Article on Marketing Strategy of Telecom Sector

7/23/2019 Article on Marketing Strategy of Telecom Sector

http://slidepdf.com/reader/full/article-on-marketing-strategy-of-telecom-sector 1/8

Volume 4, Number 1, January – March ‟ 2015

ISSN (Print):2279-0977, (Onl ine):2279-0985

PEZZOTTAITE JOURNALS SJ I F (2012): 3.23, SJ I F (2013): 5.057

I nternational Jour nal of Applied Servi ces Marketing Perspectives© Pezzottaite Jour nals . 1450 |P a g e

MARKETING STRATEGIES OF INDIAN TELECOM COMPANIES

Dr. Amulya M.19

ABSTRACT

The Telecom sector is one of the fastest growing sectors in India. The telecom sector has, during the last decade, witnessed atransition from being a state-owned monopoly to one with competition and unprecedented growth in the subscriber base. Thegrowth has contributed immensely to the improvement in quality of life of the common person and facilitating the promotion

of trade and commerce besides strengthening the unity and integrity of the nation. The overall Teledensity today is around 74 percent. Still there are millions of ears in India waiting to hear the ring tone. As all the players are offering the services withless differentiation the only way they can differentiate themselves is through the marketing approaches adopted to createimpression in the minds of the customers. Therefore, this paper focuses on the marketing strategies adopted by various

telecom companies to grab the same portion of the customers.

KEYWORDS

Indian Telecom Companies, Subscriber, Competition etc.

INTRODUCTION

India stands second in the world in the trailing only to China in the telecom market. Gone are the days where customers used to pay advances to have the phone connection and wait for long years to have one. Customers had no other options then, as it was themonopoly of the government owned company until recently. From the last decade, telecom sector has seen a tremendous growthdue to the entry of the private players in the market. The incumbent BSNL had never ever thought that it would face such acompetitive environment. In this changed scenario, it is inevitable for the companies to come up with the unique strategies tosustain in the market. A good telecom marketing strategy will take the business vision and apply it to the customer base.

Following are the marketing strategies adopted by both public and private players to create impression in the minds of thecustomers.

Cross-function Interaction

As telecom services is a technology driven industry, recent development in the technology made it possible to consolidatedifferent operations of the company by integrating process, organisations and technology. The CRM software usage to automatesales and marketing made it possible to integrate all the functions by the availability of the data and to consolidate marketing

operations across geographies and channels.

Strategic Al li ance Partner

A series of strategic alliances, both formal and informal, have already been entered in the Indian telecom sector by companies who

are either constrained by shortages of resources or do not have adequate presence in all geographical markets. Ex: Airtel themarket leader in the telecom sector has outsourced all the operations except sales & marketing and finance.

Market Entering Strategies

In case of a fast changing industry such as telecom, which is characterized by availability of variety of technologies and standardsand evolving regulations, timing of entry and roll out is a major strategic decision. Too early an entry involving irreversible

commitments may turn out is wrong while delayed entry may mean lost opportunities. Ex: Airtel bagged the first moveradvantage, where Tata Docomo used pricing strategy as the market entry strategy.

Market Segmentation-Geographical

As each segment is homogeneous in its needs and attitudes, it is likely to respond similarly to a given marketing strategy. Therange of choices available can include local, regional and national. For example: Reliance Infocom, given its big bang approach,

plans to cover all the 18-telecom circles in India. As against this, Bharti seems to be focusing on south and north Indian circles,

Tata Tele services in Andhra Pradesh, while smaller players with limited resources such as HFCL Infotel and Shyam Telecom areconcentrating on a single circle.

19Assistant Professor, Department of MBA, University of Mysore, Karnataka, India, [email protected]

mailto:[email protected]










Market Position ing

Market positioning has come to mean the process by which marketers try to create an image or identify in the minds of their targetmarket for its product, brand or organisations. It is the ‗relative competitive comparison‘ their product occupies in a given market

as perceived by the target market. Repositioning involves changing the identity of a product, relative to the identity of competing products, in the collective minds of the target market. De-Positioning involves attempting to change the identity of competing

products, relative to the identity of your own product, in the collective minds of the target market.

