Pritesh Patkar

8/13/2019 Pritesh Patkar

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INDEX

Executive Summary

Chapter 1 : Introduction to the study 2

Objective o the project

!ypothesis

"esearch methodo#o$y

Chapter 2 : Introduction o %irte# 1&' (odaone

Chapter ) : "evie* o the #iterature +,

Chapter - : %na#ysis o the project +2

Observations ' indin$s

.imitations

Chapter / : Conc#usions ' Su$$estions +&

%ppendix

0ib#io$raphy

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O0ECI(E O3 !E S4D5

)very organi%ation has to achieve its organi%ation goals. *or this it is

very essential for an organi%ation 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 the study is as under(+

,. To identify the difference between market performance of $irtel industry and

Vodafone.

!. To study the market of $irtel Industry and Vodafone on big scale

telecommunication sector.

-. To compare various parameters of marketing strategies&

manufacturing process technology adopted production policy& advertising&

collaboration& eport scenario& future prospect f or the tw o companies and

government policies.

/. To study customer buying behavior and factors which influence

the purchase decision process.

0. To know how the company has been successful in encountering the

aggressive marketing strategies of competitors.

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!ypothesis

The *ollowing hypothesis were framed.

1ypothesis ,(Than ,!0 million telephones network is one of the

largest communication networks in world& which continues to grow at

a blistering pace.

1ypothesis !(. 2urrently more than -" lakh phones are being added

each month and it is targeted that by the end of !""3 the total number

of phones may reach a level of-0" million taking the tele+density to

more than -"4 which is currently at !/.5-4.

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6E!OD O3 CO..ECION

*ield procedure for gathering primary data included observation and

interview schedule in which the

questionnaires were filed by the personal interviews through self

administered survey was done to collect the data& market research

was undertaken& that was accomplished by performing various activities

designed.

"ESE%"C! INS"46EN

6uestionnaire

he 7uestionnaire *as ormu#ated by 8eep in mind the o##o*in$ points.

iving the respondents clear comprehension of the question.

Identifying the needs to be known.

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% brie history o e#e sector in India

In the early ,77"s& the Indian government adopted a new economic policy

aimed at improving India8s competitiveness in the global markets and the

rapid growth of eports. 9ey to achieving these goals was a world+class

telecom infrastructure.

In India& the telecom service areas are divided into four metros :;ew


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G;TPH ,777=. nder this new policy& the old fied+ licensing regime was to be

replaced by a revenue+ sharing scheme whereby between 3+,! percent

of cellular revenue were to be paid to the government.

INDIAN CELLULAR MARKET - EARLIER ROADBLOCKS AND THEIR

RESOLUTION

Indian 2ellular market immediately after the first round of licensing in

,77/+75 was beset by several problems for - + / years till the ;ew Telecom

Policy,777 was announced. Bome of these roadblocks J current position is

tabulated below(

"O%D0.OC9S

C4""EN OSIION

High license fees

Migration to revenue sharing mode in ,777 mitigates high initial fund

requirements for payment of license fees.

Inadequately funded businesses J weak and fragmented promoters.

?usinesses that have since been adequately funded growing at over

5"4 per annum& while businesses with weak promoters continuing to

languish + spate of acquisitions J mergers& with /J0 major groups emerging in

the last oneJtwo years.

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Regulatory authority not in place

Telecom Degulatory $uthority of India :TD$I= firmly in place& and its role being

accepted by all operatorsK


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Problems in Financial closres !e "o#

Eicensing tenure of ," years

Earge upfront cash requirements from promoters due to heavy license fee

burden in initial stages of deployment $sset based financing approach by

Indian *inancial Institutions.

Eicensing tenure increased from ," to !" years

Earge upfront cash requirements for license fee payments mitigated with

migration to sharing mode allowing promoters to deploy more capital for

capital ependitureK project financing being considered by most financial

institutions.

Forei$n o%ners&i' ( c&an$e o) 'ar"ner limi"a"ions

ownership norms clarified& and change of partners allowed as a matter of

routine allowin ease of entry J eit + paves the way for full control of businesses

by foreign companies.

Inadequate growth of market J subscribers

Doadblocks spelt out earlier resulted in low market J subscriber

growth& but with corrective measures taken& market J subscriber base

epected to %oom.

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*+* DE,ELOPMENTS IN THE CELLULAR INDUSTR

The interconnection regime between cellular operators and fied+line

operators is still biased against the former.


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)nterprises @ another major cellular player @ acquired.

2ommunications renamed ?harti Mobinet :$ugust !"""=. ?harti also acquired

the Punjab license of )ssar and started operations& giving competition

to the lone operator there& Bpice 2ommunications. oing forward&

?harti is likely to merge all its cellular companies into one entity.

