A chat with Nokia's Vesa Jutila, on retail incentives, carrier exclusivities and more

At Mobile World Congress this week, Nokia announced two new additions to its range of Windows Phone 8 devices, the Lumia 720 and Lumia 520 (be sure to check out my hands-on first impressions of the new handsets). The man in charge of overseeing how these devices will be promoted to an increasingly crowded market is Vesa Jutila, Nokia’s global head of smartphone marketing.

Many of you answered the call to submit your own questions to put to Vesa, both here on Neowin and by tweeting me @gcaweir, and in an interview today here in Barcelona, I probed him - figuratively - on a range of issues, including some raised by you folks out there, to find out more about how Nokia plans to promote and market the new devices, the thorny issue of carrier exclusivity, where Windows Phone 7.8 fits into all of this, and the curious rise of big screen sizes.

Before we get into the interview itself, let me just say a big thank you to all of you who submitted your questions and shared your thoughts, and although there simply wasn’t time to ask every question that you submitted, I hope you’ll find at least a few of your queries have been dealt with. Thanks also to Vesa Jutila and Nokia's Ray Haddow for their time.

So, let’s start with yesterday’s launch. How do you feel it went, and what sort of response have you seen from those who have played with the new devices?

I feel so good about it, and the response from the media and from people that I’ve been talking to about it has been very, very positive. When last year we announced the 920 as the world’s most innovative smartphone, we got a LOT of interest, and it really put the Nokia brand back into the high end of the smartphone space. What we announced yesterday shows that we’re bringing a lot of this high-end innovation to completely new price points.

Look at the 720, for example. It’s a sleek and stylish mid-range product with a beautiful unibody design that Nokia is known for, and at a mid-range price point – but at the same time we’re bringing a similar level of high-end imaging performance and camera quality into a totally new price point. In fact, we’re bringing beautiful high-end imaging into a price point that nobody else can come close to.

So where exactly do these new devices slot into the Lumia range, given that the Lumia 620 is already available as a budget-friendly handset?

The 720 sits nicely between the 820 and 620--

…so it’s literally numerical order.

It’s kind of numerical order, in terms of price and feature set. So the 820 is shipping at around €300 – consumer price, before taxes – and the 720 is coming at €249, so it’s a step down with a big margin between them.

The reason I ask is that there's surely a significant overlap between the new 720 and the existing 820 and 620.

No, I think there’s loads of room there. If you think about the consumer price points, the 620 is below the €200 price point, the 720 at €249 and the 820 at €300--

…but pricing aside, where’s the actual differentiation between these devices?

Well, let’s compare the 820 and 720. The 820 supports 4G LTE radio for example; it also has the same 1.5GHz dual-core processor as the 920; the 720 has a 1GHz dual-core processor and less RAM, and no LTE. So the 720 is targeted at markets where LTE is not such a big thing; it’s primarily designed for markets like China and Asia-Pacific, where LTE isn’t big but people still want a high-performance, high-calibre smartphone, and at the price point we’re looking at, the 720 will be an aspirational product for many of these emerging markets where people aren’t able to afford the most expensive flagship products.

The 620 is a much more youthful device; we’re targeting younger consumers with it. We aimed to make the whole design a bit more groovy and kind of different. The 520 delivers the same user experience but at a lower price point, being the most affordable Windows Phone 8 Lumia in the family. Having a big screen on affordable devices is very important, especially in these emerging markets like China, where screen size is a big purchase criterion and highly competitive, because many of the competing products at this price point will only have a 3.5-inch or 3.8-inch screen.

But the user doesn’t have to make any compromises when they get the 520. We want to deliver a better smartphone experience, whatever Lumia you choose, at any price point.

Nokia believes that its imaging expertise is an important differentiator across all price points

Let me just pick on that issue of price points. We’ve seen the dominant rise of Samsung and Android, and the fall of Nokia’s global smartphone share, over the last couple of years. Can Nokia still compete effectively by attacking all price points at the same time – or is there a risk that by trying to fill every gap will make Nokia a jack of all trades but master of none?

Well, the fact is that we’re going through a major transition. Of course, our smartphone share decreasing relates only to Symbian smartphones; now with Windows Phone products, we’re just picking up speed – and now we have all the assets we need, in terms of a full portfolio of great products to execute on. This year, and going forward, it will be about just, you know, getting these devices into the hands of more and more consumers, because we know that when people switch to Lumia, they love it, and don’t want to switch back to what they had before, and they recommend it to their friends.

We need to put a lot of effort in to make sure that we build awareness, that we build on that preference, especially at retail. We need to make sure that our key experiences – like imaging, Nokia Music, HERE Maps – easily come to life at the point of sale.

I absolutely don’t believe that we have too many products or that we’re too broadly [approaching the market]. We have a very competitive family of products to really effectively address different segments, different geographies and different price points.

Affordable devices were the core theme of Nokia's MWC announcement this year

One of the big themes of yesterday’s launch was making smartphones more affordable, particularly with the low-cost 520. But how effective do you think that effort will be in competing in a market that’s been flooded with cheap Android handsets?

It’s all about the experience, delivering a better experience in a smartphone. We know that even people who can’t afford to buy a more expensive smartphone don’t want to lower their standards. We believe that if you put the 520 next to an Android in the same price point, the experience and overall feel to it is better.

So what are you doing with carriers and retailers to make sure that that comparison is made in stores?

We do a lot. This year, you’re going to see much more focus from Nokia on retail execution. When it comes to the 520, we’re not going to rely that much on traditional media spending – not necessarily much TV advertising and so forth – but we’ll focus our investment more on retail stores. We’ll make sure that retail staff are well trained, to have the information that they need to promote and talk about the device and the great experiences [that it offers]. Taking Cinemagraph photos in the store, for example, trying Nokia Music on the device… empowering retail staff to bring the experience to users and show what’s different.

