Vodafone STP & Marketing Strategy - MBA Project Report Free PDF Download PDF

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A REPORT ON VODAFONE ESSAR LIMITED

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CONTENTS:

page no.

1. Objectives

4

2. Introduction

5

3. Segmentation

6

4. Targeting

8

5. Positioning

8

5. Enterprise Services

9

6. Market and Competitive analysis

10

7. Brand and distribution

11

8. Macro and Micro economical factors

15

9. SWOT analysis

19

10. Future strategies

20

11. Ansoff Matrix

21

12. Product Life Cycle(PLC) analysis

23

13. Appendix

26

14. Interview

32

15. References

35

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OBJECTIVES:

To understand the current Segmentation, Targeting, Positioning and Marketing strategy of Vodafone. To study the Macro and Micro Environmental factors affecting it. Analyse its Market presence by studying the strengths, weaknesses, Opportunities and threats. Drafting a future strategy using Product – Market Matrix and PLC in order to increase the market share, expand the presence and be prepared for the possible threats.

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INTRODUCTION:

Vodafone Essar is an Indian subsidiary of Vodafone group and commenced its operations in 1994 when its predecessor Hutchison Telecom acquired the cellular license for Mumbai. The company now has operations across the country with over 78.68 million GSM mobile customers. Over the years, Vodafone Essar, has been named the ‘Most Respected Telecom Company’, the ‘Best Mobile Service in the country ‘and the ‘Most Creative and Most Effective Advertiser of the Year’. Vodafone is the world’s leading international mobile communications group with approximately 315 million proportionate customers as on 30 June 2009. Vodafone acquired an indirect controlling interest in Vodafone Essar, their local operating company in India, in 2007-08. Vodafone currently has equity interests in 31 countries across five continents and around 40 partner networks worldwide.

Vodafone Essar is now largest operating company for Vodafone when measured by customer numbers and its sheer scale and rapid growth makes it unique. It has nearly 10,000 employees and employs more than 90,000 contractors. The network is rapidly expanding to meet demand and extend telecommunications to more rural areas, with more than 2,500 new base stations deployed each month.

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SEGMENTATION: Product Segmentation

Telecommunication means

Landline

Mobiles

GSM

AIRCEL

AIRTEL

VODAFONE

RELIANCE

CDMA

BSNL

OTHERS

GSM

Consumer Segmentation Customers are typically classified as prepaid or contract customers. Prepaid customers pay in advance and are generally not bound to minimum contractual commitments, while contract customers usually sign up for a predetermined length of time and are invoiced for their services, typically on a monthly basis. Increasingly, Vodafone offers SIM only tariffs allowing customers to benefit from the Vodafone network whilst keeping their existing handset. o The following segmentation variables are used by Vodafone in order to segment the market : Geographic : Vodaf onesegment si t smar k etasmet r os ,Aci r cl e,Bci r c l eandC-ci r cl e.Her e,t hesegment at i oni s

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Downloaded from Studynama.com. Click to download unlimited free college projects » doneont hebas i sofr egi onsi nwhi c ht heyoper at e.Al so,r ur al andsemi ur banmar k et sar ef as t emer gi ngaspr ofit abl emar k etsegment ,s oVodaf onei st r yi ngt oenhancei t soper at i onseffect i v el y f ur t heri nt hes esegment .

Demographic: Income : Vodaf onef ur t hers egment si t smar k etac cor di ngt ov ar i ousi nc omel ev el sandhav ev ar i ouspl ans f orev er y st r at aofsoci et y .

Age: odaf onedoesnotpr i mar i l ysegmenti t smar k etont hebasi sofagebutt heyhav especi fic pl ansf ory out h.

Nature of the Customer: Dependi ngont hef actt hatwhet hert hecust omeri si ns t i t ut i onal orsol e,t heser v i c esandpl ans pr ov i dedbyVodaf onev ar i esandt hus,i tf or msani mpor t antbas esf orsegment at i on.

Psychographic: tyle and Personality: Vodaf onesegment si t sus er sont het ypeofser vi cet heyus ebased ont hei rl i f es t yl e s uc hasdi ffer entpl ansf ors t udent s,pr of es s i onal set c.

Behavioural: efits Sought: Vodaf onesegment si t scus t omer sont hebas i soft hebenefi t ssoughtbyt hem suc has suchas : l oc al cal l , STDcal l orI SDcal l mak er s;us er sofv al ueaddeds er v i c es ,connect i vi t y,cov er age.

age Rate : Vodaf oneal s oc l ass i f yi t sus er sasonewi t hheav yus ager at e,medi um us ager at eandl i ght us ager at eandhav edi ffer entt ar get i ngsc hemesf oreachoft hem.

Type of the service: eTypeoft heser vi cepr ovi dedbyVodaf onet oi t sc us t omer sal sopl aysacr uc i al r ol ei n deci di ng t he s egment at i ons t r at egyi mpl ement edbyVodaf one.

