The Nokia Crisis – Extraordinary Customer Experience changed the leadership rules for Nokia, Blackberry and others

The crisis at Nokia has been building since at least January 2007.  A critical part of the company’s downward spiral is that customer experience changed the market with the introduction and tremendous acceptance of Apple’s iPhone.  When an “experience maker” like Apple changes the market from competing on features and price to one where success depends on people’s experiences with a company’s messages, processes, people, products and services, other companies adapt, get marginalized or go away.  This is not just about the smartphone market.  It could be about your market too.

Within customer experience is the user experience, sometimes referred to as UX.  The user experience is based on a person’s direct interaction with a company’s products or services.  It IS the proof point the promises made by the companies during the customer experience (with messages, people and processes) about what the products or services will do for customers is true or not. 

Since 2007 customers in the wireless phone market, and more specifically the smartphone market, have voted with their dollars and it has not been in favor of Nokia or Blackberry. 

When doing the interviews and research while writing the book The Customer Experience Revolution with Sean Van Tyne, I was focusing on what Steve Jobs and the team at Apple saw prior to 2007 that made it a very good idea to enter the smartphone market.

Before 2007, there were already many successful companies making smartphones, which combine computing, Internet connectivity, and other capabilities into a wireless phone. Before Apple entered the market, these smartphone companies included formidable competitors such as Nokia, Research in Motion’s BlackBerry, Palm, and Motorola. These telecommunication giants leapfrogged each other every three months, constantly adding innovative features and functions.

Most customers were not having a very good experience with smartphone companies, the promises made, processes, and the user experience with smartphones.  As Apple saw it, success in this market wasn’t about the technology, features, the calling plan, or the price.  While all those are important ingredients, Apple’s iPhone delivered exactly what it promised – an extraordinary experience. From the time people heard about the iPhone until they became customers and then enthusiastic advocates, the iPhone offered, by far, the best smartphone experience.

It is no accident that Research in Motion (RIM) and their BlackBerry is in crisis along with Nokia.  From a customer experience standpoint, they were marginalized along with Nokia in 2007.  Research in Motion and Nokia never changed when market leadership changed to require extraordinary customer experiences.  The people at Google understood this.  They are experience makers and compete effectively with Apple’s iPhone.  They get it.

A great customer experience with an extraordinary user experience is not exclusive to high end markets.  The Wall Street Journal noted last Thursday that “Nokia is also losing its dominance in developing countries like India and in the Middle East as consumers increasingly dump their basic Nokia phones for cheap smartphones running Google Inc.’s Android operating system.”  Those cheap smartphones offer a customer and user experience that is now expected throughout the smartphone market and the world. 

I would like to see Nokia turn around.  The competition would be healthy and positive.  I hope that Stephen Elop, appointed CEO of Nokia Corp. in September 2010, with the help of all the people at the company do it. 

However, if Nokia is to turnaround, it will have to include a customer experience and user experience that is at parity with the leaders.  It would be better if they took a careful look at what kind of experiences people where having now and innovate a completely new and extraordinary customer experience.  

Can an experience maker come into your market and change the rules of success? What would you advise the people at Nokia and Blackberry to do regarding customer experience leadership?