Research Report MBA (043) On COMPARATIVE ANALYSIS OF MARKETING STRATEGIES OF VODAFONE AND AIRTEL

SUBMITTED TO Gautam budha technicaql university,lucknow TOWARDS THE PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE OF MASTER OF BUSINESS ADMINISTRATION GUIDED BY Mrs.SMRITI SRIVASTAVA SUBMITTED BY SANKALP PURWAR ROLL NO.1005670076

Session 2011-2012 Department of Management

BABU BANARASI DAS NORTHERN INDIA INSTITUTE OF TECHNOLOGY

Sector I, Dr. Akhilehs Das Nagar, Faizabad Road, Lucknow (U.P.) India

PREFACE

project

research

is a

systematic &

scientific

in

investigation

for

identifying a specific problem or study in a particular area in t h e organization & thereby analyzing the same to give the best solution.T h i s p r o j e c t is also an attempt to study the comparative analysis of marketing strategies of Vodafone and project telecom respect to is tostudy the sector and airtel. T h e objective of doing the two

competitive all the

advantages between necessary

collect

information with

marketing strategies they adopted in their company. The different

information about the organization in different fields has given me a wider exposure.I have applied the concepts & gained knowledge learned during thecourse at IME in the practical business situations & thus have understood these concept in a better way.The research work really have poured of immense learning for me.

SANKALP PURWAR

ACKNOWLEDGEMENT
`I sankalp purwar, sincerely thankful to all those people who have been giving me any kind of assistance in the making of this project report.i express my gratitude to mrs.smriti srivastava who has through her vast experience and knowledge has been able to guide me, both ably and successfully towards the completion of the project. i express my gratitude to BBBNIIT would hereby, make most of the opportunity by expressing my sincerest thanks to all my faculties whose teachings gave me conceptual understanding and clarity of comprehension, which ultimately made my job more easy. credit also goes to all myfriends whose encouragement kept me in good stead.their continuous support has given me the strength and confidence to complete the project without any difficulty.last of all but not the least i would like to acknowledge my gratitude to the respondents without whom this survey would have been incomplete.i am also thankful to authority of airtel & vodafone for providing me the information.

SANKALP PURWAR

TABLE OF CONTENT
S.No Particulars

Page no.

1. 2. 3. 4. 5.

Executive summary Objective of the study Significance of scope Introdution of the topic Company profile of Vodafone & airtel Research methodology Data analysis and interpretation Findings & conclusion Suggestions & recommandations Limitations Bibliography Annexure

6. 7.

8. 9. 10. 11. 12.

EXECUTIVE SUMMARY
Telecom Sector In India Than 125 million telephones network is one of the largest communication networks inworld, which continues to grow at a blistering pace. The rapid growth in the telecom sector can be attributed to the various pro-active and p o s i t i v e thegovernment spirit of the as well telecom as policy the measures taken by

dynamic providers

a n d entrepreneurial in private and

various

service

both

publicsector. The telecom sector has shown impressive growth during the past decade. Today,more Two striking features of this growth viz. increasing preference for mobile phones andhigher contribution of private sector in the incremental growth have predominated thetelecom sector. The share of mobile phones (including WLL mobile) has overtaken theshare of landlines with 62% in the total number of phones. The private sector's contributionis also increasing rapidly. Currently more than 30 lakh phones are being added each monthand it is targeted that by the end of 2008 the total number of phones may reach a level of 350 million taking the teledensity to more than 30% which is currently at 24.63%.

Network Expansion: The total number of telephone subscribers has reached 291.62million at the end of January 2012 as compared to 242.87 million in July 2011.The

overallTeledensity has increased to 23.63% in January 2012 as compared to 21.20% in August2011. Wireless Service : The wireless segment saw a surge of 8.77 million subscribers last monthcompared to 8.17 million in December2007. This pushed the total wireless subscribers baseto 242.40 million by Jan 31 2011. Wire line Subscribers: The wire line segment subscriber base stood at 39.73 million witha decrease of 0.16 million at the end of January 2012. Teledensity: The gross subscriber base reached 206.83 million at the end of March 2011.The Teledensity is 24.63%at the end of January 2012 as compared to 18.31% at the end of March2011, registering an increase of 6%. Increasing Role of Private Sector: The private sector has played a significant role in the growth of telecom sector. The share of private sector has risen to 85 per cent in December 2011 from 64.14 per cent in November 2010.

Tariff Rebalancing Measures: There has been a dramatic fall in the tariffs due toincreased competition. The minimum effective charges for local calls

h a v e f a l l e n considerably in recent months especially for cellular service. The long distance domestic aswell as international charges have also fallen considerably. Telecom Regulatory Authority of India (TRAI): T R A I w a s e s t a b l i s h e d u n d e r t h e Telecom Regulatory Authority of India Act, 1997 enacted on March 28,1997. The goals a n d o b j e c t i v e s o f T R A I a r e f o c u s e d t o w a r d s p r o v i d i n g a r e g u l a t o r y f r a m e w o r k t h a t facilitates achievement of the objectives of New Technology Policy (NTP) 1999. TRAI has endeavored to encourage greater corporation in the telecom sector together with better quality and affordable prices.

OBJECTIVE OF THE STUDY

Every organization has to achieve its organization goals. For this it i s v e r y e s s e n t i a l f o r a n organization to know about the view of consumers and their competitive products. This survey research may be also aimed as to estimate potential buyer for the product. The objective of thestudy is as under:1.To identify the difference between market performance of Airtel and Vodafone. 2.To study the market of Airtel and Vodafone on big scale telecommunication sector. 3 . To compare various parameters of marketing strategies, manufacturing process, technology adopted production policy, advertising, collaboration, export scenario,future prospect for the two companies and government policies. 4 . To study customer buying behavior and factors which influence the purchase decision process .5.To know how the company has been successful in encountering the aggressive marketing strategies of competitors.

SIGNIFICANCE AND SCOPE

1.To identify the difference between market performance of Airtel industry and Vodafone.
2. To study the market of Airtel Industry and Vodafone on big scale telecommunication

sector.
3.To compare various parameters of marketing strategies,

manufacturing process,

technology adopted Production policy,advertising,collaboration, export scenario, future prospect for the two companies and government policies. 4.To study the level of customer satisfaction in Airtel & Vodafone. 5.To study customer buying behavior and factors which influence the purchasedecision process. 6.To study consumer preferences. 7.To study the consumer trend in telecommunication sector. 8.To study competitive marketing strategies adopted by Airtel and Vodafone

INTRODUCTION OF THE TOPIC

10

A brief history of Telecom sector in India In the early 1990s, the Indian government adopted a new economic policy aimed at improvingIndia's competitiveness in the global markets and the rapid growth of exports. Key to ach ievingthese goals was a world-class telecom infrastructure. In India, the telecom service areas are divided into four metros (New Delhi, Mumbai, Chennai andKolkata) and 20 circles, which roughly correspond to the states in India. The circles are further classified under "A," "B" and "C," with the "A" circle being the most attractive and "C" being theleast attractive. The regulatory body at that time the Department of Telecommunications (DOT) allocated two cellular licenses for each metro and circle. Thirty-four licenses for GSM900cellular services were auctioned to 22 firms in 1995. The first cellular service was provided by,Modi Telstra in Kolkata in August 1995. For the auction, it was stipulated that no firm can win inmore than one metro, three circles or both. The circles of Jammu and Kashmir and Andaman and Nicobar had no bidders, while West Bengal and Assam had only one bidder each.In 1996, the Telecom Regulatory Authority of India (TRAI) bill was introduced in the Lok Sabha,and the president officially announced the TRAI ordinance on 25 January 1997. The governmentdecided to set up TRAI to separate regulatory functions from policy formulation, licensing andtelecom

operations. Prior to the creation of TRAI, these functions were the sole responsibility of the DOT.

