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Superbrands case studies: Siemens mobile

Originally published in 'Consumer Superbrands' Volume VI, July 2004. The book reviews the UK's strongest consumer brands as judged by an independent judging panel.

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Market
Mobile phones have come a long way since the early 1990s, when only the rich and famous used the, then huge, devices. Today, around 470 million ever-smaller mobiles are sold every year, becoming as much a fashion statement as they are a means of communication.
 
Intensely competitive, marked by lightning-fast changes in technology and fashion, the mobile phone market is primarily driven by innovation. Because of this, the average life cycle of a mobile handset is just fifteen months.

 

Examples of technological milestones include the launch of Wireless Application Protocol (Wap) in the late 1990s and the use of the Short Message Service (SMS) -- allowing people to send simple text messages. This transformed the market, with more than one billion messages sent each month in the UK alone. Enhanced Messaging Services (EMS) then hit the market, which means consumers can include text, pictures, icons and sound in their messages.
 
Another big development was the arrival of General Packet Radio Service (GPRS) networks offering a higher-speed, always-on connection, making it faster and easier to connect to the internet and opening the way for richer content to be downloaded.
 
The introduction of 3G, or Third Generation phones, raises the bar even further, bringing video capability, web access, e-commerce applications, remote networking, file transfer, document sharing and conferencing.
 
The convergence of mobile phones, computers and personal entertainment products has blurred application boundaries. For example, more handsets now use the Bluetooth short-range wireless connection system, allowing a mobile phone to be used as a wireless modem with portable PCs or other devices. Mobile phones now also double up as music players, with some models offering MP3 technology.

Achievements
Siemens mobile is the number two handset manufacturer in Europe and the UK. This is a sizeable achievement given that in 1999, Siemens mobile held sixth position in the mobile market across Europe. In 2004, Siemens mobile also won the UK mobile industry's most prestigious award, being named the 'Manufacturer of the Year' by Mobile News magazine.
 
2003 was a particularly successful year, with the Siemens A55 being the best selling pre-pay handset of that year and the SL55 one of the most talked about and desirable handsets of the year. The company is the only manufacturer to have achieved a significant increase in average market share for 2003 in the UK resulting in increased profitability and higher levels of brand awareness.
 
Siemens mobile's success is due to the desirability as well as the technical excellence of its products. This has been recognised through a host of media and industry awards. For example, the Siemens S55 was voted 'top gadget every man should own' by the Daily Star and Stuff magazine, as well as 'best phone' in Loaded. It also received the second highest-ever rating in Mobile Choice magazine.

The SL55 has also attracted accolades, being voted 'best budget buy' in the Independent, 'best fashion phone' of 2003 in the Mobile Choice Consumer Awards and runner-up in 'best phone of 2003' in Stuff. Meanwhile, the SL45 was described by T3 magazine as "Better than sex". It added: "Forget Nokia, forget GPRS, the best thing in the world is the sexy and tiny Siemens SL45" -- praise indeed.

History
Werner Siemens established Siemens in 1847. Set up to take advantage of the latest advances in communications technology, Siemens quickly established a reputation for itself as an innovator.

Siemens established a London office as early as 1850. The UK business grew rapidly and played a vital role in the improvements in the age.
 
In 1873, it laid the first transatlantic undersea cable, spawning an exciting new age of communication.
 
Thanks to its pioneering work in electricity generation, Siemens grew as quickly as the electrical industry.
 
In 1986, the first Siemens mobile phone, the C1, was designed for installation in cars. In 1992, Siemens unveiled its first GSM mobile phone, the P1. Although weighing 2.2kg, the P1 was innovative for its day, featuring a hands free facility and phonebook. The same year, Siemens launched its first true mobile phone, the C4 compact, weighing only 600g.
 
In 1997, Siemens unveiled the S4, the first mobile phone to feature a colour display. In the same year, Siemens mobile was launched as a standalone business.
 
Innovations continued apace, with Siemens mobile introducing its first  Wap handset, the S25, in 1999 and the SL45 became the first luxury handset to have a built-in MP3 player in 2002. In 2003, it introduced its first 'total entertainment' GPRS-enabled handset with integrated video player, video recorder, MP3 player, FM radio and gaming functionality.

Recent developments
In January 2003, Siemens took a radical step in the mobile phone market by launching a new fashion accessory phone category called Xelibri. This is a new collection of stylish personal communication devices in radically different shapes and wearable designs.
 
Xelibri accessories are marketed as fashion items, with two collections launched per year. The new fashion accessories are sold in department stores as well as traditional mobile phone retailers.
 
