1

Strategic Marketing Planning

December 2014 Examination

Post Graduate Diploma in Marketing

Sri Lanka Institute of Marketing

Assignment

Topic

Formulating a Strategic Marketing Planning

Student name

A. Mohamed Azhar

Reg. No.

0000016630

2

Acknowledgement

I would like to express thanks to the Sri Lanka Institute of Marketing for giving this task

which I always consider as a great opportunity to enhance my knowledge and improve

my planning ability.

I would like to thank Mr. Mahasena Senanayake, who is our lecturer for this Strategic

Marketing Planning subject. It is really helping me to make the success of this marketing

planning with his guidance and knowledge in completing this assignment.

I express my sincere thankfulness for my all friends; they provided me additional

knowledge to complete this assignment. As well as my thankfulness to my family

members who encouraged me at all time when preparing this assignment.

3

Subject : Strategic Marketing Planning (SMP)

Company: Sri Lanka Telecom PLC

Product : Megaline (Wireline connection)

Name : A. Mohamed Azhar

Reg. No. : 0000016630

Examination Month: December 2014

4

Tables of contents

Acknowledgment page i

1. Executive Summary 07

A. Summary of situational analysis 07

B. Summary of Marketing Objectives. 08

C. Summary of Marketing Strategies. 09

D. Summary of Financial projections. 10

2. Vision and Mission 11

3. The Company 12

3.1 Brief History, Current size, Branch if any, etc… 12

3.2 Internal Environment 14

a. Staff Relation 14

b. Resource constrains 15

c. Corporate structure and Culture 16

4. The Product 19

4.1 General product story of the product 19

a. Development, introduction and history 19

b. Product category and characteristic 20

c. Stage of the product life cycle 20

d. Any other important characteristic 20

5. The overall Market (customers) 22

5.1 Description of the characteristic of target customers 22

a. Need and benefit sought 22

b. Product usage 22

c. Attitudes of the customers 23

I. As to the product category 23

II. As to the company product 23

III. Why they like our product or not 23

IV. Any unique character of customers 24

5.2 Description of the characteristic of target customers 24

a. Buying decision making process 24

b. What source of information is sought 25

c. Who makes the purchase 26

5

d. Is purchase the consumer 26

e. Who or what may influence the purchase 26

6. Competition and Market share 27

6.1 Identification of the competitors 27

a. List of primary competitors 27

b. Secondary competitors 27

c. Possible new competitors 28

6.2 Market share 28

a. Total current industry sales by market 28

b. Comparative analysis of market share 29

c. Trend and future growth 30

d. Expected total market (demand estimates) 30

6.2 Describe following details of two players in the market and any other 31-38

7. External environment factors 39

1. Political 39

2. Economical 39

3. Social 39

4. Technological 40

5. Ecological 40

6. Environmental 41

7. Legal 41

8. SWOT analysis 42

3. G.1. Strengths 42

3. G.2 Weaknesses 42

3. G.3 Opportunities 42

3. G.4 Threats 42

9. Sales objectives 42

10. Marketing objectives 42

11. Market Segmenting, Targeting and Positioning 46

11.1 Market segment 46

a. Geographic 46

b. Demographic 46

c. Psychographic 46

d. Behavioral 47

6

11.2 Targeting 47

11.3 Positioning 48

12. Tactical marketing mix strategy development (7 ps) 49

12.1 Product strategy 49

12.2 Pricing strategy 51

12.3 Promotion strategy 51

12.4 Distribution strategy 54

12.5 Physical strategy 55

12.6 Process strategy 55

12.7 People strategy 56

13. Budget and financial analysis 58

14. Marketing strategy implementation 61

15. Monitoring and evaluation 63

List of References 65

Appendix 66

7

1. Executive summary

A. Summary of Situation Analysis

The strategic marketing planning has analysed about Megaline service of the Sri Lanka

Telecom PLC for the financial year 2015. The Sri Lanka Telecom PLC will achieve the

specific goal and objectives in the year 2015.

Sri Lanka Telecom PLC has a proper plan according to the vision and mission, which is a

guideline for practical approaches to reach its success in the telecommunication industry.

The Sri Lanka telecommunication industry has aimed new innovations for country

infrastructure facility and people‟s communication requirement. Generally, SLT is a

backbone of Sri Lanka‟s telecommunications industry.

SLT is a public limited company which is established in 1858. It gained over 150 years of

goodwill and trust from their valuable customers. The main targets of SLT PLC are

providing quality, uniform, steady and reliable services to their customers. SLT offers

various telecommunication services such as Megaline, Citylink, Peo TV and Broadband.

Those are sold island wide through the 34 regional branches, 36 teleshops, 22

maintenance centres and 7 contact centres. SLT PLC has a strong financial growth

because it is attained revenue about Rs. 36.78 billion, which was increased by 5.93% in

2013 and asset value was Rs.83.09 billion and total employees were 7861 in 2013.

Ownerships of SLT hold two primary partners of Sri Lankan government, which holds

49.50% and global telecommunication holdings N.V of Netherland, which owned 44.98%

where the remaining balances own with the general public.

SLT PLC staffs are very friendly among them and they get various benefits and

motivation from SLT. The current resources are backbone to SLT which has financial

resources, human resources, technological resources and physical resources. However,

the sales team is a limited one in the personal selling. The formal and informal structures

successfully works, which corporate structure was strongly organized by SLT that

ensured every rule and responsibility of employees.

SLT Megaline provides three types of telecommunication services as voice, data and

entertainment via Megaline connection which valuable packages reached at maturity

stage in the product life cycle with maximum profit and which increasing market shares.

8

SLT divided their target consumers as individual consumers and corporate consumers

who like an effective and efficient of this three way service through one connection. The

customers have a good attitude about this Megline service which provides a lot of benefits

to their target customers.

There is no direct competition to Megaline connection, because SLT is a monopoly

business and it is an only wire-line telephone connection in Sri Lanka, but most of the

other competitors are wireless local telephone connections. SLT PLC has identified

primary competitors, secondary competitors and possible new competitors for Megaline.

SLT is a market leader in total fixed connection which has a 57 % market share, which

has contributed two fixed services, which are Megaline connection holds 38.86% and

Citylink holds 18.14%. Competitor of Lanka Bell CDMA holds 30% market share and

Dialog (Dialog CDMA and Suntel CDMA) holds 13% market share. The identified

competitors have discussed within the background, current product strategy, current

distribution strategy, current pricing strategy and current promotional strategy.

PESTEEL factors have analyzed about the political environment, economic environment,

social environment, technological environment, ethical environment, ecological

environment and legal environment.

The SWOT analyzed strengths, weaknesses, opportunities and threats which are strong

point of SLT‟s Megaline which has major strongest services due to multiple packages,

which weaknesses will be transformed into strengths, threats will transformed into

opportunities, finally, its strengths transformed into business opportunities in the

telecommunication industry.

B. Summary of the Marketing objectives

Both marketing and sales objectives are preferred in the SMART approach. The

Megline‟s sales objective is “The revenue of the Magaline will be increased by 12.5% at

all islands widest in the end of the December 2015”

Marketing objectives include five key tools which are most important target goals of

Megaline sales objectives. The sales objective leads to set marketing objectives, that will

be accomplished through the marketing activities which are increasing the net worth

growth by 10%, convention by 15% from existing competitors, increase consumers by

9

20% carry out to remind of the Sri Lanka project, enhance the brand awareness, capture

revenue up to 50%.

C. Summary of marketing strategies

The Megaline‟s segment described about geographic, demographic, psychographic and

behavioral segmentation. SLT is separated their target audience as individual consumers

and corporate consumers. Also, the target segmentation is positioned by lower price and

high quality of services. That was properly indicated the Megaline‟s future position in the

perceptual map.

Product strategies are differentiated according to business objectives to capture the more

consumers. SLT promotes the Megaline as general product to overall customers that has

three types of services as voice, data and entertainment services according to their

Megaline connection. Though, their core services is voice.

The penetration price strategy appropriates to Megaline connection, because they attract

more consumer among vast competitions also it enhances the market shares, increase

sales volume, increase revenue, boost competitive advantage to current competitors and

etc.

The current promotional campaign of Megaline mainly focuses on quality of innovative

services. Promotion strategy includes radio, TV, outdoor, newspapers, special offers, free

gift, public relationship, sponsorship, social media and websites. The percentage of the

marketing budget is allocated to media advertising, but it is less cost when comparing

with sales promotion.

SLT has competitive advantage in distribution strategy. Because, It distributes through

the 36 Teleshops, 34 Regional offices, 22 Maintenance centres and 07 Contact centres.