11

High license fees and excessive bids for the cellular licenses put tremendous financial burden onthe operators, diverting funds away from network development and enhancements. As a result, by1999 many operators failed to pay their license fees and were in danger of having their licenseswithdrawn. In March 1999, a new telecom policy was put in place (New Telecom Policy [NTP]1999). Under this new policy, the old fixed -licensing regime was to be replaced by a revenue-s h a r i n g scheme whereby between 8-12

p e r c e n t o f c e l l u l a r r e v e n u e w e r e t o b e p a i d t o t h e government.

INDIAN CELLULAR MARKET - EARLIER ROADBLOCKS AND THEIR RESOLUTION Indian Cellular market immediately after the first round of licensing in 1994 96 was beset byseveral problems for 3 - 4 years till the New Telecom Policy of 1999 was announced. Some of these roadblocks / current position is tabulated below:

12

ROADBLOCKS CURRENT POSITION High license fees Migration to revenue sharing mode in 1999 mitigates high initial fund requirements for payment of license fees.Inadequately funded businesses / weak and fragmented promotersB u s i n e s s e s t h a t h a v e s i n c e b e e n a d e q u a t e l y f u n d e d g r o w i n g a t o v e r 6 0 % p e r a n n u m , w h i l e businesses with weak promoters continuing to languish - spate of acquisitions / mergers, with 4/5major groups emerging in the last one/two years. Regulatory authority not in place Telecom Regulatory Authority of India (TRAI) firmly in place, and its role being accepted by alloperators; Deptt of Telecommunications (DOT) operations and policy makingroles vested in different bodies. Issues relating to unfavorable interconnect terms for private operators, pass through income, intracircle long distance, spectrum availability and allocation and the like remained unresolved for long periods. Interconnect terms since rationalized, risks on pass through income to DOT / AIRTEL( M a h a n a g a r T e l e c o m N i g a m L t d . ) r e s o l v e d t o t h e s a t i s f a c t i o n o f a l l p a r t i e s w i t h c h a n g e s i n methodology / revenue sharing, intra circle long distance allowed, spectrum availability cleared with vacation of frequencies for usage by GSM operators. restructured, with

13

Problems in Financial closures due to: Licensing tenure of 10 years Large upfront cash requirements from promoters due to heavy license fee burden in initialstages of deployment Asset based financing approach by Indian Financial Institutions. Licensing tenure increased from 10 to 20 years Large upfront cash requirements for license fee payments mitigated w i t h m i g r a t i o n t o revenue sharing mode allowin g promoters to deploy more capital for capital expenditure; project financing being considered by most financial institutions.

Foreign ownership / change of partner limitations Foreign ownership norms clarified, and change of partners allowed as a matter of routine allowingease of entry / exit - paves the way for full control of businesses by foreign companies. Inadequate growth of market / subscribers Roadblocks spelt out earlier resulted in low market / subscriber g r o w t h , b u t w i t h c o r r e c t i v e measures taken, market / subscriber base expected to zoom.

14

DEVELOPMENTS IN THE CELLULAR INDUSTRY The interconnection regime between cellular operators and fixed -line

operators is still biasedagainst the former. Despite the recent gains of the cellular industry, not everything is rosy. The cellular penetrationrate is still very low at 0.8 percent in a nation of over one billion people. In recent years, many foreign companies had pulled out from their cellular joint ventures in Indiadue to the difficult operating environment and bureaucracy. In 1999 alone, Swisscom pulled outfrom Sterling Cellular, Telstra from Modi Telstra and both the Telecom Organization of Thailandand Jasmine International from JT Mobile. In 2000, Telecom Malaysia sold its stake in Ush aMartin Telecom, and both Shinawatra of Thailand and Bezeq exited from Fascel. In June 2001, B r i t i s h Telecom exited from Airtel Cellular. Bell South International has also i n d i c a t e d i t s intention to pull out from Skycell Communications, and Hong Kongbased Distacom is seeking to s e l l i t s s t a k e i n S p i c e C o m m u n i c a t i o n s . First Pacific's (based in Hong Kong) c o n t i n u e d commitment to

Escotel is uncertain, and the former is reviewing various options. The string of sell-outs notwithstanding, there has been a merger and acquisition wave sweepingacross the Indian cellular industry in recent years. Hong Kong-based Hutchison Whampoa, viaH u t c h i s o n

Telecommunications (HK), acquired major stakes in Sterling Cellular ( D e c e m b e r 1999), Usha Martin Telecom (mid-2000) and Fascel (September 2000). Through a partnershipwith local company, Kotak Mahindra Finance,

15

Hutchison Whampoa practically controls Fascel and Usha Martin Telecom, thus circumventing the 49 percent limit on foreign ownership in Indiancellular operators. Hutchison Whampoa is also the controlling shareholder of Hutchison MaxT e l e c o m . N o t t o b e o u t d o n e , A i r t e l E n t e r p r i s e s a n o t h e r m a j o r c e l l u l a r p l a y e r a c q u i r e d control of JT Telecom, which was later renamed Airtel Mobile (December 1999), and SkycellCommunications renamed Airtel Mobinet (August 2000). Airtel also acquired the Punjab licenseo f started operations, giving competition to Essar the and lone

o p e r a t o r t h e r e , S p i c e Communications. Going forward, Airtel is likely to merge all its cellular companies into one entity.

Five companies together bid Rs16.3 billion to bag the licenses for the fourth operator slots in four metros and 13 circles. Airtel emerged as the No. 1 bidder with eight new licenses, followed byEscotel with four, Hutchison with three, and Vodafone and Idea cellular with one each. Airtel andHutchison have already commenced operations in all the circles while Idea is set to launch in Delhi. Escotel and Vodafone have not made any headway. AIRTEL, the third cellular operator for Delhi and Mumbai, started services in March 2001. BSNL,as the third nationwide cellular operator, launched services in Kolkatta and Bihar in January 2002.This was followed by Tamil Nadu in July 2002. A nationwide launch was scheduled for 2 October 2002. However, this has been postponed until after mid October. Once BSNL rolls out its service,m o s t t e l e c o m c i r c l e s w i l l h a v e f o u r c e l l u l a r o p e r a t o r s . T h e r e w i l l b e t r e m e n d o u s c o m p e t i t i v e pressure,

16

which will result in lower tariffs. Future rate cuts are expected, which will drive demand,together with falling handset prices and the introduction of prepaid services. In the midst of declining interest in technology stocks, Airtel came out with its longawaited initial p u b l i c o f f e r i n g ( I P O ) i n J a n u a r y 2 0 0 2 . L e v e r a g i n g o n t h e s u c c e s s o f i t s c e l l u l a r s e r v i c e , t h e company got a very good response from the primary market. The total size of the IPO was 185million shares at a floor price of Rs10. The issue was oversubscribed by more than 2.5 times,netting Rs8.3 billion. This will be used to fuel its investment in long distance, basic and cellular services. As of October 2002, only BPL Mobile has launched commercial general packet radio service(GPRS) in Mumbai. However, large -scale uptake remains elusive. While both Airtel and Ideahave GPRS-enabled networks, there is caution on their part to launch the service. With hardly anyapplications, the success of GPRS remains a question. In 2005 Hutchison Essar an Indian and hongko ng telecommunication alliance was taken over bythe United Kingdom based telecommunication company name Vodafone telecomm services and comes with the name of Vodafone essar Virgin mobile comes in Indian Territory with the alliance of TATA telecommunicationMaharashtra in 2008. Mitsubishi a Japanese telecomm services (MTS) company comes in India in 2009 and take over first rainbow in Rajasthan with CDMA network criteria.

