Understanding Consumer Behavior in Rural Market for Telecom

8/9/2019 Understanding Consumer Behavior in Rural Market for Telecom

1/30

by

B.Sandeep

PGDM-RM


2/30

The Indian Telecom sector is thirdlargest network in the world.

Second largest wireless network inthe world.

Fastest growing telecom sector withan average addition of over 10-12

million subscribers per month. Tele density in India is 54.10 Tele density of rural in Andhra

Pradesh stands at 22.24while theurban at 131.10

Total telecom

subscribers :

638.05million

Wirelesssubscribers :

601.22 million

Wire linesubscribers :

36.83 million

Tele density : 54.10 %

Indias RuralMobile Phone

Users :

>100 Million


3/30

Subscriber base in india

384.09429.72

464.82

562.16

632.18

0

100

200

300

400

500

600

700

Dec-08 Mar-09 Jun-09 Dec-09 Apr-10

Subscrib

erBase(millions)


4/30

Tele Density in Indi

33.2236.98

43.547.88

54.1

0

10

20

30

40

50

60

Dec-08 Mar-09 Jun-09 Dec-09 Apr-10

Teledensit

y


5/30

Wire less Wire line


6/30

Rural Tele density

reached 21.16 and

urban Tele density

110.96 at the end

of Dec-09. Theshare of rural

subscribers

increased to 31%

in total

subscription.

Subscrs iber base in Rura l

0

5 0

1 0 0

1 5 0

2 0 0

2 5 0

3 0 0

3 5 0

4 0 0

D ec -08 M a r-0 9 Jun -0 9 S ep -0 9 D e c -0 9

SubscriberBase(millions)

Ru ra l

Urb a


7/30

There are 6,38,365 villages in India and almost 74% of population are invillages.

The country saw addition of an average of around 10 Million subscribers

per month in its mobile subscriber base during 2009 with penetration

approaching saturation in urban India. With this, mobile operators in the

country are now vying rural India as their next area for growth in the nearfuture.

Striking points

Affordability

Acceptability

Availability

Awareness


8/30

Brand Name: TATA Indicom

Network: CDMA 2000-1x Network Coverage: 22Telecom circles Subscriber base: > 39million Market Share: 9-11% Subscriptions: Post Paid, Pre Paid , internet facility

TATA Teleservices spearheads the Groups presence in the telecom sector.Incorporated in 1996, TATA Teleservices was the first to launch CDMAmobile services in India with the Andhra Pradesh circle.

TATA Teleservices is part of the INR Rs2,51,543Crore (US$ 62.5 billion)TATA Group, that has over 110 companies, over 3,30,000 employees andmore than 3.5million shareholders.

TATA Tele Services Limited along with TATA Tele Services (Maharashtra)Limited serves over 58.43 million customers in more than 6000 towns.


9/30

To understand customer perception and preference for telecom service inrural.

To Study and analyze the consumer behavior in rural areas.

To determine the factors which influence the purchasing behavior of

mobile/landline phone.

To analyze the customers attitude towards TATA Indicom service

To determine the factors which influence the purchasing behavior of

mobile connection.

To study the customer satisfaction and understand the current

market scenario in Telecom Sector.


10/30

Sample size

o The number of sample is 300 from different rural areas of Andhra Pradesh,

which fulfills the requirement. Each respondent is treated as a case of

detailed analysis

Data collection method

Primary Data:

o The Primary data was a detailed interview schedule with the help of a

detailed questionnaire. The samples were drawn purposively from various

areas for the relevance of the study.

secondary Data:o For this study the secondary data were collected from magazines, journals,

references and websites and manuals of the TATA Indicom.


11/30

.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

features price schemes brand image others

Responsesin%

Factors

Factors influencing in purchase of mobile phone

Inference: Since customers are very much concerned about the

features, TATA Indicom should look forward to impart more

features in the coming models.


12/30

Money spent on purchasing a mobile phone

.0

20.0

40.0

60.0

80.0

Rs1500

Money spent

Responsesin%

Inference: Customers are willing to spend more than 1500

i.e. around 2000 on mobile phone.

They are ready to pay an additional price for the features.


13/30

Inference: Telecom service providers should concentrate more on signal

strength and the price as they are given much importance by the customer

while selecting a telecom service.

Factors influencing cutomers to select a particular telecom

15%

5%

46%

29%

1% 4%Price

Brand image

Coverage

Advice by freinds and relativ

Advertisements

Advice by dealer/retailer


14/30

9.73.3

24.358.3

3.0 1.3

Sources through which Tata Indicom is reaching public

newspapers

radio

television

word of mouth

hoardings

pamphlets

Inference: In rural areas since most of population constitute

illiterates, Specific promotional activities should be adopted to get

along with the customers.


15/30

30.7

69.3

Awareness of different products & services offered byTata Indicom

yes

no

Inference: In Rural, Media is not playing a major role in creating awareness

about the products and services of TATA Indicom. So separate promotional

activities should be designed which enable customers to know more about

the products and services.


16/30

S a ti sf a c ti o n l e v e l w i th t h e ta r i ff p l a n o f

9 .3

5 9 .

1 6 .11 .1

3 .7

.0

10 .0

20 .0

30 .0

40 .0

50 .0

60 .0

70 .0

H ig h ly s a t is f i e d s a t is f ie d N e u tr a l D is s a t is f i e d Hig h ly D is s a t is f i e

S a t is f a c t io n l

Percentages

Inference: TATA Indicom is being preferred because of its economical tariff

plans. And customers are expecting the same from the company in the

coming future.


17/30

54%

6%7%

15%

18%

Tariff plan of Tata Indicom currently using

Pay per call

Pay per call flexi plan

3 pay 3 offer

Chatter box plan

Others

Inference: Pay per call is famous among the other plans since it has

been in the market for a long time. Customers are also impressed with

the fares of the plan.