*ive companies together bid Ds,5.- billion to bag the licenses for the fourth

operator slots in four metros and ,- circles. ?harti emerged as the ;o. ,

bidder with eight new licenses& followed by )scotel with four& 1utchison with

three& and Vodafone and Idea cellular with one each. ?harti and 1utchison

have already commenced operations in all the circles while Idea is set to

launch in


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success of PDB remains a question.

In !""0 1utchison )ssar an Indian and hongkong telecommunication alliance

was taken over by the nited 9ingdom 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 T$T$

telecommunication Maharashtra in !""3.

Mitsubishi a Capanese telecomm services :MTB= company comes in India in

!""7 and take over

Bil!in$ .isibili"/ an! a%areness

Arange 1olidays> and>Arange Monsoon Affers> at very

attractive rates and added benefits like discounts on airfare& food and

beverages& among others. Athers offer special privileges in retail outlets&

cinemas and music shops.

En"er'rise mobile a''lica"ions 0 'romisin$ re.ene s"ream

$ll along& customer acquisition and the top line have been the

focus. *ew operators have concentrated on offering differentiated services

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for businesses. 1owever& as operators reali%e that offering basic voice and

Bhort Message Bervice :BMB= will get them the numbers but not the

margins& some are now seriously looking at the enterprise segment for

provisioning superior services.

2ost+centered solutions like closed user group :2=& value+adds like

unified messaging and instant alerts are being offered.

$ variety of mobile applications are finding takers among the enterprise

segment. ?harti is in the process of introducing a facility to fleet

management companies so that they can improve the efficiency of trucks

or buses by tracking movement and ensuring higher+use& accurate

route planning. Premium automakers are also installing a global system for

mobile communications inside a vehicle to help trace lost vehicles and track

down stolen cars.

2orporations can choose enhanced services like user+defined call routing to

prevent misuse. 2alls can be barred& limiting access to select numbers

and diverting calls to one single number. ?roadcasting services are

also quite popular& especially among fast food centers that have a central

number. roup BMB is quite popular& especially among enterprises both in the

service as well as number. roup BMB is quite popular& especially among

enterprises both in the service as well as number. roup BMB is quite popular&

especially among enterprises both in the service as well as the fast+moving

consumer goods :*M2= segment that have a large field force and

need to provide regular updates on inventory status& discount schemes

and movement of goods from warehouse to the retail outlet. ?anks

too find bulk BMB service very useful to forward transactional alerts

to their customer

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*+1 FUTURE TRENDS AND DE,ELOPMENT

There will be more competition& forcing operators to constantly

focus on differentiations to maintain their lead.

The implementation of enhanced networks like !.0 will enable

operators to offer data services. This is an opportunity to customi%e

and differentiate better.

The entry of state+run operators like ?B;E and ?1$DTI means that

prices will no longer be controlled& thus there is less chance of a cartel

being formed.

;etwork coverage in terms of geographic spread and quality of

coverage is crucial especially for the business subscriber. The bigger

the service providerLs national presence& the better it is for businesses.

An the roaming front& signing up with a national operator is advantage

Eimited mobility wireless in local+loop services :by fied network service

providers= will be a disadvantage for cellular operators in the short term.

2onsequently& operators need to streamline their customer relation

activities and adopt aggressive subscriber acquisition and retention

strategies

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*+2 RE3ULATOR ISSUES

The operations of this sector are determined as under the Indian

Telegraph $ct of ,330. $ document buried in the sands of time. The net

major policy document& which was produced& was ;ational Telecom Policy of

,77/& a consequence of the on going process of liberali%ation.

5ear Event

,30, *irst telephones in India

,7/- ;ationali%ation of telephone companies

,730


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$ugust ,770 VB;E launches Internet services

Canuary ,775 TD$I formed

;ovember ,773 Internet policy announced

The ;ational Telecom Policy of ,77/ document& which laid out broad policy

guidelines rather than a series of action points. Eike other policies& it sought to

achieve the impossible in finite time like improve quality of service and its

availability& wide coverage :a phone in every village=& at reasonable rates& etc.

The targets in quantifiable terms were installation of 7.0mn additional lines&

telephone on demand by ,77F& and a P2A pop of 0"". The )ighth Plan had

also allowed private operators in value added services. To facilitate licensing&

the nation was divided into !" circles:akin to a state= for basic and !, circles

for cellular telephony. Mumbai falls in Maharashtra circle and


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The telecom sector has witnessed some fundamental structural and

institutional reforms in the past decade. Telecom equipment manufacturing

was completely deregulated in ,77,. Value+added services :including

cellular services= were thrown open to private sector participation in ,77!.