17

Building visibility and awareness

Deviating from competing on the price platform, cellular operators are actively promoting their b r a n d and service portfolio through high -

v i s i b i l i t y a d v e r t i s i n g a n d p r o m o t i o n a l c a m p a i g n s . Cellular operators like Airtel, Orange and BPL Mobile have been advertising aggressively

onhoardings and kiosks. Public transport like the cityrail system and cabs are used widely to carry the message of mobility. Customer-focused activities are gaining traction among cellular operators with the establishmentof longstanding consumer benefit programs. Orange in Mumbai offers "Orange Holidays" and "Orange Monsoon Offers" at very attractive rates and added benefits like discounts on airfare, foodand beverages, among others. Others offer special privileges in retail outlets, cinemas and musicshops

18

Enterprise mobile applications promising revenue stream All along, customer acquisition and the top line have been the f o c u s . F e w o p e r a t o r s h a v e concentrated on offering differentiated services for businesses. However, as operators realize thatoffering basic voice and Short Message Service (SMS) will get them the numbers but not the m a r g i n s , some are now seriously looking at the enterprise segment for

p r o v i s i o n i n g s u p e r i o r services. Cost-centered solutions like closed user group (CUG), value -adds like unified messaging andinstant alerts are being offered. A variety of mobile applications are finding takers among the enterprise segment. Airtel is in the process of introducing a facility to fleet management companies so that they can improve thee f f i c i e n c y o f t r u c k s o r b u s e s b y t r a c k i n g m o v e m e n t a n d e n s u r i n g h i g h e r - u s e , a c c u r a t e r o u t e planning. Premium automakers are also installing a global system for mobile

communicationsinside a vehicle to help trace lost vehicles and track down stolen cars. Corporations can choose enhanced services like user-defined call routing to prevent misuse. Callsc a n b e b a r r e d , l i m i t i n g a c c e s s t o s e l e c t n u m b e r s a n d d i v e r t i n g c a l l s t o o n e s i n g l e n u m b e r . Broadcasting services are also quite popular, especially among fast food centers that have a centralnumber. Group SMS is quite popular, especially among enterprises both in the service as well ast h e f a s t - m o v i n g c o n s u m e r g o o d s ( F M C G ) s e g m e n t t h a t h a v e a large field force and need to provide regular updates on inve ntory status, discount schemes and movement of goods from w a r e h o u s e

19

to the retail outlet. Banks too find bulk SMS service very u s e f u l t o f o r w a r d transactional alerts to their customers.

FUTURE TRENDS AND DEVELOPMENT There will be more competition, forcing operators to constantly focus o n d i f f e r e n t i a t i o n s t o maintain their lead. The implementation of enhanced networks like 2.5G will enable operators to offer dataservices. This is an opportunity to customize and differentiate better. The entry of state-run operators like BSNL and AIRTEL means that prices will no longer be controlled, thus there is less chance of a cartel being formed. Network coverage in terms of geographic spread and quality of c o v e r a g e i s c r u c i a l especially for the business subscriber. The bigger the service provider's national presence, the better it is for businesses. On theroaming front, signing up with a national operator is advantageous. Limited mobility wireless in local -loop services (by fixed network service providers) will be a disadvantage for cellular operators in the short term. Consequently, operators need tostreamline their customer relation activities and adopt aggressive subscriber acquisition andretention strategies

20

Company profile of vodafone

21

Vodafone Group plc is a British multinational mobile network operator headquartered in Newbury, Berkshire, United Kingdom. Vodafone is the world's largest mobile telecommunication network company, based on revenue, and has a market value of about \u00a371.2 billion (November 2009). It currently has operations in 31 countries and partner networks in a further 40 countries. Based on subscribers, it is the world's second largest mobile phone operator behind China Mobile, with over 427 million subscribers in 31 markets across 5 continents as of 2009. In the UK, its home ground, Vodafone has badly underperformed in the last few years due to brisk change in administration. It has slipped from first to third largest telecom operator generating revenue of \u00a34.9 billion from its 18.7 million customers in 2008-09. As of March 31, 2009, the company employs more than 79,000 people worldwide \u201cThe name Vodafone comes from voice data fone, chosen by the company to "reflect the provision of voice and data services over mobile phones.\u201d

22

Marketing Analysis Product Profile

Company Profile will assists individual investors, managers and companies in evaluating opportunities, trends, market innovations, and selecting appropriate information solutions in order to make effective decisions. The report has been made after extensive research using the data available from reliable publications, trade associations and the companies sources. The report elaborates on the company's business structure and operations, products and services. The report includes key financial information and strategic analysis that intends to aid investors to find better prospects with the company and gain an insight into the corporate policies.

Target Customers

Positioning Vodafone as a younger, more dynamic network, based on brand personality and attitude, would have greater appeal for Vodafone's core 18 to 39 age target.

Positioning Strategies First brand in the category to develop a personality-based brand positioning.

Positioning Vodafone as a younger, more dynamic network, based on brand personality and attitude, would have greater appeal for Vodafone's core 18 to 39 age target.It would also further encourage the perception that Optus was moving in the

direction of Telstra's older, more conservative position

23

OUR VISION To enrich our customers lives through unique power of mobile communication. OUR PASSION 1. FOR CUSTOMERS: In anticipation of their customers trust Vodafone understands their needs & delightsth emes with its services. 2. FOR OUR PEOPLE: Outstanding people working together make Vodafone exceptionally successful. 3.FOR RESULTS: Vodafone believes in being action oriented & is driven by a desire to be the BEST. 4. FOR THE WORLD AROUND US: Vodafone believes helping people of the world to have fuller lives through their services & its impacts.

24

Business models Access to communications in emerging markets

Our research demonstrates that the needs of customers in emerging markets can be quite different from those in developed markets. This means we need to adopt different business models affecting network development, customer service and price plans according to local needs and what customers can afford. These are some examples of how we are tailoring our services to emerging markets:

Pre-payProviding flexible payment options helps to overcome credit barriers. For example, a pre-pay business model enables people to top up the credit on their phones as and when they need to, or are able to, rather than committing customers to a standard monthly charge. Pre-pay options (via cards, vouchers or electronic top-up schemes) are available in all our markets. We offer lower denomination pre-pay cards in emerging markets, to enable poorer customers to pay for just a small amount of call time at once. Reverse charge (No airtime? No problem!)Reverse charge enables people to make critical calls even when they have run out of credit. For example, Vodacom in South Africa offers a service where contract customers are billed for reverse charge calls made to them by family and friends. Customer service vans for rural regionsWe are bringing mobile services to rural communities in India through traveling phone shops. Vans drive from village to village in remote parts of the country, reaching people that otherwise would not have access to

25

mobiles. As the vans run as a franchise, they also provide the opportunity for local people to set up a small business. Self-service kiosks to top up pre-pay cardsVodafone Essar operates self- service phone kiosks in urban areas in India, which are open 24 hours a day. The kiosks offer a convenient, affordable way to top-up and provide information services for customers. Free callback requestsOur Please Call Me service in South Africa enables customers to send a free text message asking the recipient to call them back, even when the sender has run out of credit. The cost of running the service is covered by advertising that is included alongside the Please Call Me message. A similar service in Egypt enables customers to send up to three free Please Call Me text messages a day as part of our Wayak initiative

26

COMPANY PROFILE OF AIRTEL

27

Vision "As we spread wings to expand our capabilities and explore new horizons, the fundamental focusr e m a i n s u n c h a n g e d : s e e k o u t t h e b e s t t e c h n o l o g y i n t h e w o r l d a n d p u t i t a t t h e s e r v i c e o f o u r ultimate user: our customer." These are the premise on which Airtel Enterprises has based its entire plan of action. Airtel Enterprises has been at the forefront its of technology and has and

revolutionizedtelecommunications

with

world-class

products

services.Established in 1985, Airtel has been a pioneering force in the telecom sector. With many firsts andinnovations to its credit, ranging from being the first mobile service in Delhi, first private basictelephone service provider in the country, first Indian company to provide comprehensive telecomservices outside India in Seychelles and first private sector service provider t o launch NationalLong Distance Services in India. Airtel had approximately 3.21 million total customers nearly2.88 million mobile and 334,000 fixed line customers. Its services sector businesses include mobile operations in Andhra Pradesh, Chennai, Delhi,Gujarat, Haryana, Himachal Pradesh,

K a r n a t a k a , K e r a l a , K o l k a t a , M a d h y a P r a d e s h c i r c l e , Maharashtra circle, Mumbai, Punjab, Tamil Nadu and Uttar Pradesh (West) circle. In addition, italso has fixed-line operations in the states of Madhya Pradesh and Chhattisgarh, Haryana, Delhi,Karnataka and Tamil Nadu and nationwide broadband and long distance networks.

