Professional Documents
Culture Documents
CHAPTER-1
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RESEARCH
METHODOLOGY
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RESEARCH METHODOLOGY
Achieving accuracy in any research requires in depth study regarding the subject. As the prime objective of the project is to compare Airtel with the existing competitors in the market and the impact of WLL on Airtel, the research methodology adopted is basically based on primary data via which the most recent and accurate piece of first hand information could be collected. Secondary data has been used to support primary data wherever needed.
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 the questionnaire method, as one continuously observes the surrounding environment he works in.
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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 conclusion and recommendations given.
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CHAPTER-2
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INTRODUCTION
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INTRODUCTION
In the early 1990s, the Indian government adopted a new economic policy aimed at improving India's competitiveness in the global markets and the rapid growth of exports. Key to achieving these goals was a world-class telecom infrastructure.
In India, the telecom service areas are divided into four metros (New Delhi, Mumbai, Chennai and Kolkatta) 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 the least attractive. The regulatory body at that time the Department of Telecommunications (DOT) allocated two cellular licenses for each metro and circle. Thirtyfour licenses for GSM900 cellular services were auctioned to 22 firms in 1995. The first cellular service was provided by, Modi Telstra in Kolkatta in August 1995. For the auction, it was stipulated that no firm can win in more 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 government decided to set up TRAI to separate regulatory functions from policy formulation, licensing and telecom operations. Prior to the creation of TRAI, these functions were the sole responsibility of the DOT. High license fees and excessive bids for the cellular licenses put tremendous financial burden on the operators, diverting funds away from network development and enhancements. As a result, by 1999 many operators failed to pay their license fees and were in danger of having their licenses withdrawn. In March 1999, a new telecom policy was put in
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place (New Telecom Policy [NTP] 1999). Under this new policy, the old fixed-licensing regime
was to be replaced by a revenue sharing scheme whereby between 8-12 percent of cellular revenue were to be paid to the government.
Indian Cellular market immediately after the first round of licensing in 1994-96 was beset by several problems for 3 - 4 years till the New Telecom Policy of 1999 was announced. Some of these roadblocks / current position is tabulated below:
Migration to revenue sharing mode in 1999 mitigates high initial fund requirements for payment of license fees. Inadequately funded businesses / weak and fragmented promoters Businesses that have since been adequately funded growing at over 60% per annum, while businesses with weak promoters continuing to languish - spate of acquisitions / mergers, with 4/5 major groups emerging in the last one/two years.
Telecom Regulatory Authority of India (TRAI) firmly in place, and its role being accepted by all operators; Deptt of Telecommunications (DOT) restructured, with operations and policy making roles vested in different bodies.
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Issues relating to unfavorable interconnect terms for private operators, pass through income, intra circle 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/ BHARTI (Mahanagar Telecom Nigam Ltd.) resolved to the satisfaction of all parties with changes in methodology / revenue sharing, intra circle long distance allowed, spectrum availability cleared with vacation of frequencies for usage by GSM operators.
Problems in Financial closures due to: Licensing tenure of 10 years Large up front cash requirements from promoters due to heavy license fee burden in initial stages of deployment Asset based financing approach by Indian Financial Institutions. Licensing tenure increased from 10 to 20 years Large up front cash requirements for license fee payments mitigated with migration to revenue sharing mode allowing promoters to deploy more capital for capital expenditure; project financing being considered by most financial institutions.
Roadblocks spelt out earlier resulted in low market / subscriber growth, but with corrective measures taken, market / subscriber base expected to zoom.
