Contents

THE PRODUCT - Airtel Mobile Services ......................................................................................................... 4 OBJECTIVES ................................................................................................................................................... 5 Corporate Objectives ................................................................................................................................ 5 Marketing & Sales Objectives ................................................................................................................... 5 Financial & Operational Objectives........................................................................................................... 5 Customer Retention .................................................................................................................................. 5 SITUATION ANALYSIS .................................................................................................................................... 6 SWOT: ....................................................................................................................................................... 6 PORTERS 5 FORCES .................................................................................................................................. 8 COMPANY & COMPETITOR ANALYSIS......................................................................................................... 11 Product features matrix .............................................................................................................................. 11 Objectives of Competitors: ......................................................................................................................... 13 COMPETITOR ANALYSIS .............................................................................................................................. 14 COMPETITOR STRATEGY ............................................................................................................................. 17 Applying 4P Marketing Mix to Airtel ........................................................................................................... 18 Profits ...................................................................................................................................................... 21 Value Chain Analysis ................................................................................................................................... 22 Differential Advantages .......................................................................................................................... 23 Maintain Specialty .................................................................................................................................. 23 Hope for Market Growth ........................................................................................................................ 24 Maintain Cost Advantage........................................................................................................................ 25 Outstanding Success ............................................................................................................................... 26 Market Segmentation ................................................................................................................................. 27 Targeting ..................................................................................................................................................... 28 Evaluation of Market segments .............................................................................................................. 28 Selecting a targeting strategy ................................................................................................................. 29 The Target Market Segments.................................................................................................................. 29 Positioning .................................................................................................................................................. 31 CONSUMER BEHAVIOUR ............................................................................................................................. 33 ASSUMPTION IN PLANNING PROCESS ........................................................................................................ 38 2|Page

THE PRODUCT STRATEGY ............................................................................................................................ 44 Strategy Marketing Communications Programmes ................................................................................. 46 Integrated Marketing Communications Programs ................................................................................. 46 Pricing Strategy ....................................................................................................................................... 47 Channel Strategy ..................................................................................................................................... 48 Research Strategy ................................................................................................................................... 49 MONITORING & CONTIGENCY PLANS ......................................................................................................... 50 Recommended Marketing Strategies for Airtel .......................................................................................... 51 REFERENCES ................................................................................................................................................ 53

3|Page

THE PRODUCT - Airtel Mobile Services

Airtel Mobile services is one of the four strategic business units of Bharti-Airtel limited formerly known as Bharti-Tele Ventures LTD (BTVL). The mobile services division of the company is branded as Airtel. Going by the subscriber base Bharti is the fifth largest mobile operator in the world, with an estimated base in about 18 countries. Airtel currently offers both 2G and 3G services depending on the country of operation. It has recently secured the 3G licenses in 13 telecom circles of India and plans to launch 3G services by the month of October this year.2 The cellular services division of Airtel has also entered the smart phone market segment. On 19th October 2004 Airtel announced the launch of Black Berry Wireless Solutions in India. By August 2008 Airtel had signed up with Apple for the launch of Apple 3G iPhone services. It has however been unable to capitalise and emulate the success of Apple iPhone on the account of high pricing and contract bond accompanying these services. Considering the fact that India is now the second largest telecom market in the world and more importantly the fastest growing market globally (about 19 million additions a month), there have been several new entrants in the markets lately.3 This has led to ever lowering tariffs and a decrease in the revenue of existing players. Fresh acquisition of customers is then no longer a guarantee to increase in revenue. As a consequence in addition to the lower calling rates, the operators have been forced to provide a host of value added and auxiliary services. Here Airtel is already leading the way in areas of mobile commerce, banking etc. As the Indian telecom industry enters its third phase, growth in the markets are bound to mirror the growth in the economy. This provides valuable pointers to the next driver of growth the rural India where mobile penetration levels still remain an abysmal 15%.4 Airtel has been looking to expand to learn and expand in the rural/low income market segment. In this regard Airtel has already ventured into providing mobile financial services, mobile money transfers to customers in rural areas, further leveraging its existing base of cellular subscribers.

4|Page

OBJECTIVES
Corporate Objectives
To dominate the cellular services industry by being the market leader in products and services category in wireless market and lead on all important fronts viz. market share, brand loyalty and customer satisfaction.

Marketing & Sales Objectives

1. To achieve higher penetration in rural markets by capitalising on the existing base to reach out to new subscriber markets. 2. To create markets for Value added services by integrating more features into the existing scheme of things. 3. To reach out to different market segments with products and services customised to cater to the segment specific needs. 4. To study the brand loyalty within the existing set to better understand and appreciate our product differentiation. And also how we can build upon it further. 5. To engage with customers continuously to be able to adapt to the changing market needs and consumer behaviour. 6. To explore the potential for broadband data markets by exploring the scope of 2G and 3G cellular services in urban/rural markets.

Financial & Operational Objectives

1. To expand and outsource capital intensive tasks (involving building & maintenance). 2. To be able to break even on the capital spent in securing 3G licensing services by improving on the ARPU and ensuring better penetration into the SaaS market by broadband data services. 3. To ensure 3G services usage generates enough revenues per annum to enable normal pay back and returns.

Customer Retention
1. To leverage the existing base of customers by engaging them with new products and services launches on a periodic basis 2. Empower and engage with consumers on a regular basis to ensure customer satisfaction and value delivery.

5|Page

SITUATION ANALYSIS
SWOT:
Strengths 1. It is the largest cellular service provider in India with a subscriber base of over 135 million (June 2010) and market share of 29.2%. 2. Airtel is currently operating in 18 different countries in Asia and Africa which reflects its global presence. 3. Airtel is in with strategic alliance with majors from other telecom leaders like Ericsson, Nokia Siemens Network and Sing Tel which gives insight into other areas of telecommunication. 4. Mobile Business Unit of Airtel is a profit making division where profits soared by 3% to Rs. 8227 crore giving enough cash in hand. 5. Tie-ups with BlackBerry Wireless Solution, Apple Iphone 3G and Facebook give access to emerging new growth markets. Weakness 1. Airtel outsources everything except marketing and sales which makes it dependent on other players. 2. Dominance within India is limited to circles in Northern and Eastern India with high competition in Southern India. 3. Airtel focuses on nationwide advertisement strategies which give other regional players to dominate in several regions. 4. Bharti did not own majority of its own network towers which hampers the coverage area and give advantage to its competitors. Opportunities 1. With the help of its wide national presence Airtel can aggressively venture into new emerging areas like mobile banking, 3G Technology 2. Strategic position of Airtel in international market can help to acquire new business divisions in other countries to expand the business horizontally. 3. With the huge cash base Airtel can hugely invest in innovative products like Airtel Worldwide SIM and Airtel App Central which is Indias first mobile app store. 4. The company can promote its worldwide presence by sponsoring more international events like Twenty-20 World Cup and UEFA Champions League.