28

Airtel has recently launched national long distance services by offering data transmission servicesand voice transmission services for calls originating and terminating on most of India's mobile networks. The Company is also implementing a submarine cable project connecting ChennaiSingapore for providing international bandwidth. Airtel Enterprises also manufactures and exports telephone terminals and cordless phones. Apartfrom being the largest manufacturer of telephone instruments, it is also the first telecom companyto export its products to the USA.Airtel Tele-Ventures' strategic objective is to capitalize on the growth opportunities that

theC o m p a n y b e l i e v e s a r e a v a i l a b l e i n t h e I n d i a n t e l e c o m m u n i c a t i o n s market and consolidate i t s position to be the leading integrated

telecommunications services provider in key markets in India,with a focus on providing mobile services. The Company has developed the following strategies to achieve its strategic objective: Focus on maximizing revenues and margins; Capture maximum telecommunications revenue potential with minimum geographicalcoverage; Offer multiple telecommunications services to provide customers with a "one-stop shop"solution; Position itself to tap data transmission opportunities and offer a d v a n c e d m o b i l e d a t a services; Focus on satisfying and retaining customers by ensuring h i g h l e v e l o f c u s t o m e r satisfaction;
29

 Leverage strengths of its strategic and financial partners; and Emphasize on human resource development to achieve operational efficiencies.

BUSINESS Airtel Tele-Ventures current businesses include Mobile services Fixed-line National and international long distance services VSAT, Internet services and network solutions Broadband services with DSL and Wi-Fi network

30

Competitive Strengths Airtel Tele-Ventures believes that the following elements will contribute to the Company's successas an integrated telecommunication services provider in India and will provide the Company witha solid foundation to execute its business strategy: Nationwide Footprint - approximately 92% of India's total mobile subscribers resided in theC o m p a n y ' s f i f t e e n m o b i l e c i r c l e s . T h e s e 1 5 circles collectively accounted f o r approximately 56% of

India's land mass; Focus on telecommunications to enable the Company to better anticipate industry trendsand capitalize on new telecommunications-related business opportunities. The strong brand name recognition and a reputation for offering high quality service to itscustomers; Quality management team with vision and proven execution skills; and The Company's strong relationships with international strategic and financial investors suchas SingTel, Warburg Pincus, International Finance Corporation, Asian Infrastructure FundGroup and New York Life Insurance.

31

Brand Architecture: Airtel is working on a complex three-layered branding architecture to: Create specific brands for each service, Build sub-brands within each of these services and Use Airtel as the mother brand providing the group its corporate identity as wellas defining its goal to become a national builder of telecoms infrastructure.

32

BHARTI

AIRTEL(Cellular operations)

TOUCHTEL(Basic service operations)

INDIA ONE(National long distance)

Airtel The flagship brand for cellular operations all across the

I n d i a n country. Touchtel - The brand earmarked for basic service operations. India One - The brand for national long distance (NLD) telephonyT h o u g h t h e c o s t s o f c r e a t i n g n e w b r a n d s a r e h e a v y b u t t h e g r o u p w a n t s t o create d i s t i n c t i n d e p e n d e n t b r a n d s t o a d d r e s s d i f f e r e n t c u s t o m e r s a n d profiles

33

Brand Strategy
To understand the brand strategy, let s first look at the brand building exercise associated withAirtel a brand that had to be repositioned recently to address new needs in the market. When the brand was launched seven years ago, cellular telephony wasnt a mass market by anymeans. For the average consumer, owning a cellular phone was expensive as tariff rates (at Rs 8 aminute) as well as instrument prices were steep sometimes as much as buying a second -handcar. Airtel could have addressed the customer by rationally explaining to him the economic advantage of using a mobile phone. But Sachdev says that such a strategy would not have worked for thesimple reason that the value from using the phone at the time was not commensurate with the cost. Instead of the value-proposition model, we decided to address the sensory benefit it gave to thecustomer as the main selling tack. The idea was to become a badge value brand, he explains.S o t h e A i r t e l l e a d e r s h i p s e r i e s c a m p a i g n was launched showing successful men with their laptops and in their deluxe cars using the mobile phone. In simple terms, it meant Airtel w a s positioned as an inspirational brand that was meant for leaders, for customers who stood out in a crowd. Did it work? Repeated surveys following the launch showed that there were three core benefits thatwere clearly associated with the brand leadership, dynamism and performance.

34

These were valuable qualities, but they only took Airtel far enough to establish its presence in themarket. As tariffs started dropping, it became necessary for Airtel to appeal to a wider audience.And the various brand -tracking exercises showed that despite all these good things, there was no emotional dimension to the brand it was perceived as cold, distant and efficient.Sachdev and his team realized that in a business in which customer relationships were the core thiscould be a major weakness. The reason with tariffs identical to competitor Vodafone telecomm andr o u g h l y t h e s a m e l e v e l o f s e r v i c e a n d s c h e m e s , i t h a d n o w b e c o m e i m p o r t a n t f o r A i r t e l t o humanize Airtel and use that relationship as a major differentiation. The brand had become something like Lufthansa cold and efficient. What they needed was to become Singapore Airlines, efficient but also human. A change in tack was important because thiswas a time when the cellular market was changing. The leadership series was okay when you were wooing the crme de la crme of society. Once youreached them you had to expand the market so there was need to address to new customers. By that time, Airtel was already the leading cellular subscriber in Delhi with a base of 3.77 lakh (itnow has 1.8 million customers). And with tariffs becoming more affordable as cell companiesstarted cutting prices it was time to expand the market .How could Airtel leverage this leadership position down the value chain? Surveys showed that thec o n c e p t o f l e a d e r s h i p i n t h e c u s t o m e r s m i n d s w a s a l s o changing. Leadership did not meandirecting subordinates to execute

35

o r d e r s b u t t o w o r k a l o n g w i t h a t e a m t o a c h i e v e c o m m o n objectives it was, again, a relationship game that needed to be reflected in the Airtel brand. Also, a survey showed that 50 per cent of the new customers choose a mobile phone brand mostlythrough word-of-mouth endorsements from friends, family or colleagues. Thus, existing customersw e r e a n i m p o r t a n t t o o l f o r m a r k e t e x p a n s i o n a n d A i r t e l n o w f o c u s e d o n b u i l d i n g c l o s e r relationships with them. That is precisely what the brand tried to achieve through its new p o s i t i o n i n g u n d e r t h e A i r t e l Touch Tomorrow brand campaign. This set of campaigns portrayed mobile users surrounded byc a r i n g f a m i l y m e m b e r s . S a y s S a c h d e v : T h e n e w c a m p a i g n a n d p o s i t i o n i n g w a s d e s i g n e d t o highlight the relationship angle and make the brand softer and more sensitive. As it looks to expand its cellular services nationwide to eight new circles apart from the seven inwhich it already operates Airtel is now realizing that there are new compulsions to rework theA i r t e l b r a n d , a n d a n e w e x e r c i s e i s b e i n g l a u n c h e d t o t h i s e f f e c t . R i g h t n o w , t h e c o m p a n y i s unwilling to discuss the new positioning in detail. But broadly, the focus is on positioning Airtel asa power brand with numerous regional sub-brands reflecting customer needs in various parts of the country. If Airtel is becoming more humane and more sensitive as a brand, Airtel has also understood thatone common brand for all cellular operations might not always work in urban markets that are nowgetting increasingly saturated. To bring in new customers, the company decided that it needed to segment the market. One suchexperiment, launched last year, is Youtopia, a brand aimed at