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In recent years, many foreign companies had pulled out from their cellular joint ventures in India due to the difficult operating environment and bureaucracy. In 1999 alone, Swisscom pulled out from Sterling Cellular, Telstra from Modi Telstra and both the Telecom Organization of Thailand and Jasmine International from JT Mobile. In 2000, Telecom Malaysia sold its stake in Usha Martin Telecom, and both Shinawatra of Thailand and Bezeq exited from Fascel. In June 2001, British Telecom exited from Bharti Cellular. Bell South International has also indicated its intention to pull out from Skycell Communications, and Hong Kong-based Distacom is seeking to sell its stake in Spice Communications. First Pacific's (based in Hong Kong) continued 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 sweeping across the Indian cellular industry in recent years. Hong Kong-based Hutchison Whampoa, via Hutchison Telecommunications (HK), acquired major stakes in Sterling Cellular (December 1999), Usha Martin Telecom (mid-2000) and Fascel (September 2000). Through a partnership with local company, Kotak Mahindra Finance, Hutchison Whampoa practically controls Fascel and Usha Martin Telecom, thus circumventing the 49 percent limit on foreign ownership in Indian cellular operators. Hutchison Whampoa is also the controlling shareholder of Hutchison Max Telecom. Not to be outdone, Bharti Enterprises another major cellular player acquired control of JT Telecom, which was later renamed Bharti Mobile (December 1999), and Skycell Communications renamed Bharti Mobinet (August 2000). Bharti also acquired the Punjab license of Essar and started operations, giving competition to the lone operator there,
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Spice Communications. Going forward, Bharti 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. Bharti emerged as the No. 1 bidder with eight new licenses, followed by Escotel with four, Hutchison with three, and Reliance and Idea cellular with one each. Bharti and Hutchison have already commenced operations in all the circles while Idea is set to launch in Delhi. Escotel and Reliance have not made any headway. BHARTI, 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, most telecom circles will have four cellular operators. There will be tremendous competitive pressure, 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, Bharti came out with its longawaited initial public offering (IPO) in January 2002.
Leveraging on the success of its cellular service, the company got a very good response from the primary market. The total size of the IPO was 185 million 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 Bharti and Idea have GPR Senabled networks, there is caution on their part to launch the service. With hardly any applications, the success of GPRS remains a question.
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Cost-centered solutions like closed user group (CUG), value-adds like unified messaging and instant alerts are being offered.
A variety of mobile applications are finding takers among the enterprise segment. Bharti 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.
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Corporations can choose enhanced services like user-defined call routing to prevent misuse. Calls can be barred, limiting access to select numbers and diverting calls to one single number. Broadcasting services are also quite popular, especially among fast food centers that have a central number. Group SMS is quite popular, especially among enterprises both in the service as well as the fast-moving consumer goods (FMCG) 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. Banks too find bulk SMS service very useful to forward transactional alerts to their customers.
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o Consequently, operators need to streamline their customer relation activities and adopt aggressive subscriber acquisition and retention strategies.
REGULATORY ISSUES
The operations of this sector are determined as under the Indian Telegraph Act of 1885. A document buried in the sands of time. The next major policy document, which was produced, was the National Telecom Policy of 1994, a consequence of the on going process of liberalization.
YEAR
1851
EVENTS
First telephones in India
1943
1985
1986
1991
1994
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1994
September 1994
Guidelines for private sector participation in basic services Cellular licenses issued for metros
November 1994
December 1994
Tenders for cellular licenses in 19 cities apart from 4 metros Tenders for 2nd operator in basic services apart from DoT on circle basis. VSNL launches Internet services
January 1995
August 1995
January 1996
TRAI formed
November 1998
The National Telecom Policy of 1994 document, which laid out broad policy guidelines rather than a series of action points. Like 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 9.5mn additional lines, telephone on demand by 1997, and a PCO pop of 500. The Eighth Plan had also allowed private operators in value added services. To facilitate licensing, the nation was divided into 20 circles (akin to a state) for basic and 21 circles for cellular telephony. Mumbai falls in Maharashtra circle and Delhi in itself a circle.
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The basic premise on which competition has been introduced is that every circle will have one private operator apart from DoT/ BHARTI for basic and two operators for cellular. DoT/ BHARTI have the option to become the third cellular operator in future.
Government did not achieve most of its stated targets. The basic theme, which was broadening the reach of telephony in India, has not been met. Even liberalization policies were not implemented properly. The regulator TRAI was set up after delays and confusion and even after its creation, DoT continued to fight with it in courts. It was also affected by the resource crunch, and financing options like BOT, BOOT and BOLT was not used at all. The major policy direction it showed was to allow private sector entry in both basic and value added services. The intention, though noble failed to achieve its goals because of improper implementation, the economic costs are still borne by the end user.