For example: In telecom sector, there are a number of ways by which a new entrant can develop its market position. The key issueis whether the firm wants to be an integrated or focused player. Reliance Infocomm, Bharati Tele ventures, and Tata tele-servicesare positioning themselves as integrated players, though with differing levels of scope and commitment, and with desires to have a

presence in basic (both wire-line and wireless) as well as national and international long distance. All three companies are laying a

fiber optic network across the country to build backbone infrastructure, though the scale at which Reliance is building far exceedsthat of say, Tata tele-services. Bharti‘s project to connect Chennai and Singapore through an underground cable shows itscommitment to international long distance market.

Pri cing Strategies

Pricing strategies are a sometimes-overlooked part of the marketing mix. They can have a large impact on profit, so should begiven the same consideration as promotion and advertising strategies. For example: Pay per second billing: Until the entry of the

Tata Docomo no one ever thought of offering services at the cheaper rate as it did. All the customers were paying for the entire

minute even though they have used few seconds, pay per second billing made a revolutionary change in the market, which finallyincumbents started adopting to change.

Promotional Mi x

There are four main aspects of promotional mix. These are advertising, personal selling, sales promotions, public relations:

Ex: Overall, three observations emerge from the way reliance handled the media. Firstly, Reliance built huge public relations

exercised around the launch of the product. The public relations effort gave much advantage to the advertising and gave rise to aword of mouth campaign. Secondly, Reliance Infocomm utilized every media vehicle very effectively. It advertised on every TVchannel available and in most newspapers, thus making sure that the product was being promoted across India-a nation very muchdivided by language and market conditions. At the peak reliance, Infocomm booked about 5,000 spots on 40 TV channels, 1

million sq.ft. of space on hoardings across the country and inserted ads in over 70 publications in national and regional languages.Thirdly, Reliance Infocomm capitalized on the passions of Indians when framing advertisements. The campaigns had anemotional pitch, piggy backing on cricket and bollywood thus effectively connecting with almost every Indian.

Idea launched a unique Interactive Voice Response rural service called ‗Behtar Zindagi‘ in 16 regional languages, which providesinformation on key requirements of the rural segment like mandi rates, livestock, weather information, agriculture etc. ClassifiedServices have been launched as a new VAS service, offering access to Jobs, Real Estate, Matrimony, Best Deals etc. Ideacontinued on its „What an Idea Sirji‟ campaign and launched the much appreciated ‗Break the Language Barrier‘ campaign. It was

supported with a unique service of ‗Idea Language Helpline‘ offering instant translations in 15 Indian languages. The Idea 3Gmedia campaign was launched to support Idea‘s 3G rollout. Idea strengthened its brand through a series of media properties wi thassociations with Kaun Banega Crorepati, Koffee with Karan, Mission Army and Grammy Awards on VH1; in addition toexisting marquee properties like Idea Film fare Awards, Idea Present Citizens Journalist and other regional media properties. The

brand continued its association with the Delhi Daredevils team in IPL4. Idea launched a unique National Inter School Skill festcalled ―Kaho what‘s Your Idea‖ in association with renowned Quizmaster Derek O Brien. The program was very well received, asit became one of the largest National School Connect Programs in the country touching 2.5 Lakh students across 3000 schools in100 cities.

OBJECTIVES OF STUDY

To analyze the marketing strategies of BSNL and other private telecom service providers

HYPOTHESIS OF STUDY

H1: There is no significant difference between BSNL and other private telecom companies in their marketing strategies.H2: There is significant difference between BSNL and other private telecom companies in their marketing strategies.







METHODOLOGY OF RESEARCH

Research Design: Descriptive method is used for conducting research. Data is gathered from customer care representatives, andrelationship /marketing managers of BSNL and from selected private telecom companies based on convenience sampling method

for the purpose of the study.

Source of Data: The proposed research requires both primary and secondary data.

Primary Data: Primary data on the CRM practices of the telecom companies is collected through the structured questionnaire.The primary data collected from the managers, customer care executives, and relationship managers/executive of select telecomcompanies.

Secondary Data: The secondary data is extracted from among different published sources such as TRAI manuals and reports,magazines, voice & data magazine, research articles, cellular operators associations, research articles, books and selectedwebsites.