6|Page

5. With the right regional marketing strategies Airtel can acquire the dominance in regional market and increasing the market share of the company. Threats 1. Companies like Virgin and Tata Docomo are aggressively targeting younger generation with there new innovative products and applications, thereby reducing the market share of Airtel. 2. There is always a potential for entry of foreign player or revival of domestic competitor like Vodafone from Hutch.

7|Page

PORTERS 5 FORCES
Mobile Services Industry Structure: Mobile services in India are fast growing with a YoY growth rate of 58.17% in 2008 and 50.06% in 2009. There are multiple service providers with as many as 12-13 service providers in all circles.6 While Circle A, Circle B and Metro circle is already nearing very high penetration levels, Circle C subscription base is increasing at the fastest rate, ensuring a high rate of increase in the overall subscription base.9 Subscriber base of mobile services (GSM and CDMA): 2007-2009 Service Providers Bharti BSNL Reliance Vodafone Tata Idea/Escotel Aircel Others TOTAL 2007 37.14 30.99 28.01 26.44 16.02 14.01 5.51 6.99 165.11 2008 61.98 40.79 45.79 44.13 24.33 24 10.61 9.44 261.07 2009 93.92 52.15 72.67 68.77 35.12 38.89 18.48 11.76 391.76 Source: TRAI YoY over 2009 51.53% 58.70% 55.84% 27.85% 44.35% 62.03% 74.18% 10.76% 50.06%

1. Threat of new entrants-HIGH a. Department of Telecom and the Telecom Regulatory Authority of India (TRAI) are the policy formulating and regulatory bodies. TRAIs stated objective is to encourage greater competition in the telecom sector together with better quality and affordable prices and in line with that, has been following a liberal regulatory regime b. The government presently allows FDI of 76% in the sector, encouraging foreign players to enter the Indian market. c. The sector offers tremendous growth opportunity. By 2012, total telecom penetration in rural markets is expected to reach 40% compared to the current tele-density of 16.6%.7 Given the profit opportunities and regulatory environment, threat of new entrants is high. 2. Bargaining Power of buyers- VERY HIGH a. Lack of product differentiation- The product offering is similar from almost all players with the same basic product and similar value added services. There are short term gains that one player may have from innovation/ first mover advantage into a new value added service, but these are soon offered by competitors as well b. Extremely low switching costs in moving from 1 service provider to another 8|Page

c. Multiple service providers- very wide variety of choice for the customers. d. Competitive landscape implies consistently better offers and deals for customers.

3. Bargaining power of suppliers-VERY LOW Airtel outsources most of its operations. Since contracts are allocated to the highest bidder, Airtel only looks at getting the best deal. This mechanism provides Airtel with a high degree of flexibility. a. Network outsourcing/maintenance partners: Ericsson(15 circles), Siemens(7 circles), Huawei. b. IT system partner: IBM c. Tower maintenance and other infrastructure: BhartiInfratel and Indus towers d. Call center partners: IBM Daksh, Nortel, Hinduja TMT, Teleperformance, Mphasis, Firstsource& Aegis

4. Pressure from substitutes-HIGH The communications space is very dynamic with new technology (3G and 4G) and products flooding the market. Mobile services are competing with products such as a. Wired-lines b. CDMA c. Video telephony d. Tata/ Reliance- Walky phones e. Internet telephony- Skype, google, fringetc f. VSAT phones

Additionally, data services on cellular phones have become an essential product feature. On this front, mobile services face a significant threat from local ISPs, broadband service, leased lines, Blackberry and iPad. 5. Current Rivalry Airtel is the current market leader in the mobile service (GSM) sector with 31% market share. Vodafone, BSNL, Idea are its major competitors.6

9|Page

6. Category Capacity: As of January 2010, the overall tele-density was recorded at 49.5 per cent with a total telephone subscriber base of 581.81 million.6 By 2012, the total telecom subscriber base is expected to reach approximately 700 million to include about 650 million wireless users and approximately 50 million fixed line users, driven by a rise in the demand for communications from semi-urban and rural India.7

10 | P a g e

COMPANY & COMPETITOR ANALYSIS

Product features matrix

Table 1 depicts the product feature matrix to simplify the difference between the product features or services offered by Airtel Mobile as compared to other competitors in the market. By analyzing the table we can get a very clear idea of the strength and weakness of Airtel product relative to the other competitors. Notes (As mentioned in Table below): 1. Process of receiving updates automatically on your phone without the need of initiating a request every day. 2. It includes services like Call Conferencing, Call wait, Call Hold, Call Divert, Missed Call Alert 3. It includes service like Send/Receive Emails, Mobile Office, Fax and Data 4. mVoip or mobile Voice over Internet Protocol is an extension to VOIP through which a mobile handset can be integrated into a VoIP network 5. Apple IPhone is available in India either through BhartiAirtel or Vodafone service provider. No other service providers has given right to sell IPhone in India. 6. Service that provides instant chat with friends with any mobile number, anywhere in India. A user can exchange text, photos and emoticons. 7. Customers can SMS to multiple contacts, anywhere in the world. Users can create their own groups, communities in order to SMS all of them at the same time with reduced rates per SMS

11 | P a g e

Various Operators

Mobile

Normal Users GPRS Prepaid Service Postpaid Service Subscription Service1 Call Management Service2 Data Service3 SMS Directory Language SMS MMS Service National Roaming E-Recharge Business Users Blackberry m VOIP4 ISD Calling Cards Operator Services Just Dial Conversion from Prepaid to Postpaid or vice versa Customer Care Caller Tunes Voice SMS Additional Features Apple Iphone5 PC2Mobile6 Corporate Group Messaging7 Customized Chatting Client m-Commerce Phone Backup

No No No

No No No

No No

Product Features

No

No No

No

No No

No No

Table: Product feature matrix of Airtel Mobile

12 | P a g e

Objectives of Competitors
Below are the current objectives of the competitors, an assessment of these objectives can give a brief idea about the current strategy of the competitors and how aggressive it will be in future. 1) Vodafone Essar: Vodafone Essar is the Indian subsidiary of Vodafone group; previously it was Essar who was in the telecom area since 1994.Companys main objective is to leverage the global position of Vodafone n India as well and become the top player in terms of market share as well as revenue in Indian circle.

