SMART: V1 who to serve for the Telenor Group ?

Distribution in market (% / #)

Revenue share (%)

Total value in lifetime (DKK)

Churn propensity (%)

Mobile data users (%)

18% / 1 mill. 38% 6927 22% 58%

13% / 0,7 mill. 7% 2273 13% 25%

13% / 0,7 mill. 6% 1913 12% 34%

12% / 0,7 mill. 8% 1059 31% 49%

17% / 1 mill. 30% 3611 39% 84%

19% / 1,1 mill. 11% 2175 25% 48%

2

Introducing the six consumer segments initially points to the fact that only two segments stand for two thirds of revenue in the market…

SMART STEER CO. MEETING || INTRODUCING THE SEGMENTS

SOURCE: MAP, Telenor GroupNOTE. Distribution in market is based on 5,6 mill. people

1

2

3

4

5

6

Recommended segment mix in Telenor portfolio will cover 90 % of the market and overlap on the most exposed segment

SMART STEER CO. MEETING || STRATEGIC RESOURCES & SUM UP

3

SOURCE: Team analysis

1

5 4

6

NONE

3

4

The Quality oriented segment don’t mind spending a little extra

SOURCE: Telenor MAP

SMART STEER CO. MEETING || TELENOR; WHO TO SERVE

1SEGMENT

Family with older children

52YEAR-OLD

DEMOGRAPHICS

Middle/high income38 % of market

VALUES

• I´m oriented towards nature and happy pay more for environmentally friendly products

• I place high importance on elegance and aesthetics

• Good customer service is significantly important

LATEST PHONE

10%

54%Retail

WEB 25%

Mobile data 58%

Voice 22 min/day

SMS 7/day

BEHAVIOR

PSTN 68%

High involvement 18%

Province/city

47% 53%

18 % of the population

5

Strong match between Telenor´s profile and the Quality oriented top drivers of choice makes a solid base for attracting the segment

SOURCE: Telenor MAP

SMART STEER CO. MEETING || TELENOR; WHO TO SERVE

1SEGMENT

• Especially in service areas Telenor has a solid base to match the segments needs

Attribute importance (relative to market) is listed clockwise – starting at 12 0’clock

6

Although Telenor has a fair share of segment one, competitors profiles have even stronger fits on hygiene factors

SOURCE: Telenor MAP & Data from Pricing project, 2012

NOTE: * Measured in sim share

SMART STEER CO. MEETING || TELENOR; WHO TO SERVE

1SEGMENT

8%

28%

14%

30%

Quality oriented

21%

TDC

Telia

3

Other

Telenor

Segment one attribute score on hygiene factors (share of customers). Attribute absolute importance is listed clockwise – starting at 12 0’clock

According to complementary data from Pricing project Telia has build stronger NW perception. Supposable due to massive media spend and communication of 4G NW

7

The youngest segment, called Cost and image has a distinct profile in terms of price focus and online shopping behavior

SOURCE: Telenor MAP

SMART STEER CO. MEETING || CBB; WHO TO SERVE

6SEGMENT

Young family / single

29YEAR-OLD

DEMOGRAPHICS

Low income11 % of market

LATEST PHONE

3%

23%Retail

WEB 59%

Mobile data 48%

Voice 8 min/day

SMS 7/day

BEHAVIOR

PSTN 36%

High involvement 13%

City

49% 51%

19 % of the population

VALUES

• Social status is important to me and I like when others look up to me

• I'm first with the latest and I always know what is new and hip

• I will always go for the cheaper product cause price is most important

8

Price is the only significant telecom driver of choice; Due to strong attractive value profile and large share in customer base the segment will serve as the target segment

SOURCE: Telenor MAP

NOTE: * Measured in sim share

SMART STEER CO. MEETING || CBB; WHO TO SERVE

6SEGMENT

Cost & image

24%

36%

28%

3%10%

Other MVNO`s

Other MNO´s

Telmore

Onfone

CBB

Segment one attribute score on hygiene factors (share of customers). Attribute absolute importance is listed clockwise – starting at 12 0’clock

9

The Image & quality segment is immensely data and handset oriented

SOURCE: Telenor MAP

SMART STEER CO. MEETING || CBB; WHO TO SERVE

5SEGMENT

Before / young family

30YEAR-OLD

DEMOGRAPHICS

Low income30 % of market

LATEST PHONE

6%

39%Retail

WEB 44%

Mobile data 84%

Voice 20 min/day

SMS 10/day

BEHAVIOR

PSTN 32%

High involvement 37%

City

56% 44%

17 % of the population

VALUES

• Products with technical innovations are exciting and important to me

• I like when others look up to me and being the centre of attention

• Thrills give me the feeling of living more intensely

10

Gaps on important attributes initially addressed in the rebranding of Bibob. Attributes reflects former Bibob brand strategy before March 2012

SOURCE: Telenor MAP

SMART STEER CO. MEETING || BIBOB; WHO TO SERVE

5SEGMENT

• Implemented web shop in October 2012

• Introduced instalment plans in October

• Introduced content bundling in June

• Introduced CRM program in April

• Followed Oister on data price most of 2012

• Increased data speed to 32 Mbit/s

Attributes relative importance is listed clockwise – starting a 12 0’clock.

11

No single competitor owns the segment in terms of segment market partly due to the extreme switch probability (~37%)

SOURCE: Telenor MAP

NOTE: * Measured in sim share

SMART STEER CO. MEETING || BIBOB; WHO TO SERVE

5SEGMENT

16%

Image & quality

19%

14%

15%

2%

15%

17%

Telia

TDC

Telmore

3

BiBoB

Other MVNO´s

Telenor

Segment one attribute score on hygiene factors (share of customers). Attribute absolute importance is listed clockwise – starting at 12 0’clock

With recommended segment mix the Telenor brand portfolio targets ~80 % of revenue share; Covering a broad mix of consumer values

12

SMART STEER CO. MEETING || STRATEGIC RESOURCES & SUM UP

SOURCE: MAP, Telenor Group

Fair

Nature

Purism Tranquil

Prestige

Vitality

Classic

Thrill &Entertainment

Carefree

Clanning Cool&Trendy

ServiceInnovation/

Protech

Personalefficiency

Customized

Proven

QualitySmart

shopping

Total cost

E

C̶ +Security

R

6

1

5

SHARE OF REVENUE

STRONGEST COMPETITORS

38 %

30 %

11 %

TDC

SEVERAL

TELMORE