The telecom sector has witnessed some fundamental structural and institutional reforms in the past decade. telecom equipment manufacturing was completely deregulated in 1991. Valueadded services (including cellular services) were thrown open to private sector participation in 1992. Basic services were opened to private participation in 1994 by dividing the country into 21 telecom Circles and allowing one private operator per Circle to compete with DoT. An independent telecom regulatory Authority of India was set up in 1997. A new Policy for Internet Service Policy Providers (ISPs) was announced in 1998 allowing independent service providers to enter the sector ending the earlier monopoly of VSNL. Reorganization of DoT, separating policymaking function and service provision and corporatization of DoT's operational network are two major institutional reforms, which need to be implemented.
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These are the premise on which Bharti Enterprises has based its entire plan of action.
Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunications with its world-class products and services.
Established in 1985, Bharti has been a pioneering force in the telecom sector. With many firsts and innovations to its credit, ranging from being the first mobile service in Delhi, first private basic telephone service provider in the country, first Indian company to provide comprehensive telecom services outside India in Seychelles and first private sector service provider to launch National Long Distance Services in India. Bharti had approximately 3.21 million total customers nearly 2.88 million mobile and 334,000 fixed line customers.
Its services sector businesses include mobile operations in Andhra Pradesh, Chennai, Delhi, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Kolkata, Madhya Pradesh circle, Maharashtra circle, Mumbai, Punjab, Tamil Nadu and Uttar Pradesh (West) circle. In addition, it also has a fixed-line operations in the states of Madhya Pradesh and Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu and nationwide broadband and long distance networks.
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Bharti has recently launched national long distance services by offering data transmission services and 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 Chennai-Singapore for providing international bandwidth.
Bharti Enterprises also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments, it is also the first telecom company to export its products to the USA.
Bharti Tele-Ventures' strategic objective is To capitalize on the growth opportunities that the Company believes are available in the Indian telecommunications market and consolidate its 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: o Focus on maximizing revenues and margins; o Capture maximum telecommunications revenue potential with minimum geographical coverage; o Offer multiple telecommunications services to provide customers with a "one-stop shop" solution;
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o Position itself to tap data transmission opportunities and offer advanced mobile data services; o Focus on satisfying and retaining customers by ensuring high level of customer satisfaction; o Leverage strengths of its strategic and financial partners; and o Emphasize on human resource development to achieve operational efficiencies.
Businesses
Bharti Tele-Ventures current businesses include o Mobile services o Fixed-line o National and international long distance services o VSAT, Internet services and network solutions
Competitive Strengths
Bharti Tele-Ventures believes that the following elements will contribute to the Company's success as an integrated telecommunication services provider in India and will provide the Company with a solid foundation to execute its business strategy:
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Nationwide Footprint - approximately 92% of India's total mobile subscribers resided in the Company's fifteen mobile circles. These 15 circles collectively accounted for approximately 56% of India's land mass; Focus on telecommunications to enable the Company to better anticipate industry trends and capitalize on new telecommunications-related business opportunities;
The strong brand name recognition and a reputation for offering high quality service to its customers; Quality management team with vision and proven execution skills; and The Company's strong relationships with international strategic and financial investors such as SingTel, Warburg Pincus, International Finance Corporation, Asian Infrastructure Fund Group and New York Life Insurance.
Brand Architecture:
Bharti is working on a complex three-layered branding architecture to: Create specific brands for each service,
Use Bharti as the mother brand providing the group its corporate identity as well as
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AirTel - The flagship brand for cellular operations all across the country. Touchtel - The brand earmarked for basic service operations. India One - The brand for national long distance (NLD) Telephony
Though the costs of creating new brands are heavy but the group wants to create distinct independent brands to address different customers and profiles.
Brand Strategy:
To understand the brand strategy, lets first look at the brand building exercise associated with AirTel 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 any means. For the average consumer, owning a cellular phone was expensive as tariff rates (at Rs 8 a minute) as well as instrument prices were steep sometimes as much as buying a secondhand car.
Bharti 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 the simple 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 the customer as the main selling tack. The idea was to become a badge value brand, he explains.