2) Reliance:ADA Groups flagship company, Reliance Communicationss objectives include focus on customer delight and hence business productivity and to offer communication services in all sphere to all individual customers and business in India.

3) Idea: Idea is one of the few companies that are seen as an innovative, customer focused brand. Its vision is to expand its mobile operations to all sectors of people according to their individual needs. It also aims to expand its coverage area nationally as well as internationally to cater to more consumers.

4) Aircel: Aircel is one of the recent entrants into the telecom sector with the aim of becoming Indias pioneer in mobile technology and mobile services. With its aggressive marketing campaign it has already gained a significant amount of market share. And hence company is aiming to continue its growth in whole of India. 5) Tata Docomo: Docomo is the global leader in Value Added Services. Its collaboration with Tata as Tata Docomo was launched in 2009. Despite its late entry into telecom sector Tata Docomo is aiming at broaden its telephone services to include Mobile Services, Wireless Desktop Phones, Public Booth Telephony and Wire-line Services.

6) BSNL:BSNL is World's 7th largest Telecommunications Company providing comprehensive range of telecom services. With its wide coverage area in terms of rural penetration in not only Mobile Telephony but also in broadband has contributed in achieving top position. BSNL is looking forward to maintain this position in coming years.

13 | P a g e

COMPETITOR ANALYSIS
Presented below is the pictorial representation of Airtel's market share in Indian telecommunication market from January 2009 through April 2010. January 09
4.01%
6.26% Bharti Airtel 1.49%

0.75%

Vodafone Essar
32.99% 14.94%

BSNL
IDEA Aircel

15.93% 23.64%

Reliance Telecom MTNL

BPL

April 2009
2.13% 1.48% 0.78% Bharti Airtel

6.57%

Vodafone Essar 29.38%

17.10%

BSNL
IDEA Aircel Reliance Telecom

21.82%

20.75%

MTNL

BPL

14 | P a g e

July 2009
4.07% 1.33%

0.72%
Bharti Airtel

7.08% 32.25%

Vodafone Essar BSNL

IDEA Aircel Reliance Telecom

14.88%

15.55%
24.12%

MTNL

Loop Mobile

October 2009
4.11% 1.25%

0.72%
Bharti Airtel

7.80% 31.83% 15.00%

Vodafone Essar BSNL

IDEA Aircel Reliance Telecom

15.17% 24.13%

MTNL

Loop Mobile

15 | P a g e

January 2010
1.17% 0.69% 0.64% 0.13% Bharti Airtel Vodafone Essar 8.38% 30.86%

4.00%

IDEA BSNL
Aircel Reliance Telecom MTNL

15.08%

15.19%
23.87%

Loop Mobile

Uninor
STel

April 2010
1.11% 1.16% 0.67% 0.26% 0.00% Bharti Airtel Vodafone Essar

3.77%

8.88%
30.16% 14.95%

IDEA BSNL
Aircel Reliance Telecom MTNL

15.08% 23.96%

Uninor

Loop Mobile
Stel

Source of Figures: www.coai.com

Looking at the above market share data, it is clear that BhartiAirtel has been losing market share over the last one year. This can be attributed to the entry of new payers in the cellular market. However, it is important to note that while all other players have been losing market share over the period, Airtels closest competitor Vodafone Essar has been able to hold on to its market share.

16 | P a g e

COMPETITOR STRATEGY
A brief analysis of all major competitor strategy is listed under: 1. Vodafone Essar: Vodafone is a British Telecom giant and took over Hutchison Essars operations in India in February 2007. Ever since, Vodafone has concentrated on building its image as a customer friendly organization as is reflected in its tagline Happy to help. With its aggressive telemarketing campaign, Vodafone has been able to maintain its market share over the last one year. 2. BSNL/MTNL: BSNL and MTNL are GoI owned telecom companies. While BSNL is the all India operator, MTNL operates exclusively in the metros. Indian consumers faith in government institutes is BSNLs biggest advantage. BSNL exploited its political clout to be the first to enter the 3G segment while its competitors waited for an auction. BSNLs entry in the 3G segment saw an unprecedented increase in its market share from 17.5% to 23.5% in Q1 of 2009.5 However, the market share dropped back to previous levels in the next quarter. BSNL/MTNL is struggling to change its image of being the service provider for the elderly. 3. Idea: Owned by the Aditya Birla Group, Idea has been operating in the cellular market since the very beginning. However, it has never been close to being the numerouno. Ideas biggest strength is its consistency. It has held on to nearly 15% of market share and the number does not seem to change. Idea seems to be concentrating on only holding on to its market share. It has not gone into aggressive marketing mode and concentrates on maintaining its subscriber base by providing the lowest call rates in the market. 4. Aircel: Aircel, owned majorly by Maxis communications has been the top service provider in South India for very long. Only recently, it has entered into the other circles and is now functional in 23 circles. Aircel has seen quick growth in the last one year with its market share rising steeply from 6.26% to 8.88%.6 Aircel does not enter into a price war with its existing competitors. It has tried to build a market for itself by providing superior service quality and value added services. 5. Tata Docomo: Tata DOCOMO is Tata Teleservices Limited's (TTSL) telecom service on the GSM platform-arising out of the Tata Group's strategic alliance with Japanese telecom major NTT DOCOMO in November 2008. Tata DOCOMO which operates in 18 circles has risen to be the biggest force in the cellular market in the last one year, adding over 60 million customers. Tata DOCMO has garnered market share through innovation and aggressive telemarketing. 6. Reliance Communication: Reliance Comm. majorly operates in the CDMA market and has recently entered the GSM market. However, it has not been received too eagerly by the consumers. This may be attributed to the fact that the Reliance has not differentiated its services and has engaged in a price-war with the existing competition. Also, in its marketing campaign there seems to be no differentiation between its CDMA and GSM services.

17 | P a g e

Applying 4P Marketing Mix to Airtel

1) Product: The 'products' offered by the Mobile Services unit of Airtel include the following: Prepaid Post-paid Blackberry wireless handheld Value-added services Solutions for business enterprises International facilities through calling cards and prepaid world SIMs m-commerce 2) Price: Tariff analysis of major players in the market reveals that Airtel is not the cheapest service provider. They are in an advantageous position due to offers like: Variable customer based pricing strategies Flexible pricing mechanism

Over the last few years, Airtel has provided its customers various facilities on the price front: a) b) c) d) Total Cost Control: Customers can recharge their phones with a denomination of their choice. Easy Recharge: Airtel was the pioneer of e-recharge facility being provided to customers. 24-hour Recharge via ATM: Allows recharge of Airtel Prepaid round-the-clock at nearest ATM. Internet Recharge: Airtel prepaid can be recharged online. However, customer survey shows that the usability of Airtels online recharge portal is poor as compared to that of its competitors. e) Roaming: Airtel was the pioneer in reducing roaming tariffs.