The physical evidence strategy of SLT is their labels, pennants, and other printed

information, all SLT outlets and vehicles place SLT Logo, colours, staff uniform and

website design and etc.

Process strategy changes to online process such as bill payments and purchasing process

which is easier for consumers and organization.

People strategy include about the staff and their capabilities and qualifications.

10

D. Summary of financial projection

Megaline is contributed approximately 20 billion (54%) of their total revenue in 2013. I

assume, the revenue will increase by 12.5% in 2015.

SLT PLC will achieve their revenue through their Megaline budget plan. Anyway, after

allocating budgets for the Megaline connection will get 12.5% revenue.

Description Amount (Rs)

Revenue 22,500,000,000

Expenditure

Operating cost 12,250,000,000

Distribution expense 3,350,500,000

Financial cost 2,116,900,000

Total expenditure 17,717,400,000

Profit before tax 4,782,600,000

Income tax expense 956,520,000

Net profit 3,826,080,000

Figure 01: Budget and Financial analysis of Megaline connection in 2015.

11

2. Vision and Mission

Vision

All Sri Lankans seamlessly connected with world class information, communication and

entertainment services.

Mission

You're trusted and proven partner for innovative and exciting communication experience

delivered with passion, quality and commitment.

12

3. The company

3.1 Brief history, Current Size, branches if any, the product and services that the company

is offering, growth and profitability etc.

Sri Lanka Telecom (SLT) has built over 150 years of goodwill and trust with its valued

customers. It has established their operations since 1858 where the first Telegraphic

Circuit established between Galle and Colombo.

In 1911, SLT established as a Central telegraph office where the installation of Automatic

Telephone Exchange established at Kahawatta in Ratnapura District in 1931. In 1935 it

was a golden era where International Telephone Service inaugurated.

The journey in 1991 the first Sri Lanka telecom corporation formed and they have

introduced a packet switching service (1993), internet, email service (1996) and also in

the same year SLT corporation has been converted into a public company.

SLT had been incorporated in Sri Lanka in September 1996 under the Conversion of

Public Corporations or Government Owned Business Undertakings into Public Limited

Companies Act No.23 of 1987 and quoted on the Colombo Stock Exchange in January

2003.

The year of 1997 Sri Lanka Telecom has been privatized with the collaboration of Nippon

Telegraph & Telephone Corporation of Japan and listed in the Colombo Stock

Exchange's Milanka Price Index.

SLT is one of Sri Lanka's most valuable blue chip companies with an annual turnover of

around Rs 60.14 billion. SLT received the distinction of being ranked No.1 in Sri

Lanka‟s telecommunication industry. The national telecommunications service won

silver, which is the first time SLT has been recognized at the HRM Awards in 2012 and

also in recently it was awarded ISO 9001:2008 certification for its quality management

system.

Current size

The total employees are around 7861 in SLT that has estimated the total revenue of Rs.

36.78 billion and also the asset value is Rs.83 billion.

Branches

13

The SLT distribution network includes 34 regional branches, 36 dealerships, 22

maintenance centres and 7 contact centres.

Products and services;

The SLT offers a various telecommunication services. Those are Megaline, Citylink, PEO

TV and Broadband.

Growth and profitability;

When considering about the last three years of the company sales, it is continuously

growing in every year when the last year revenue has increased by 5.93% (Rs. 34.72

billion to Rs. 36.78 billion) from 2012 to 2013. Following last three year chart

Figure 02: Total Sales of Sri Lanka Telecom PLC

Ownership

The two major ownerships of SLT are, one is Sri Lankan government hold 49.50% and

another one is the global telecommunication holdings N.V of Netherland holds 44.98%

that the remaining balance is owned by the general public.

30

31

32

33

34

35

36

37

38

2011 2012 2013

VA

LU

ES

IN

(L

KR

) B

ILL

ION

YEAR

TOTAL SALES OF SLT PLC

14

3.2. Internal environments:

a. Staff relations

Employees of the SLT are considered as a valuable and vital asset. Only well-motivated

employees can deliver better service according to this, SLT possess a better environment

for the employees to maintain a good staff relationship where they have the freedom to

get mentor also with cultural freedom.

The Sri Lanka Telecom has a close friendly relationship with their staff through the staff

relation, motivating intercom petition programs, internal and external training programs,

health safety workshop and staff meetings. Also the employees are motivated by the job

security, job enrichment and salary increments and promotions.

At the same time, SLT has ensured their staff‟s accommodation with standardizing higher

than their competitors. They consider their staff as the main driving force of the

organization where they do have a better understanding, mutual trust and good

relationship among all parties.

SLT is a kind of bearding organization where it encourages its staff to learn through their

experience as well they also provided infrastructure facilities such as libraries and

playground facilities mainly in the capital city.

SLT conduct annual tour over and digital Life magazines and also paper articles in

Sinhala, English and Tamil languages its updates are available for internal and external

parties on SLT.

Staff relation within SLT is such an amazing one where they behave as a family for their

sustainability. Motorbike Loan facilities at lower interest rates, annual sport meets, trips,

cultural programs, quiz competitions are some of the activities and events organized by

SLT in order to build good relationship between companies and employees as well as

with their valued customers.

15

b. Resource and Limitation

Resource

The effective management system is a strong indicator of the organization's success. SLT

is a company which efficiently uses all of its different business resources where it

performs at a higher level and makes more money than other companies.

Financial Resources

The Financial Resources have noted that isn‟t enough considerable by Sri Lanka

Telecom.

SLT's total financial

strengths

December 2013 December 2012

Turnover Rs. 36,781 million Rs. 34,719 million

Gross Profit Rs. 9,960 million Rs. 9,286 million

Operating cost Rs. 3,156 million Rs. 2,582 million

Profits Before Tax Rs. 5,014 million Rs. 4,567 million

Profit after tax Rs. 3,635 million Rs. 3,246 million

Figure 02: Total Finacial resources of Sri Lanka Telecom PLC

Human Resources

Human resource is a valuable asset to SLT which is currently have 7861 employees who

very strength to SLT. The majority of employees serves long time and management,

creating the efficiency of work by providing training and workshop.

Technology resource

The SLT's IT systems awarded by ISO/IEM 27001:2005 security management standard

and SLT have moved 72nd

to (2012) to 69th

place (2013) in global network readiness. The

company believes that IT is potential in their every success and sustainability. The

improving IT technology systems satisfy the consumers. The SLT has island wide IT

16

Operational support systems with System developments, network and end user support.

Network operator such as SLT NOC and Island wide broadband network operators,

including IPVPN/MPLS/Data service and internet services, internet data centres, broad

band services and etc.

Physical Resources

Physical Resources include the management process, distribution channel, maintenance

requirements and etc. The category of physical resources covers a wide range of

operational resources which capability to deliver a strategy to SLT.

Limitation

SLT„s sales are mostly based on the network resources via the branch. But, the limitation

is a direct sales team for island wide distribution network where the less focus on

personal selling

c. Corporate structure and culture

Corporate structure

The organization structures of SLT contain rapid elaborated changes; we can easily find

out some characteristics of division structure and new workplace structure. Therefore, this

combination offers a flexible structural design in order to achieve their ultimate goals and

objectives.

Sri Lanka Telecom operates under the Mr. Nimal Welgama who is director of mobility

(Pvt) Ltd and subsidiaries, who is a major decision maker of SLT and other entire

companies. He is responsible for leading the board who participates with company

meeting and company strategies. He manages the board members and the senior

management team.

17

Chairman manages the board committee that includes the 5 departments, such as Audit

committee, remuneration committee, technology subcommittee, and senior render board

and nominating committee.

Lalith De Silva is a CEO of SLT; he is a responsible person to ensure under effective

training to key staff. He is responsible for company development and long term success

with shareholders. He takes session to their management level. Also, implement SLT's

short and long term plan according to the CEO, the management committee work with 09

departments. They are working to provide day to day business plan for company

operation.

Figure 03: Formal structure of Sri Lanka Telecom PLC

Chairman & Board of Directors

Group CEO

Management Committees &

composition

L.T S.G O.R.T R.A.F.M P.M.F E.R.M I.S.M.F S.C.Q.M.S S.G.B

C.F.G.S

Board Committees & composition

A.C R.C T.F.C S.T.B N.C

C.S

T.G.B P.G.B I.G.B N.G.B F.G.B E.S.G.B

18

Culture

Formal culture

Culture is the sum of total learned values, beliefs, customs that are served to direct

consumer behavior in a particular country market. Although, the structure is the

arrangement of parts which is indicated previously,

SLT organization cultures reflect their mentality. The organization management

committee is handling by top level managers. The authorization and better understanding

of their culture and how to transform it, is a critical skill for leaders in SLT, they are

trying to achieve strategic outcomes. Strategic leaders have the best perspective, because

of their position in SLT, to see the dynamics of the culture, what should remain, and what

needs want to transform as well as the rules and regulation are minimized and a very

flexible approach to handle issues.

