History lesson for Nokia’s Vertu in Japan
Nokia has announced that they plan to launch an MVNO with Docomo using their Vertu brand in Japan.
A quick look at this brings up many more questions than answers. Vodafone failed spectacularly in Japan just a few years ago, and without careful understanding of the Japan market, Vertu/Nokia will fail as well. Masayoshi Son was the major benefactor of the failed Vodafone Japan effort.
I think Vertu in Japan needs to understand why these efforts failed in Japan:
– Toyota’s Lexus brand
– Sony’s Qualia brand
Lexus did well in the US because the US Toyota dealership experience was so horrendous for customers that they were happy to pay more for a much better dealer experience AND the products had a premium that was not as high as the German competition but was as good as they expected of a Japanese manufacturer. Affordable luxury. In Japan, the dealer experience is much more uniform so that is not a competitive edge, and for Japanese car buyers, Lexus is a domestic brand, it does not have the cachet of a foreign brand like BMW or Audi. We all know that the Lexus RX and the Toyota Harrier are the same vehicle, the GS is a gussied up Toyota Crown, the IS is a gussied up Toyota Altezza, etc.
Sony’s Qualia effort was doomed from the start, even if the idea may have been a good one. The products were roundly derided as being poorer feature-sets for the outrageous prices that were being demanded.
Unless Vertu has a whole new line of phones designed just for the Japanese market, they’ll fail via product, as Vodafone did. And even if Vertu has a whole new line of phones for Japan, it’s incredibly poor timing to launch a premium-anything in Japan. Maybe if the target market is the top 10,000 richest people in Japan, but how valuable is that market really?
More competition in Japan’s mobile market is very welcome, but I don’t see clearly Nokia’s strategy wrt a Vertu-based MVNO in Japan. If anyone can convince me otherwise, I’m all ears.
UPDATE: on my way home yesterday I was wondering how Disney Japan is doing with their MVNO with Softbank but since the target demographic is so different from what Vertu wants to do, I don’t think there are many lessons to be learned.