provides
the function they need.
2. Behaviour based
• Very active consumers
• High self esteem
• Pursue most fashionable products with advanced technologies.

11. • Like to purchase products of leading brands.
• like fashionable design
3. Income
• Above 30,000/ month

12. Marketing mix- Target Market Segment
• Segmentation:
1. Occupation based
• Business professionals
• People who are wiling to pay more for newest product that provides
the function they need.
2. Behaviour based
• Very active consumers
• High self esteem
• Pursue most fashionable products with advanced technologies.

13. • Like to purchase products of leading brands.
• like fashionable design
3. Income
• Above 30,000/ month

14. MARKETING
STRATEGY(contd…)
MARKET POSITIONING

15. MARKETING POSITIONING
• Focus on product image in consumer’s mind with respect to
competing products.
• Do everything instantly – make & receive phone calls, browse Web,
organize, enjoy multimedia, etc.
• Always stay connected to people and resources – very useful for
mobile professionals.

16. “SWOT” Analysis of BlackBerry
• STRENGTHS:
1. Support of over 650 carriers across globe.
2. More than 72 million loyal customers.
3. Specialization in Security Encryption feature – preferred by 14
million plus enterprise customers.
4. QWERTY keyboard idea is innovative for a phone.

17. • WEAKNESS :
1. Responded slow to competitors – iPhone changed the market
completely.
2. Unable to clearly position itself in market.
3. Lack of apps compared to Android and Windows.
4. Too long to introduce OS 10 phone – that too very costly.
“SWOT” Analysis of BlackBerry

18. • Opportunities :
1. Strong growth of mobile advertising market
2. Overwhelming acceptance of BB 10 in India, Canada, UK and
Indonesia.
• Threats :
1. Competitors have the advantage of economies of scale.
2. Rapid technological changes.
3. Stiff competition quickly burnt the cash in the company.
“SWOT” Analysis of BlackBerry

19. Reasons for Success and Failure
• Why success? Advertising (U2s’ Bono), functional email devices
(proprietary, ie. Protected by a Patent), Secure Network
• Few reasons contributing to the failure of models –
• An international outage in mid-October
• The Playbook tablet, a weak answer to the iPad
• Phones with web browsing that is both laughably low-quality and slow
• Greatest crisis yet as Android and Apple are targeting Business Market
(their biggest strength).

20. Why it has failed?
• Apple has been highlighting business applications like Dropbox and
Cisco's WebEx (company that provides on-demand collaboration,
online meeting, web conferencing) in its iPhone advertising.
• Inexpensive and high-quality "cloud" capabilities of Google assisting
Android.
• At the time of this debacle, the company still had 70 million
worldwide subscribers, and shipped some 10.6 million smartphones
last quarter. (Mid 2012s)

21. Why it has failed?
• At the time of the iPhone and Android’s arrival, the whole mobile industry
was on the precipice of moving to bigger touchscreen displays. Qwerty
simply got ‘old’.
• Early Google and Apple phones were RIM clones. Companies started going
with latest specifications and greater speed with Dual Core processors as
they had nothing to lose.
• During this evolution on Android front, BlackBerry was more concerned
with protecting what it already had instead of conquering new lands.
• Why? The majority of big businesses and government organizations relied on
BlackBerry’s superb security, reliable email, and utilitarian functionality to keep their
workers productive on the move
• Safe to say that focusing on the tens of millions of customers it already had,
Blackberry missed out on the billions that were to come in near future

22. Why it has failed?
• Blackberry thought they had more time and room for error than they
actually did.
• When they launched the PlayBook tablet (iPad rip-off) without an
email client, they insisted, along with Adobe, that Flash would be the
future of rich mobile content, and it delayed the release of a spec-
competitive smartphone until it had a chip powerful enough to
handle the requirements of Flash.
• BlackBerry believed people would wait for its superior product.
• Doesn’t it sound like Apple’s approach now-a-days? Recent stunt with
headphone jack removal? What is the difference?

23. Possible Solutions
• Marketing Issues
1. Lost its image as a smartphone producer
2. Failure to produce and promote new apps
3. Diverted attention and resources to playbook
4. Failure to produce new smartphones with sufficient features and
quality to withstand its competitors
5. Found it difficult to position its products when market is dominated
by Android and iphones

24. Possible Solutions
• Strategies to turn around
1. Success of BBM could be used to brand Blackberry products
2. Marketing the “Security Features”
3. Focusing on its original image; business communications for
business people
4. Going with the strategies implemented by John Chen. Retaining him
for a long time
5. Moving towards Emerging markets

25. Possible Solutions
• HR Issues
1. Dual CEO structure
2. Heavy layoffs
3. Demotivation among employees
4. Inefficient employees
5. Growth hampered

26. Possible Solutions
• Strategies to turn around
1. Overhaul the organizational structure
2. Motivation and creating a value among employees
3. Hiring efficient people with latest technical abilities
4. Compensation and rewards in points

27. Queries?