A Study of Marketing Strategy and Performance of Airtel Industry New

8/8/2019 A Study of Marketing Strategy and Performance of Airtel Industry New

1/83

A STUDY OF MARKETING STRATEGY

AND PERFORMANCE OF AIRTELINDUSTRY

SUMMER TRAINING PROJECT REPORT

SUBMITTED TOWARDS THE PARTIAL

FULFILLMENT OF

BACHELOR OF BUSINESS ADMINISTRATION(Affiliated To I.P.U, New Delhi)

Academic Session

[2006-2009]

SUBMITTED BY:-

SUSHANT GILL

Roll no:BBA V Semester

UNDER THE GUIDANCE OF:External supervisor Internal supervisorMr.Chetan Kumar Dr. SharmaBHARTI AIRTEL ltd FACULTYOkhala Industrial Estate, BLSIM,New Delhi Ghaziabad

B.L.S INSTITUTE OF MANAGEMENT,

MOHAN NAGAR Ghaziabad-201009


2/83


3/83

CONTENTS

ACKNOWLEDGEMENT -- 1

PREFACEPREFACE ---- 22

EXECUTIVE SUMMARYEXECUTIVE SUMMARY ---- 33

OBJECTIVE OF THE STUDY -- 4

RESEARCH METHODOLOGY -- 5-12

INTRODUCTION -- 13-24

COMPANY PROFILE -- 25-46

FINDINGS AND ANALYSIS -- 47

SUGGESTIONS -- 55

SWOT ANALYSIS -- 57-58

RECOMMENDATION -- 58

LIMITATIONS -- 59

CONCLUSION -- 60

BIBLIOGRAPHY -- 61

QUESTIONNAIRE -- 63


4/83

ACKNOWLEDGEMENTACKNOWLEDGEMENT

I am sincerely thankful to all those people who have been giving me

any kind of assistance in the making of this project report.

I express my gratitude to Dr. SHARMA as through her vast experience

and knowledge has been able to guide me, both ably and successfully towards

the completion of the project. I express my gratitude, B.L.S.INSTITUTE OF

MANAGEMENT, Ghaziabad. I would hereby, make most of the opportunity

by expressing my sincerest thanks to all my faculties whose teachings gave

me conceptual understanding and clarity of comprehension, which ultimately

made my job more easy. Credi t a lso goes to al l my f riends whose

encouragement kept me in good stead. Their continuous support has given

me the strength and confidence to complete the project without any difficulty.

Last of all but not the least I would like to acknowledge my gratitude

to the respondents without whom this survey would have been incomplete.

I am also thankful to authority of Airtel for providing me the information.

SUSHANT GILL


5/83

PREFACEPREFACE

I, SUSHANT GILL, being a student of BBA, of B.L.S.INSTITUTE OF

MANAGEMENT, Mohan Nagar .

The project title Market performance of Airtel industry is the analysis of the

big scale sector of communication. This project involves the big scale level

provided by Airtel to its customers. The survey was conducted so as to

analyze the big scale sector prevail ing in the current industry and the

improvement that can be made upon it.

Market research study has been conducted in order to bring out the picture of

big scale sector that exists in this industry. The differences in service quality

that exists in the market. What the customers preferences are provided by the

Airtel?


6/83

EXECUTIVE SUMMARYEXECUTIVE SUMMARY

The project is an extensive report on how the Airtel Company

markets its strategies and how the company has been able in tackling the

present tough competition and how it is cooping up by the allegations of the

quality of its products. The report begins with the history of the products and

the introduction of the Airtel Company. This report also contains the basic

marketing strategies that are used by the Airtel Company of manufacturing

process, technology, production policy, advertising, collaboration, export

scenario, future prospect and government policies. The report includes some

of the key salient features of market trend issues.

In todays world of cutthroat fierce competition, it is very essential to

not only exist but also to excel in the market. Todays market is enormously

more complex. Hence forth, to survive in the market, the company not only

needs to maximize its profit but also needs to satisfy its customers and should

try to build upon from there.


7/83

OBJECTIVE OF THE STUDY

1. To identify the difference in market performance of Airtel industry.

2. To study the market of Airtel Industry in big scale sector.

3. To compare various parameters of manufacturing process, technology,

production policy, advertising, collaboration, export scenario, future

prospect and government policies.