The Autumn/Winter 2003/4 XELIBRI collection consists of four visually striking phones. Displays with over 4,000 colours, new animated menu prompting, and unusual shapes and materials give a dash of flamboyance to the new models. Typical basic features are voice dialling, vibrating alarm, polyphonic ring tones and integrated games. The SIM card can also be changed without opening the mobile. The models include the Xelibri 5 snap-link phone, the Xelibri 6, which resembles a glamorous cosmetics compact, the Xelibri 7 super thin clip phone and the Xelibri 8, which hangs around the neck like a necklace.

Promotion
Siemens mobile makes extensive use of above-the-line advertising, conscious that brand awareness is crucial in this highly image-driven market. It has certainly been able to achieve impactful 'cut-through' advertising, with the campaign for the SL55 recognised for generating high recall by Marketing magazine's regular 'Adwatch' survey. Advertising for the MC60 delivered huge awareness and desire though integrated TV, press, online and outdoor campaigns.
 
However, below-the-line is also hugely important for Siemens mobile. Since the 1990s, Siemens mobile has made dramatic inroads into the consumer press, regularly appearing in the fashion and lifestyle press including: Glamour, Arena, DJ Magazine, Marie Claire, Vogue, CosmoGIRL and J17. A mixture of product related and brand awareness PR campaigns have also helped to increase awareness of the Siemens mobile brand. For example, a February 2001 celebrity launch of the SL45, a luxurious mobile phone with the capability to play up to 45 minutes of MP3 music, helped position the model as the celebrity handset of choice. In order to position the phone as the ultimate in exclusivity, and to create word-of-mouth endorsement, phones were seeded with style leader celebrities at an exclusive London Fashion Week after-show party.
 
As a result, demand for the phone within celebrity circles increased with follow-up requests coming from celebrities such as Madonna and Guy Ritchie.
 
Another successful PR campaign took place in August 2003, when Siemens mobile teamed up with some of the UK's coolest club nights to create a 'passport' to free entry as a reward for owners of its latest mobile phone -- the SL55. Owners of the handset were granted free entry and preferential treatment at five of the UK's top clubs.
 
Reaching out to students is another important promotional avenue. As part of the ongoing communication with this audience, the brand recently staged a promotion at Birmingham University where students competed to win a Siemens mobile-branded car by seeing who could keep their hand on it for the longest. The eventual victor endured for over 34 hours.
 
Another innovative student-focused project, reflecting Siemens' brand values of individuality and style, was the Siemens Student Style Icon award. Far from a beauty contest, the judges, from iconic brands such as Ministry of Sound, Elle magazine, Ben de Lisi and Central St Martin's fashion college looked for a winner with originality and a sense of savoir-faire.
 
Product placement has also become a valuable brand-building tool, with over 70 placements in 2003. This included Siemens products appearing in TV hits such as 'EastEnders', 'Spooks', 'Jonathan Creek', and 'Footballers' Wives' and films such as 'Alfie' and 'Bridget Jones 2'.
 
Siemens mobile makes extensive use of its global sponsorship properties, notably including Real Madrid. The brand became the team's shirt sponsor in 2002. With David Beckham joining the squad the following season, the deal came at a good
time, with the England midfielder helping to boost the team's and the brand's profile even further. Siemens mobile also has sponsorship deals with other clubs including Chelsea, Juventus and Bayern Munich.

Siemens has a major presence in Formula 1 with two high-profile partnerships. As technology partner to the West McLaren Mercedes team Siemens supply the whole team with products and solutions, with the Siemens logo prominent on the cars and uniforms of David Coulthard and Kimi Raikkonen. In addition, as a global partner to Formula 1, Siemens manufactures the official Formula 1 mobile phone.

Brand values
Since the first GSM phone in 1997, Siemens mobile has built on its brand values and reputation for innovation, by producing highly desirable products with a key focus on design.
 
The brand carries the equity of the master Siemens brand, which has always been a technology leader, responsible for a long history of firsts that have fundamentally shaped and brought value to consumers' everyday lives.
 
Like its parent brand, Siemens mobile has a proven track record for doing things that provide real satisfaction through real benefits.
 
It strives to set standards across all categories by constantly elevating, thereby redefining the standard. Siemens mobile phones come with proven technical expertise in designing and integrating capabilities, have a progressive and appealing design and come with a commitment to the highest standards of quality. Product values can be summarised as: quality, usability, design and value.

(c) 2004 Superbrands Ltd

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