Sampling Design: Around 125 employees of various telecom service providers are selected for the study. Out of this, 50employees were from BSNL, 25 from each of the private telecom service providers are selected for the study.

To analyze the data collected from respondents and to prove or disprove hypotheses, various statistical tools and techniques have

been applied in this study. For the purpose of processing and analyzing the collected data, statistical tools such as tables, charts

are used in this study. Mean, standard deviation and correlation are used for descriptive statistics. Cronbach‘s alpha was us ed fordetermining the predictive validity and reliability of the questionnaire used in the study. The hypotheses are tested using ANOVAtest, Contingency Coefficient, P value and Pearson correlation analysis. The data collected from respondents is analyzed with the

help of SPSS.

MARKETING STRATEGIES OF TELECOM COMPANI ES

Opinions of the employees on marketing strategies of Telecom companies are considered for the following statements:

a) Our Company Advertisements Are Innovative and Make Our Work Easier

Table-1

Sources: Field Survey

Advertisements help in building the brand image in turn increases the sales. 92% of Idea, 88% of BSNL, 84% of Vodafone and

76% of Airtel employees agree that their company advertisement innovative and makes their work easier. The test revealed a -significant difference between these categories of responses (CC=0.463; P=0.000).

Idea employees feels that there advertisements are innovative and compliment the sales where least employees of the Vodafone

agree with the statement. There is a significant difference between the opinions of the service providers. Even though it wasawarded as most innovative advertisement, Vodafone employees do not feel that it is complementing the sales compared to idea.







B) Our Website is more informative and Makes our Work Easier

Table-2

ResponseMobile Service Providers CC

Value

‘P’

ValueBSNL Airtel Vodafone Idea Total

Strongly Disagree F 1 0 0 0 1

0.504 0.000

% 4.0% .0% .0% .0% .8%

NeutralF 5 0 4 5 14

% 20.0% .0% 16.0% 20.0% 11.2%

Somewhat AgreeF 6 6 10 15 37

% 24.0% 12.0% 40.0% 60.0% 29.6%

Strongly AgreeF 13 44 11 5 73

% 52.0% 88.0% 44.0% 20.0% 58.4%


Website is a convenient means of reaching the customers with the required information throughout the world. In this internet eraself-service leads to less work for the employees as customers can access information, place request and queries at their

convenience through the website. 100% of Airtel, 84% of Vodafone, 80% of Idea and 76% of BSNL employees are of the opinionthat their website is more informative and make their work easier. The test revealed a significant difference between thesecategories of responses with contingency and p value (CC=0.504; P=0.000).

C) We Sell SIM Cards in all Possible Areas through All Channels

Table-3


Value

‘P’


Strongly DisagreeF 0 1 0 0 1

0.396 0.006

% .0% 2.0% .0% .0% .8%

NeutralF 5 0 4 6 15

% 20.0% .0% 16.0% 24.0% 12.0%


% 20.0% 10.0% 36.0% 20.0% 19.2%


% 60.0% 88.0% 48.0% 56.0% 68.0%Sources: Field Survey

The distribution channel of the service provider is very important to make its service available easily, by selling SIM cardsthrough all possible channels, may be through the dealer, retailer or franchisee. 88% of the Airtel employee strongly agrees that

SIM cards are available in all the channels , 84% of Vodafone, 80% of BSNL, 76% of Idea employees subscribe to the opinionthat their SIM cards are available at the areas through all possible channels. The responses were similar which is further confined

by a non-significance contingency value and p value (CC=0.396: P=0.006).

D) We Will Not Delay in Activating Service on Purchase

Table-4


Value

‘P’


Strongly Disagree F 1 0 0 0 1

0.200 0.738

% 4.0% .0% .0% .0% .8%

Somewhat DisagreeF 0 0 0 1 1

% .0% .0% .0% 4.0% .8%

NeutralF 4 2 5 3 14

% 16.0% 4.0% 20.0% 12.0% 11.2%


% 40.0% 14.0% 28.0% 28.0% 24.8%

Strongly Agree10 41 13 14 78

40.0% 82.0% 52.0% 56.0% 62.4%








Quick activation is one of the determinants of the efficiency of service delivery. SIM card purchased need to be activated by theservice providers within the time given. 96% of Airtel employee agreed that it is done immediately followed 84% of Idea and80% of both BSNL and Vodafone. The pattern of responses was found to be similar which is further confined by a non-significance contingency coefficient and p value (CC=0.200: P=0.738).which means all the service providers activate the SIM

card immediately.