4. To study the level of customer satisfaction in Airtel.

5. To study customer purchase decision behaviour and factor influence the decision

process.

6. To study consumer preferences.

7. To study the consumer trend in telecommunication sector.

8. To study competitive marketing strategies adopted by Airtel.


8/83

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.

Primary data was collected using the following techniques

Questionnaire Method

Direct Interview Method and

Observation Method

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.


9/83

TYPE OF RESEARCHTYPE OF RESEARCH

EXPLORATORY:EXPLORATORY:

TYPE OF RESEARCH CARRIED OUT WAS EXPLORATORY IN NATURE; THETYPE OF RESEARCH CARRIED OUT WAS EXPLORATORY IN NATURE; THE

OBJECTIVE OF SUCH RESEARCH IS TO DETERMINE THE APPROXIMATEOBJECTIVE OF SUCH RESEARCH IS TO DETERMINE THE APPROXIMATE

AREA WHERE THE DRAWBACK OF THE COMPANY LIES AND ALSO TOAREA WHERE THE DRAWBACK OF THE COMPANY LIES AND ALSO TO

IDENTIFY THE COURSE OF ACTION TO SOLVE IT. FOR THIS PURPOSE THEIDENTIFY THE COURSE OF ACTION TO SOLVE IT. FOR THIS PURPOSE THE

INFORMATION PROVED USEFUL FOR GIVING RIGHT SUGGESTION TO THEINFORMATION PROVED USEFUL FOR GIVING RIGHT SUGGESTION TO THE

COMPANY.COMPANY.


10/83

DATA COLLECTIONDATA COLLECTION METHODMETHOD

THERE TWO TYPE OF METHOD OF DATA COLLECTION.THERE TWO TYPE OF METHOD OF DATA COLLECTION.

PRIMARY DATAPRIMARY DATA

SECONDARY DATASECONDARY DATA

DATA USED FOR THE RESEARCH WORK WAS PRIMARY IN NATURE.DATA USED FOR THE RESEARCH WORK WAS PRIMARY IN NATURE.

PRIMARY DATAPRIMARY DATA ::

PRIMARY DATA IS THAT WHICH IS THE COLLECTED FOR THEPRIMARY DATA IS THAT WHICH IS THE COLLECTED FOR THE

FIST TIME AND THUS HAPPEN TO BE ORIGINATED IN CHARACTER.FIST TIME AND THUS HAPPEN TO BE ORIGINATED IN CHARACTER.

QUESTIONNAIRE SURVEYQUESTIONNAIRE SURVEY ::

IN THE STUDIES A QUESTIONNAIRE IS PREPARED. THEIN THE STUDIES A QUESTIONNAIRE IS PREPARED. THE

QUESTIONNAIRE CONSISTS OF 20 QUESTIONS.QUESTIONNAIRE CONSISTS OF 20 QUESTIONS.

SECONDARY DATASECONDARY DATA ::

SECONDARY DATA REFER TO THE DATA THAT HAS BEENSECONDARY DATA REFER TO THE DATA THAT HAS BEEN

ALREADY COLLECTED .THE SECONDARY DATA, WHICH HAS BEENALREADY COLLECTED .THE SECONDARY DATA, WHICH HAS BEEN

USED TO CARRY OUT THIS STUDY, ARE AS FOLLOW:USED TO CARRY OUT THIS STUDY, ARE AS FOLLOW:

BOOKS, JOURNALS, MAGAZINES, NEWSPAPERSBOOKS, JOURNALS, MAGAZINES, NEWSPAPERS

INDUSTRY REPORTSINDUSTRY REPORTS

COMPANYS INTERNET SITECOMPANYS INTERNET SITE

OTHER RELEVANT STUDIES MATERIAL AND WEBSITES.OTHER RELEVANT STUDIES MATERIAL AND WEBSITES.