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So the AirTel leadership series campaign was launched showing successful men with their laptops and in their deluxe cars using the mobile phone. In simple terms, it meant AirTel was positioned as an aspirational 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 that were clearly associated with the brand leadership, dynamism and performance.
These were valuable qualities, but they only took AirTel far enough to establish its presence in the market. 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 this could be a major weakness. The reason? With tariffs identical to competitor Essar and roughly the same level of service and schemes, it had now become important for Bharti to 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 this was 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 you reached them you had to expand the market so there was need to address to new customers.
By that time, Bharti was already the leading cellular subscriber in Delhi with a base of 3.77 lakh (it now has 1.2 million customers). And with tariffs becoming more affordable as cell companies started cutting prices it was time to expand the market.
How could Bharti leverage this leadership position down the value chain? Surveys showed that the concept of leadership in the customers minds was also changing. Leadership did not mean
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directing subordinates to execute orders but to work along with a team to achieve common 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 mostly through word-of-mouth endorsements from friends, family or colleagues. Thus, existing customers were an important tool for market expansion and Bharti now focused on building closer relationships with them.
That is precisely what the brand tried to achieve through its new positioning under the AirTel Touch Tomorrow brand campaign. This set of campaigns portrayed mobile users surrounded by caring family members. Says Sachdev: The new campaign and positioning was designed to 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 in which it already operates Bharti is now realizing that there are new compulsions to rework the AirTel brand, and a new exercise is being launched to this effect. Right now, the company is unwilling to discuss the new positioning in detail. But broadly, the focus is on positioning AirTel as a 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, Bharti 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. One such experiment, launched last year, is Youtopia, a brand aimed at the youth in the 14 to 19 age bracket and for those who are young at heart. With its earlier positioning, AirTel was perceived as a brand for the well-heeled older customer; there was nothing for younger people. With Youtopia, AirTel hoped to reverse that.
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In order to deliver the concept, AirTel offered rock bottom tariff rates (25 paise for 30 seconds) at night to Youtopia customers a time when they make the maximum number of calls. It also set up merchandising exercises 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 SMS rates with normal calls to make it cheaper for young people to use.
The other experiment that Bharti 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 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 (accusingly slow 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.
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The Magic:
Perhaps the more ambitious experiment has been with Magic the pre-paid card. The idea was to make the brand affordable, accessible and, most importantly, feasible as a means of expanding the market even faster.
PHASE I
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. 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 Bharti did three things. o One, the product was made available at prices ranging from Rs 300 to Rs 3,000 with no strings attached and was simple to operate. o 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. o Third, to make the product more approachable to the customer, the company came with vernacular ad campaigns like Magic Daalo Se Hello which appealed to local sensibilities.
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This apart, the company roped in Karisma Kapoor and Shah Rukh Khan for a major ad campaign all across Delhi, a ruse that saw the number of subscribers go up from 5.47 lakh to 12 lakh 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. Earlier, the branding strategy was aimed at roping in only interested customers that is, customers who were already inclined to opt for mobile services. But now, with basic service
providers having been allowed limited mobility at far cheaper rates, mobile service providers could find 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 they had not perceived would be available from using a pre-paid card.
PHASE II
Bharti used AirTel Magic to build a strong value proposition and accelerate market expansion through Indias first national pre-paid card TV brand campaign o First time ever in India - any pre-paid card brand goes on TV o A combination of the film genre exposed through the TV medium designed to connect with the masses of India o Youth based - romance driven strategy platform makes the value proposition of AirTel Magic - Mumkin Hai come alive
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o All elements - user imagery, context, tone & language created to connect the category to the lives of the SEC B & SEC C segment the middle class nonmobile user. o AirTel Magic positions itself on the platform of being excellent for emergency situations - increasing productivity as a part of everyday life. o 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 nonuser segment defined as young adults, 15-30 years of age; in the Sec B & C segment is aimed at accelerating market expansion. The value proposition is centered around a persons desire to make all his / her dreams, ambitions & aspirations instantly possible. The new campaign for AirTel Magic 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 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. 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 slogan Magic hai to Mumkin hai 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 share in the process. The brand ambassadors Sharukh 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 from a TV actor to become Indias top film star and national heartthrob. Kareenas success is due to
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her attitude, talent, hard work and the sheer ability to make a mark in such a short time. Both these stars have said Mumkin hai and made it happen for themselves.