E) We Conduct Survey to Understand the Satisfaction Level of Customers

Table-5


Value

‘P’



0.467 0.000

% .0% .0% .0% 4.0% .8%


% 8.0% 4.0% 4.0% 32.0% 10.4%

NeutralF 6 2 7 7 22

% 24.0% 4.0% 28.0% 28.0% 17.6%


% 32.0% 44.0% 36.0% 20.0% 35.2%


% 36.0% 48.0% 32.0% 16.0% 36.0%


Frequent survey is conducted by the service providers to understand the satisfaction level of the customer and to analyze needs ofthe customers and service quality. Many organizations depend upon simple customer questionnaire that may be completed and

returned by mail or deposited into a customer comment collection box. 92% of Airtel, 68% of Both BSNL and Vodafone and36% of Idea employees subscribe to the opinion that they conduct survey to understand the satisfaction level of customers. Thetest revealed a -significant difference between these categories of responses with contingency coefficient and p value (CC=0.467;P=0.000).

F) We Conduct Exit Interview to the Customers and Their Feedback is Taken Seriously

Table-6

Response Mobile Service Providers CCValue

‘P’ValueBSNL Airtel Vodafone Idea Total


0.341 0.057

% 4.0% .0% 8.0% .0% 2.4%

NeutralF 6 3 7 5 21

% 24.0% 6.0% 28.0% 20.0% 16.8%


% 48.0% 46.0% 24.0% 44.0% 41.6%


% 24.0% 48.0% 40.0% 36.0% 39.2%


Exit interviews reveal the satisfaction and dissatisfaction level of the customers; customers exit interview measures customer

perception, brand value or promotional values. Professionally trained interviewers conduct these studies to ensure qualityresponse. 94% of Airtel, 80% of Idea, 72% of BSNL and 64% of Vodafone employees agree that they conduct exit interview tothe customers and their feedback is taken seriously by their companies. The responses were similar which is further confined by anon-significance contingency coefficient and P value (CC=0.341: P=0.057).

G) We Analyze the Reason for Leaving Our Service and Try to Implement It Wherever Necessary

Lost customers analysis is a research method used to determine a reason an individual customer or a class of customer has

withdrawn its service, whether by switching to a competing firm. Such analysis usually includes survey of lost customer and it isused to improve performance by identifying and neutralizing sources of potential or actual customer dissatisfaction.56% ofemployee respondents of Idea, 50% of Airtel, 48% of BSNL, 24% of Vodafone are of the opinion that they conduct lost customersurvey, whereas 52% of Vodafone, 28% of BSNL, 20% Idea and 8% of Airtel employees do not agree with this. The test revealed

a -significant difference between these categories of responses with contingency coefficient and P value (CC=0.437; P=0.001).







Table-7


Value

‘P’



0.437 0.001

% .0% 2.0% 16.0% 16.0% 7.2%

Somewhat Disagree F 7 3 9 1 20% 28.0% 6.0% 36.0% 4.0% 16.0%

NeutralF 6 21 6 6 39

% 24.0% 42.0% 24.0% 24.0% 31.2%


% 48.0% 50.0% 24.0% 56.0% 45.6%


H) We Run the Customer Loyalty Programme to Our Customers

Table-8


Value

‘P’



0.454 0.001

% 4.0% .0% 4.0% 4.0% 2.4%


% 12.0% 18.0% 24.0% 8.0% 16.0%

NeutralF 7 6 7 3 23

% 28.0% 12.0% 28.0% 12.0% 18.4%


% 40.0% 14.0% 16.0% 56.0% 28.0%


% 16.0% 56.0% 28.0% 20.0% 35.2%


Loyalty programs are structured marketing efforts that rewards and in turn encourages loyal buying behaviour, which is beneficialto the firms. More specifically a loyalty card, reward card, point card identifies the card holder as a member in a loyalty

program.76% of Idea, 70% of Airtel,56% of BSNL, 44% of Vodafone employees agree that they run customer loyalty programs

to customers. Whereas, 28% of Vodafone, 18% of Airtel, 16% of BSNL and 12% of Idea employees do not agree with this. Thetest revealed a -significant difference between these categories of responses with contingency coefficient and P value (CC=0.454;P=0.001).