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BUSINESS SEGMENTATION The Group continues to grow usage and penetration across all business segments. VGE manages the Group’s relationship with Vodafone’s 270 largest multinational corporate customers. VGE simplifies the provision of fixed, mobile and broadband services for MNCs who need a single operational and commercial relationship with Vodafone worldwide. It provides a range of managed services such as central ordering, customer self-serve web portals, telecommunications expense management tools and device management coupled with a single contract and guaranteed service level agreements. The Group continues to expand its portfolio of innovative solutions offered to small office home office (‘SoHo’), SME and corporate customers. Increasingly these combine fixed and mobile voice and data services integrated with productivity tools.

Targeting:Vodafone has full market coverage with differentiated offerings. Market is targeted through many different tariffs, services and propositions for every segment according to specific customer preferences and needs. These often bundle together as: voice, messaging, data and increasing value added services. The various examples for this include: 

Home calling cards for the family of those professionals who use to work abroad.

  

Rs.10 recharge for small users Cheap SMS facility for youths Facilities for circle users etc

POSITIONING: Vodafone has continued to build brand value by delivering a superior, consistent and differentiated customer experience. Their tagline “Where ever you go our network follows” gives the customer indication of their vast coverage. Downloaded from Studynama.com. Click to download unlimited free college projects »

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They differentiated themselves from other mobile service providers by delivering the promise of “helping customers make the most of their time” and their communication strategy has always focussed on “Happy to help” which tends to strike an emotional chord with the customer. The Group’s vision is “to be the communications leader in an increasingly connected world” expanding the Group’s category from mobile only to total communications. To enable the consistent use of the Vodafone brand in all customer interactions, a set of detailed guidelines has been developed in areas such as advertising, retail, online and merchandising. In April 2009 a campaign, focusing on the different value added services (VAS) offered by the company was launched, introduced new characters called the Zoozoos who seem to be in between the world of animation and reality. Several advertisements in which the Zoozoos featured were shown on television during the Indian Premier League (IPL) Season 2 and were instant hit among the customers but the conversion of this excitement into revenue is yet to be seen.

ENTERPRISE SERVICES:  Voice services  Pre – Paid  Post – Paid  Value Added Services  Tunes and downloads  Entertainment  Devotional  Sports  News and Updates  Call Management Services Downloaded from Studynama.com. Click to download unlimited free college projects »

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 Astrology  Finance  Travel  Mail, Messaging  Dial in Services  Bill Info  Vodafone Live  Vodafone Business Solutions  Mail on the move  Business application  Vodafone Office  Vodafone Business Solution

MARKET AND COMPETITIVE ANALYSIS:

market% 7.09 32.29 3.94 1.33 0.72

14.9

15.57

Bharti Airtel Vodafone Essar BSNL Idea Cellular Aircel Reliance GSM MTNL Loop

24.16

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40

GSM SUBSCRIBERS base in India as in June 2009

/ existingusers/ ser 0

120,000,000 100,000,000 80,000,000 60,000,000

SUSCRIBERS

r Airtel from the ngly expanding e far from Airtel r base along

40,000,000 20,000,000

Lo op

M TN L

BS ID NL EA Ce llu lar Ai Re rce lia l nc eG SM

ar ti

Ai rt Vo el da fo ne

0

Bh

afone stores and country specific Vodafone websites, and indirectly via third party service providers, independent dealers, distributors and retailers, to both consumer and business customers in the majority of markets under the Vodafone brand . Customer strategy and management Customer Delight Index:(2008: 73.1,2007: 70.6, 2006: 69.9)

The Vodafone Group has created a Global Customer Value Management team to support operating companies with their aim to engage with customers directly through a data driven approach. Recent examples of this include: rollout of a consistent and innovative store, successful trial of an innovative handset based self service solution and creation of a global training academy for customer facing staff. Vodafone continues to use a customer measurement system called “customer delight” to monitor and drive customer satisfaction in the Group’s controlled markets at a local and global level which identifies areas for improvement and focus. Marketing and brand : 1. 68.8 million Vodafone subscribers across India as at 31 March 2009 (up from 44.1 million as at 31 March 2008) Downloaded from Studynama.com. Click to download unlimited free college projects »

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 2 million new subscribers a month on average  18% market share

Logo

a new visual identity—from the deep pink logo of Hutchison-Essar to Vodafone’s trademark deep red speech mark introduced in 1998. Advertisement: The inaugural TV commercial showed the trademark pug (minus the boy) moving out of a pink kennel into a red one. An energetic version of Hutch’s signature ‘You and I’ tune played towards the end, as the super concluded, ‘Change is good. Hutch is now Vodafone’. There were four more commercials featuring Hutch’s animated boy and girl, introducing the new brand’s logo to consumers. Vodafone put in close to Rs 150 crore into the first phase of the rebranding exercise—with Rs 60 crore in mass media and another Rs 90 crore in retail activities. In the second phase, Vodafone ushered in its global strapline—“Make the most of now”, which replaced “How are you?” in 2001. By then it was apparent, the boy-and-pug chapter would soon be over. In 2008, Vodafone used the platform of cricket when it unveiled the ‘Happy to Help’ series during the first season of the Indian Premier League (IPL). This season the Zoozoos are all the rage. These characters have virtually hijacked the online media as well as television—to convey a value added service (VAS) offering in each of the new commercials. In Indian scenario when other major telecom service providers are using celebrities(Airtel-Shahrukh Khan, BSNL-Deepika Padukone, Aircel-Mahendra

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Singh Dhoni, Idea-Abhishek Bachchan) as their brand ambassadors, Vodafone is standing out proudly with Zoozoos and pug as successful ad campaign.