The genre of this new strategy & campaign is Hindi cinema led. This genre connects millions across India. The spirit of romance, dancing the Indian cinema, well known to most as Bollywood, holds millions of Indians together as one.
The new TV campaign of AirTel Magic crafted in the Hindi film idiom, magnifies the empowering optimism of Mumkin Hai, in the endearing situation of a boy-girl romance. Where Sharukh Khan, sets his eyes on Kareena Kapoor and wins her love with the help of AirTel Magic. (Poignantly conveying that special feeling we all get when a dream is made possible and a victory of the heart is won).
The strategy & new brand campaign is targeted at the large untapped base of intending mobile customers from Sec A, B & C. The estimated addressable market of such customers in the next two years is around 25 million in AirTels 16 states. The new strategy aims at correcting the 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 nationwide research and is an integral part of AirTel Magics new multi-media campaign. The campaign has been created by Percept Advertising.
PHASE III
Bharti used AirTel Magic to build a strong value proposition and accelerate market expansion through Indias first national pre-paid card TV brand campaign
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o First time ever in India - any pre-paid card brand gives such freedom to recharge any value o A combination of the film genre exposed through the TV medium designed to connect with the masses of India o Youth based - romance driven strategy platform makes the value proposition of AirTel Magic - Aisi azaadi aur kahan? come alive o Sharukh Khan makes everything in life possible 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 value proposition is centered around a persons desire to make all his / her dreams, ambitions & aspirations instantly possible. The new campaign for AirTel Magic 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 to make all their dreams, hopes & desires come alive instantly .At a amount of your choice you can recharge your account with available validity time .Improving productivity, letting you befriend the world and opening up new 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 slogan Aisi azadi aur kahanhas been specially created to capture this effectively.
Amount (Rs)
54 60
Validity (Day)
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75 100 125 150 175 200 216 225 250 275 300
5056 7041 9026 11.11 12.96 14.81 16 16.67 18.52 20.37 22.22
25 25 50 50 50 50 85 85 85 85 85
44.44 67.59 65.74 88.89 112.04 135.19 115 123.33 146.48 169.63 183.78
5 10 10 10 10 20 20 20 20 20 20
Amount (Rs)
324 350 360 375 400 425 475
Validity (Day)
30 30 30 30 30 30
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30 30 30 30 30 30
775 800
57.40 50.36
150 150
567.59 580.74
30 30
Amount (Rs)
900 1000 1080 1200 1300 1400 1500 1800 2000 2160
Validity (Day)
60 60 60 60 60 60 60 60
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YOUR TALK TIME = MRP PROCESSING FEES SERVICE TAX Other Brand Building Initiatives:The main idea is to stay ahead of competition for at least six months. Working on the above game plan Bharti 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 devised common numbers for subscribers across the country for services like customer care, food services and cinema amongst others.
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place to another do not have to close and then again open new accounts at another place.
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It will also launch a unified billing system across circles so, customers moving from one
To assist customer care personnel to deal with subscriber queries, a storehouse of 40,000 frequently asked questions and their answers have been stored on the computers. Bharti 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.
