Blackberry's Poor Performance

1. Introduction

1.1. Overview
The objective of this report is to examine and explain the causes of poor performance discovered in the 2014 BlackBerry annual report, newspaper and articles. The report starts off with a brief overview of the latest BlackBerry’s poor performance. Then it lists and evaluates the several poor performance shown in relation to the macro and micro business environment issues and the internal organisational factors. Subsequently, it will investigate what BlackBerry could do to successfully undergo this struggle.

1.2. Blackberry
Founded in 1984 and based in Canada, BlackBerry is a world-wide leader in mobile communications that transformed the mobile industry with the introduction of the BlackBerry solution in 1999.
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However, its market share is significantly low. The primary reason is because of low brand identity. “Brand names help consumers identify the source of a product, and signal specific attributes and key benefits of the product to the consumer.” (Kotler and Keller, 2009) Brand names can also “impact the way consumers perceive a specific product, and may cause consumers to form positive impressions or images.” (Keller, 1993) For instance, Apple 's iPhone models are typically retailed at a higher price than BlackBerry 's handsets. BlackBerry Z30 16GB unlocked phone is sold for $499, while a 16GB Apple iPhone 5s costs $649. However, more consumers are willing to pay a higher price and purchase Apple device over a BlackBerry. This is because “brand loyalty is considered as an asset and consumers are ready to pay more than usual for a brand,” (Wernerfelt, 1991) which explains the customer’s purchasing behaviour. It proves that BlackBerry has a weaker brand value compared to their competitors, which is directly linked to customer base and …show more content…
Recommendation (Figure 5)

Service, including BlackBerry enterprise solutions and BBM, has started to account for majority of the company 's revenues. One could say the company 's services are much more profitable than its hardware sales. In fact, BlackBerry’s services business kept its steady gross profitability in 2013, while hardware and other has shown a negative gross margin. So, BlackBerry should focus more of their investment and attention in the service business.

3. Conclusion

BlackBerry experienced major achievement in the smartphone market from 2005 and 2011. However due to growth of its competitors, incapability to follow the smartphone trend and internal business issues such as delayed product launch and low focus on brand identity, one could say their hardware business has failed tremendously. In order to progressively recover their market position and profit level again, BlackBerry should focus more on the service business than the hardware

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