Nokia 1020 Channel Checks

| About: Nokia Corporation (NOK)

Now that the dust has settled on the new mega-camera, I wanted to see if the Lumia 1020 had actually helped Nokia (NYSE:NOK) gain market share in the States after a very lackluster debut.

It is well known that Nokia is having difficulty re-introducing its wares to the US market. Of the total Lumias sold in Q2, only 5% were sold in the United States, appalling when you consider the USA as one of the largest smartphone markets.

Despite a patchy track record, Nokia once again decided to award AT&T (NYSE:T) with an exclusivity agreement, pricing the phone at $299 on a two-year contract. From the unveiling event, the 1020 built up a large amount of interest with many positive reviews praising the quality of the camera and the sturdiness of the overall package.

Following on from these positive first takes, the company has increased their advertising presence while AT&T appears to have made a reasonable attempt at promotion, giving the phone the main banner on their Amazon shop.

Amazon in particular seems to point towards strong sales of the device with the 1020 currently holding positions four and five of the best-seller list.

It should be remembered that US sales will provide only upside to the beleaguered share price as the strategy has been an utter failure across the Atlantic. Therefore, please don't think of this as a reason to sell your shares when I tell you that the channel checks were not that encouraging.

I checked up on thirty or so stores spread across the states where Lumia 1020 Google Trends were highest. I chose 10 states and called one big box store and two authorised resellers from each state. Apart from New York, Washington & Dallas, sales were seen below expectations.

Store 1

A small store. Salesman has seen no sales but he does think there is an interest for those who like digital cameras.

Store 2

Has been selling okay but nothing special. People are complaining about the $299 price point.

Store 3

Has had a pretty okay launch, people are coming in specifically to buy it but really no blow out sales.

Store 4

Hasn't been selling.

Store 5

Lots of enquiries but not many sales. Outselling the 925 though.

Store 6

No good, they have only sold one and it got returned as the customer didn't like the OS. Price point is a big problem and they don't expect it to be a hit.

Store 7

Phone isn't selling well and they have got units in stock - it's a miss

Store 8

Not selling and currently out of stock. They have no need for getting any more. HTC Ones are in demand though.

Store 9

One sales guy has sold two. It's a small store but they haven't seen much interest.

Store 10

Sales have been okay, nothing amazing (store is a smaller store)

Store 11

Sales have been okay, trend will likely stay the same and they believe that the phone is priced too high.

Store 12

Sales have been quite good, not on par with other leading handsets but solid nonetheless.

Store 13

Selling comfortably, plenty of different price plans to make it more affordable.

Store 14

Selling okay but not as well as hoped.

Store 15

Selling pretty well. There are still a lot of other phones that outsell it, but the phone has been building momentum.

Store 16

Selling quite well but not on the same level as iPhone or Samsung, not even the HTC one. Apps are a problem.

Store 17

Selling surprisingly well and constantly selling out. Not on the same level as Samsung S4 and iPhone and would be better at $199.

Store 18

Sold two or three. A lot of interest but the price point puts most people off

Store 19

They haven't received it to stock, but haven't had any interest either.

I stopped writing after nineteen as the story became completely monotonous.

There is no doubt that the Nokia 1020 had caused a stir. A lot of storekeepers were keen to point out to me the incredible features and quality of the product but the problems seemed glaringly obvious to most staff members. The product is priced too high and the Microsoft (NASDAQ:MSFT) OS simply hasn't got the fanbase.

They also pointed out that not only was the phone outsold quite tremendously by iPhones and Galaxies (to be expected) but phones such as the HTC One were also superior performers. Despite Amazon (NASDAQ:AMZN) painting a solid picture of demand, the stores do not.

Fear not fellow Nokia acolytes as we all knew that this was to be expected and the European and Asian releases would be a LOT more important than US sales data. The UK and Europe will see full release on the 5th of September, 5 days before Apple (NASDAQ:AAPL) comes out with a pair of phones that will increase the pressure on one of our favourite come back kings.

In case you are new to my articles, you will know that my near-term Price Target is EUR3.90 // $5.20

I am looking forward to channel-checking Europe as this will definitely impact my portfolio and urge anyone following Nokia to pay attention to both this data as well as NSN's results from the China Mobile tender where whispers have come in line with expectations

Until then, thanks for reading and thanks to the AT&T staff for answering my petulant questions (apart from the one guy who hung up on me)

Disclosure: I am long NOK. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.