11/83

SAMPLE UNITSAMPLE UNIT : - NEW DELHI: - NEW DELHI

THE RESEARCH PROCESS WAS DONE BY INTERACTING WITH NUMBER OFTHE RESEARCH PROCESS WAS DONE BY INTERACTING WITH NUMBER OF

CUSTOMERS DURING THE ACTIVITIES PERFORMED, WHICH INCLUDED,CUSTOMERS DURING THE ACTIVITIES PERFORMED, WHICH INCLUDED,

MARKETS, COLD CALLING, CANOPIES, ETC. SAMPLE DESIGN CONSISTSMARKETS, COLD CALLING, CANOPIES, ETC. SAMPLE DESIGN CONSISTS

OF RANDOM SAMPLING.OF RANDOM SAMPLING.

SAMPLE SIZESAMPLE SIZE : -: - 100 PEOPLE100 PEOPLE


12/83

METHOD OF COLLECTIONMETHOD OF COLLECTION : -: -

FIELD PROCEDURE FOR GATHERING PRIMARY DATA INCLUDEDFIELD PROCEDURE FOR GATHERING PRIMARY DATA INCLUDED

OBSERVATION AND INTERVIEW SCHEDULE IN WHICH THEOBSERVATION AND INTERVIEW SCHEDULE IN WHICH THE QUESTIONNAIRES WERE FILED BY THE INTERVIEWER.QUESTIONNAIRES WERE FILED BY THE INTERVIEWER.

PERSONAL INTERVIEWS THROUGH SELF ADMINISTERED SURVEY WASPERSONAL INTERVIEWS THROUGH SELF ADMINISTERED SURVEY WAS

DONE TO COLLECT THE DATA, MARKET RESEARCH WAS UNDERTAKEN,DONE TO COLLECT THE DATA, MARKET RESEARCH WAS UNDERTAKEN,

THAT WAS ACCOMPLISHED BY PERFORMING VARIOUS ACTIVITIESTHAT WAS ACCOMPLISHED BY PERFORMING VARIOUS ACTIVITIES

DESIGNED.DESIGNED.

RESEARCH INSTRUMENTRESEARCH INSTRUMENT ::

QUESTIONNAIREQUESTIONNAIRE

THE QUESTIONNAIRE WAS FORMULATED BY KEEP IN MINDTHE QUESTIONNAIRE WAS FORMULATED BY KEEP IN MIND

THE FOLLOWING POINTSTHE FOLLOWING POINTS : -: -

GIVING THE RESPONDENTS CLEAR COMPREHENSION OF THEGIVING THE RESPONDENTS CLEAR COMPREHENSION OF THE

QUESTION.QUESTION.

INDUCING THE RESPONDENTS TO CO-OPERATE.INDUCING THE RESPONDENTS TO CO-OPERATE.

GIVING INSTRUCTIONS AS TO WHAT IS WANTED.GIVING INSTRUCTIONS AS TO WHAT IS WANTED.

IDENTIFYING THE NEEDS TO BE KNOWN.IDENTIFYING THE NEEDS TO BE KNOWN.

LIMITATIONS:LIMITATIONS:

The following were the limitations that were there during the course of the study:

1. Limited time period.

2. Less number of respondents.

Biasness of the respondents.


13/83

Primary data was collected using the following techniques

Questionnaire Method

Direct Interview Method and

Observation Method

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.

Procedure of research methodology

# To conduct this research the target population was the mobile users, Who are using

GSM technology.

# Target geographic area. Sample size of 100 was taken.

# To these 100 people a questionnaire was given, the questionnaire was a combination

of both open ended and closed ended questions.

# 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.


14/83

Sources of secondary data

Used to obtain information on, Bhartis history, current issues, policies, procedures etc,

wherever required.

# Internet

# Magazines

# Newspapers

# Journals

# Bharti Circulars

# Bharti News Letters


15/83

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. Thirty-four 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


16/83

were in danger of having their licenses withdrawn. In March 1999, a new telecom

policy was put in 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.

1.1 INDIAN CELLULAR MARKET - EARLIER ROADBLOCKS AND

THEIR RESOLUTION

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:


17/83

ROADBLOCKS

CURRENT POSITION

High license fees

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.

Regulatory authority not in place

Telecom Regulatory Authority of India (TRAI) firmly in place, and its role being

accepted by all operators; Deptt of Telecommunications (DOT) restructured, withoperations and policy making roles vested in different bodies.

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


18/83

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.