Products and services in India:

   

Average cost of calls: 2 US cents per minute Average revenue per customer: US$6.4 per month 853,039 points of sale, covering 65% of the population With more than 3 million Vodafone-branded, affordable handsets sold in 2008/09, Vodafone ranks among the top five handset brands in India

Brand and customer communications

 In the BrandZ most powerful brands ranking: Ranked 11th globally.  In telecom industry it proudly stands as world no. 2 after China no. 2 GSM service provider in India after Airtel A new Marketing Framework has been developed and implemented across the business, which includes a new vision of expanding the Group’s category from mobile only to total communications “to be the communications leader in an increasingly connected world”. Brand and customer experience continues to implement Vodafone’s promise of “helping customers make the most of their time”. The brand function has also developed a methodology to develop competitive local market brand positioning, with local brand positioning projects now implemented in 12 markets. In September 2007, Vodafone welcomed India with the “Hutch is now Vodafone” campaign. The migration from Hutch to Vodafone was one of the fastest and most comprehensive brand transitions in the history of the Group, with 400,000 multi brand outlets, over 350 Vodafone stores, over 1,000 mini stores, over 35 mobile stores and over 3,000 touchpoints rebranded in two months, with 60% completed within 48 hours of the launch. Brand Health Tracking:

Vodafone regularly conducts Brand Health Tracking since 2002, which is designed to measure the brand performance against a number of key metrics and generate insights to assist the management of the Vodafone brand across all Vodafone branded operating companies. Downloaded from Studynama.com. Click to download unlimited free college projects »

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Sponsorships

Vodafone majorly sponsors the following teams and events, apart from various regional and timely sponsorship: Kshitij, Annual Techno-management festival of IIT Kharagpur, Strategic Partner 2008    

Indian Premier League (Cricket), Associate sponsor England cricket team Vodafone McLaren Mercedes Formula One team, title sponsor Triple 8 Race Engineering, V8 Supercars team, primary sponsor (since 2007)

Distribution Direct distribution-Number of directly owned stores - 1150

Vodafone directly owns and manages over 1,150 stores. These stores sell services to new customers, renew or upgrade services for existing customers, and in many cases also provide customer support. A standard store format, which was tested in 2006, was rolled out in 11 markets during the 2008 financial year. All stores in India were rebranded as Vodafone and over 40 stores were refurbished to the Group’s standard format. The Group also has 6,500 Vodafone branded stores, which sell Vodafone products and services exclusively, by way of franchise and exclusive dealer arrangements. The internet is a key channel to promote and sell Vodafone’s products and services and to provide customers with an easy, user friendly and accessible way to manage their Vodafone services and access support. Additionally, in most operating companies, sales forces are in place to sell directly to business customers and some consumer segments. Downloaded from Studynama.com. Click to download unlimited free college projects »

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Downloaded from Studynama.com. Click to download unlimited free college projects » Indirect distribution

The extent of indirect distribution varies between markets but may include using third party service providers, independent dealers, distributors and retailers. The Group hosts MVNOs in a number of markets. These are operators who buy access to existing networks and resell that access to customers under a different brand name and proposition. Where appropriate, Vodafone seeks to enter mutually profitable relationships with MVNO partners as an additional route to market. Presence in India:  Presence in all 23 Indian telecom circles (up from 16 in 2007/08)  Over 78,000 base stations across India  Around 2,600 new base stations deployed each month  Network deployment and maintenance of 56,933 base stations in 16 circles outsourced to Indus Towers, of which Vodafone Essar has a 42% shareholding  8,163 base stations directly managed by Vodafone Essar in the remaining seven circles  A further 13,225 base stations shared with other operators

MACRO AND MICRO ENVIRONMENTAL FACTORS: Factors affecting growth of mobile telecommunication          

Market potential Buying decision process Infrastructure Country’s political, social and economic scenario Government policies and business climate(Interest rates and Inflation) Technology and Special zones Competition Income levels Employee skills and unionization of employees Ethical considerations

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

Changing Lifestyles of Consumers

PRINCIPAL RISK FACTORS AND UNCERTAINTIES:

The following discussion of principal risk factors and uncertainties identifies the most significant risks that may adversely affect the Group’s business, operations, liquidity, financial position or future performance. Adverse macro economic conditions in the markets in which the Group operates could impact the Group’s results of operations. Adverse macro economic conditions and further deterioration in the global economic environment, such as a deepening recession or further economic slowdown in the markets in which the Group operates, may lead to a reduction in the level of de...