3) Place: Airtel's aim is to help customers as quickly and as efficiently as possible at first point of contact. The customers have the option to email Airtel directly, useful telephone numbers, quick links to store locations, payment centres and many other facilities. The major point of contact is the Airtel Relationship Centre where one can get a new Airtel connection, subscribe to any value added services and get more information on them, pay bills or get a new handset. Airtel provides its customers with the following facilities: Extensive presence across 23 circles Airtel customer care touch points setting up convenient service centres in market places helps to increase visibility and improves accessibility to customers. Distributors like grocery stores/ small outlets etc. Internationally offers telecom services in 18 countries across Indian subcontinent and Africa. It includes three countries in Indian subcontinent: India, Sri Lanka, 18 | P a g e

Bangladesh and fifteen African countries, namely: Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia.

4) Promotion: Airtel is one of the best known brands in India. Not as many people relate with Bharti as much as they do with Airtel. That is because its brand Airtel is so successful. Bharti is now piggybacking on the success of its brand Airtel to create a giant conglomeration. Recently Bharti unveiled its new logo.

Airtel is known for being the first mobile phone company in the world to outsource everything except marketing and sales. Airtels marketing teams emphasis lies in relating with the customer and his/her idols. Airtel has consciously made an effort to make the best in business its brand ambassadors. This is easily visible in the following cases: Celebrity endorsers like Shah Rukh Khan, AR Rahman, and Sachin Tendulkar BhartiAirtel signed a five-year deal with ESPN Star Sports to become the title sponsor of the Champions League Twenty20 cricket tournament. The tournament itself is named "Airtel Champions League Twenty20." On May 9, 2009 Airtel signed a major deal with Manchester United Football Club. As a result of the deal, Airtel gets the rights to broadcast the matches played by the team to its customers.

Clearly, all its celebrity endorsers are the best in their field. Sponsoring the Champions League is also a conscious effort of relating with the champion/best. Also, Manchester United is arguably the worlds best football team. Other than projecting the image of being the best in business, Airtel engages in marketing activities typical of all firms of its size: Extensive print and video advertising Tie up with leading handset manufacturers like Nokia, Samsung and HTC to provide Airtel connections as a part of the package. Sponsoring socially relevant community programs across country, for example, organising painting competitions for children, educational facilities for marginalised children. Sponsoring popular events like half marathons, concerts and boat races.

19 | P a g e

Airtels advertisements are always very distinct and present the brand as very energetic, youthful and essential. Airtel came up with many ad-specific taglines like 'Kabhibhi, Kahinbhi', 'Touch Tomorrow' and the current tagline 'Express Yourself'. They capture the importance of Airtel in consumers' lives.

20 | P a g e

Profits
AirtelsYoY revenue growth from the mobile services business has slowed. Simultaneously, net income growth has slowed considerable for BhartiAirtel in 2010. Tata DoCoMo, a JV of Indias Tata Teleservices Ltd and Japans wireless operator DoCoMo, has been capturing the new customers in the mobile services space. Tata DoCoMos plan to charge per second for calls, unlike other operators who charge per minute, has enabled it to garner more subscribers1

450,000,000 400,000,000 350,000,000 396,150,229

369,615,517

300,000,000 250,000,000
200,000,000 150,000,000 100,000,000 50,000,000 -

270,249,348

Figure: Total Revenues for 2009-10 (in Rs. '000)

Slower net income growth in 2010: Airtels net income growth has slowed in 2010 particularly in the mobile services business. In the non metro circles, the subscription growth average2 for BhartiAirtel has been slower than for competitors. For example, in A circle, except in Andhra Pradesh, BhartiAirtels revenue growth has been lesser than the industry average. This may be a serious threat for BhartiAirtel. Operating income has, in fact, declined by 4% in 2010 as compared to a 36% rise in 2009.In 2009-2010, BhartiAirtel posted net profits of Rs. 93 Billion.

21 | P a g e

Value Chain Analysis

The traditional mobile industry value chain basically involved the mobile operator, service provider, device manufacturer and the customer. However the mobile services industry is rapidly evolving with value added services, data services etc. gaining significance. These are a very profitable revenue stream for the service provider. For example in the value added services segment, the network operator keeps about 60% of revenue, the technology/software developer retains about 25%, while the content provider gets about 20% of the revenue from value added services (Source: IMRB Research).

With M-Commerce contents becoming increasingly important in the value chain, it is seen that the operator share in the value chain has been declining. Airtel has been tying up with entertainment providers, FMCGs, insurance companies to maintain a share in the value chain. From a strategy perspective, this should be one of the focus areas for Airtel.

Source:IMRB, 2006

22 | P a g e

Differential Advantages
The following matrix can be used to analyze the industry for differential advantages for each of the companies in the wireless cellular services market.

The urban markets, typically in the mobile cellular divisions, have saturated causing players to move into the digital data transfer/telemedia sectors. Using the existing infrastructure for Airtel-Mobile services, the DTH and Enterprise data divisions SBUs stand to benefit from it.

Maintain Specialty
A high relative cost (incurred) and high differentiation area for the company. Typically requires the company to have a specialty (differentiation product/service) to serve premium products priced at premium levels. Considering the market structure of the telecomm sector, there are very few products/services which can be termed as premium products for the companies. While there are several player in the market, including the new entrants, Bharti-Airtel, Rcom and BSNL are the only players to gain a differential advantage on the account of existing infrastructural capability.

23 | P a g e

Hope for Market Growth

By New Products/Services
Represents - low product/services differentiated market at higher expected costs to company. Commodities type of product with high cost and expected future revenues. Typically include services like Direct to Home operations. The major players in the markets and the product services they have on offer are:

The market for DTH is expected to grow from 18 million currently to 35 million households by 2013.

24 | P a g e

By New Markets

Both Reliance and Bharti-Airtel are investing heavily in the rural markets. With a Pan-India network presence Airtel is a clear leader as far as the rural subscriber base is concerned. Others like BSNL and Vodafone are a close third and fourth. In-addition to providing voice/text services, all major players are looking to cash in on the revenues from Value Added Services (VAS), expecting it to account for 15-20% of the ARPU.