?asic services were opened to private participation in ,77/ by dividing

the country into !, telecom 2ircles and allowing one private operator

per 2ircle to compete with


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Sources o secondary data

Internet

Maga%ines

Cournals

?harti 2irculars Btore

Vodafone Btore

Vodafone Ministore

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2hapter !

Introduction Af the Topic

The project is an etensive report on how the $irtel 2ompany markets its

strategies and how the company has been able in tackling the present tough

competition and how it is scooping up by the allegations of the quality of its

products. The report begins with the history of the pr oducts and the

introduction of the $irtel 2ompany. This report also contains the

basic marketing strategies that are used by the $irtel 2ompany of

manufacturing process& technology& production policy& advertising&

collaboration& eport scenario& future prospect and government policies. The

report includes some of the key salient features of marketer end issues.

In today8 s world of cutthroat fierce competition& it is very essential to not only

eist but also to ecel in the market. Today8s market is enormously more

comple. 1ence forth to s ur vive in the market& the company not only

needs to maimi%e its profit but also needs to satisfy its customers and

should try to build upon from there.

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%I"E.

Company proi#e

%I"E. is a brand of telecommunication services in India operated by ?harti

$irtel. $irtel is the largest cellular service provider in India in terms of number

subscribers. ?harti $irtel owns the $irtel brand and provides the following

sevices under the brand name $irtel( Mobile Bervices :using BM

Technology=& ?roadbandN Telephone Bervices :*ied line& Internet

2onnectivity:


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in ,730& ?harti has been a pioneering force in the telecom sector. 'ith many

firsts and innovations to its credit& ranging from being the first mobile service

in


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The 2ompany has developed the following strategies to achieve its

strategic objective

*ocus on maimi%ing revenues and marginsK

2apture maimum telecommunications revenue potential with

minimum geographical coverageK

Affer multiple telecommunications services to provide customers with a

>one+ stop shop> solutionK

Position itself to tap data transmission opportunities and offer

advanced mobile data servicesK

*ocus on satisfying and retaining customers by ensuring high

level of customerK satisfactionK

Eeverage strengths of its strategic and financial partnersK

andS.)mphasi%e on human resource development to achieve

operational efficiencies.

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0usinesses

?harti Tele+Ventures current businesses include

Mobile services

*ied+line

;ational and international long distance services

VB$T& Internet services and network solutions

?roadband services with


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quality service to its customersK

6uality management team with vision and proven eecution skillsK

and

The 2ompanyLs strong relationships with international strategic and

financial investors such as BingTel& 'arburg Pincus& International

*inance 2orporation& $sian Infrastructure *und roup and ;ew Oork

Eife Insurance.

0rand %rchitecture:

?harti is working on a comple "o "&ree-la/ere! bran!in$ arc&i"ec"re

0!%"I %I"E. O4C!E. INDI% ONE

Air"el -The flagship brand for cellular operations all across the Indian

country.

Toc&"el-The brand earmarked for basic service operations.

In!ia One-The brand for national long distance :;E


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Bran! S"ra"e$/

To understand the brand strategy& let8s first look at the brand building eercise

associated with $irtel @ a brand that had to be repositioned recently to

address new needs in the market. 'hen the brand was launched seven years

ago& cellular telephony wasn8t a mass market by any means. *or the average

consumer& owning a cellular phone was epensive as tariff rates :at Ds 3 a

minute= as well as instrument prices were steep @ sometimes as much as

buying a second+hand car.

?harti could have addressed the customer by rationally eplaining to him the

economic advantage of using a mobile phone. ?ut Bachdev says that such a

strategy would not have worked for the simple reason that the value from using

the phone at the time was not commensurate with the cost.

QInstead of the value+proposition model& we decided to address the sensory

benefit it gave to the customer as the main selling tack. The idea was to

become a badge value brand&R he eplains. Bo the $irtel Qleadership seriesRcampaign was launched showing successful men with their laptops and in

their delue cars using the mobile phone. In simple terms& it meant $irtel

was positioned as an inspirational brand that was meant for leaders& for

customers who stood out in a crowd.


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Bachdev and his team reali%ed that in a business in which customer

relationships were the core this could be a major weakness. The reason with

tariffs identical to competitor Vodafone telecomm and roughly the same

level of service and schemes& it had now become important for

?harti toQhumani%eR $irtel and use that relationship as a major differentiation.

The brand had become something like Eufthansa @ cold and efficient. 'hat

they needed was to become Bingapore $irlines& efficient but also human. $

change in tack was important because this was a time when the cellular

market was changing

The leadership series was okay when you were wooing the crUme de la crUme

of society. Ance you reached them you had to epand the market so there was

need to address to new customers ?y that time& ?harti was already the leading

cellular subscriber in


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That is precisely what the brand tried to achieve through its new

positioning under the $irtel4Toc& Tomorro%5 brand campaign. This set of

campaigns portrayed mobile users surrounded by caring family members.