And are you incentivising retail staff?

Ray Haddow: We’re not financially incentivising; we encourage sales through better training but there’s no financial incentive.

Just returning to product positioning, the low-cost of the 520 seems to sit slightly uneasily with the Windows Phone 7.8 devices that you’ve launched relatively recently – the Lumia 510 and 610. Are you accelerating the pace at which Windows Phone 8 will trickle down to the cheapest devices?

Over time, Windows Phone 8 will of course be our only platform for the future, but we still have some great Windows Phone 7.5 and 7.8 devices out there, and they have their own role. Price point-wise and channel-wise; we’re playing things differently. It will seldom be the case that you’ll find a 510 and 520 on the same retail shelf. So we’ll be playing things tactically, but there will certainly be room for both [WP7.x and WP8] in the months to come.

Does that not create problems from a marketing point of view, having to promote a ‘split’ operating system?

Vesa: It’s not really split; all of our Windows Phone devices deliver the same Lumia experience. We have the same key applications – Nokia Maps, Nokia Drive, Nokia Music and such – everything is available across our devices, and that’s what matters much more than what the underlying OS is for end-users.

Ray: When we launched the Lumia range, we only had Windows Phone 7.5 at the time, and now those products are sort of coming to the end of their natural life cycle, the upgrade to 7.8 is there, which gives you the Windows Phone 8 look and feel, and experience in terms of the tiles and stuff. In terms of product life cycle, they’re sort of coming to an end anyway. There’s a sort of natural evolution going into Windows Phone 8. There’s no real crossover at retail.

Vesa: Just to add to what Ray said, 7.8 offers users a great way to get used to the new Windows Phone 8 user experience, and then of course a natural path to upgrade to 8 at some point.

No Nokia HERE... the company has rebranded its cross-platform location-based apps.

Nokia’s in-house apps are a clear differentiator in marketing terms, although we’ve seen some of those location services being rebranded, dropping the Nokia name and taking on the HERE brand. Is that not a wasted marketing opportunity, in terms of being able to promote the Nokia brand to customers on competitor devices, and even rival platforms?

We wanted to brand the HERE services with a separate brand to Nokia, because we wanted it to represent a horizontal offering across platforms and devices. The HERE brand is very much the same essentially as what the Nokia brand is delivering. With HERE getting more awareness, more attraction, and the apps also being rebranded on Lumia devices, that will bring value back to the Nokia brand too.

Moving on to issues of carrier exclusivities… this is something that’s frustrated many Neowin readers and many consumers out in the real world, particularly those trying to get a Lumia 920. Why does Nokia enter into such exclusivity arrangements?

Well, I think the 920 is a bit of a different case, because it was our ultimate flagship handset – so we wanted to be very focused with our launch strategy. We wanted to guarantee the right support from the carriers on retail execution, having live demos in place, getting retailer training done... and we didn’t want to start too broadly, to jeopardise the success of the launch.

The 820 is available more widely, and for devices such as the new 720 and 520, they’ll be made available much more broadly right from the start.

Are you seeing significant carrier and retailer demand in those markets where the 720 and 520 will be offered? Are they eager to offer these handsets to their customers?

The 520 will be such an important device for us. For example, in Europe, the carriers tell us that [the 520] is entering now into a sweet spot in the market, where carriers want to migrate current feature phone users to smartphones, to sell them a data plan and get them to use additional services, and the 520 is a great vehicle for them to boost their business models.

Many of our readers have wondered whether there’s any room in the Lumia range for a ‘flagship’ device in a smaller form factor. Does every flagship have to come with an enormous screen?

That’s a big question. How do you define a flagship? If you look at a device like the 720, it has so much of the same innovation that the 920 is delivering, yet in a more accessible form factor, beautiful 4.3-inch screen, great camera… and we believe this will be the flagship for many people who don’t want to pay so much or don’t necessarily want the very latest and greatest—

Nokia believes that the 720 can be pitched as an "affordable flagship" in key markets

…but since you’ve not made one yet, presumably, you’re not seeing the demand from users wanting a 3.5-inch device, say, with the same features as the 920 or 720?

Well, we’re seeing an increasing trend for larger screen sizes. We believe that the 4.5-inch screen in the 920 is optimal for a high-end smartphone experience; 4.3-inch is very optimal for a nice device with a very slim form factor like the 720 as well. Typically, you’ll see that as the price goes down, the screen size goes down too. But we went against that trend by putting the 4-inch screen into the 520, because we’re seeing that a large screen size is becoming such an important criterion for people who want to buy a device.

Are we now looking at a ‘complete’ Nokia range?

For the time being, yes. We have a nice set of products addressing different segments, different geographies, different price points, but of course we continue to invest in new technologies, and of course you’ll be seeing new innovations coming to devices.

So we might see a new flagship above the 920? A new entry-level device below the 520?

We are absolutely not stopping here. But now, for the time being, we’re fully focused on getting these devices into the hands of millions of people.

With the clock ticking, I have to ask my final – and perhaps most important – question from our readers: do you have any plans to bring back Snake?

Ray: Just yesterday, I was showing a phone to someone on the stand over there, and the first thing he asked me was “Does it have Snake?” – and this was the 105, the new €15 device. And he said “Awesome, I’m gonna buy one!”

Vesa: I look forward to anybody bringing lots of new versions of Snake to Windows Phone 8; it would bring back some happy memories…

You need to release it as an Xbox LIVE title!
Why not!

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