Foreign ownership / change of partner limitations

Foreign ownership norms clarified, and change of partners allowed as a matter of

routine allowing ease of entry / exit - paves the way for full control of businesses by

foreign companies.

Inadequate growth of market / subscribers

Roadblocks spelt out earlier resulted in low market / subscriber growth, but with

corrective measures taken, market / subscriber base expected to zoom

1.2 DEVELOPMENTS IN THE CELLULAR INDUSTRY

The interconnection regime between cellular operators and fixed-line operators is still

biased against the former.

Despite the recent gains of the cellular industry, not everything is rosy. The cellular

penetration rate is still very low at 0.8 percent in a nation of over one billion people.

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


19/83

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 tothe lone operator there, 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


20/83

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 long-

awaited 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 GPRS-enabled networks, there is caution on their part to launch

the service. With hardly any applications, the success of GPRS remains a question.

Building visibility and awareness

Deviating from competing on the price platform, cellular operators are actively

promoting their brand and service portfolio through high-visibility advertising and


21/83

promotional campaigns. Cellular operators like Bharti, Orange and BPL Mobile have

been advertising aggressively on hoardings and kiosks. Public transport like the city rail

system and cabs are used widely to carry the message of mobility.

Customer-focused activities are gaining traction among cellular operators with the

establishment of longstanding consumer benefit programs. Orange in Mumbai offers

"Orange Holidays" and "Orange Monsoon Offers" at very attractive rates and added

benefits like discounts on airfare, food and beverages, among others. Others offer

special privileges in retail outlets, cinemas and music shops.

Enterprise mobile applications promising revenue stream

All along, customer acquisition and the top line have been the focus. Few operators

have concentrated on offering differentiated services for businesses. However, as

operators realize that offering basic voice and Short Message Service (SMS) will get

them the numbers but not the margins, some are now seriously looking at the enterprise

segment for provisioning superior services.

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.

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


22/83

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.

1.3 FUTURE TRENDS AND DEVELOPMENT

There will be more competition, forcing operators to constantly focus on

differentiations to maintain their lead.

The implementation of enhanced networks like 2.5G will enable operators to

offer data services. This is an opportunity to customize and differentiate better.

The entry of state-run operators like BSNL and BHARTI means that prices will

no longer be controlled, thus there is less chance of a cartel being formed.

Network coverage in terms of geographic spread and quality of coverage is

crucial especially for the business subscriber.

The bigger the service provider's national presence, the better it is for

businesses. On the roaming front, signing up with a national operator is

advantageous.

Limited mobility wireless in local-loop services (by fixed network service

providers) will be a disadvantage for cellular operators in the short term.


23/83

Consequently, operators need to streamline their customer relation activities and

adopt aggressive subscriber acquisition and retention strategies.

1.4 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 Event

1851 First telephones in India

1943 Nationalization of telephone companies

1985 DoT was created

1986 Creation of BHARTI and VSNL

1991 Telecom equipment liberalized

1994 Licenses for paging

1994 Telecom policy announced

September 1994 Guidelines for private sector participation in basic services

November 1994 Cellular licenses issued for metros

December 1994 Tenders for cellular licenses in 19 cities apart from 4 metros

January 1995 Tenders for 2nd operator in basic services apart from DoT on

circle basis.

August 1995 VSNL launches Internet services

January 1996 TRAI formed

November 1998 Internet policy announced


24/83

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.

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. Value-added services (including cellular services) were thrown open to private


25/83

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.


26/83

COMPANY PROFILE

Vision

"As we spread wings to expand our capabilities and explore new horizons, the

fundamental focus remains unchanged: seek out the best technology in the world and

put it at the service of our ultimate user: our customer."

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.


27/83

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 capitalise 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:

Focus on maximizing revenues and margins;

Capture maximum telecommunications revenue potential with minimum

geographical coverage;

Offer multiple telecommunications services to provide customers with a "one-

stop shop" solution;

Position itself to tap data transmission opportunities and offer advanced mobile

data services;

Focus on satisfying and retaining customers by ensuring high level of customer

satisfaction;


28/83

Leverage strengths of its strategic and financial partners; and

Emphasize on human resource development to achieve operational efficiencies.


