CONSUMER BEHAVOIUR

Consumer Behavoiur: Blackberry

Consumer Behavoiur: Blackberry

Introduction

BlackBerry Smartphone awes launched in 1999 and have also developed its operating system. Blackberry has distribution partnership with 550 carriers in 175 countries to sell its devices, software and services. The company derived 81.1% of total revenue from devices in FY'10. However, RIM reported consolidated revenues of $14,953m for the fiscal year ended February 2010, an increase of 35.1% over 2009. The Y-o-Y results were driven by increased sales of BlackBerry devices and a growing base of subscribers. Consolidated revenues increased at a CAGR of 57.7% during 2008-10, revealing a strong demand for its handsets. RIM reported an operating profit of $3,237m in 2010, an increase of 18.9% over 2009, owing to the company's cost reduction efforts. Operating profit increased at a CAGR of 36.7% during 2008-10. RIM reported consolidated revenues of $14,953m for the fiscal year ended February 2010, an increase of 35.1% over 2009, driven by increased sales of BlackBerry devices.

However, even after such a strong notion of blackberry there is one element that is problematic. It is the consumer believes about blackberry, as they think that it is for businessmen and for people with serious attitude. However, this is not the scenario as blackberry is for everyone and for the youth. Thus, this is the problem that revolves around for blackberry and they require studying the consumer behavior to tackle this problem.

Industry Environment

The $133bn global handset industry is set to witness high growth with the advent of smartphones. Reflecting strong pent-up demand, smartphone devices will record growth rates of 27.4% to reach 712m in 2014 from 112m in 2009. The segment's revenues are projected to grow at a rate of 37.8% between 2009-14, and contributed to an overwhelming 78.7% of the industry's profits, yet accounted for a mere 17.2% share in shipments in 2009. Apple and Google are transforming the Smartphone market into a PC like environment, transferring value from hardware to software and content. On the other hand, the entry of several players is intensifying price competition. Asia-Pacific is the growth engine for the industry contributing to nearly 46.8% of total shipments in 2009, with India and China driving most of this growth.

In 2010 Apple dominated the Smartphone app market, offering over 225,000 apps. Its strict control over approval of apps has allowed it to maintain quality and user experience, but has also set the company at odds with developers. Apple has already sold more than 150 apps from which it generated $2.4bn in revenues. Nearly 5bn apps were downloaded from its App Stores. While blackberry offers 10,000 apps, the market leader Symbian offered only a mere 6,118. Android on the other hand offered 140,000 apps to its users to take up second position in the apps market. The Android Marketplace does not have the same kind of restrictions as Apple, and while this allows for a certain amount more freedom for both developers and users, the quality and compatibility of apps cannot be guaranteed in the same ...