18/30

Inference: Extent of connectivity and awareness of schemes are the major

issues for which TATA Indicom is not being preferred by the customers.

Reasons for which Tata Indicom is not being preferr

58%27%

4%11% Extent of connectivity

Lack of aw areness of th

schemes

Quality of services

Others


19/30

Money spent per month on mobile phone

34.338.3

11.7

6.79.0

.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

Up to Rs200 Rs200-500 Rs500-1000 Rs1000-1500 Above 1500

Money spent

Percentage

Inference:

From the above graph we can understand the affordability of the consumers.

So telecom service providers should come up with new plans which fall into

above mentioned category.


20/30

Inference: From the graph we can interpret that per call charges of TATA

Indicom are highly satisfactory and also the per call charges of the other

telecom service providers are not as good as TATA Indicom.

5.812.5

62.5

17.31.9

3.321.3

52.5

19.73.3

1.93.722.2

44.4

27.8

18.5

18.5

33.3

25.9

3.7

0

20

40

60

80

100

120

Airtel Idea Tata Indicom BSNL

Satisfaction level on per call charges of customer with their

respective telecom service

Highly satisfied

SatisfiedNeutral

Dissatisfied

Highly dissatisf ied


21/30

Inference: From the graph, we can interpret that most of the respondents who are

availing Airtel & Idea, BSNL are highly satisfied with the wide network

coverage (signal strength) where as the respondents who are availing TATA

Indicom are dissatisfied with the same.

1.93.83.8

64.4

26

3.31.73.3

78.3

13.3

14.8

42.6

22.2

18.51.9

7.4

14.8

22.2

51.9

3.7

0

20

40

60

80

100


Satisfaction level on network of customer with their respective

telecom service

Highly satisfied

Satisfied

Neutral

Dissatisfied

Highly dissatisfied


22/30

Inference: Majority of the respondents who are availing TATA Indicom are

satisfied with schemes where as the respondents availing Airtel,Idea,BSNL are

dissatisfied with the same.

5.8

20.2

53.8

19.21

8.313.3

40

35

3.3

1.93.711.1

53.7

29.6

14.8

18.5

37

25.9

3.7

0

20

40

60

80

100


Satisfaction level on schemes of customer with their respective

telecom service

Highly satisf ied

Satisfied

Neutral

Dissatisfied

Highly dissatisfied


23/30

Inference: Most of the customers are interested in value added services related to

entertainment such as Mp3 tones, dialer tones etc and general news related to

their regions. Youngsters are showing interest in value added services related to

sports.

6 % 1 3 %

1 0 %

4 3 %

2 8 %

T y p e o f v a l u e a d d e d s e r vi c e s t h a t a r e in t e r e s t e d

A st ro lo g

S p o rt

B u sin e s

E n te rt a in m

G e n e ra l n e


24/30

Inference: Customers dont want to migrate to new service providers unlessthey are dissatisfied with the current service provider. More the consumer is

satisfied with the products and services of the company eventually more they

will become loyal to the company.

65.0

30.3

3.7 1.0

.0

10.0

20.0

30.040.0

50.0

60.0

70.0

percentage

No Once Tw ice >2

No. of times

Freuency of switching to the other telecom s ervices from the

current telecom service


25/30

Inference: Extent of connectivity and the better schemes (in sense Economical

&Value creating) offered by the alternative service provider are the major

reasons for withdrawing from the current service provider.

36.4

47.7

3.7.9

11.2

.0

10.0

20.0

30.0

40.0

50.0

Percentag

Coverage Schemes Serv ice Vo ice c la r it y Others

Factors

Reasons for w ithdraing from the c urrent telecom operator se rvice to

service provider


26/30

Inference: Most of the customers are expecting good tariff plans and wide

network coverage from their respective telecom service provider.

0

10

20

30

40

50

60

Percentage

Good service Network Schemes voice quality

Type of expectations

Expectations of the customer from their respective

service provider


27/30

Reluctance on the part of the respondents to provide exact details. Sample size may not sufficient.

Assumptions:

The area selected is assumed to represent whole universe of Indian rural

telecom market.

Data collected are assumed to be bias free from side of respondents,

interviewer or any other.

Whole research and analysis part based on data collected is carried out

under unbiased environment and without any influence of any factor

which can lead to deviation in result.


28/30

Over two thirds of India's population live in rural surroundings and inthese telecoms have not really made their presence felt to any real extent.So telecom service providers should concentrate in rural areas.It is probable in these rural areas that cheap call rates will link with state-of-the-art technology to boost tele density and offer more freedom.Most of the customers in rural areas are less aware of different andservices of different telecom service providesNetwork is the main concern than the tariff plans.Word of mouth influence the purchasing behavior of the target market somobile operator should adopt some tactic to promote word of mouthpromotion.The customers are not satisfied with services because of the low quality

high price, poor after sales services, less network coverage etc.


29/30

First of all more sales promotions required for mobile handset

Set Quality & features should be improved. Training must be given to the retailer for increasing the sales.

Training must be given to retailer about product knowledge, so that they cancompete with other companys product.

To increase the sales, the telecom service providers should concentrate on the

following aspects Establishment of More towers in rural market Availability of all types of recharge vouchers at distributors house. To briefly describe all type of prepaid plan and recharge voucher. More promotional activities are to be made in rural market such as

1.campaigning 2. Direct Marketing 3. Banner 4. Leaflet 5. Advertisement by

Cable Opening service centers in rural market


30/30

Understanding Consumer Behavior in Rural Market for Telecom

Documents

Transcript of Understanding Consumer Behavior in Rural Market for Telecom