36

the youth in the 14 to 19 age bracket and for those who are young at heart. W ith its earlier positioning, Airtel was perceived as a brand for the well-heeled older customer; there was nothing for younger people. W ith Youtopia, Airtel hoped to reverse that.In order to deliver the concept, Airtel offered rock bottom tariff rates (25 paise for 30 seconds) atnight to Y outopia customers a time when they make the maximum number of calls. It also setup merchandising exercises around the scheme like a special portal for young people to buythings or bid for goods.The company is now looking at offering other services at affordable prices to this segment whichinclude music downloads on the mobile and bundling SMS rates with normal calls to make it cheaper for young people to use.The other experiment that Airtel has worked on is to go in for product segmentation through theTango brand name. The brand was created to offer mobile users Internet-interface services or whatis known as WAP (Wireless Application Protocol).The idea was to bring Internet and mobile in perfect harmony. The name was chosen from the popular movie title It Takes Two to Tango: basically, you need the two services to tango to offer customers a new choice, says Sachdev.This, however, had less to do with the branding exercise as with inefficiency of service (accusinglyslow download speeds) and the limited utility of WAP services.Subsequently, the ads were withdrawn, but the company re-iterated that the branding exercise could be revived because Tango will be the brand to offer GPRS services or permanent Internet connectivity on the mobile phone which Airtel is expected to launch soon.

37

The Magic
Perhaps the more ambitious experiment has been with Magic the pre-paid card. The idea was tomake the brand affordable, accessible and, most importantly, feasible as a means of expanding themarket even faster. PHASE I Magic was aimed at bringing in infrequent users of a mobile phone into the market and assure himthat he would have to pay only if he made a call. Such a customer used the phone sparingly mostly for emergencies and was not willing to pick up a normal mobile connection with its relatively high rentals (pre-paid cards do not include rental charges). To achieve its objectives Airtel did three things. One, the product was made available at prices ranging from Rs 300 to Rs 3,000 with nostrings attached and was simple to operate. Two, the product was made accessible and distributed through small stores, telephone booths and even kirana shops so that the offering was well within arms reach. Third, to make the product more approachable to the customer, the company came with vernacular ad campaigns LikeMagic Daalo Say Hello which appealed to local sensibilities.

38

This apart, the company roped in Karisma Kapoor and Shah Rukh Khan for a major ad campaignall across Delhi, a ruse that saw the number of subscribers go up from 5.47 lakh to 1.2 million today, overtaking Essars branded pre-paid card Speed , which was launched much ahead of Magic.The company is now re-working its Magic strategy even further.E a r l i e r , t h e b r a n d i n g s t r a t e g y w a s a i m e d a t roping in only interested customers that is,customers who were already inclined to opt for mobile services. But now, with basic s e r v i c e providers having been allowed limited mobility at far cheaper rates, mobile service providers couldfind themselves under threat again.That is why the new exercise is aimed at co-opting non-adopters. While the exact strategy is under wraps, insiders say the new branding strategy would be aimed at offering them value which theyhad not perceived would be available from using a pre-paid card.

39

PHASE II Airtel used Airtel Magic to build a strong value proposition and accelerate market expansionthrough Indias first national pre-paid card TV brand campaign First time ever in India - any pre-paid card brand goes on TV A combination of the film genre exposed through the TV medium designed to connect with themasses of India Youth based - romance driven strategy platform makes the value proposition of Airtel Magic -Mumkin Hai come alive All elements - user imagery, context, tone & language created to connect the category to thelives of the SEC B & SEC C segment the middle class nonmobile user. Airtel Magic positions itself on the platform of being excellent for emergency situations -increasing productivity as a part of everyday life. Sharukh Khan makes everything in life possible while romancing pretty Kareena Kapoor with Airtel Magic, Indias leading pre-paid mobile card. Airtel today unveiled its strategy for market expansion with the launch of its new Airtel Magic pre-paid card brand campaign Magic hai to Mumkin hai. The strategy is targeted at the non -user s e g m e n t d e f i n e d a s y o u n g a d u l t s , 1 5 - 3 0 y e a r s o f a g e ; i n t h e S e c B & C s e g m e n t i s a i m e d a t accelerating market expansion. The value proposition is centered around a persons desire to makeall his / her dreams, ambitions & aspirations instantly possible. The new campaign for AirtelMagic is all about empowering millions of Indians to be on top of their lives.The brand is positioned to be relevant to the mass -market who want

40

to make all their dreams,hopes & desires come alive instantly. (At just Rs.300/- per month Airtel Magic is so easy to buy.) Improving productivity, letting you befriend the world and opening up new horizons. Itgives you the freedom to control your life in a way never possible before. Indeed, anything thatyou think is possible is possible with Airtel Magic. The new brand slogan Magic hai to Mumkinhai has been specially created to capture this effectively. This strategy is designed to help us talk to this segment directly in the tone, manner & language of the masses. The Mumkin hai value proposition will help us expand the market and gain a higher percentage of market shares in the process.The brand ambassadors Shahrukh Khan and Kareena Kapoor embody this can do or Mumkin Hai spirit (infact that is the reason they were selected as brand ambassadors). Sharukh rose froma TV actor to become Indias top film star and national heartthrob. Kareenas success is due to her attitude, talent, hard work and the sheer ability to make a mark in such a short time. Both thesestars have said Mumkin hai and made it happen for themselves.The genre of this new strategy & campaign is Hindi cinema led. This genre connects millionsa c r o s s I n d i a . T h e s p i r i t o f r o m a n c e , d a n c i n g t h e I n d i a n c i n e m a , w e l l k n o w n t o m o s t a s Bollywood, holds millions of Indians together as one.The new TV campaign of Airtel Magic crafted in the Hindi film idiom, magnifies the empoweringoptimism of Mumkin Hai, in the endearing situation of a boy-girl romance. Where SharukhK h a n , s e t s h i s eyes on Kareena Kapoor and wins her love with the help of A i r t e l M a g i c . (Poignantly conveying that special feeling we all get when a dream is made possible and a victoryof the heart is won).The strategy & new brand

41

campaign is targeted at the large untapped base of intending mobilecustomers from Sec A, B & C. The estimated addressable market of such customers in the nextt w o y e a r s i s a r o u n d 2 5 m i l l i o n i n A i r t e l s 1 6 s t a t e s . T h e n e w s t r a t e g y a i m s a t c o r r e c t i n g t h e perception that the mobile category is useful mainly for business or work related scenarios.The new strategy, brand positioning & brand slogan is an outcome of an extensive nationwideresearch and is an integral part of Airtel Magics new multi -media campaign. The campaign has been created by Percept Advertising

PHASE III Airtel used Airtel Magic to build a strong value proposition and accelerate market expansionthrough Indias first national pre-paid card TV brand campaign First time ever in India - any pre-paid card brand gives such freedom to recharge any value A combination of the film genre exposed through the TV medium designed to connect with themasses of India Youth based - romance driven strategy platform makes the value proposition of Airtel Magic -Aisi azaadi aur kahan? come alive Sharukh Khan Makes everything in life possible Airtel today unveiled its strategy for marketexpansion with the launch of its new Airtel Magic pre-paid card brand campaign Magic Haito Mumkin Hai. . The value proposition is centered on a persons desire to make all his / her dreams, ambitions & aspirations instantly possible. The new campaign for Airtel Magic is allabout empowering millions of Indians to be on top of their lives.

42

The brand is positioned to be relevant to the mass-market who want to make all their dreams,hopes & desires come alive instantly .At a amount of your choice you can recharge your accountwith available validity time .Improving productivity, letting you befriend the world and opening upnew horizons. It gives you the freedom to control your life in a way never possible before.Indeed, anything that you think is possible is possible with Airtel Magic. The new brand sloganAisi azadi aur kahan has been specially created to capture this effectively.