Informal culture

Informal culture is a visible element to SLT which has a good relationship with

population to exist in long day. It is a relationship with customers via the personal

relationship, social networks, religious group, co-workers, and communities of common

interest and emotional sources of motivation.

19

4. The product/ service

4.1 General product story of the product

a. Development, introduction and history

The SLT Megaline connection was introduced by Sri Lanka Telecom in 2008. The

service included the voice and broadband connection only, after two years Megaline was

expanded with Peo TV connection. The Megaline strategy helps their sustainable market

shares in the fixed line sector (Megaline and Citylink), above 40% and helps to retain the

Megaline market share above 25%in 2010.

The Megaline services satisfy different customer through the three types of packages such

as voice service only (Single Play), voice and broadband services (Double Play), voice,

broadband and Pro TV (Triple Play). Especially in the case of triple play connection, it is

expected to satisfy the all the needs of customers only through Megaline service.

The Megaline customer base is increased by 24,590 in 2010 and maintain its position due

to the introduction of the triple play connection which has a major contribution attained

by broadband connection within the triple play.

Sri Lanka Telecom is a differentiated network on voice call rates, browsing internet data

and entertainment services. Previously, a single call plan was maintained for Megaline

and CDMA, now this has been separated.

SLT has recognized telephone services as their traditional business which has served

customers since inception due to the advancement of technology and varying customer

needs, SLT‟s revenue composition is shifting more towards broadband, data and

wholesale segments. Their traditional business consists of Megaline (wire-line), Citylink

(CDMA) and IDD services.

Recently, SLT focus on the multiple services which bring a major contribution to the

market shares. The current fixed line total market is heavily competitive, but the

Megaline is a strong brand name and high loyalty in the fixed communication services.

Because, last year approximately 4% market shares downed in fixed communication, but

the Megaline connection was increased by 6.91%.

20

b. Product category and characteristics

SLT PLC is offering a wire-line connection through three types of packages that enables

two people who freedom to choose, especially the packages includes the broadband,

internet and voice value added services, as well as making wire Magaline connectivity

more affordable to the public.

Sri Lanka Telecom (SLT) reduced prices of wire line connection with the introduction of

SLT Megaline. SLT Megaline purchasing to use at home and offices.

Services offered Calling plan Free services Connection charges

Triple play Mega home or mega office Triple play vas bundle

10,000

Double play Mega home or mega office Double play vas bundle

Voice + broadband

without CPR* Rs 7,000 or

Voice + Peo TV RS

11,000

Single play Mega home or mega office Single paly vas bundle 12,000

Figure 04: Three types of packages of Megaline connection

(Resource:http://www.slt.lk/personal/telephone/megaline/new-connection-charges)

c. Stage of product life Cycle

Figure 05: Product life cycles of Megaline connection

21

After launching the Megaline connection, Sri Lanka telecommunication industry has

rapidly grown, Also the Megaline is a valuable contribution to the Sri Lankan

telecommunication industry.

At present, SLT Megaline across at the maturity level in the product life cycle. According

to my analysis, The SLT Megaline connection is still keeping its maturity levels. Because

Following reasons are mentioning the reasons;

SLT is a monopoly business by lager investment resources.

Existing competitor has less market share and still not entering a new competitor,

because they still need a huge investment.

SLT Megaline provides high standard multiple services to existing customers.

The industry‟s capacity utilization is at high level.

d. Any other important characteristic of Megaline

Crystal clear voice

Offer of voice, broadband and Peo TV services through a single line

Single number for generation

Island wide network coverage

Safe to use – more less radiation

A line that is always connected - No utility, powder requirement for telephone user

Business customers are benefited when making longer call because of call charges are

reduced after 3rd minute.

Extended off-peak time band for home users

22

5. The overall market (Customers)

5.1Description of the characteristics of target customers

a. Need and the benefit sought

The Megaline‟s target segments are individual customers (home) and the corporate

consumer (business organization) who enjoy multiple connections its target market

segments look a reasonably effective and efficient service at these 3 ways service in a

one connection.

SLT Megaline makes a lot of benefits in a believable manner. Because, consumers

favaour to increase their packages from single packages to triple and multiple

packages.

Megaline primarily use for communicating with other via voice call also, the service

extension provides internet access and television service and entertainment services.

In this era the multiple packs become a more important to consumers to communicate

and entertainment activities.

b. Product usage

The SLT Megaline connection is used by two types of consumers such as House

(Individual) consumers and Office (Corporate) consumers.

Who is using – SLT Megaline connection is mostly used by upper & middle class

families, Multinational & enterprise customers, public sector institutions, other

operators / wholesale customers, SME, retail customers and domestic user.

Why they use –Megaline is a clear connection with acceptable price. Also, it

provides a Peo TV and broadband services via the one connection.

When do they use – The individual consumers or corporate consumer needs or

likely to communicate with others. They spend their valuable time on

entertainment of Television channel and internet access.

How it is used – to call, internet access and television watch.

23

c. Attitudes of the consumers

i. As to Product category

The Magaline is a major fixed line connection in Sri Lanka, where it is enjoyed by the

Sri Lankan consumers in the multiple product categories. The existing consumers are

most valuable resource to SLT because of the good brand image of Mgaline

connection.

The current buyers have a good attitude about the Magaline connection. Because, the

multiple and triple services available at a cheaper price than single packages, the

Triple connection satisfies via call, entertainment and Peo TV services. Also, the

voice connection can move on to multiple connection and triple connection.

ii. As to company‟s product

SLT has more than 150 year reputation with consumers. The consumers know the

Megaline connection which has a very strong relationship with their existing

consumers. SLT Megaline customers have a positive attitude about its services which

is good quality and clear services in the telecommunication industry

The SLT Megaline connection is a brand of the Sri Lanka that was first licensed in the

telecommunication industry. The consumer associates the quality of services, safety

and excellent customer services.

iii. Why they like our products or not

The Megaline‟s customer enjoys its services, because the Megaline connection is

clear voice services and available other two services of broadband and Peo Tv, it is

the lowest call rate compare with the wire-line connection and mobile phone

connections, it is demanded by the latest technology development with the delight

customer service. These three are in one facility which is mostly used in banks, hotels,

shops, private and government institutions, house and etc.

24

iv. Any unique character of customers

The customer‟s character changes by their lifestyle and mobile market competition.

When looking a history of customers, they are switching to mobile phone connection.

The Megaline consumers‟ characteristics are:

More price concern in call rate

Expecting quality of services

Focusing the product rank because the more than connection reduces the

monthly rental and connection charges

Expecting valuable and additional services because telecommunication

industry is more competitive.

Ideal customer

Most consumers don‟t know the quality of services however purchased.

Repeat buyer

5.2 descriptions of the purchasing process

a. Buying decision making process

Megaline is a telecommunication brand which has a very competitive advantage in Sri

Lanka, because the SLT selects an effective advertising and promotion campaign and

over 150 market reputations. Also, the consumers have to seek the effective services

which are appropriate for communicating with others.

According to consumer need, they will purchase best services which process created

ideal condition.

Figure 06: consumer buying decision making process of Megaline connection

Post Purchase

Purchase Decision

Evaluation of Alternative

Information Search

Problem Recognition

25

SLT identified the consumer‟s decision making process that includes five steps.

Problem recognition - In this step, consumers desire to communicate with others.

Information search - The person collects information about the best

telecommunication connection according to two methods. Those are:

Internal: - The consumers may ask their relations and friends who are using fixed

line connection.

External: - The consumers find the information about fixed connection via.

Evaluate of alternative - After information gathered, Person selects a better option

among various alternative services.

Purchase Decision - according to the above steps, consumers purchase a Megline

service.

Post purchase - In the final step, the consumer analysis about quality of Megaline

services which is satisfying or not, it is a quality one or not. If, it satisfied the

consumers who will recommend to others to use Megaline and they will

continuously enjoy the services. If it doesn't satisfy the consumers who will not

continue the services and will not recommend to others.

b. What sources of information is sought?

The required source of information has analyzed below for the Megaline connection.

Public sources – consumers obtain information through the mass media,

newspapers, magazines, radio and etc.