29/83

Businesses

Bharti Tele-Ventures current businesses include -

Mobile services

Fixed-line

National and international long distance services

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:

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.


30/83

Brand Architecture:

Bharti is working on a complex three-layered branding architecture to:

Create specific brands for each service,

Build sub-brands within each of these services and

Use Bharti as the mother brand providing the group its corporate identity as

well as defining its goal to become a national builder of telecoms infrastructure.

AirTel - The flagship brand for cellular operations all across the country.

BHARTI

AIRTEL(CellularOperations)

TOUCHTEL(Basic ServiceOperations)

INDIA ONE(National Long

Distance)


31/83

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 second-hand 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.


32/83

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.


33/83

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 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.


34/83

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.

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.


35/83

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.

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.

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.

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.


36/83

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.

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

First time ever in India - any pre-paid card brand goes on TV

A combination of the film genre exposed through the TV medium designed to

connect with the masses of India


37/83

Youth based - romance driven strategy platform makes the value proposition of

AirTel Magic - Mumkin Hai come alive

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 non-mobile

user.

AirTel Magic positions itself on the platform of being excellent for emergency

situations - increasing productivity as a part of everyday life.

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 non-user 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.


38/83

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 shares in the process.

The brand ambassadors Shahrukh 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 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.


39/83

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.


40/83

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

First time ever in India - any pre-paid card brand gives such freedom to recharge

any value

A combination of the film genre exposed through the TV medium designed to

connect with the masses of India

Youth based - romance driven strategy platform makes the value proposition of

AirTel Magic - Aisi azaadi aur kahan? come alive

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.


41/83

Amount Service Processing Talk

Time

Validit

y(Rs.) Tax

(8%)

Fees(Rs.) (Rs.) (Days)

324 24 150 150 30350 25.93 150 174.07 30360 26.67 150 183.33 30375 27.78 150 197.22 30400 29.63 150 220.37 30425 31.48 150 243.52 30475 35.19 150 289.81 30

500 37.04 150 312.96 30525 38.89 150 336.11 30540 40 150 350 30600 44.44 150 405.56 30650 48.15 150 451.56 30700 51.85 150 498.15 30775 57.41 150 567.59 30800 50.36 150 580.74 30

( Rs.)

Tax

(8%) Fees(Rs.) (Rs.) (Days)850 62.96 150 637.04 60900 66.67 150 683.33 60

1000 74.07 150 775.93 601080 80 150 850 601200 88.89 150 961.11 601300 96.3 150 1053.7 601400 103.7 150 1146.3 601500 111.11 150 1238.89 601800 133.33 150 1516.67 602000 148.15 150 1701.85 60

2160 160 150 1850 603000 222.22 150 2627.78 605000 370.37 300 4329.63 3666000 444.44 300 5255.56 3667000 518.52 300 6181.48 3668000 592.59 300 7107.41 3669000 666.67 300 8033.33 3669999 740.67 300 8958.33 366

Other Brand Building Initiatives:-

Amount Service Processing

Talk

Time

Validit

y

(Rs.)

Tax

(8%) Fees(Rs.) (Rs.) (Days)54 4 25 25 560 4.44 25 30.56 575 5.56 25 44.44 5

100 7.41 25 67.59 5

125 9.26 50 65.74 10150 11.11 50 88.89 10175 12.96 50 112.04 10200 14.81 50 135.19 10216 16 85 115 20225 16.67 85 123.33 20250 18.52 85 146.48 20275 20.37 85 169.63 20300 22.22 85 183.78 20


42/83

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.

It will also launch a unified billing system across circles so, customers

moving from one place to another do not have to close and then again open new

accounts at another place.

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.


43/83

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 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-spread-out clientele with

technology and strategic alliances. Bharti is focusing on two factors to make


44/83

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 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


45/83

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.


46/83

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.

Customizing the product (and communication of its benefit) to meet the specific needs

of various consumer/customer sub-segments is the third element in creating brand

appreciation.

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


47/83

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.


48/83

FINDINGS AND ANALYSIS

Age Group Graph

As we can see from the above graph, the people who are in the age group of 21-28

years are the ones who are the maximum users of mobile phones. This segment is the

one which gives maximum business to the mobile operators. This segment constitutes

the young executives and other office going people. They are 65% of the total people

who were interviewed. The next age group are the people who are 28-35 years old.