Other Brand Building Initiatives The main idea is to stay ahead of competition for at least six months. Working on the above game plan Airtel is constantly coming up with newer product offerings for the customers.The focus, of course, is to offer better quality of service. To make the service simpler for customers using roaming facilities, Airtel has devisedcommon numbers for subscribers across the country for services like customer care, food servicesand cinema amongst others. It will also launch a unified billing system across circles so, customers moving from one place to another do not have to close and then again open new accounts at another place. To assist customer care personnel to deal with subscriber queries, a storehouse of 40,000frequently asked questions and their answers have been stored on the computers.
43

 Airtel expects that most of its new customers (one estimate is that it would be 60 to 70 per cent of the total new subscriber base) would come from the pre-paid card segment. So, they must be given value-added products and services which competitors dont provide. Airtel, for the first time for a cellular operator, has decided to offer roaming services evento its pre-paid customers, but the facility would be limited to the region in which they buy the card.To ensure that customers dont migrate to other competing services (which is known as churn andranges from 10 to 15 per cent of the customer base every month), the company is also working on aloyalty program. This will offer subscribers tangible cash benefits depending upon their usage of the phone. The loyalty program will not be only for a badge value, it will provide real benefits tocustomers. The idea is to create an Airtel community. Another key area which Airtel is concentrating its attention upon is a new roaming servicelaunched in Delhi under which calls of a roaming subscriber who is visiting the city will be routeddirectly to his mobile instead of traveling via his home network. The company also offers multi-media messaging systems under which customers having aspecialized phone with a in-built camera can take pictures and e-mail it to friends or store it in the phone. The cost per picture is between Rs 5 to Rs 7. Airtel is also aware that it has to make owning a ready-to-use cellular service much easier than it is today. A key area is to increase the number of

44

activation centers. Earlier Airtel had 250Airtel Connect stores which were exclusive outlets (for its services) and about 250 Airtel

Pointswhich were kiosks in larger shops. Now activation can be done by all of them, and not only byConnect outlets, all within 15 to 20 minutes. In comparison, the competition takes two to four hours. Pre- paid cards are really catching up with the mobile phone users and it is actually helpingthe market to increase. First, they are easier to obtain and convenient to use. Unlike post-paid, onen e e d n o t p a y s e c u r i t y d e p o s i t s for picking up a pre -paid card. It is often available even w i t h paanwalas. As befits a fast-moving consumer service, the game is now moving beyond price toe x p a n d i n g servicing a well-spread-out distribution with reach and

clientele

technology

andstrategic alliances. Airtel is focusing on two factors to make p r e - p a i d c a r d s m o r e a t t r a c t i v e . Keeping the entry cost low for consumers and making recharging more convenience. Airtel is in the process of launching a new system in alliance with M u m b a i - b a s e d Company Venture InfoTech which

will enable a pre-paid card user to renew his subscription by just swiping a card. The system will not only save users the hassle of going out and buying a carde v e r y time it expires but also enable mobile

c o m p a n i e s t o r e d u c e t h e c o s t o f p r i n t i n g a n d distributing cards. Airtel Televentures has tied up with 'Waiter on wheels,' a company delivering food athome, to reach its Magic pre -paid cards to

45

subscribers' doorsteps. The company is also joininghands with local grocery shops which will enable users to recharge their cards by j ust making a phone call to the shop. Apart from improving the convenience of recharging, mobile operators are beefing up their distribution channels. The company is constantly innovating to enhance the value proposition for its prepaid service. They are and leveraging deliver technology to expand their

distributionn e t w o r k

round-the-clock

recharge

o p t i o n s t o i t s M O T S ( M o b i l e o n t h e S p o t ) subscribers Airtel Cellular has also launched a special service, CareTouch, for high-value, corporatec u s t o m e r s , providing them with instant,

single-point access for any assistance they require.Customers can dial 777 and enjoy a slew of services, which includes e a s i e r p a y m e n t o f b i l l s , service on priority basis, and value -added services without any additional paper work. AirtelC e l l u l a r i s o f f e r i n g a range of services without going through an interactive voice r e c o r d e r ensuring that they save time. Dedicated CareTouch

executives are expected to assist customerswith any service on priority basis. Besides the regular proactive re minder calls for bill

payment,customers can also call CareTouch for bill payments at free of cost. Airtel presented MTV Inbox;the first on-air SMS based interactive music dedicationshow exclusively for Airtel and Airtel Magic customers. Highly interactive VJ based show withreal-time feedback mechanism. Both brands joined hands to target the high growth youth segment

46

Airtel views on its branding strategy First, brand building efforts in todays context have to be see n in a m o r e h o l i s t i c m a n n e r . Delivering value on a sustained basis is perhaps the most potent key to build a brand that lasts.Unflinching orientation to customer needs is the second key success factor. Customers (be it for industrial products or consumer goods and services) across the world are more informed and, at thesame time, becoming more individualistic in their needs and far more demanding with the passageof time.Pro-active tracking of shifts in consumer behavior, anticipating redefined or emerging customer needs, and then reacting in real-time are essential to attract and retain customer loyalty a keyelement of creating brand equity in the present situation.Customizing the product (and communication of its benefit) to meet the specific needs of variousconsumer/customer sub-segments is the third element in creating brand appreciation.As far as allocation of time and financial resources are concerned, too many companies mistakenlyallocate a

disproportionate amount on mere advertising and promotion. This is not to say thatadvertising and promotion are less relevant. On the contrary, with more choices and higher mediaclutter, businesses need to budget for an increasingly higher spend on their brand promotion but t h i s h a s t o b e u n d e r t a k e n i n tandem with enterprise-wide reengineering of the

b u s i n e s s philosophy and core design, production, and delivery operations for the product itself.The positive spin to this argument is that by first addressing the fundamentals, the enterprise itself becomes more competitive. This can be the beginning of a virtuous cycle wherein brand equityconti nues to increase as

47

the enterprise sustains delivery of an appropriate product or service at an ever increasing value.It is, however, crucial to note that in the years to come, not only will the cost of building a regionalor a national (or an international) brand will continue to rise but also the time taken to do so will belonger and will need sustained and focused efforts.

48

Comparison of marketing strategies between Airtel and Vodafone

49

Purpose Of Comparison The sub main purpose of this report is to compare the marketing Strategies adopted by Airtel and its rival Vodafone The comparison shows how both of the companies have been challenging each other togain market shares.

Why comparison with vodafone Airtel is the leader in telecommunication sector. Airtel holds the lion share of market of communication sector. However, Vodafone has been giving tough competition to Airtel. Vodafone is the second largest player and share holder in Communication sector. Since its launch Vodafone has been adopting aggressive marketing strategies. The comparison shows how Hutchison Essar Telecom. Captured 22% market share in onemonth of its first launch of postpaid subscription in 2002.AD. With a different technology Vodafone creates its own market. Vodafone odafone. Today deals in every business of communication sector. Vodafone making and changing the strategies to capture the market shares

50

Marketing strategies of Airtel

Market segmentation Geographical segment (metropolitans & cities India) Demographic segment - middle income groups People age group of 20 to 28 year

Target marketing People who living in cities and towns. Poor or middle income group people. Youngsters in big cities. Businessmen

Positioning Creating brands (Sharukh khan & Sachin Tendulker) Ads and promotions Promotion for study of poor childrens Marketing mix Price: low price strategy Place: maximum outlets and service centers Product: verities available for various groups Promotion: various schemes for pre-paid and post-paid
51

Marketing strategies of Vodafone

Vodafone target the Rural India The main targeted customers of Vodafone are from rural India.By offering cheap and light mobile sets Vodafone attracts most of the customers of small villages and towns. Offering cheap handsets Vodafone offers cheap and free connections to all customers.The cost for these sets was Rs-799849-1099\set and onward. Free support and services In every district and big towns Vodafone opens its service centers to provide better support andservices. Strong logistics and supply chain Vodafone has a strong logistic and supply all over India.In every small town the potential customers can easily purchase the Vodafone SIM & Sets. Targeting youngsters in metropolitans Vodafone attracts youngsters by offering colorful handset at very low prices.