Personal sources - consumers obtain information through the family, working

partners and friends.

Commercial - Consumers recognize the information through the sales peoples and

display of the Megaline connection.

Experimentally – Consumers obtain a information via a previous experience such

as handling, examining and using the Megaline connection.

26

c. Who makes the purchase?

People purchase the Megaline connection to home (individual consumers)

multinational & enterprise customers, Public sector institution, another operation/

wholesaler customers, SME & retail customers, domestic users (co-operate

consumers), because they also know the services and benefit of this connection. The

head of the organization approves to purchase the Megaline

d. Is purchaser the consumer?

We discussed the target consumers are home and corporate consumers. In this

situation all the purchaser is not the real consumer, because home consumers pay their

own money, but privet officers purchase for their offices that payment comes from

corporate owners and the government offices purchase money that comes from

government.

e. Who or what may influence the purchase?

We identified two types of influence when purchase a Megaline connection. Those

are identified under the heading of man and promotional campaign.

Who may influence

Family member

Corporate owners

What may Influences

Advertising and promotion

Web site

Leaflet

Past experience

Quality of services

Multiple connection

27

6. Competition and market share

6.1 Identification of competitors

a. List of Primary competitors

SLT PLC does not have any direct competitors for Megaline connection. It is a

pioneer and a monopoly service provider in fixed wire telephone line. But, other

competitors do not arrive at all segments that they are unable to achieve their targets

due to SLT‟s huge cost.

Also, telecommunication regulatory commission of Sri Lanka has divided into two

types of fixed connection as wire-line telephones and wireless local loop telephones.

The Megaline is only wire-line telephone and Citylink and other competitors are

wireless local loop telephones. We recognized, the Suntel was jointed with Dialog

fixed telecommunication services.

Megaline has recognized as their primary competitors (wireless local loop

telephones).

Lanka Bell CDMA

Dialog CDMA

Suntel CDMA

Citylink CDMA

(Resource: Central bank report 2013)

b. Secondary competitors

Secondary competitors offer mobile phone services in the telecommunication industry

that does not directly related with a Megaline connection but related to the

telecommunication industry.

Secondary competitors are mobile communication service providers.

Dialog

Etisalat

Mobitel

Airtel

Hutch

28

c. Possible new competitors

Tritel Services (Pvt) Ltd

I identified the Tritel services (Pvt) Ltd which incorporated since 1997. It is a public

phone terminal service (payphone services) provider in the rural areas in Sri Lanka.

Tritel has more than 4 million regular consumers and 5000 Tritel phones are located

in Sri Lanka. It is mostly contribute to the rural community in Sri Lanka.

(Source: http://www.tritelnet.com/)

6.2 Market share

a. Total current industry sales by market

According to TRCSL, approximately 2.70 million (2013) Fixed line and wire-line

connection are used in Sri Lankan where total market worth was Rs 459 billion. The

total Megaline (wire-line telephones) connection has increased from 999,354 (2012)

to 1,062,065 (2013). But, the total wireless local loop telephone (total fixed

connection without Megaline) connection was decreased from 2.45 million (2012) to

1.64 million (2013). So, total connection (fixed and wire-line) down from 3.45 million

to 2.70 million.

(Resource:

http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/English/7_Cha

pter_03.pdf)

Sri Lanka Telecom‟s fixed connection (Megaline & Citylink) has 57% market share

(1.5million), Megaline has contributed 38.86% (approximately 1 million

connections). Megaline‟s market share has increased by 6.91%, increased the revenue

by 2,150 million compared with 2012.

(Source: SLT Annual report – 2013)

The changing lifestyles in the innovative mobile phone connection which reduced the

total fixed line connection. The Megaline connection continuously increasing and it

has increased its shares in 2013.

29

b. Comparative analysis of market share held by the company and competitors

The Fixed line (Megaline and Cityline) has contributed 57% market share, but,

Megaline connection only holds 38.86% market share and Citylink only holds 18.14%

market share.

Lanka Bell holds 38% market shares, Dialog (Dialog CDMA and Suntel) holds 13%

market shares. According to dialog‟s annual report, The Suntel was incorporated with

the dialog's fixed telecommunication services in 2012.

Figure 07: Comparative analysis of market share held by the company and

competitors.

(Resource: SLT annual report – 2013 and

http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/English/7_Cha

pter_03)

Figure 08: Market share of total fixed connection of company and competitors

Sri Lanka Telecom

57%

Lanka Bell 30%

Dialog Axiata 13%

Market Share of Fixed connection

companies

Company Product

No of

subscribers

(2012)

No of

subscribers

(2013)

Market Share of

Fixed connection

(2013)

Sri Lanka Telecom Megaline,

Citylink CDMA 1,511,163 1,571,309 57%

Lanka Bell Limited Lanka Bell

CDMA 1,410,727 786,454 30%

Dialog Axiata PLC Dialog CDMA,

Suntel CDMA 527,000 349,837 13%

Total 3,448,890 2,707,600 100%

30

c. Trend and future growth

Megaline is a market dominator in fixed line connections. The innovative service was

increased by excellent brand image among all consumers.

According to SLT, The Megaline connection‟s market share has increased by 6.1%

(2012) and 6.3% (2013). The future growth of Megaline is ensured by Sri Lanka

Telecom, which is estimated that, in the financial year 2015 that growth will increase

by 12.5%. The Megaline connection is growing continuously when the total fixed

connections increase or decrease in Sri Lanka.

d. Expected total market

The Megaline consumers have a benefit from multiple services Magaline connection

has a standard image by providing new innovation and good quality for their

consumers. The Megaline connection will reach more consumers in 2015 by its high

competitive advantage.

We have plans to increase the awareness level of consumers and increase the

contribution of the Megaline connection in 2015. Also, we planned all appropriate

strategy to Megaline connection. So, The strategic plan estimated the market share up

to 12.5 % in 2015 and 2,250 million sales growth.

31

6.2

a. Background of competitors

I. Company and its size/ type

Lanka Bell Limited

Lanka Bell is a world class telecommunication

operator that provides a full range of

telecommunication service to business and

residential customers.

Lanka Bell established in 1997 as the single

BOI company in Sri Lanka with an investment

over US $ 150 million.

It is introduced the innovative services as a 4G

connection since 2014.

It has estimated revenue Rs. 3,997 million,

which was increased by 0.93% in the year

2013.

Dialog Axiata PLC

Dialog Pvt (Ltd) established in 1993 then,

converted to a PLC in 2005. Dialog Axita

PLC is subsidiary Axita Group Berhad

Axiata.

It is larger and faster mobile phone network

in Sri Lanka. It has advanced Mobile phone

and broadband service of 3G/3.5G and 4G

network, which subscribers over 8 million.

The Dialog has estimated the revenue Rs.

63.3billion and its growth increased by 12%

in December 2013.

II. Reputation

Lanka Bell is awarded ISO 9001:2008 quality

management system certificates for providing

standard of customer services.

Lanka Bell is awarded the National quality

software award from the British computer

society also.

Dialog good reputed and superior services

company in telecommunication industry, it‟s

providing worldwide roaming service to

more than 200 countries.

They are awarded with ISO 900 certificate,

local and international National quality

award, three successive GSM world award

and SLIM-Nielsen People choice award

2014.

Currently, Dialog is a main sponsor of the

Sri Lanka cricket team.

III. Sales force and their expertise

32

Lanka Bell has an expertise sales team of 5

regional managers and 45 sales representatives.

Amali Nanayakara is the leader of the

marketing department. The Dialog is

operating all over the country where the

sales force is consisted with 8 regional sales

manager, 25 district manager and

salespeople.

IV. Financial strength

Total revenue was Rs. 3,997 million in 2013,

which is increased by lower rate of 0.9%.

Because, this company invested a large amount

to improving 4G-LTE services.

Dialog‟s financial stability is strong, because

the revenue increased by 11.34% in 2013,

which value was 55.44 billion and total asset

is 103.98 billion in 2013.

V. Technology used

Lanka Bell has 4G connection which has

improved since 2014.

Dialog has a 4G connection over the Island

wide.

VI. Any other important aspect

Lanka Bell attempts to increase the fixed line

connection via the lowest call rate.

The Dialog provides roaming services in

more than 200 countries.

Strong infrastructure and customer loyalty

in the mobile telecommunication services.

Also, the Suntel was incorporated with

Dialog which contributes to fixed line the

connection.