Maintain Cost Advantage

The entry of new players in the telecom space has led to increased tariff wars and reduced ARPUs. This can be observed from the fact that Tata DoCoMo and TTSL are both loss making entities at the net-level. An increase in operations may bring in new subscribers, however to sustain the players will need deep pockets. It can be observed that RCom and Bharti are able to offer lower tariffs largely due to economies attained over the 10-12 years on the account of several factors. In recent times consolidation has been used by larger player to absorb the domestic operations on the newer entrants. Examples abound in BPL, Spice Communications and Aircel which were sold to domestic/international players.

25 | P a g e

Outstanding Success
Typically comprised by high differentiation and low cost to company. Implies the freedom to compete at compete at any prices. Not relevant to this sector.

26 | P a g e

Market Segmentation
Using a combination of Behavioral Segmentation and Demographic Segmentation, Airtel can divide its customers into the following segments. During segmenting customers, emphasis has been laid on customer need and benefits sought: Segmentation Basis Benefits sought (in Rs./month) Segments included High consumption of Value-added-services (VAS) (>Rs.100/month) Medium consumption of VAS (Rs. 25100/month) Low consumption of VAS(<Rs.25/month) High level of usage (>1500 min/month) Medium level of usage (500-1500 min/month) Low level of usage (<500 min/month) High (>25 calls/day) Medium(10-25 calls/day) Low(<10 calls/day) Corporate customer Individual customer Non-users First-time users Ex-users Potential users Existing users Extremely loyal customers Not-so-loyal customers Disloyal customers Teen and youth (13-30yrs) Matured

Usage rate (in terms of minutes/month)

Usage rate (in terms of no. of calls made/day)

Type of usage User status

Loyalty status

Demographics (based on age)

27 | P a g e

Targeting
Evaluation of Market segments
Of all the 21 market segments identified in the market segmentation, 18 are evaluated based on current segment sales, growth rates and profitability. Evaluation has been done on a 3 point scale wherein 3 is the highest and 1 is the lowest. The segmentation based on consumer-loyalty is used to develop better marketing strategies. These segments cannot be done justice with based on the three criteria listed above. Hence, they have been excluded from the ratings. Evaluation of market segments is an important step towards recognizing the target market. Segments rating highly on the chosen criteria will be chosen as target segments. The highest preference among the segments will be given to the profitability.

Segment High consumption of Value-addedservices (VAS) (>Rs.100/month) Medium consumption of VAS (Rs. 25-100/month) Low consumption of VAS (<Rs.25/month) High level of usage (>1500 min/month) Medium level of usage (500-1500 min/month) Low level of usage (<500 min/month) High (>25 calls/day) Medium(10-25 calls/day) Low(<10 calls/day) Corporate customer Individual customer Non-users First-time users Ex-users Potential users Existing users 28 | P a g e

Sales 2

Growth Rates 2

Profitability 3

2 2 3

3 3 3

1 3 2

2 2 3 1 3 3 NA 2 NA NA 3

2 3 2 2 2 3 NA 3 NA NA 1

1 3 1 1 3 1 NA 3 NA NA 2

Teen and youth (13- 3 30yrs) Matured 2

3 1

3 2

Selecting a targeting strategy

The targeting strategy can be chosen based on five parameters: 1. 2. 3. 4. 5. Company resources Product variability Product life cycle Market variability Competitors strategy

All these parameters are now analyzed individually and an appropriate targeting strategy is arrived at. Bharti is one of the largest companies of India and has no dearth of resources. Also, looking at its large consumer base, Bharti should not use Concentrated Marketing. With the introduction of value-added-services, mobile services can no longer be classified as uniform services. There is a large degree of variability that can be introduced in mobile services. Thus, it makes sense to use differentiated marketing. Airtel has been rated as the most highly recognized brand of India for the past few years.Although the mobile phone services market is growing at a rapid pace, as a brand, Airtel is in its mature phase. In the mature phase, its best to go for differentiated marketing. The market variability is high because of the difference in amounts and types of usage the mobile phone is put to. Thus, undifferentiated marketing cannot be done. It is best to go for differentiated marketing. Nearly all mobile phone service providers (with the exception of Virgin) are still going for undifferentiated marketing. This is a major opportunity for Airtel to start differentiated marketing and capture specific market segments. Looking at the above factors, it is clear that Airtel should change its current target marketing strategy of mass marketing and start Differentiated Marketing.

The Target Market Segments

Based on the analysis of targeting strategy to be chosen and evaluation of various market segments, Airtel should target the following market segments: 1. High and medium VAS consumers 2. High and medium usage rate consumers (based on min/month) 29 | P a g e

3. 4. 5. 6.

High usage rate consumers (based on no. of calls/day) Corporate users First-time users and maintaining current users Teen and youth

Some of these target market segments are likely to be overlapping since they were segmented using various different criteria. However, the overlap does not change the importance of any of these target segments.

30 | P a g e

Positioning
Through various phases in time, Airtel has repositioned itself in the minds of the consumers. Airtels Live Every Moment, Touch Tomorrow and Express Yourself have been the best recognized taglines of their times. We can also try and categorize Airtel on a positioning-map vis-a-vis its competitors. The following positioning map uses three criteria to position these brands Quality of service, Customer Satisfaction and Value-service (inexpensive service).

Customer Satisfaction

DOCOMO Vodafone Airtel

Airtel Idea BSNL R. Comm Value-service

Quality of service

Thus, it can be seen that Airtel is perceived by the customers as a brand which concentrates on quality of service provided leading to customer satisfaction. Over the years, with the entry of new players in the market, a major price war has begun. Unlike vodafone which has refrained from entering the price war, Airtel, in spite of being the market leader has gotten sucked into it. This has resulted in a dilution of the Airtel brand. Also, Airtel lags far behind Vodafone and Docomo in its online platforms and services, which has resulted in a decrease in customer perception about Airtels services.

31 | P a g e

Based on the customer targeting done, Airtel needs to concentrate more on the quality of services it provides to increase profitability. Instead of fighting a price war with established players, Airtel must utilize its resources and reposition itself as a high quality brand with attractive options for corporate users and youth. Given the decreasing Average Revenue per User (ARPU), Airtel should also come out with useful schemes to incentivize high usage.

32 | P a g e

CONSUMER BEHAVIOUR
Below is the basic framework of Consumer Behavior process which includes 3 stages of consumer behavior segregated into the environment, buyers black box and buyers response. The environment analysis like 4Ps has been presented before therefore we will analyze the Buyers decision making process.

