At the dawn of the economic crisis, many believed the Hungarian-based NNG would struggle to find its place in the navigation market with its then primary focus on developing solutions for personal navigation devices (PNDs).
The company, which is best known for its award-winning iGO Navigation software, shifted its business strategy in 2006-2007 from a focus on consumer electronic devices to the automotive OEM and wireless market. This move from B2C to B2B client portfolio has positioned NNG as one of the leading white label suppliers of navigation software for Tier 1 providers, and among the biggest names in the automotive navigation and services industry.
NNG believes its international success can be attributed to timing – realizing ahead of its competitors when it was time to find a new market in which to apply its technology and generate demand. In 2008 – seeing that the PND and personal navigation assistant (PNA) market had consolidated and sales had shifted to regions where populations were just getting acquainted with car ownership – NNG made a bold statement: “navigation will be an elementary onboard solution in every vehicle’s infotainment system”.
This then radical view lead the company to focus on automotive line-fit, targeting Tier 1 providers with its iGO Navigation product. Partnerships have been developed and strengthened with influential hardware brands like Alpine, Clarion, Fujitsu TEN and Pioneer. These essential business relationships find NNG with commitments under contracts for over eight million units for OEMs in different parts of the world.
Its success can also be linked to the company’s conscious efforts to thoroughly interview and test its applicants, with a goal of having the highest level of competency of any of the Hungarian technology companies: 80% of employees are software engineers who go through a rigorous test before being accepted into the company.
“Nobody believed that our small company could enter such a saturated and austere international environment, where product lifecycles follow a typically comfortable pace. Today our navigation software is running in seven out of the top 10 selling auto manufacturers’ cars and we have supplier agreements with a total of 25 car brands” says Peter Balogh, one of the founders and the CEO of NNG.
One of NNG’s unique selling points is the capability to offer its partners a wide range of flexible navigation solutions. The iGO Navigation engine – the heart of all navigation solutions – can be customized and composed to provide either 100% turn-key, custom-built or one of a selection of comprehensive SDKs. NNG continues to invest heavily in the aggregation of a wide selection of content and services in the industry, enabling the company to deliver not only navigation solutions but also content and location aware solutions.
NNG also offers a user-friendly end-to-end solution to meet consumer expectations for up to date content, as well as connected services. With the Naviextras.com portal NNG created and deployed a full ecosystem for aggregating content and services from nearly 80 map and other content providers globally, with coverage of over 115 countries. After compiling the content and services, the NNG delivers them through a flexible commercial environment directly into the embedded software in the car. This portal offers online map and content updates to over 1.4 million users worldwide, providing support for more than a thousand different device types from more than 220 brands around the world. In the first half of 2012, Naviextras.com posted a significant 102% increase in revenue compared to the same the period in 2011.
Through a recent global partnership with Vodafone, NNG has extended its services range for the automotive industry. NNG can now bundle a Vodafone M2M SIM card with its software products. This solution includes software, content, services and global localization. Next to the development of connected features – such as Online Traffic, Online Alert Points and Local Search – NNG is now able to deliver a complete connectivity solution to its OEM partners.
Highlighting the company’s resourcefulness, NNG’s Senior VP of Automotive OEM Sales, Jim Nardulli says: “We saw early on that it’s one thing to find content and services, but it’s another thing to be able to go out and actually deliver those all the way. Not just stop at some point. We handle the commercial side on both ends: managing contracts around the world at the wholesale level and managing the e-commerce on the consumer level on the delivery. All of this is done on a white label basis – we do it for some of the largest brands on earth, which allows us to maintain our direct-to-OEM relationships”.
This strategic shift helped to perpetuate a solid path for NNG, with a total of 20 million licenses expected to be shipped to partners in the next three years – the majority connected to automotive sales. Eighty percent of NNG’s business comes from the automotive industry and the company forecasts a 60% increase in gross margin for 2012, confirming the upward trend due to sales to automotive industry partners.
Despite the declining global demand for PNDs, the company has maintained its legacy revenues from consumer markets, with a strong focus on emerging markets. NNG has also expanded its global footprint to react more quickly to market demands. Asia markets are now directly in the company’s focus, with new regional offices in India and China which provide localized expertise in those markets.
The company plans to enter the Japanese market as its next step in its’ globalization effort. This fast-growing company has also moved this fall to a new headquarters building in Budapest to accommodate its expanding number of experts in software development. The software company starts 2013 with 400 highly competent employees in a bright and shiny new office – ready to take on the next challenge, it says.
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