33

b. Current product strategy of competitors

Comparative analysis of competitor‟s product strategy

i. Product mix

Lanka Bell Limited

Lanka Bell fixed line

Lanka Bell broadband

Dialog Axiata PLC

Dialog Fixed line (CDMA)

Dialog Mobile

Dialog Broadband (ISP)

Dialog TV (pay TV)

ii. Branding and packaging

Lanka Bell CDMA has two types of package.

Postpaid packages

Its features are lower call charge, IDD call,

superior voice quality with per second rates

and bill payments for postpaid package is

available in bank, food city and etc.

Prepaid packages

Its features include superior voice quality,

lower IDD calls charged with per minute and

also recharged via reload & card.

There are 4 packages available.

Post-paid

Its features include lower call charge,

superior voice quality with per second

Prepaid

Its features include Superior voice quality,

Lower IDD calls charged with per minute

Reload & Recharge

Easy reload and recharge in every phone

shop.

IDD Rates

It‟s features are Lower IDD rate, superior

voice quality with per second with lower

money rate.

iii. Positioning

Lanka Bell position by lower price and

innovative service quality.

Positioned by best level customer services

and innovative technology. Also the

34

Dialog‟a call rate is very low when call with

another Dialog CDMA, Suntel CDMA and

Dialog mobile phone services.

iv. Image and reputation of brand

The Lanka bell‟s call rate is cheaper than other

fixed connection which increase brand

reputation among home segments and SME.

Sponsor of national cricket team and rugby

team of Sri Lanka and over 10 years partner

with a national volleyball federation.

v. Product strength and weakness

Strength

Advance Technology (SMS, Email via

SMS, BMS, FMS, voice, SMS, Tune,

internet services, IDD services

4Gconnection)

For two purposes - residence (domestic

need) and enterprise (corporate need)

Brand Reputation high among home

consumes.

Competitive lower call rate.

Continue services without termination.

Weakness

Not provide Wi-Fi services

Late delivery due to less sales channel.

Late repairing service with few branches.

Strength

Advance Technology (Ringing Tone,

Flunkey message, Missed call alerts,

call holding, call waiting, call

forwarding, fax, internet/data, calls Line

identification, voice mail,

4Gconnection)

High brand reputation

Stable Brand Equity

Extended range of services in

telecommunication industry

Island wide perfect coverage

Roaming services over 20 countries.

Weakness

A similar number of users

Sales continually decrease

CDMA connection termination

continuously increases.

35

c. Current distribution strategy of competitors

Comparative analysis about the competitor‟s distribution strategy

i. Type of distribution network used

Lanka Bell

Branch and teleshops

Lanka bell outlets (Sub agents)

Agents and Dealers

Dialog CDMA

Dialog outlets (Sub agents)

Other agents and Dealers

Selected Retail and phone Shops

ii. Evaluation of how distribution targets accomplished

The target evaluates via the sales of branch and

distribution accounts.

Target evaluate via a number of CDMA sales

of branch and distributor sales record.

iii. Relationship with channel members

Lanka Bell has a close relationship with the

external distribution network.

Friendly relationship with channel partner

and they gives more offers like, promoting

their individual distributors by rating them as

4star and 5star and appreciating them by

giving prizes and some priceless offers and

inviting them to participate in dialog

business meetings.

iv. Strength of the channel members

They have a sufficient capacity to facilitate the

market. Their distributors are committed to do

the sales and distributes.

The larger distribution channel opportunity

for sales lager volume. The Dialog has a

enough financial resource which supports

the new distributors and offer credit for few

distributors.

36

d. Current price strategy

Comparative analysis of competitors prices

i. Pricing objectives

Lanka Bell Limited

The pricing objectives are increasing profits,

service quality leadership, market penetration,

increase sales volumes, increase competitive

advantage and avoid the termination of

existing services.

Dialog Axiata PLC

The pricing objectives are Market

penetration, increase sales volumes, market

leadership, increase company image and

avoid the termination of existing services.

ii. Pricing strategy

Lanka Bell set a price as promotional pricing

strategy and market penetration pricing

strategy.

Dialog uses a promotional pricing strategy

and market penetration pricing strategy.

iii. Buyers attitude about the company prices

The buyers favorable attitude about Lanka

bell‟s pricing due to lower call charge.

The price is accepted by the consumer due

to service quality and lager coverage

network.

iv. Channel attitude of about the company‟ price

Channel member accepted a price due lager

competitive advantage in CDMA connection.

Price is accepted by a channel member due

to a variety of services and providing

benefits.

37

e. Current promotional strategy

Comparative analysis of competitor promo tool and campaign

i. Promotional objectives

Lanka Bell

The primary promotion objectives include

increasing brand awareness, increasing sales,

providing information and increase purchase

strength.

Dialog CDMA

The primary promotion objectives include

increasing market shares, brand loyalty,

market penetration and creating more brand

awareness.

ii. Strategies and themes used

The strategic theme is

“The truly Sri Lankan Company‟‟

The “Future Today” strategic themes mostly

uses with Dialog logo and Other strategic

them use such as “Get ahead and joint the

SMART generation Today” “Star Friends

and Smarthunt”.

iii. Promotional tools used

a. Advertising – the company use

advertisement tool such as Television

advertisement, Social media (Facebook,

Twitter), magazine and company web site.

b. Sales promotion – seasonal offers and

lower call rate in New Year and festival

periods.

c. Public relation – use tool are intranet,

websites, annual report, meeting,

conference, press releases and corporate

websites.

a. Advertising - the company uses an

advertisement tool such as Electronic

Media (TV and Radio), Print Media

(Newspapers, Magazine), Internet and

websites Media (Social Networks on

Facebook, twitter and YouTube),

Outdoor Advertising (Banner and

posters)

b. Sales promotion – used tools are

seasonal offers, lower call rate in the

New Year, festival seasons and loyalty

marketing.

38

d. Direct marketing– face to face sales by

effective sales peoples.

e. Personal selling – it uses very minimum

level to increase a new customer.

c. Public relation – Sponsor of Sri Lanka

cricket team, rugby, CRS, meeting and

conference, press releases, websites and

annual report.

d. Direct marketing – face to face sales by

effective sales peoples.

e. Personal selling – personal selling

handling by strong sales team.

iv. Success and failures of promo campaigns

The promotional campaign is successful which

increase the new connection and avoid

termination of the existing connection. The

company has successful result with TV

advertisement and magazine advertisement.

The promotional campaign is successful

because brand image increase among

consumers. The company has good

experience by promoting a Television

advertisement, internet, social media and

personal selling.

39

7. External Environmental factors

1. Political

Political factor is influenced by the Telecommunications Regulatory Commission of

Sri Lanka (TRCSL).

Government controls the business operations by taxation and rules & regulation of

telecommunication industry.

The Political environment orders to protect customers by implementing price

discrimination and to protect society from irresponsible organization behaviors.

SLT operates without a substantial impact from politics the reasons that the industry

is under control without any harmful effects. Also, government ensures the quality of

the customer‟s services, protection from monthly rental and call charges.

2. Economical

In the years of 2012/2013 the GDP had a positive growth and the beginning of this

first quarter growth by 8.2%, but in the end last two quarters of the year it declined

(7.6%, 7.8%) significantly.

Developing telecommunication industry contributes to Sri Lankan GDP and

Employment.

Megaline connection sales growth rate decreased in the 2013. Because the consumer

switching to mobile phone connection. But, The Megaline‟s revenue continuously

increases, which contributes revenue to Sri Lankan economy.

3. Social

The different religion people live in Sri Lanka, where the Telecom very close

relationship with all people and SLT participates with tradition and norms.

Changing consumers‟ lifestyles have decreased the Megaline growth rate from last

two years.

40

Megaline connection provides three diffident types of services within the one

connection which favorable to the entire segment because most parents and youngest

likes voice call services, youth segment mostly likes broadband and the child mostly

likes Peo TV connection.

SLT has donated the books to educate institutes. SLT finally donated approximately

one million books to universities, vocational training centers and island school in

2013.

According to the theme of “Preserving heritage for tomorrow”, Over many years SLT

encouraged the protection of Sri Lanka‟s rich heritage for the future generations.

The SLT concern different social activity such as the employees create awareness,

educate the impact of child abuse in 300 islands wide awareness program in 2013 and

technology donated to Deyata Kirula, CHOGM, and Techno.

4. Technological

Sri Lanka Telecom is the desirable position of being the National Telecommunication

Solutions Provider which responsibility SLT takes very seriously. We also recognize

that access to world class ICT is a right of all Sri Lankans and must be efficiently and

effectively delivered to derive maximum social, business and economic benefits for

the country. It is with this at the forefront of our long range and strategic planning,

that we are constantly evolving our company across multiple stages of technology,

service delivery, marketing and innovative new services.