The Environment 1) Marketing Stimuli : 4P's - Product, Price, Place, Promotion 2) Other: Economic, Social, Technological, Cultural

Buyer's Black Box 1) Buyer's characteristics 2) Buyer's decision Process

Buyer's Response 1) Buying Attitude 2) Purchase behaviour 3) Brand and Company relationship bhaviour Figure: Model of Consumer Behavior Buyers Black Box To understand the buyers decision making process following data was collected from 105 respondents in Jamshedpur area.

1) Monthly Expenditure on Mobile: Below is the data that we got from the respondents about their expenditure on mobile for a month. As we can see from the data given almost half of the consumers falls into category who spends grater than 500 rupees but less than 1000 rupees 33 | P a g e

Amount (in Rs) Less than Rs 100 Between 100 to 500 Between 500 to 1000 Greater than 1000

No of Respondents 4 22 52 27

Percentage 3.81 20.95 49.52 25.71

Montly Expenditure
3.81

25.71

20.95

1 2 3 4

49.52

2) Use of internet or any other method before taking a new connection: Information Search No of Respondents Percentage Internet 32 30.48 Friends/Groups 55 52.38 Newspaper/Magazine 3 2.86 None 15 14.29

34 | P a g e

Information Search
2.86 14.29 30.48 2 1

52.38

3) Awareness of other competitors in market: After collecting data , it is known that most of the consumers are aware of the competitors in the market like Vodafone, Tata Docomo, Uninor, Idea, Reliance. 4) Buying of multiple mobile SIMs: Number of SIM's No of Respondents Percentage 1 89 84.76 2 16 15.24 3 0 0.00

35 | P a g e

Number of SIM's
00 15.24 1 2 3 4 84.76

5) Post purchase behaviour- rating of Airtel services: Rank 1(Best) 2(Good) 3(Average) 4(Poor) 5(Worst) 21 24 35 22 3 14 28 38 23 2 11 13 39 35 7 39 20.24 37 24.29 28 33.33 1 19.29 0 2.86

Features Coverage Call Charges Schemes Customer Care Percentage

Rank Distribution %
2.86 20.24 1 2 3 24.29 33.33 4 5

19.29

36 | P a g e

We can see from the Consumer Research that most of the respondents areusing Airtel but they are just using it because it is available in the market at theaffordable and comparative prices. As we can see from the result above the buying behavior of the customer is dependent on the involvement and difference between brands which is similar as given in figure below.

Involvement of Consumer High Involvement Difference between brands Low Involvement

Significant

Complex Dissonance reducing

Variety Seeking

Few

Habitual buying

Figure: Four types of buying behaviour

37 | P a g e

ASSUMPTION IN PLANNING PROCESS

Market potential:

Planning and management of mobile services requires an understanding of the factors that are responsible for the evolution of the market. The most important factors for the purpose of capacity planning are market potential, timing and speed of adoption. BhartiAirtel was founded in 1995 as a public limited company4. The telecom sector was predominantly under public sector control at this time. India ranked 14th in the world in 1995 in terms of number of main telephone lines1. From the point of view of telecom potential in India, this was a momentous era due to following reasons:

1. Policy environment started changing from 1994 onwards. This provided impetus for development of telecom sector: The industry transited from monopoly to duopoly, as the Government mandated two fixed and two mobile operators in each circle in 1995 Independent regulator, TRAI, established in 1997 NTP in 1999 stimulated migration from high-cost fixed licence fee to a low-cost revenue sharing regime . 2. National telecom policy was announced in 1994. Steps were taken to allow private players in telecom domain1. 3. Mobile phone manufacturing firms (Nokia) started its operations in 1995 3. Infact the first mobile phone call was made in India in 1995 on a Nokia phone over Nokia network. 4. The manufacturing sector opened in 1984 .

38 | P a g e

This was the most crucial time for players who wanted to make a niche in telecom sector in India. The effects of adoption of liberalization policy were starting to show. New technologies were being adopted by India, private participation was increasing and being encouraged by the conducive policies of government. During this time when Airtel just started, cellular mobile telephones subscribers in India were around 77 thousand in 1995. The proportion of cellular subscribers total number of telephone subscribers (basic plus cellular) was 0.6 percent in 1995. In 2002 this figure was around 14.6 and has tremendously increased since 1. Mobile density was close to 0.003 in 1995. In fact, the overall development of telecom industry, in terms of overall size of sector and advancement of technologies used, started in the late 90's in India.

Forecast Assumptions: The most important criteria for establishing business in a capital intensive sector like telecom is correct analysis of market demand and potential. Also it is important to develop understanding of future trends, be able to develop reasonable estimates of patterns and rates of adoption etc. For this it is important to know about the theoretical models of diffusion of innovations in the market. Successful innovations tend to follow a sigmoid or S-shaped curve. During the initial stages only a few members of the society adopt the innovation. These are the people who are highly involved in buying process and like to experiment and are the first adopters of new technologies and innovations. Gradually, owing to development of better technologies and dissemination of information many people consumethe innovation and the diffusion process further unfolds. Finally, during the maturing phase, the rate of diffusion goes down and diffusion curve reaches a saturation level.

39 | P a g e

Figure: Innovation Life Cycle

Hence, it can be hypothesized that mobile density growth can be modeled on a sigmoid or Scurve. Logistic and Gompertz sigmoid curves are the most commonly used ones. Hence, forecasting and modeling may be done using them.

Figure: Projections of Mobile Density in India

Using these growth and market potential may be forecasted and analysed. The assumptions used in the analysis are:

40 | P a g e

a) For any country the saturation level will depend on whether it is an early or late adopter of the technology. b) Early adopters are usually developed countries and they show a lesser reliance on mobiles due to high switching costs. c) Late adopters are mostly developing countries and they show a lesser reliance on fixed line phones due to high infrastructure costs. d) Various mathematical models are used by companies to forecast demand and growth patterns. The studies done on Indian mobile sector using different models confirm the theoretical pattern of growth.