Bharti, for the first time for a cellular operator, has decided to offer roaming services even to 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 and ranges from 10 to 15 per cent of the customer base every month), the company is also working on a loyalty 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 to customers. The idea is to create an Airtel community. Another key area which Bharti is concentrating its attention upon is a new roaming service launched in Delhi under which calls of a roaming subscriber who is visiting the city will be routed directly to his mobile instead of traveling via his home network. The company also offers multi-media messaging systems under which customers having a specialized 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. Bharti 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 activation centers. Earlier Bharti had 250 Airtel Connect stores which were exclusive outlets (for its services) and
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about 250 Airtel Points which were kiosks in larger shops. Now activation can be done by all of them, and not only by Connect 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 helping the market to increase. First, they are easier to obtain and convenient to use. Unlike post-paid, one need not pay security deposits for picking up a pre-paid card. It is often available even with paanwalas. As befits a fast-moving consumer service, the game is now moving beyond price to expanding distribution reach and servicing a well-spreadout clientele with technology and strategic alliances. Bharti is focusing on two factors to make pre-paid cards more attractive. Keeping the entry cost low for consumers and making recharging more convenience. Bharti is in the process of launching a new system in alliance with Mumbai-based 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 card every time it expires but also enable mobile companies to reduce the cost of printing and distributing cards. Bharti Televentures has tied up with 'Waiter on wheels,' a company delivering food at home, to reach its Magic pre-paid cards to subscribers' doorsteps. The company is also joining hands with local grocery shops which will enable users to recharge their cards by just 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 pre-paid service. They are leveraging technology to expand their distribution network and deliver round-the-clock recharge options to its MOTS (Mobile on the Spot) subscribers. Bharti Cellular has also launched a special service, CareTouch, for high-value, corporate customers, providing them with instant, single-point access for any assistance they
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require. Customers can dial 777 and enjoy a slew of services, which includes easier payment of bills, service on priority basis, and value-added services without any additional paper work. Bharti Cellular is offering a range of services without going through an interactive voice recorder ensuring that they save time. Dedicated CareTouch executives are expected to assist customers with any service on priority basis. Besides the regular proactive reminder 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 dedication show exclusively for AirTel and AirTel Magic customers. Highly interactive VJ based show with real-time feedback mechanism. Both brands joined hands to target the high growth youth segment.
Bhartis View on its Branding strategy:First, brand building efforts in todays context have to be seen in a more holistic manner. 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 the same time, becoming more individualistic in their needs and far more demanding with the passage of 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 key element of creating brand equity in the present situation.
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Customizing the product (and communication of its benefit) to meet the specific needs of various
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As far as allocation of time and financial resources are concerned, too many companies mistakenly allocate a disproportionate amount on mere advertising and promotion. This is not to say that advertising and promotion are less relevant. On the contrary, with more choices and higher media clutter, businesses need to budget for an increasingly higher spend on their brand promotion but this has to be undertaken in tandem with enterprise-wide reengineering of the business 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 equity continues to increase as 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 regional or a national (or an international) brand will continue to rise but also the time taken to do so will be longer and will need sustained and focused efforts.
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CHAPTER-3
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are 15-21 years old. They are school and college going students and carry mobile phones to flaunt. They are 15% of the total interviewed people.
Occupation Graph
As the above graph shows that 55% of the total people interviewed are working. So, these people are the ones who are the maximum users of mobile phones. They are the young executives, managers, Tele - callers etc. who require mobile for their official purposes. The next category is the households, who are either housewives, small units which operate from their homes etc. They are 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.
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TYPES OF CARDS
SIM CARD 15%
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RELIANCE 85%
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On the basis of analysis of the questionnaire I have found that the maximum no. of people who use mobile phones is in the age group of 20 to 28. Who are the young executives and other office goers?
There are more no. of prepared cards than post paid cards. The mobile users want to spend money side by side than to spend money at the end of the month on a big bill.
Now when I compared Airtel with its competitor from the point of view of the consumer I found that on the basis of Tariff plan, value added services and billing accuracy Airtel is at par or ahead of its competitor but in the case of customer care and availability they lag behind there competitors. As, Airtel has a hold in the market because it has the maximum no. of connections, so it must improve upon it customer services. As far as WLL is concerned people are aware
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People at this point of time are not interested to switch over from GSM to WLL.
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about it but not many people are aware about Tata. They only Know more about Reliance.
CHAPTER-4
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SWOT
ANALYSIS
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SWOT ANALYSIS
Strengths
o Being one of the largest companies in India the company has achieved a degree of focus in its core business of its products. o It has a strong brand name, superior quality products and an enviable distribution network. o It has a clear and well-defined organization structure and limits of financial authority. o Increase in advertisement spends affect the companys margins. o The companys bottom line falls victim to the bloated and highly paid workforce, which affects its margins.
Weakness:
o Little efforts over the Advertising of products. o Distribution channel is not accurately categorized. o Premium priced products, hence cant compete in low price segment.