Verif ication of Hypothesis

H0: BSNL & other private telecom companies do not differ significantly in their marketing strategies.H1: BSNL & other private telecom companies differ significantly in their marketing strategies.

Table-9: ANOVA Test Statistics

Sum of Squares d.f. Mean Square F Significance

Between Groups 445.392 3 148.464 9.092 0.000

Within Groups 1975.920 121 16.330

Total 2421.312 124

Sources: Authors Compilation

Table-10: Descriptive Statistics

SP N Mean Std. Deviation

Airtel 25 32.7200 4.49555

Idea 25 32.0000 3.47611

BSNL 50 36.0400 3.55114

Vodafone 25 31.9600 4.92849

Total 125 33.7520 4.41890

Sources: Authors Compilation







The data in the table reveals that there is a significant difference among the opinions of the employees of the BSNL and other private service providers which is confirmed by the contingency value and P value for the each statement, except for thestatements ―We will not delay in activating service on purchase‖ and ―We conduct exit interview to the customers and theirfeedback is taken seriously‖.

The analysis shows the results of the statement, which deal with the marketing strategies by telecom, service providers. The F

value and P value are 9.092 and 0.000(P<0.05) respectively. The data reveals that there is a significant difference in marketingstrategies of telecom service providers irrespective of private or public. Results of ANOVA support the findings of the

contingency coefficient value and the P value.

Hence, the null hypotheses BSNL & other private telecom companies do not differ significantly in their marketing

strategies is rejected and the alternative hypothesis BSNL & other private telecom companies differ significantly in their

marketing strategies is not rejected.

F indings with respect to Mar keting Strategies of Telecom Compani es

The opinions of the employees of BSNL, Airtel, Vodafone and Idea differ for all the statements except for ―we will not delay inactivating service on purchase‖ and ―conducting lost customer survey to take feedback‖. The opinion of employees varies withrespect to advertisement effectiveness, website support, customer satisfaction survey, customer loyalty programs, and distributionchannels. So marketing strategies of the firm differs with public and private companies:

Idea employees feels that there advertisements are innovative and compliment the sales where less employees of BSNLfeels so.

It is found that, all the employees Airtel feel that their website is informative & supportive to the sales. Whereas veryless number of BSNL employees feels so

It is found that, Airtel SIM cards are available at all possible locations where it is least with the idea.

It is found that, the opinions of the employees are similar for the statement ―we will not delay in activating service on

purchase‖

Airtel conducts frequent surveys to understand the satisfaction level of the customers whereas it is less practiced in

Idea.

Exit interview of the customers who leaves the service is conducted in Airtel where it is less practiced in Vodafone.

Analyzing the reason for customer churn is done in Idea where as it is less practiced in Vodafone compare to other

service providers.

More number of loyalty programs is conducted in Airtel and it is less with Vodafone compare to other service

providers.

It is found that all the service providers are running customers‘ loyalty programs, which are more with idea with 76%and least with Vodafone 44%.

The ANOVA test with F value and P value are 9.092 and 0.000(P<0.05) indicates that , the null hypotheses BSNL & other

private telecom companies do not differ significantly in their marketing strategies is rejected and the alternative hypothesisBSNL & other private telecom companies differ significantly in their marketing strategies is accepted

CONCLUSION

The ultimate objective of any marketing activity is to satisfy the customers and today even a step ahead i.e., ‗delighting‘ thecustomers. For which customers are offered something beyond their expectations from the service or the product. The objective

being to acquire and retain the customers, who should continually feel that they are getting more value of the money, they aredeparting with. Marketing is the establishment, development, maintenance and optimization of long-term mutually valuable

relationships between consumers and organisations. Successful marketing focuses on understanding the needs, desires of thecustomers, and is achieved by placing these needs at the heart of business by integrating them with the organisations strategy,

people, technology and business processes. At its most basic, marketing involves customers, organisations and relationships andthe combination creates the need for the management.

