STRATEGIC & CHANGE MANAGEMENT

Vodafone SWOT Analysis

Introduction
Established 1985
HQ in Newbury, London
8,000 employees
Revenue 400 million
LSE, 197.50/share (31 July 2014)
To enrich our customer's lives through the unique power of mobile communication

Strength
Improve its data coverage and in-building
reception to 98%

Service
Strong Brand Recognition

Red Plan: incorporates a number of

innovative services
24/7 customer support hotline
Online payment and purchasing
Leading operator in their emerging
markets
4TH best Telecom provider in the world

Skilled Workforce

Motivated, diverse and skilled workforce

High performing global organisations

Efficient Supply chain

Management

European Supply chain Excellence

Award 2012
M2M solutions : monitor energy at their
network sites, retail premises.

Weaknesses
Underperformance
in key markets

Economic slowdown
in European Market

Poor Coverage

Deterioration of
network after began
rolling out its 4G
services.
Vodafone fail to
meet minimum
coverage obligation
for 3G from 80% to
90% in 2010.

Centralised
Management
System

Unable to
effectively address
competition

Difficult to
communicate
managerial
decisions.

Focused on the UK
market.

Decline in creativity
and inflexibility.

Competitiveness in
price: o2s 4G plan
is only 20 &
Vodafones 4G plan
which is 26.

High level of
customer churn
rate

2007, Vodafones
churn rate increased
from 2.8% to 3.4%

Opportunities
Mobile Money
Transfer
4G & 5G
Mobile Data Services
Emerging Markets
New Service

Value added service to transfer money via mobile to

enhance innovation.
Improving the current 4G issues and staying
updated with the progress in 5G network.
Voice calls, texts, EDGE, etc. to stay connected with
better retention programs.
Merging and opening its services in the developing
nations to gain more revenue.
Machine-Machine services, mobile commerce
services. etc.

Threat
Competitors

Legal Risks

Global
competition
and lower
entry barriers
brings in
more
competitors

Developing
nations has
varied
political
instability
and brings in
legal risks.

New Mobile
Entrants
Launching of
new entrants
posses a
possible
threat in the
market for
the existing
business.

Target
Market
Needs
Flexibility of
choices in
accordance
to peoples
need and
wants

Global
Competition
Huge
saturation of
Telco
Companies
and the
global
intense
market.

Competitive Advantage
Quality & Innovation
98% coverage in the U.K
4G LTE Service

Strong brand recognition

Leading operator in emerging markets
4th best telco provider in the world

Major Weaknesses
Fail to address
effective
competition

High Churn Rate

37% of customers by market is India, followed by South

Africa (14%), Germany and Egypt (9%), Italy (6%), UK (5%),
Spain (4%), Others (16%) (Vodafone: Investor, 2013).
In UK Market, still cant be able to compete with other
competitors. Example: O2 price for 4g service is 20 pounds,
while vodafone still at 26 pound

Due to intense competition, Vodafone Australia loses

500.000 ($218 Million) customers in period December 2012
to June 2013 (Financial Review, 2013).

Recommendation
1. Increment in radio towers
2. Revised prices
3. Revised prices
4. Mobile phone number as credit card
5. Sports sponsorship, celebrities
endorsement can improve outreach to
public

Justification of Strategy
High initial cost
Lower profit margin, higher total revenue
Low cost to implement, increased attractiveness.
Mobile theft might increase due to mobile phones being a form of cash.
Sports sponsorship, celebrities endorsement can improve outreach to public

Conclusion
Based on the 5 recommendations, some are made for the long term profit (increment of radio towers
& Mobile phone credit card) and some are made to improve customer base in the short term (revised
prices, loyalty point system, improved marketing strategy).
The cost of radio towers do not come at a low price, and the results only show after a long period of
time. As for the mobile phone credit card system may take some time for the public to accept the new
service.
The 3 recommendations that are deemed as short term remedies can be easily replied by
competitors, by having even lower and more attractive prices, while a more rewarding loyalty system
can be implemented by other competitors in just a short time to recover their market share.

Reference
Financial Review: Vodafone Loses 500.000 Customers in Six Months, (2013), retrieved 17 August 2014, from
http://www.afr.com/p/business/companies/vodafone_loses_customers_in_six_xCTi8yOWLlztAJ2A4V7MFK
Vodafone: Investor, (2013), retrieved 17 August 2014, from
http://www.vodafone.com/content/dam/vodafone/investors/factsheet/group_presentation.pdf