5. Environmental

Sri Lanka Telecom more responsible to protect the environment via best practices to

all employees through training, education and development also employees work with

a friendly attitude.

The Sri Lanka Telecommunication‟s sustainability included the reduction in the

carbon footprint, energy efficiency, water management and water reduction.

41

SLT conducted the energy awareness programs for all the employees in island wide

how to protect the environment through many forums as possible.

6. Ethical

Sri Lanka is a collectivism country where more emphasis should be given to ethics

because it is established more than 150 years, which are giving more emphasis on

maintaining standards of corporate governance.

The SLT‟s sales and advertisement activities do not affect the customers and

competitors and also the environment pollution were reduced by business activities.

The SLT is awarded for standard of security management of ISO/IEO 27001:2005.

SLT conducts its business with eco-friendly manner.

7. Legal

Legal factors include discrimination law, employment law and health and safety law.

The SLT has a comprehensive legal system. Also the business does not follow in

agreement with applicable laws.

The challenge faced in 2011, the need for renewal of SLT‟s 20 year operating license,

which expires on 07 August 2011. The company is in the process of requesting its

renewal from the Telecom Regulatory Commission. However, the regulator is in the

process of formulating a Next Generation Network (NGN) policy for Sri Lanka

through which a new licensing regime will be introduced and SLT firsts operator to

face the newly introduced changes to license conditions.

42

8. SWOT analysis

3. G.1 Strengths

Strong infrastructure and high-performing cable equipment.

SLT Megaline has brand loyalty and excellent brand image.

Strong financial stability and fixed investment.

Strong public relations over 150 years.

Strong island wide distribution network.

Have an excellent management process

Strong corporate leadership.

Innovative technology service (4G connection)

3. G.3 Weaknesses

Fewer sales team to initiate personal selling

Communication tools ineffective.

Corroded cable lines

Lower Sales growth rate

Strong finance needs to introduce or improve the technology

Lower knowledge and training when comparing with competitive organizations.

3. G.3 Opportunities

The external structures are outside the company‟s control that could potentially

benefit the company growth.

The government develops technological infrastructures.

The competitors do not trust by SLT that in the long run.

Outside events that SLT can use to enhance its existing strengths.

Increasing the consumer awareness level.

3. G.4 Threats

Consumers most favorable to purchase and use a mobile Subscriber Identity

Module (SIM)

43

Introducing new technology of mobile phone services reduces the fixed

connection.

The threat of a telecommunications involves the external structures outside the

industries.

Government interference

The new competitors offer fast service and cutting-edge technology to their

customers.

Global economic instability & recession

44

9. Sales Objectives

Marketing plan of Megaline connection is in orders to achieve the expected sales

objective.

“The revenue of the Magaline will be increased by 12.5% at all islands widest in

end of December 2015”

The Megaline depends on the achievement of these objectives and this is the

profitability of the company. This expected sales revenue, making it challenging for

the company to achieve its corporate objectives.

The entire marketing plan will be developed based on the above mentioned sales

objectives.

45

10. Marketing Objectives

Marketing objectives include five main parts which are contributing to sales

objectives of Megaline connection.

Increase the net growth of Megaline connection MOM 10% at Island wide in 2015

(increasing new connections and decreasing the disconnections)

Their target will be achieved by improving greater quality of the services in voice,

broadband and Peo TV, donations to corporate social responsibility, Enhance

customer experience by being more responsive to customer needs, reduce the monthly

rental amount to triple and double connection than a single connection and delivering

high quality services faster with increased value aligned to market requirements.

15% Conversions from the competitor to Megaline connection at Island wide in

2015

The target will be achieved by identifying Megaline consumer‟s preferences,

introducing effective promotion activity, enhance brand awareness and enhance the

brand penetration in rural areas.

Increases the Megaline customer by 20% to carry out the remain Sri Lankan

project at island wide in 2015.

We improved 4G connection in town areas, but this year we have planned to develop

the 4G connection in all the rural areas including eastern and north region.

To enhance the awareness level of the consumers by 75% for the Megaline

connection at island wide in 2015.

Capture 50% market share from the Megaline about 30 Billion quantitative total

sales through market penetration at island wide in 2015.

46

11. Segmenting, Targeting and Positioning

a. Geographic

The geographic segment covers the entire area of Sri Lanka but, it has divided into

four areas in the island wide and which is divided according to the total customers and

service facility. For an Example the total number of fixed line consumers is 574,390

in Colombo district (Metro), but the total number of consumers are 134,493 in

Northern, Eastern province (Region 3). SLT‟s geographic segmentations are given

below.

Metro – Colombo

Region 1 - Central province, North central & North Western

Region 2 - Western province without Colombo, Uva province, Sabaragamuwa

province & Southern province

Region 3 - Northern, Eastern province

(Source: Annual report 2013)

b. Demographic

Demographic variables essentially refer to personal statistics such as income, age,

gender, education level, and amount of family members. The demographic is the traits

a human population, demographic segment consists of education qualification,

monthly income level and resistance palaces.

The Sri Lankan geographic segmentations are:

Organization size

Family members

Monthly income

c. Psychographic

The target market has built long term faith towards to the SLT. Consumers believe the

organization and its facility which contributing to fixed income to SLT, Government

47

servants and people stabilize their life with most of the time psychologically. This is

all about the psychological traits of customers. That including attributes such as;

Personality

Beliefs

Lifestyle

d. Behavioural

Behavioral role is an important factor of the telecommunication industry. The

Megaline consumer has following behavioral attitudes.

Customer service excellence

Quality of voice

Innovative technology

Benefits sought

Brand loyalty

Produce user rate

Speed

11.2 Targeting

Target market is a group of individual consumer/corporate consumers with a set of

common characteristics. Target market agrees to form a concentration of effect

against a share of the universe with similar descriptors, product needs and buying

habits. A targeting total determination depends on several factors of SLT Magaline

connection. Target market consumers are:

Individual consumer (upper, middle class families)

Corporate customers (Multinational & enterprise customers, public sector

institutions, other operators/ wholesale customers, SME, retail customers and

domestic user)

48

11.3 Positioning

Positioning is the act of designing the company‟s offer and image to occupy a

distinctive lace in the mind of the target market. The end result of positioning is to

win the current position of consumer mind in the future. In marketing positioning is

all about creating an image or identity in the minds of their target market for its

product, brand or organization. The Megaline has positioned services by technology,

clear voice, low-cost and entertainment.

Our Megaline services positioned among rational consumers who has loyalty of this

Megaline connection.Our plan is to position Megaline connection to attract individual

and corporate consumer.

I have planned to increase the high quality customer technology solutions to its

customers and meet their expectations in all aspects of packaging with a high quality

service and deciding lower prices to maintaining customer satisfaction, integrity and

corporate social responsibility. It is competitive advantages to the characteristics of

the needs and the wants of the target market. So, we can capture new consumer and

can avoid a termination existing Megaline connection.

Figure 09: Perceptual map for Megaline connection between competitive brands

High monthy

rental Low monty

rental

High Quality

Technology Solutions

Low quality

Technology Solutions

Megaline

Cityling CDMA

Dialog CDMA

CDMA

Lanka Bell

CDMA

Suntel CDMA

49

12. Tactical marketing mix strategy development (7ps)

12.1 Product strategy

SLT is a telecommunication company which provides different innovative

telecommunication services for individual consumers and corporate customers. The

Megaline is an intangible innovative service which currently is in majority level and it

provides services under the modern technology and high quality to the customers.

The Megaline connection includes the three packages of voice, broadband and

television. The core benefit of Megaline connection addressed the consumer's basic

need for voice. The actual product that includes two packages of broadband and Peo

Tv connection.

SLT Megaline is a famous brand in telecommunication industry. The innovative

technology is a major strength of the Megaline connection, because SLT is the only

technology provides a 4G technology services to all the urban and suburban areas. But

in some rural areas its not providing these facilities..

Megaline connection has various product features according to multiple services.

Those are:

Crystal clear voice

Offer of voice, broadband and Peo TV services through a single line

Single number for generation

Island wide network coverage

Lower call charge for IDD call

Corporate consumer is benefitted when calling for more than three minutes.

Safe to use with very rare radiation

A line that is always connected - No utility, powder requirement for telephone

user

Corporate customers are satisfied when making longer call due to reducing call

charges after the third minute.

