Vertu Case Study

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Individual Case Study ‟Vertu: Luxury redefined” “We are not in the hundreds of thousands [per year] yet, but our aspirations are there.”1 - Chris Harris, marketing director, Vertu, in August 2006. “We understand communications technology. We believe now that we understand the luxury industry. It will take something for competition to match that.”2 - Nigel Litchfield, president, Vertu, in 2002. Introduction Vertu, headquartered in the UK, was established by Nokia –then the world’s largest mobile phone maker- as a subsidiary in 2002. Although the idea to create exclusive luxury phones was first conceived by Frank Nuova, the chief designer of Nokia, in 1995, it was several years before it took shape. “In 1995, Frank Nuovo, had an idea that mobile communication devices would one day be available not just in the mass market, but also in the luxury market. That idea was discussed and talked about for several years,”3 said Nigel Litchfield, president, Vertu. In August 2006, Vertu, announced that it was unable to meet the demand for its luxury phones and would increase its production capacity in the near future. The mobile phones, or personal communication instruments, as they were referred to in the company’s communications, were priced between US$ 4,900 and US$ 50,000 (as of 2006). The phones were handcrafted with high quality components including precious stones. The more expensive models were made of platinum. Vertu had invested considerable money as well as time in conceptualizing and creating its range of luxury phones. These extremely expensive phones were primarily targeted at young and successful businessmen. Vertu realized early that mobile phones, far from being just a communication device, would also come to reflect the personality of their owners. While the Vertu phones evoked a good response, some analysts doubted whether the interest would be sustained. As

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