They are 20% of the total. They are those who are at home or have small business units

etc. And the next age group is the youngest generation who 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

AGE GROUP

15-21

15%

21-28

65%

28-35

20%


49/83

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 housewife, 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.

Service Provider Graph

OCCUPATION

15%

55%

20%

10%

STUDENTS EXECUTIVES HOUSEHOLDS OTHERS


50/83

The above graph shows a slice of 50%. These are the total no. of people who are using

Airtel. It seems that people are more aware of Airtel than any other brand. The next

popular brand is Hutch. 305 of the people interviewed had Hutch connections. The next

popular brand was Idea. 15% people had Idea connections. As it came very late in the

market when Airtel had established it self very well. So, that could be one of the

reasons of such a low percentage. The remaining 5% had trump connections.

Customer Service At Airtel Graph

SERVICE PROVIDER

15%

30%

5%

50%

IDEA AIRTEL HUTCH OTHERS


51/83

As the above graph clearly shows that customer services at Airtel seems poor. 60% of

the people are dissatisfied with the customer services provided by Airtel. They are the

ones who have the maximum share in the market but they are lagging behind in the

customer services. 10% of the people were fully dissatisfied with the customer services

of Airtel. This could leave an impact on the mind of the consumer. He can even switch

over his brand. 20% of the people seemed partially satisfied with the customer services

and only 10% seem to be fully satisfied with Airtels customer services, which is a very

small amount.

Type Of Card Graph

CUSTOMER SATISFACTION LEVEL

20%

10%

60%

10%

FULLY PARTIALLY

DISSATISFIED FULLY DISSATISFIED


52/83

Cash cards seemed quite popular among the people interviewed. 85% of the total

mobile users were having cash card connections. This means that the cash cards should

be easily and readily available in the local markets. Airtel should make sure that Magic

is available in each and every nook and corner of the market. 15% of the people were

having sim connections which is the regular bill.

TYPES OF CARDS

CASH

CARD85%

SIM

CARD

15%


53/83

Monthly expense graph

People on an average spend RS 500 per month as their mobile phone expense. 64%

people spend this amount. 24% people spend RS 300 per month as their monthly

mobile expense. And the remaining 12% had an expense more than RS 1000, they

could the ones having sim connections or having cash cards and having a lot of

business calls on their mobiles.

Monthly Expense

12%

64%

24%

Rs 600

Rs 450Rs 200


54/83

Awareness About WLL Graph

WLL seemed to be a new word for many of the people. 45% of the people were not at

all aware of such a technology. So, in order to get the answer for this question they

were first explained the concept. Only, 55% people knew what WLL is all about.

AWARENESS ABOUT WLL

YES

55%

NO

45%


55/83

Awareness of WLL Players Graph

Reliance was the brand which was popular amongst the interviewed people. As

Reliance had done so much advertising and has it banners and hoarding spread all over

Delhi. So, this could be one the reasons of its popularity. Tata was hardly a known

brand in this new field. Possibly, because of less promotions done by them as compared

to Reliance.

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?

They spend a maximum of RS. 500 as their mobile expense.

AWARENESS OF WLL PLAYERS

RELIANCE

85%

TATA

INDICOM

15%


56/83

There is 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 about it but not many people

are aware about Tata. They only know more about Reliance. People at this point of

time are not interested to switch over from GSM to WLL.


57/83

SUGGESTIONS

Following are the few suggestions to AIRTEL for improving the market share andimage 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 customers.


58/83

SWOT ANALYSIS

Strengths

Being one of the largest companies in India the company has achieved a

degree of focus in its core business of its products.

It has a strong brand name, superior quality products and an enviable

distribution network.

I t has a clear and well-defined organizat ion structure and l imits of

financial authority.

Increase in advertisement spends affect the companys margins.

The companys bottom line falls victim to the bloated and highly paid

workforce, which affects its margins.

Weakness:

Little efforts over the Advertising of products.

Distribution channel is not accurately categorized.

Premium priced products, hence cant compete in low price segment.

No separate strategy for rural market.