52

Market segmentation Geographical segment (rural India) Demographic segment - middle income groups

Target marketing People living in small towns and villages. Poor and middle income groups. Youngsters in big cities. Businessmen

Positioning Creating brands Ads and promotions

Marketing mix Price : low price strategy Place : maximum outlets and service centers Product : varities available for various group Promotion: various schemes for pre-paid and post-paid

53

Services provided by Airtel Mobile services with GSM technology Fixed-line connections National and international long distance services VSAT, Internet services and network solutions Broadband services

Services provided by Vodafone . mobile services with GSM technology fixed-line telephone services Universal Internetworking VoIP (Voice over Internet Protocol) Interactive Television Visual Communication Broadband Portal Telecommuting

54

RESEARCH METHODOLOGY
Achieving accuracy in any research requires a deep study regarding t h e s u b j e c t . T h e p r i m e objective of the project is to compare Airtel with the existing competitor (Vodafone) in the marketand the impact of WLL on Airtel. The research methodology adopted is basically based on primary data via which the most recentand accurate piece of first hand information could be collected. Secondary data has been used to support primary data wherever needed. Primary data was collected using the following techniques Questionnaire Method Direct Interview Method and Observation Method The main tool used was, the questionnaire method. Further direct interview method, where a face-to-face formal interview was taken. Lastly observation method has been continuous with thequestionnaire method, as one continuously observes the surrounding environment he works in

55

Type of Research Methodology

:Exploratory t y p e

of research carried out was exploratory in of such research is to determine the

n a t u r e ; t h e objective

approximate area where the drawback of the company lies and also t o i d e n t i f y t h e course of action to solve it. For this purpose the information proved useful for giving right suggestion to the company.

DATA COLLECTION METHOD Here two type of method of data collection.. Primary data Secondary data Primary data: d a t a used for the research work was primary in

n a t u r e . primary data is that which is the collected for the fi rst time .and thus happen to be originated in character. Questionnaire survey In the studies a questionnaire is prepared. The questionnaire .consists of 13 questions.

SECONDARY

DATA

refer

to

the

data

that

has

been

a l r e a d y collected .the secondary data, which has been used to carry out this study, are as follow: Books, journals, magazines, newspapers Industry reports
56

 Companys internet site Someother relevant study material and websites.. SAMPLE UNIT:- lucknow. The research process during was the done activities by interacting which with included,

number

o f customers

performed,

markets,c o l d c a l l i n g , c a n o p i e s , e t c . S a m p l e d e s i g n c o n s i s t s o f r a n d o m sampling.

SAMPLE SIZE: 100 PEOPLE

SCOPE OF THE STUDY To conduct this research the target population was the mobile users, W h o a r e u s i n g G S M technology. Targeted geographic area of Lucknow. Sample size of 100 persons was taken. To these people a questionnaire was given, the questionnaire was a combination of both openended and closed ended questions. The date during which questionnaires were filled. Some dealers were also interviewed to know their prospective. Interviews with the managers of GSM service providers were also conducted Finally the collected data and information was analyzed and compiled to arrive at the conclusionand recommendations given.

57

Sources of secondary data Used to obtain information on, Airtel history, current issues, policies, procedures etc, wherever required. Internet Magazines Newspapers Journals Airtel Circulars Store AirtelNews Letters Vodafone Store Vodafone Ministore

58

DATA ANALYSIS AND INTERPRETATION

59

Q.SUBSCRIBER NUMBER IN (mn) HELD BY VODAFONE AND AIRTEL

June -08 AIRTEL 3.19

SEP-09 4.62 4.19

DEC-10 5.50 6.24

Mar-11 6.54 7.26

Dec-11 10.98 10.45

Mar-12 14.07 12.99

VODAFONE 1.82

Source TRAI:
16 14 12 10 8 6 4 2 0 2008 june 2009 sep 2010 dec 2011 mar 2011 dec 2012 Mar Airtel Vodafone

60

Q.Market players in telecommunication Market share mar08 19.06 21.81 17.03 10.45 Market share mar12 22.49 16.96 16.01 8.49

Operator AIRTEL VODAFONE RELIANCE COMM. IDEA CELLULAR

25 21.81 20 19.06 17.03 15 10.45 10 10.01 16.96 14.49 Airtel Vodafone Reliance comm. Idea 5 22.49

0 Market share'2008 mar Market share'2012 mar

61

Q. AGE GROUP GRAPH

Age group

20%

28-35 yrs 15-21 yrs 15% 65% 21-28 yrs

As we can see from the above graph, the people who are in the age group of 21-28 years are theo n e s w h o a r e t h e m a x i m u m u s e r s o f m o b i l e p h o n e s . T h i s s e g m e n t i s t h e o n e w h i c h g i v e s maximum business to the mobile operators. This segment constitutes the young executives andother office going people. They are 65% of the total people who were interviewed. The next age group are the people who are 28-35 years old. They are 20% of the total. They are those who are at home or have small business units etc. And the next age group is the youngest generation who are 15 21years old. They are school and college going students and carry mobile phones to flaunt. They are15% of the total interviewed people.

62

Q.OCCUPATION GRAPH

10%

15%

20%

students executives households others

55%

As the above graph shows that 55% of the total people interviewed are working. So, these peoplea r e t h e o n e s w h o a r e t h e m a x i m u m u s e r s o f m o b i l e p h o n e s . T h e y a r e t h e y o u n g e x e c u t i v e s , managers, Tele - callers etc. who require mobile for their official purposes. The next category isthe households, who are either housewife, small units which operate from their homes etc. Theyare 20% of the whole. The next segment is the students. They are 15% of the whole. And 10% of the whole is categories who are the professionals

63

Q.SERVICE PROVIDER GRAPH

Market share

20% 36% Airtel Vodafone Reliance 17% Idea cellular others 13% 14%

These are the total market share of mobile user or people captured b y t h e m o b i l e p r o v i d e r company. There two major company in mobile phone service sector Vodafone and Airtel who r e s p e c t i v e l y hold the

market share with other company as 17% and 20% of total market u s e r segment of mobile customer

64

Q.Awareness of 3G plan-Graph

Awareness of 3G plan

45%

65%

yes no

It will be seemed to be that 3G plan is a new word for many of the people. 45% of the people were not at all aware of such a technology. So, in order to get the answer for this question they were first explained the concept. Only, 65% people knew what 3G is all about.

65

Q.Awareness of WLL players-graph

80% 70% 60% 50% 40% 30% 20% 10% 0% Vodafone Airtel awareness WLL players

Vodafone was the brand which was popular amongst the interviewed people. As Vodafone haddone so much advertising and has it banners and hoarding spread all over Delhi. So, this could beo n e t h e r e a s o n s o f i t s p o p u l a r i t y . T a t a w a s h a r d l y a k n o w n b r a n d i n t h i s n e w f i e l d . P o s s i b l y , because of less promotions done by them as compared to Vodafone.On the basis of analysis of the questionnaire I have found that the maximum no. of people whouse mobile phones is in the age group of 20 to 28. Who are the young executives and other officegoers?They spend a maximum of RS 500 as their mobile expense.There is more no. of prepared cards than post paid cards. The mobile users want to spend moneyside by side than to spend money at the end of the month on a big bill. Now when I compared Airtel with its
66

competitor from the point of view of the consumer I foundthat on the basis of Tariff plan, value added services and billing accuracy Airtel is at par or ahead o f its

competitor but in the case of customer care and availability t h e y l a g b e h i n d t h e r e competitors. As, Airtel has a hold in the market because it has the maximum no. of connections, soit must improve upon it customer services. As far as WLL is concerned people are aware about it but not many people are aware about Tata. They only know more about Vodafone. People at this point of time are not interested to switch over from GSM to WLL.