Other Assumptions: a) The marketing and business strategies must be aligned over the short, intermediate and long planning horizons. b) The strategy must reflect the company's mission and must be used to achieve the goals set by management. c) This requires extensive research and analysis by the company as described above. d) The company must obtain inputs primarily on the following: 1) Competitive threats: no major threats when Airtel started operations. In fact it was one of the earliest private players and had considerable first-mover's advantage. Currently, its main competitors are Idea, Vodafone, BSNL and now in many areas Tata Docomo and Reliance GSM. 2) Profitable opportunities: immense scope for profit when it started as entire untapped market was waiting to be catered to. With government policy impetus, profitability was definite. Currently, intense price competition in the market combined with growing mobile penetration offer a unique profitabile scenario. Also, with its Zain acquisition, Airtel has no dearth of profitable opportunities with 15 African nations' markets in its pockets. Its sales increased by 17% while EBITDA rose 3% in the first quarter of 20107. 3) Areas of market growth, maturity and decline: commencement of Airtel operations along with many other incidents was responsible for developing Indian telecom market. India's market is still growing and will continue to do so for another 10 years at least before it reaches maturity phase. Airtel still occupies a mjor chunk of Indian market (~ 30%). When it started operations, the
41 | P a g e

metros were the main and focal areas of growth. Currently, the focus is on maintaining quality of service in cities while expanding base in rural areas.

Figure: Customer Needs Analysis

4) Latent and explicit customer needs:telecom industry particularly cellular operations and services have long transcended the basic utility of communication. Airtel has invested heavily in infrastructure and marketing campaigns to promise and deliver quality communication facilities. Of late mobile operators are increasingly venturing into internet and other wireless services along with a variety of value added services. As the average customer is likely to be quite removed from the intricacies of mobile technology, the onus is on the operator to identify and provide new services. Mobile banking especially microfinance in rural areas is an example of such innovation. 5) Ideas for distributing and pricing: even though Airtel is competitively priced, intense price wars and more number of players in the market led to a loss of 32% in its profit. Its net income shrank to 16.8 billion rupees in the first quarter that ended on June 30, 2010 form 24.7 billion rupees a year ago7. Indian market already boasts of having the lowest mobile tariffs in the world according to International Telecom Union. Recently, Airtel aggressively revamped its pricing and marketing strategies to become more competitive. It was the first to offer lifetime prepaid connections. It also offered differential pricing based on time of call. It also keeps launching a lot of full talk time and various discounted call-rate and messaging schemes from time to time. Recently, it also reduced the call rates on national roaming especially on incoming calls. Besides, special schemes and discounts offered vary between circles based on needs of customers in that area.
42 | P a g e

Airtel has maintained a dedicated and strong distribution channel by way of distributors, wholesalers, and franchisees and company owned Relationship Centers which are 'one-stop solutions' shops'. The distribution channels under the company include Direct Selling Associates, Corporate Selling Associates, Franchisee Selling Associates and Airtel Relationship Centers. Airtel also offers sales based remuneration to its distributors and franchisees. Example: for prepaid connections in all circles distributors and franchisees are paid 15-20% of the value of card sold.

Figure: Cellular Operator Distribution Channel

43 | P a g e

THE PRODUCT STRATEGY

Airtels mobile (GSM/CDMA) SBU is a cash cow for Bharti. Airtels mobile SBU presently serves more than 130 million customers across India. It is an established product category with high market penetration and high profitability. Airtels profits in this category have been growing yoy. Though Airtel is the overall market leader in India, it is a challenge to maintain its market share in view of the consistently evolving technology and high degree of competition.

STAR

QUESTION MARK

Market Growth

CASH COW

DOG

Market Share

BhartiAirtels product strategy revolves around maintaining its Star status in the market. The Product Line: BhartiAirtels product line has changed over the years. In the 1990s, the focus was on providing the mobile connection while now the focus has shifted to enhancing the customers experience on his mobile phone. This explains Airtels focus on value added services, additional facilities and MCommerce. BhartiAirtels product focus is three fold within the mobile services space with a view to provide a differentiated product to its customers: Provide high quality cellular service to its customers and expand its network across the country.

44 | P a g e

Providing additional facilities to its valued customers (International calling, cheaper roaming rates, STD calling, Freedom Plan). Provide innovative services and features to enhance customer experience on their mobile phones (Value Added Services).

With a high level of market penetration in the urban areas, Airtel is looking to expand its footprint in rural India with a large untapped market. Features such as M-Commerce and plans such as Freedom plan and advantage plan are expected to help reach this market segment. Growth Strategy:

Existing Market

Market Penetartion

Product Development

New Market

Market Development

Diversification

Existing Product

New Product

Product Development: The Value added services, blackberry services, M-Commerce are a part of Airtels product development strategy. Market Development:Airtel is creating new markets via its inorganic growth strategy. E.g.Zain in Africa. Market Penetration: Airtel is expanding its rural footprint and targets greater market penetration in rural India where more than 60% of the potential is untapped.

45 | P a g e

Strategy Marketing Communications Programmes

Integrated Marketing Communications Programs
Integrated marketing communications (IMC) is a mix bag of communication strategies used to convey a holistic and consistent image of the company. Airtel has used several IMC programs to including both offline and online marketing channels to identify customer insights and develop the right strategy to forge a strong brand-customer relationship. The IMC programs used by the company have been: Advertisements: A large chunk of the budget used for the promotion of the Airtel brand especially in the mobile telephony has been used creating and distribution of ads. In-fact the theme of each of these has also changed. Value Communicated: Their promotion and advertising strategy has evolved over time as:

1995-98
Positioning in premium catageory, aimed at targeting the elite. Projected as an aspirational and lifestyle brand.

1999-2001

2001-02

2003-10

Change - New telecom policy of 1999 replacing license fee with revenue sharing scheme.

Expanding to new segments, establishing the brand as a quality of life product. Associated with leadership,performance and dynamism.

Added emotional appeal to the brand. Famous A.R.Rahman Airtel musical Signature tune to increase brand recallability

Clear focus on emotions. Several youth icons hired as brand ambassadors Intent on giving brand a Human touch.

"The power to keep in touch" "Airtel celebrates the spirit of leadership" "The first choice of the corporate leaders" "Touch tomorrow" Change from regional to pan-India outlook. "Live every moment" Appeal to the masses.

"Express Yourself"

Figure: Value Communication over the years 46 | P a g e

Product to Services Branding: Shift in the strategy from product based to Services based branding. Though product innovations continue as hello tunes, easy recharges, blackberry option.

Customer Relationship Strategy: First cellular service provider to start customer call centres (Airtel Connects) where customers could pay their bills, apply for new connections and touch and feel new handset models. Modelled as one-stop shop to all customer solutions and queries.

Umbrella Marketing: Use of umbrella marketing by Bharti-Airtel to promote several of the its products namely Airtel broadband, GPRS, DTH under one single Brand name.

Co-Branding: Airtel has done several ties ups with online community sites (Hungama.com), publicprivate (Incredible India-Taj-Hotels-Airtel-Cox & Kings), media channels (MTV), Credit cards (ICICI Bank - Airtel Silver Credit Card) etc. to further the visibility of its brands.