Opportunities:

The company's financial performance can receive a major boost from its

cost reduction efforts.

There is a lot of scope of product and market diversification.


59/83

Exports of products will also have huge chances in the coming years.

Airtels business has ample scope for gaining market share from the

unorganized sector. Rural penetration too holds vast potential to bring

about growth.

Threats

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.

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.

Moreover, inordinate hike in Broad Band Internet products would also

increases companys production and distribution cost.


60/83

RECOMMENDATION

I have made following recommendation to the company after doing the summer

training there:

The company should modify its credit policy as they only target the cash paying

customers who are not easy to trace.

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.

The company should makes its marketing strategy flexible enough in order to

face competition.

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.

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. The company should offers such rate in the market so that it may able to catch a

biger 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?


61/83

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.

3. Lack of time is the basic limitation in the project.

4. Some retailers/whole sellers refuses to cooperate with the queries.

5. Some retailers/wholesellers gave biased or incomplete information regarding the

study.

6. Money played a vital factor in the whole project duration.

7. Lack of proper information and experience due to short period of time.

8. Some retailers did not answer all the questions or do not have time to answer.


62/83

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 is 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 Airtel is 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.


63/83

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.

Books :

Principles of Marketing Philip Kotler

Market Research D.D. Sharma

Research Methodology C.R. Kothari

Websites:

www.airtelworld.com

www.google.com

www.india.com

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)
http://www.airtelworld.com/http://www.google.com/http://www.india.com/http://www.airtelworld.com/http://www.google.com/http://www.india.com/


64/83

QUESTIONNAIRE

Dear Sir/Madam

I am a student of BBA of Institute of management studies 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?

0-2 Years2-5 Years5-10 YearsMore than 10 years

Q.2 Are you using other product instead of Airtel?

Yes No

Q.3 Among them, which Brand you, prefer most?

IdeaHutchAirtel

Q. 4 How would you rate the experience with Brand?

IdeaHutchAirtel

Q.5 Do you collect any information search before making purchase?

Yes No.

Excellent Good Average Below Average


65/83


66/83

Q.6 If yes, which sources are used?

MagazinesDealersSales ExecutivesOperators referencePamphlets and catalogueReference from friends and relativesAny other

Q.7 What are the features you look for in a product before making purchase

decision? Give preferences (1-Highest, 6- least)

Brand credibilityPrice and DiscountAfter sales services and parts, network Value for moneyVehicle performanceAdd on features or ergonomics of design

Q.8. Which of these marketing / sales schemes attracts you while purchasing anyconnection?

Good Network Discount schemeService packageAny other

Q.9 If you have to purchase a new connection or product in near future, whichBrand will you go for and why?

_________________________________________________ _________________________________________________ _________________________________________________

Q.10 Are you aware of various promotional activities being run by Airtel, if yesthen how? Are you satisfied with these promotional activities?

Customer CareBy Ad FilmsBy Camp24 hrs call center services

VerySatisfied

Satisfied SomewhatSatisfied

Notsatisfied


67/83

Q.11 How would you rate Airtel performance as your expectation on 5 pointsscale (5 Highest)

1 2 3 4 5After Sale serviceMaintenanceProduct as per expectation

Q.12 What are you suggestions for improving the product quality, service availabilityand parts availability?

________________________________________________________________ ________________________________________________________________ ________________________________________________________________ ____


68/83

DECLARATIONDECLARATION

I hereby declare that I have carried out Summer Training Project on the topic entitled

Market performance of Airtel Industry from New Delhi

I further declare that this project work is based on my original work and no part of this

project has been published or submitted to anybody.

SUSHANT GILL


69/83

Acknowledge

ment


70/83

Preface


71/83

Executive

Summary


72/83

Objective

of the

Study


73/83

Research

Methodology


74/83

Introducti

on


75/83

Company

Profile


76/83

FindingsandAnalysis


77/83

Suggestions


78/83

SWOT

Analysis


79/83

Recommendation


80/83

Limitations


81/83

Conclusion


82/83

Bibliography


83/83

Questionnai

re

A Study of Marketing Strategy and Performance of Airtel Industry New

Documents

Transcript of A Study of Marketing Strategy and Performance of Airtel Industry New