Extended off-peak time brand for home users

50

12.2 Pricing strategy

Price is an important element to strategic marketing plan which determine how

success to gain revenue. The price of three types of packaging are clearly described

how it is an important determinant of the valued sales made by the company. Also,

the price is really determined by the discovery of what customers perceive is the value

of the Megaline connection.

Price has a major role in telecommunication industry. Price is considered as a

deciding factor for Megaline connection which currently uses promotion and

economic pricing strategy which is satisfying the existing consumers also its good

profit margin for the Sri Laka telecom.

But, I recommend the penetration pricing strategy which is most appropriate for SLT

Megaline connection. Because, the SLT Megaline connection is on maturity level in

the product life cycle, its growth provides larger profit to Sri Lanka Telecom. The

price charged for the Megaline ordered to gain market share and Last year total fixed

connection was reduced by increasing mobile phone connections. But, if we select a

high price, customers will switch to competitors and mobile services. Because, same

quality of services available from competitors an also we can compete by selecting

this penetration strategy. We can hold our existing customers and we can add more

potential customers according to penetration strategy.

According to the Penetration pricing strategy analysis, these benefits will be achieved

by Megaline;

Increase the market share

Increase sales volume

Increase revenue

To competitive advantage with current market competitors

Increase the quality of services and packages

Gaining customer loyalty

51

12.3 Promotional strategies

Promotion is an important marketing mix element of the company. Promotion helps to

increase consumer awareness of the organization's brand name and its packaging

products, generate sales and create brand loyalty.

The current promotional campaign of Megaline mainly focuses on innovative

services. The percentage of the marketing budget spends on media advertising that

use sales promotion.

Primary promotional objectives of Megaline connection

Increase sales and profits

Increase corporate and brand image

Provide information about Megaline connection.

Build brand awareness

Create customer loyalty

Sri Lanka Telecom coordinates effective promotional strategy to trigger purchase of

Megaline connection. SLT„s primary promotional mix elements are Television

advertisement, social media advertisement, public relations and etc. following

promotional activities is below.

Above the line media

Utilized create awareness of the product during the maturity stage of brand reposition.

It will be an effective to inform the target groups, constantly remind them about the

product to encourage repeat purchases.

Radio advertisement

Most of radio advertisement is focusing the housewife and small medium enterprise

organization consumers. The advertisements plan to provide information and

encourage to purchase the Megaline. The home and small enterprise organization

consumers hear the radio advertisement during the working time.

52

TV advertisement

SLT has selected a favorable television channel such as Rupavahini, Sirasa Tv,

channel Eye, Vasantham TV to mostly target home segments. The media channel

schedules the advertisement about the Megaline connection in weekday evenings,

weekend days, during news time and between the favorite drama programs.

Outdoor / billboards

Billboard advertisement is a very effective method because, it is very less cost media,

which reaches millions of consumers every day, continuously remaining our services,

consumers can easily identify the brand, design can attract a potential customer and

work for a guide to new customers. Bill border can be placed in the crowd areas in

main street and supermarket location.

Newspapers

The newspapers target the corporate segment and individual home segment who

passing the newspapers among them to read. Our organization mostly selects weekend

newspapers to advertise such as the Sunday observer.

Below the line media

BTL media communications are used to focus on niche markets. Which gives the

market's ability to adapt their messaging to more personal manners to the audience.

Special offers

Many promotional pricing offers are specially offered in January Thaipongal/ New

Year offer, April Aurudu offer, October short month offer and etc

Tele life insurance policy is offered by SLT in partnership with the Sri Lanka

Insurance Corporation that life insurance gives at affordable premiums to SLT

Megaline customers. The major benefits of the services are the affordability of the

premiums and convenience involved. The insurance payment can pay with customer's

monthly telephone bill.

53

The new Megaline connection consumers can get a free interest payment plan which

can pay in 3 or 6 months in a installments without interest rate through the HSBC or

Sampath bank credit card.

Free gift

Sri Lanka Telecom gives free gift for the new connection purchase in the New Year

season. The Megaline consumers got a gift those are an attractive free umbrella,

travelling beg or wall clock in every end of the year.

Also, the SLT arranges some trips to foreign countries by selecting a monthly winner

from existing customers. For an example, SLT selected some winners for the

Singapore trip in 2013.

Public relation

SLT was an ICT solution provider to the Commonwealth Heads of Government

Meeting (CHOGM) in 2013. SLT provided a comprehensive communication solution

for multiple geographic locations where key forum of such as the CHOGM opening

ceremony, main conference and government functions, business forum, the people's

forum and media center.

Online

Sri Lanka telecom‟s digital marketing campaign is so effective due to less cost.

Those are internet marketing advertising and email.

Through the line media

The specific type mass advertisement uses for the prospective customer database in

the direct marketing activities.

Social media

Sri Lanka Telecom is very effectively uses the social media campaign of Facebook,

Twitter, YouTube and Google. The advertisement is very less cost to SLT which

makes an interest about the Megaline brand, organization, offers and etc.

54

According to Facebook page in the October first week, title page liked is - 224,761by

Facebook users recommend the Facebook page of SLT- 5,852 and new likes - 3,

8842.

Web site

It provides all the information about the product features, new promotion offers to

Megaline consumers.

12.4 Distribution strategy

The distribution strategy of SLT is mostly based on the branch sales. SLT provides a

telecommunication service to island wide consumer which sales distributions are:

Teleshops - 36

Regional offices - 34

Maintenance centers – 22

Contact centers – 7

SLT focuses the regional distribution based on the service and consumer segment. For

example, the majority of consumers are in Colombo areas, so it provides a 4G

connection all the areas in Colombo. But the fewer consumers are in the North and

East areas, so it provides a 4G connection in some specific cities only.

SLT Magaline covers on different areas based on the four main strategic themes such

as services, operation, network and group. Megaline is vital connectivity in Sri Lanka,

delivering faster access to information and communication in all the key economic

sectors of the country.

The Megaline connection keeps their trust consumer by providing valuable services at

airport and flight, leisure needs and transportation

The banking and finance sectors play role key in the country's systems and

sophisticated technology platforms becomes their communication backbone its

facilities are in all of their business and banking transactions.

55

12.5 Physical evidence strategy

Physical evidence refers the Megaline connection of SLT that services appear from

outsider customers and the market. However, customers tend to rely on physical cues

to help them evaluate the product before they buy it. Therefore, marketers develop

what we call physical evidence to replace these physical cues in a service.

Following examples of physical evidence

Labels, pennants, and other printed information

All SLT outlets and vehicles place SLT Logo

Colors – Use one standard color theme for all SLT offices in an island wide,

representing SLT color (Blue and White)

Staff Uniform

Website design

Layout

Packaging

Internet/web pages

Voice mails

Internet facilities

Paperwork (such as invoices, tickets and dispatch notes)

Brochures

Business cards

Mailboxes

SLT heavily depend on the physical evidence as a means of marketing

communications, for an example SLT Megaline with seasonal offers (Christmas).

This is important to their corporate image.

56

2.6 Process strategy

The marketing activity process changes are very easy for consumers, the new process

Those process changes are below.

12.7 People strategy

Figure 10: Process changes of Megaline connection

12.1 People strategy

People are important assets for running a business and achieving our business goals

and objectives. SLT deals with customers, employees, government authority,

competitors and other organization. These shareholders differ as attitudes, needs and

values.

SLT is good employer which has a friendly relationship with staff. The current

employees are educated people who have got various help for higher education. SLT

evaluates the individual staff's performance to rewarding, promotion and other

benefits that marketing relies different kinds of people set up in dealing with

customers. SLT believes of arranging training schedules and development programs

for their people in the front offices and the people in head offices. The people in the

The Existing Process

New connection application form

Megaline should be filled for all

three services and handed over it to

the front officer/marketing officer

Collect the new connection charges

Then it has entered by the front

office staff.

Service is provisioning by the

technical staff

Introducing Process

The new connection application form can

fill the online application and attached

the relevant supporting documents

E-mail it to relevant regional manager.

Then the regional office staff does a

feasibility checking and inform to the

customer.

Consumers can make the online

payment.

Next service will be provided.

Follow up the service until first bill

confirmation

57

front offices of the permits for intensive, training in consumer handling, customer

sensitivity and etc. Also, salary increment, medical allowance, requirements and free

trip are positively to staff regarding the employee's position.

In order to make sure that the process SLT internally in managed very well. The

competition in telecommunication services being very strong, each company ensure

their people are able to recover any kind of services loss immediately as otherwise it

is quite difficult to not only retain an existing customers but still more difficult to

enlist a new customer. Hence, the SLT has a very strong people development policy

and strategy.