Bays Bachdev( QThe new campaign and positioning was designed to

highlight the relationship angle and make the brand softer and more sensitive.R

$s it looks to epand its cellular services nationwide @to eight new circles

apart from the seven in which it already operates @ ?harti is now reali%ing that

there are new compulsions to rework the $irtel brand& and a new eercise

is being launched to this effect. Dight now& the company is unwilling to

discuss the new positioning in detail. ?ut broadly& the focus is on positioning

$irtel as a power brand with numerous regional sub+brands reflecting customer

needs in various parts of the country.

If $irtel is becoming more humane and more sensitive as a brand& ?harti has

also understood that one common brand for all cellular operations might not

always work in urban markets that are now getting increasingly saturated.

To bring in new customers& the company decided that it needed to segment

the market. Ane such eperiment& launched last year& is Ooutopia& a brand

aimed at the youth in the ,/ to ,7 age bracket and for those who are Qyoung

at heartR. 'ith its earlier positioning& $irtel was perceived as a brand for

the well+heeled older customerK there was nothing for younger people. 'ith

Ooutopia $irtel hoped to reverse that In order to deliver the concept& $irtel

offered rock bottom tariff rates :!0 paise for -" seconds= at night to Ooutopia

customers @ a time when they make the maimum number of calls. It also set

up merchandising eercises around the scheme @ like a special portal for

young people to buy things or bid for goods.

The company is now looking at offering other services at affordable prices to

this segment which include music downloads on the mobile and bundling

BMB rates with normal calls to make it cheaper for young people to use.

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The other eperiment that ?harti has worked on is to go in for product

segmentation through the Tango brand name. The brand was created to offer

mobile users Internet+interface services or what is known as '$P :'ireless

$pplication Protocol=.

The idea was to bring Internet and mobile in perfect harmony. QThe name

was chosen from the popular movie titleI" Ta6es basically& you need the two

services to tango to offer customers a new choiceR& says Bachdev.

This& however& had less to do with the branding eercise as with inefficiency of

service :accusingly slow download speeds= and the limited utility of '$P

services.

Bubsequently& the ads were withdrawn& but the company re+iterated that

the branding eercise could be revived because Tango will be the brand to

offer PDB services @ or permanent Internet.

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he 6a$ic

Perhaps the more ambitious eperiment has been with@ the pre+paid card.

The idea was to make the brand affordable& accessible and& most importantly&

feasible as a means of epanding the market even faster.

PHASE I 7

Magic was aimed at bringing in infrequent users of a mobile phone into the

market and assure him that he would have to pay only if he made a call. Buch

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 ?harti did three things.

Ane& the product was made available at prices ranging from Ds -"" to

Ds -&""" with no strings attached and was simple to operate.

Two& the product was made accessible and distributed throughsmall stores& telephone booths and even kirana shops so that the

offering was well within arms reach.

Third& to make the product more QapproachableR to the customer& the

company came with vernacular ad campaigns

Eike4Ma$ic Daalo Sa/ Hello5

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$ll elements + user imagery& contet& tone N language created to

connect the category to the lives of the B)2 ? N B)2 2 segment the

middle class non+mobile user. $irtel Magic positions itself on the platform of being ecellent for

emergency situations increasing productivity as a part of everyday life.

Bharukh 9han makes everything in life possible8 while romancing

pretty 9areena 9apoor with $irtel Magic& India8s leading pre+ paid

mobile card.

.

It gives you the freedom to control your life in a way never possible

before. Indeed& anything that think is possible is possible with $irtel Magic.

The new brand slogan Magic hai to Mumkin 1ai.

This strategy is designed to help us talk to this segment directly in the tone&

manner N language of the masses. The QMumkin haiR value proposition will

help us epand the market and gain a higher percentage of market shares in

the process.

?rand ambassadors Bhahrukh 9han and 9areena 9apoor embody this can

do8 or QMumkin 1aiR spirit :infact that is the reason they were selected as brandambassadors=. Bharukh rose from a TV actor to become India8s top film star

and national heartthrob. 9areena8s success is due to her attitude8& talent& hard

work and the sheer ability to make a mark in such a short time. ?oth these

stars have said Mumkin hai8 and made it happen for themselves

The genre of this new strategy N campaign is 1indi cinema led. This genre

connects millions across India. The spirit of romance& dancingS theIndian cinema& well known to most as ?ollywood& holds millions of Indians

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!%SE III

Pritesh Patkar

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