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Opportunities:
o The company's financial performance can receive a major boost from its cost reduction efforts. o There is a lot of scope of product and market diversification. o Exports of products will also have huge chances in the coming years. o Airtels business has ample scope for gaining market share from the unorganized sector. Rural penetration too holds vast potential to bring about growth.
Threats
o The slowdown in the economy has restricted topline growth of most FMCG majors and for Airtel also it will be difficult to maintain historical growth rates in such a depressed scenario. o Companys major raw materials are influenced by government policies / controls as well as vagaries of the monsoons. Fluctuations in the prices of raw materials would have significant impact on costs and margins of the company.
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CHAPTER-5
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SUGGESTIONS
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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. Its demand should be 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 released in different Medias to create brand awareness. *Free samples should be distributed among the prospects. Sales promotion tools like gifts, contests and coupons must be given to retailers as well as customers and prospects. Catalogues should be distributed among customer.
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RECOMMENDATION
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RECOMMENDATION
I have made following recommendation to the company after doing the summer training there: o The company should modify its credit policy as they only target the cash paying customers who are not easy to trace. o The company should emphasis more on the quality of Pharmaceuticals Products it was mostly claimed by the exporters that their receipts from company doesnt matches with the samples quality shown before giving orders. o The company should make its marketing strategy flexible enough in order to face competition. o The company should keep an eye on the proper delivery of the goods to exporter on time, as it has been recommended by exporters to make the delivery on time. o The company rate policy must be flexible enough to catch new customers because if company offers lower price to a new customer then he may continue buy the goods and can be a permanent customer for the company. o 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 traders and commission agents while having a brand name.
The company should take the opinion of exporters from time to time to know what problems they are facing from the companys side? And if any change they require in present supplying condition?
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LIMITATIONS
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LIMITATIONS
No project is without limitations and it becomes essential to figure out the various constraints that we underwent during the study.
The following points in this direction would add to our total 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 displayed complete ignorance about the complete branded range, which was being studied.
7. Lack of proper information and experience also because hurdle for me.
8. Some retailers did not answer all the questions or do not have time to answer.
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CHAPTER-6
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CONCLUSION
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CONCLUSION
After analyzing the findings of the research, I can conclude that Airtel lagged behind its competitors as far as customer service and availability is concerned. The maximum no. of people who use the mobile are in the age group of 20 to 28. Cash cards are the most popular type of mobile connections, as they are consumer friendly and recharging the connection is not a problem.
Maximum no. of people spends RS 500 on their connections. As Airtelis the only company having the 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 kahan has already became popular in market. So we can say that inspite of so many competitor in the market Airtel is having a good position just because every time, it tries its best to understand the need of its important customer.
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BIBLIOGRAPHY
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BIBLIOGRAPHY
In this project report, while finalizing and for analyzing quality problem in details the following Books, 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.
Websites:
Magazines:
Airtel (2 July to 10 July 2004) Airtel India page of HT paper (Thursday 1December 2004) Cowards India (26 December to 4 Jan. 2004)
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QUESTIONNAIRE
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QUESTIONNAIRE
Dear Sir/Madam,
I am a student of BBA of Fairfield Field Institute Of Management & Technology, Kapashera, doing my summer training project on consumer behavior from Airtel. Please give your precious time for filling these details.
Q.1 For how long you have been using Airtel Product?
Yes No
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Excellent
Good
Average
Below Average
Yes No.
Magazines Dealers Sales Executives Operators reference Pamphlets and catalogue Reference from friends and relatives
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Any other
Q.7 What are the features you look for in a product before making purchase decision? Give preferences (1-Highest, 6- least)
Brand credibility Price and Discount After sales services and parts, network Value for money Vehicle performance Add on features or ergonomics of design
Q.8. Which of these marketing / sales schemes attracts you while purchasing any connection?
Q.9 If you have to purchase a new connection or product in near future, which Brand will you go for and why?
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Q.10 Are you aware of various promotional activities being run by Airtel, if yes then how? Are you satisfied with these promotional activities?
Very Satisfied
Satisfied
Somewhat Satisfied
Not Satisfied
Customer Care
Q.11 How would you rate Airtel performance as your expectation on 5 points scale (5 Highest) 1 2 3 4 5
Q.12 What are you suggestions for improving the product quality, service availability and parts availability?
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