People are the most important element of any service or experience. Services tend to

be produced and consumed at the same moment, and aspects of the customer

experience are altered to meet the individual needs of the person consuming it. Most

of us can think of a situation where the personal service offered by individuals has

made people buy from people that they like, so the attitude, skills and appearance of

all staff need to be first class. People have an important role in service delivery, they

are relied upon to deliver and maintain transaction marketing and people play an

important part in the customer relationship.

58

13. Budgets and financial analysis

Description Note Amount (Rs)

Revenue 1 22,500,000,000

Expenditure

Operating cost 2 12,250,000,000

Distribution expense 3 3,350,500,000

Financial cost 4 2,116,900,000

Total expenditure

17,717,400,000

Profit before tax

4,782,600,000

Income tax expense

956,520,000

Net profit

3,826,080,000

Figure 11: Budget of SLT Megaline for the year 2015

The Megaline is already contributing approximately 20 billion (54%) of their total

revenue in 2013. I assume, that the revenue will be increased by 12.5% in 2015 year.

SLT PLC will achieve the Megaline revenue through budget plan. Anyway, after

allocating budgets for the Megaline connection will get 12.5% revenue.

59

Note 1

Revenue – show the calculation of sales figure

Product District Forecasted Sales for 2015 (Rs)

SLT Megaline Colombo 2,455,464,260

SLT Megaline Kandy 1,505,060,400

SLT Megaline Gampaha 1,152,456,852

SLT Megaline Kalutara 1,005,869,002

SLT Megaline Anuradhapura 880,456,028

SLT Megaline Batticaloa 668,405,455

SLT Megaline Ampara 642,364,483

SLT Megaline Badulla 980,444,000

SLT Megaline Kegalle 963,044,400

SLT Megaline Kurunegala 968,875,000

SLT Megaline Galle 995,730,168

SLT Megaline Mannar 985,284,525

SLT Megaline Matale 930,852,456

SLT Megaline Hambanthota 947,852,563

SLT Megaline Monaragala 887,248,630

SLT Megaline Polonnaruwa 721,456,025

SLT Megaline Puttalam 852,124,505

SLT Megaline Jaffna 648,524,152

SLT Megaline Trincomalee 785,254,822

SLT Megaline Rathnapura 982,885,124

SLT Megaline Nuwara Eliya 858,456,823

SLT Megaline Vavuniya 795,254,852

SLT Megaline Matara 886,635,475

22,500,000,000

Figure 12: Revenuce calculation of SLT Megaline for the year 2015

Note 2

Operating Expense

Salaries, wages, allowances and other benefits 6,450,120,500

Payment to network operation 2,548,410,250

Repair and Maintenance expenditure 1,580,252,560

Elasticity 556,248,600

Insurance 992,040,000

Printing and stationary 122,928,090

12,250,000,000

Figure 13: Operating expense of Megaline connection for the year 2015

60

Note 3

Distribution cost

Advertising and promotion 2,850,156,450

Travel Expense 500,343,550

3,350,500,000

Figure 14: Distribution expense of Megaline connection for the year 2015

Note 4

Finance cost

Interest 1,125,852,400

Bank charges 991,047,600

2,116,900,000

Figure 15: Financial Expense of Megaline connection for the year 2015

61

14. Marketing strategy implementation

The action plan prepared for Megaline connection in 12 months. Marketing manager

makes sure to achieve the effective activities in this period. The action plan and the

time periods taken for implementation of different tasks and evaluation are mentioned

below. The responsibility of the marketing department should take an approval from

Sri Lanka Telecom.

We must understand the role and importance of overall effort, assign responsibilities

to making things happen, what need to be done and the feedback. There are three key

steps to be followed to implement a successful marketing plan in practical

implementation.

Having adequate resources to carrying out planning activities.

Understand the lead time, those who participate in execution element

Understand completely in detail departments and salespersons requirements to

implement each element.

No

Activity Period Authorities Remark

01 Situational analysis 3 months Research officer

02 Image analysis 3 months Research officer

03 Internal communication 3 months Marketing manager

04 Corporate magazine 6 months Marketing manager

05 Public relations -

supporting for

community health

1 month Marketing manager

06 Sponsor – Rugby 3 months Marketing manager

07 Sales promotion 2 months Marketing manager

08 TV Advertisement 4 months Marketing manager

09 Online campaigns 4 months Marketing manager

10 Outdoor 10 months Marketing manager

Figure 16: Action Plan‟s Activities and Responsible for the plan of Megaline

connection.

62

The Project plan Gant chart

The Gant chart has prepared to attain the sales objective with the concern about the

payback analysis.

Activity 2015 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Situational analysis

Image analysis

Internal

communication

Promotional

activity

Corporate magazine

Public relations

Sponsor – Rugby

Sales promotion

TV Advertisement

Online campaign

Outdoor

Figure 17: Marketing strategy implementation plan of Megaline connection for the

year 2015

63

15. Monitoring and evaluation

Monitoring

The monitoring is important progress which is implementing the strategic plan to

ensure that, it is aligned with the set objectives and to make sure to achieve the

specific results of the company. The Sri Lanka telecom can implement several

methods in order to carry out its monitoring process. Those three primary methods are

given below. Those are;

Sales meeting

Sri Lanka Telecom should conduct sales meetings in every month and quarterly basis

to monitor the branch sales to achieve the target. Every branch should submit the sales

report to marketing managers who evaluate about total sales, sales targets, connection

extension (from voice to broadband and Peo Tv) and connection termination of each

branch.

Quarterly review

The company group director and marketing manager review the information about

branch sales, sales targets, connection inquiries and customer feedback in the every

quarter.

Consumer inquiries analysis

The service standard is important in the telecommunication industry. The consumer

expects and likes faster and clear services in the modern world due to their changing

lifestyles. So, the organization must collect the feedbacks and inquiries from all

customers through the websites, social media, by calling customers and etc. Then, the

marketing manager and group direct must analyze about consumer inquiries to

provide an effective sales and telecommunication services to consumers.

Evaluation

The marketing activities are based on some of the key activities that follow under the

sub topics. Different analysis can be used in the monthly basis and quarterly basis to

64

measure the organization‟s performance. The marketing activities are evaluated by

qualitative and quantitative evaluation techniques.

Quantitative Evaluation Techniques;

Quantitative evaluation techniques are based on the organization objectives. It

measures the actual and target performance of these activities. These are given below;

Increase market share.

To be the market leader

Retaining existing customers

Increase potential customers

Qualitative Evaluation Techniques

Qualitative evaluation techniques are based on the attitudes and perception of

company stakeholders. The formal and informal opinions receive from organizing

internal information, word of mouth, ideas and observations. The qualitative

evaluation techniques measure the implemented plan. Following the qualitative

evaluation techniques are;

The time period of each activity

Positive perception and motivation of the employees.

Organization employee‟s confidence level of implementing the action plan.

65

16. References

Books

G. Collin and Wilson R. M. S. Strategic Marketing Planning, 2nd

Edition, India:

Routledge 2012

Kotler P., Armstrong G. Marketing an introduction, 7th

Edition, India: Pearson‟s

publications 2012

Schiffman L. G., Kanuk L. L., Kumar S. R. In collaboration with Wisenbilt J.

Consumer Behaviour, 10th

Edition, India: Pearson‟s publications 2011

Websites

http://www.slt.lk/data/aboutslt/profile.htm

http://www.trc.gov.lk/

http://www.cbsl.gov.lk/

www.dialog.lk/

www.lankabell.com/

www.suntel.lk/

http://www.cse.lk/cmt/upload_report_file/390_1395133548115.pdf

https://www.google.com/?gws_rd=ssl#safe=active&q=slt+annual+report+2012+p

df

http://www.dialog.lk/content/uploads/pdfs/annual_reports/2013-annual-report.pdf

http://www.dcslgroup.com/reports/dcsl/2012-2013.pdf

http://archives.dailynews.lk/2012/11/06/bus16.asp

http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/statistics/other/econ_&_ss_201

3_e.pdf

http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/Eng

lish/content.htm ( Chapter 3 - Economic and Social Infrastructure)

66

17. Appendix

Fixed Operator Tariffs

SriLanka Telecom PLC

LankaBell (Pvt) Ltd

Suntel Limited

Dialog Axiata PLC

Mobile Operator Tariffs

Dialog Axiata PLC

Mobitel (Pvt) Ltd

Etisalat Lanka (Private) Ltd

Hutchison Telecommunications Lanka (Pvt) Ltd

Bharti Airtel Lanka (Pvt) Ltd