REFERENCES

1. Bowman, D., & Narayandas, D. (2001, August). Managing Customer- Initiated Contacts With Manufacturers: The

Impact on Share of Category Requirements and Word-of Mouth Behaviour. Journal of Marketing Research , 38, 281 – 297.

2. Wen-Hsien Chen (1998). Benchmarking quality goals in service systems. The Journal of Services Marketing , 12(2),

113-128.







3. Ibid, 1.

4. Cooper, D. R., & Schindler, P. S. (2006). Business Research Methods (9th Edition). New York. NY: Irwin/McGraw-Hill.

5. Gummesson, Evert. Relationship marketing and imaginary organizations: A synthesis.

6. Gronroos, C. (1982). Strategic management and marketing in the servi ce sector. Helsingfors. Finland: Swedish School

of Economics and Business Administration.

7. Gronroos, C. (1994). From Marketing Mix to Relationship Marketing: Towards a Paradigm Shift in Marketing.Management Decision , 32(2), 4-20.

8. Guenzi, & Gabriele. (2007). The Joint Contribution of Marketing and Sales to the Creation of Superior Customer Value.Jour nal of Business Research , 60(2), 98 – 107.

9. Peterson, R. A. (et. al.). (1997). Exploring the Implications of The Internet for Consumer Marketing, Journal of theAcademy of Marketing Science , 25(4), 329-346.

10. Slater, S. F., & Narver, J. C. (2000). Intelligence generation and superior customer value. Journal of the Academy of

Marketing Science , 28(1), 120 – 127.

11. Zikmund, W. (2000). Business Research Methods (6th Edition). The Dryden Press. ISBN 0-03-025817.

12. Retrieved from www.trai.gov.in

13. Retrieved from www.bsnl.com

14. Retrieved from www.airtel.in

15. Retrieved from www.idea.com

16. Retrieved from www.reliancecom.com

17. Retrieved from www.vodafone.in

18.

Retrieved from www.coai.com

19. Retrieved from http://www.slideshare.net/amulyakalia/entry-of-reliance-in-telecom-sector

20. Retrieved from http://mbapgdmstuff.blogspot.in/2013/01/marketing-strategies-of-companies.html

21. Retrieved from http://www.brandingstrategyinsider.com/2009/02/brand-positioning-basics.html

22. Retrieved from https://in.answers.yahoo.com/question/index?qid=20080820095508AAxq3QB

23. Retrieved from https://answers.yahoo.com/question/index?qid=20080715203814AA94P9A

24. Retrieved from https://in.answers.yahoo.com/question/index?qid=20081107061731AASaL2U

25. Retrieved from http://www.authorstream.com/Presentation/murugan_123-910893-positioning

26. Retrieved from http://www.websitemarketingplan.com/NewsletArch/newsletter08_14_07.htm

27. Retrieved from http://www.ukessays.com/essays/marketing/pricing-strategies-are-sometimes-overlooked-part-of-

marketi...

28. Retrieved from http://citeseerx.ist.psu.edu/showciting?cid=2939064

*****

http://www.trai.gov.in/



http://www.bsnl.com/



http://www.airtel.in/



http://www.idea.com/



http://www.reliancecom.com/



http://www.vodafone.in/



http://www.coai.com/


http://www.slideshare.net/amulyakalia/entry-of-reliance-in-telecom-sector



http://mbapgdmstuff.blogspot.in/2013/01/marketing-strategies-of-companies.html



http://www.brandingstrategyinsider.com/2009/02/brand-positioning-basics.html



https://in.answers.yahoo.com/question/index?qid=20080820095508AAxq3QB



https://answers.yahoo.com/question/index?qid=20080715203814AA94P9A



https://in.answers.yahoo.com/question/index?qid=20081107061731AASaL2U



http://www.authorstream.com/Presentation/murugan_123-910893-positioning



http://www.websitemarketingplan.com/NewsletArch/newsletter08_14_07.htm



http://www.ukessays.com/essays/marketing/pricing-strategies-are-sometimes-overlooked-part-of-marketi...



http://citeseerx.ist.psu.edu/showciting?cid=2939064





















Documents

Article on Marketing Strategy of Telecom Sector