67

CUSTOMER RESPONSE TOWARDS QUESTIONNAIRE

68

Q.1 Which brand you prefer most? Airtel Vodafone Others

45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

42%

28% customer preference in using telecom service 14%

Airtel

Vodafone

Others

Conclusion-42% respondent are using airtel and only 28% are using vodafone .it is a ghuge diffrence in using

69

Q.2 How long you have been using this product ? 0-2 years 2-5 years 5-10 years More than 10 years

16% 16% 14% 14% 12% 12% 10% 8% 6% 4% 2% 0% 0-2 years 2-5 years 5-10 years more than 10 years 3% customer usage in%

Conclusion- only 3% respondent are using airtel services from a long time like 10 years.

70

Q.3 Are you using other product alongwith Airtel ? YES NO

33%

Yes 67% No

Here are the customer responses about the use of the Airtel p r o d u c t a n d o t h e r product rather than Airtel.in this segment of survey 67 % of customer are aspire with Airtel and 33 % shown interest in other telecom products in urban areas.

71

Q4 Are you satisfied with following services given by airtel? Network Custmor support Service rate Others

others 7% service price 15% network 47% custmor support 31%

Conclusion-only 15% of respondent are satisfied with the price of airtel and 47%respondent are satisfied with tnetwork services of airtel.

72

Q5 Are you satisfied with following services given by vodafone? Network Custmor support Service rate Others

satisfaction

network 20% others 40% customer support 20%

price of services 20%

Conclusion-32%respondent are satisfied with the network.33% are tsatisfied with the Price of services.

73

Q.6 Do you collect any information search before making a purchase ?

Information search before purchsing

34%

YES 66% NO

Conclusion-66% respondent are collect information before purchashing .and 34% are not collect information before purchashing.

74

Q7 If yes, which sources are used? Magazines Dealers Sales Executives Operators reference Pamphlets and catalogue Reference from friends and relatives Any other

Sources of information
12% Magazines 5% 10% 5% 30% 20% Dealers sales executive Operators reference pamphlets andcatalogue reference from friends any other

18%

Conclusion-30%respondent are taking information from references from friend.

75

Q.8 Which of these marketing / sales schemes attracts you while purchasing any connection? Good Network Discount scheme Service package Any other

Marketing and sales scheme

10% 40% 30% good network Discount scheme service package 20% any other

Conclusion-40%are using the service for good network and 20%discount scheme.

76

CONCLUSION
After analyzing the findings of the research, I can conclude that A i r t e l l a g g e d b e h i n d i t s competitors as far as customer service and availability is concerned. The maximum no. of peoplewho use the mobile is in the age group of 20 to 28. Cash cards are the most popular type of mobileconnections, as they are consumer friendly and recharging the connection is not a problem.Maximum no. of people spends RS 500 on their connections. As Airtel is the only company havingthe maximum no of mobile connections so it must seriously look into the loop holes of the existing customer service department.As we know that now Airtel has already launched its product with logo Aisi azaadi aur kahanhas already became popular in market. So we can say that in spite of so many competitors in the market Airtel is having a good position just because every time, it tries its best to understand theneed of its important customers.From the comparison and deep analysis of every aspect of business of both the companies we canconclude that Airtel has to more work in every field of communication business.It is the time not only to survive but to sustain in the market for a long time.For this Airtel has to work on its all marketing strategies, marketing, promotion, brand image.etc.Airtel has to take Vodafone. Very seriously and update its own strategies from time to time and when the need arises.With aggressive marketing strategies Airtel has to target rural India as 70% of population of Indialives in these areas.The other segment may be costumers of all age groups

77

SUGGESTIONS
Following are the few suggestions to AIRTEL for improving the market share and image of the products concerned. 1. PRODUCT *Modification must be brought about in AIRTEL, in terms of quality. I t s d e m a n d s h o u l d b e increased. 2. PLACE * The brands must be made available easily in, PCO & general stores. 3. PROMOTION *Company must undertake extensive promotional activities like advertisements must be releasedin different Medias to create brand awareness. *Free samples should be distributed among the prospects. Sales promotion tools like gifts, contestsand coupons must be given to retailers as well as customers and prospects. * Catalogues should be distributed among customers. 4. PRICE * Price should be as competitive as other company maintains * Distribution of new connection should be in reach of customer pocket

78

RECOMMENDATIONS
I have made following recommendation to the company : The company should modify its strategy as they only target the prepaid customers who are not easy to trace. The company should make its marketing strategy flexible e n o u g h i n o r d e r t o f a c e competition. The company new schemes must be flexible enough to catch n e w c u s t o m e r s b e c a u s e i f company offers lower price of their services to a new customer then he may be a permanent customer for the company. The company should offers such rate in the market so that it may able to catch a bigger market share and it should be able to compete with the local retailers and sales agents while having a brand name. The company should take the opinion of exporters from time to time to know what problems they a r e f a c i n g f r o m t h e c o m p a n y s s i d e . A n d i f a n y c h a n g e t h e y r e q u i r e i n p r e s e n t s u p p l y i n g condition?

79

LIMITATIONS
No project is without limitations and it becomes essential to figure out the various constraints thatw e u n d e r w e n t d u r i n g t h e s t u d y . T h e f o l l o w i n g p o i n t s i n t h i s d i r e c t i o n w o u l d a d d t o o u r t o t a l deliberations:1. During the study, on many occasions the respondent groups gave us a cold shoulder. 2. The respondents from whom primary data was gathered any times d i s p l a y e d c o m p l e t e ignorance about the complete branded range, which was being studied. 3. Lack of time is the basic limitation in the project. 4. Some retailers/whole sellers refuse to cooperate with the queries. 5. Some retailers/wholesalers gave biased or incomplete information regarding the study. 6. Money played a vital factor in the whole project duration. 7. Lack of proper information and experience due to short period of time. 8. Some retailers did not answer all the questions or do not have time to answer.

80

BIBLIOGRAPHY
In this project report, while finalizing and for analyzing quality problem in details the followingBooks, Magazines/Journals and Web Sites have been referred. All the material detailed below provides effective help and a guiding layout while designing this text report. Books : Principles of Marketing Philip Kotler & Kevin keller edi. 12 Market Research D.D. Sharma Research Methodology C.R. Kothari Websites: www.Airtelworld.com www.google.com www.india.com www.Vodafone.in

Magazines: Airtel Airtel India page of HT paper Cowards India

81

ANNEXURE

82

QUESTIONNAIRE Dear Sir/Madam,I S a n k a l p P u r w a r , s t u d e n t o f M B A o f B B D N I I T L u c k n o w . I am doing my project on Comparative analysis of marketing strategy of Vodafone and Airtel Please give your precious time for filling these details.

Q1 Which brand you prefer most? Airtel Vodafone Others

Q2 How long you are using this product? 0-2 Years 2-5 Years 5-10 Years More than 10 years

Q.3 Are you using other product alongwith of Airtel? Yes No

83

Q4 Are you satisfied with following services given by airtel? Network Custmor support Service rate others Q5 Are you satisfied with following services given by vodafone? Network Custmor support Service rate Others Q.6 Do you collect any information search before making purchase? Yes No

Q.7 If yes, which sources are used? Magazines Dealers Sales Executives Operators reference Pamphlets and catalogue Reference from friends and relatives Any other
84

Q.8.Which of these marketing / sales schemes attracts you while purchasing any connection? Good Network Discount scheme Service package Any other

Q.9How would you rate Airtel performance as your expectation on 5 points scale (5H i g h e s t ? ) 1 2 3 4 5 After Sale service Maintenance Product as per expectation

Q.10If you have to purchase a new connection or product in near future, which Brand

will

you

go

for

and

why? _________________________________________________ _______________________

__________________________ _________________________________________________

Q11 What is your previous experience with communication service provider _________________________________________________ _____________________________
____________________ _________________________________________________

Q.1What are you suggestions for improving the product quality, service availability and parts availability? ___________________________________________________________________________
85

____ _______________________________________________________________________________ __ ____________________________________

Thank You.

86