Pricing Strategy
Some common strategies used by Airtel over the years, at different stages in its growth can be classified under: Penetration Pricing: Done by Airtel in response to the aggressively lower pricing-tariff strategies adopted by new entrants like DoCoMo and Reliance. The price wars have escalated in the recent times. This has however also led to buy-outs of several new entrants on the account of falling APRUs.

Price Skimming: Adopted by Airtel during the initial years when competition was limited and scope for expansion limited. The brand was projected to the elite and corporate as a symbol of leadership and excellence. The strategy has become irrelevant in recent times on the account of increased number of competitors in the market.

Psychological Pricing: Most of the value recharge at smaller denominations i.eRs. 10/-, 30/-, 60/- etc. and tariff and broadband plans at Rs 99/-, 999/- etc. are aimed at getting emotional rather than rational appeals.

Product Line Pricing: Pricing to reflect benefits of the individual components of the plan. Most topups in like SMS packs, Monthly GPRS, Airtel Live etc. fall under this category.

47 | P a g e

Promotional Pricing: Used at several occasions to promote a new tariff plan, Value added service, Roaming charges etc.

Channel Strategy
Channel Strategy comes as of extreme importance due to the high services oriented nature of the telecomm industry. When each company in the telecomm sector is selling similar products and virtually the same pricing and at same cost incurred, the only sustainable competitive advantage can come from the strategy/means used to sell. A definitive advantage to this can come by selecting the appropriate mix of distribution channels direct sales force, agents, retailers, Internet etc. Further plans of expansion in semi-urban India, and mushrooming number of service providers makes the distribution networks all the more important. Some of the initiatives taken by Airtel in this regard include: Customer Relationship Centres Facility for Mobile banking (using m-cheques) Recharge using pre-paid and Magic coupons Airtel Live using Internet

In addition to these Airtel is rapidly looking to expand in Rural India and in this regard is energizing its sales force network and distribution centres (at local Kiryanas) to better understand the customer base. Several initiatives in this regards i.e. real time pricing of farmer produces in the markets (getting quotes), mobile advice on better agriculture techniques etc. are helping win networks and further consumer bases.

48 | P a g e

Research Strategy
The typical marketing research methodology adopted by Airtel and others in the telecommunications industry includes:

Density Affluence Age

Population Purpose

Hypothesis testing

Publications Sales and ditribution reports Competitors annual reports

Procedure

Sale at retail outlets Customer relationship centers

Figure: Research strategy matrix

49 | P a g e

MONITORING & CONTIGENCY PLANS

A marketing strategy should always have a contingency plan for situations when they could go against the planned strategies. Following are the points that should be taken in consideration while thinking of making a contingency plan. Problem 1: If for any reasons the new launches done by Airtel i.e. the new mobile offers and packages are not successful or able to compete with the other competitors strategies. This problem can be solved by adopting the promotional or free trial offer marketing strategy where the new offers can be provided to selected customers to stimulate brand and product awareness, and ultimately increase sales demand through word-of-mouth promotion This will not only create the awareness of the new offers introduced by Airtel in the market but also it will help to analyze or estimate the market perception of any type of new addition.

Problem 2: If we consider the growth in market share of the company, then there is a possibility of entering of new firms and eating up market share. For stopping of new entries into this segment the only thing is to increase the entry barriers but since in this market the competitors are so many that there is always a good chance of emergence of new competitors. Therefore, this problem can be solved by product differentiation both in vertical as well as horizontal direction.

Problem 3: Expansion in rural areas where the hold of Airtel is not much as compared to other competitors, refrain from adopting Airtel as there mobile channel partner For tackling this problem , Airtel can either go for pricing strategy where the prices can be made cheaper vis--vis other competitors Or the company can focus on promotion of its service in rural market in an aggressive manner. Moreover, there is also a possibility of adopting new offers specially catering to rural sector and scrapping off some features which are not useful to rural market

Problem 4: When we consider of adopting new technologies to improve the service offered by Airtel which is in tune with the objective of this marketing strategy, there is good chance that the competitors like Vodafone, Idea came up with new technology like 3G much earlier than Airtel Carefully monitor major competitors pricing and promotional activities and entry into the 3G market, and prepare recommendations and potential adjustments to our marketing mix to ensure our leading market position and healthy sales are maintained in the long-run.

50 | P a g e

Recommended Marketing Strategies for Airtel

With the entry of multiple new players in the sector and an ever decreasing ARPU, Airtels marketing team needs to innovate constantly. In the foreseeable future, the marketing team must emphasize on the following aspects: Refrain from using pricing as a marketing tactic. With the ongoing price war, the price levels have become unsustainable anyways. Any further aggressive pricing strategies on Airtels part will only do further damage. Concentrate on the untapped rural market segment. Airtel should aggressively increase its network in the rural sector and market itself before other players enter the market in a big way. The conservative nature of the typical rural Indian consumer must be kept in mind. The first mover is bound to get an advantage. Build strong corporate contacts and offer more benefits for corporate users. This is going to be the biggest cash generating segment and Airtel must consolidate its position here. This can be achieved by entering into tie-ups with various companies. Providing more useful value added services (VAS). VAS has emerged as the most important source of revenue for mobile operators. Airtel needs to further its efforts of providing users the best possible VAS.

Provide special incentives for Airtel-Airtel calls. This is a proven way of expanding customer base and has been exploited by Reliance Communication and Tata.

Airtel must differentiate services for consumers with high usage rates by providing them special band-width such that they do not face increasing problems like call-drops and network-jams. This can result in a major source of revenue for Airtel and will do wonders for customer satisfaction and customer perception of brand quality.

Airtel must ensure that it does not lose its current users to competitors. This can be ensured by increasing quality of service provided. Decreasing prices further is not going to help retention of customers.

51 | P a g e

Airtel must position itself as a youth brand. Most new consumers getting added to the mobile services market are young teenagers who should perceive Airtel as their first choice. Also, given Indias age based demographics, maintaining a high youth penetration is extremely important.

52 | P a g e

REFERENCES
1. Sites from where data is collected: (a) Telecom Regulatory Authority of India : http://trai.gov.in (b) Bharti : http://www.bharti.com (c) Airtel : http://www.airtel.in

(d) Communications in India: http://en.wikipedia.org/wiki/communications_in_india (e) International Telecommunications Union : http://www.itu.int/ITUD/ict/statistics/ict/index.html (f) Bharat Sanchar Nigam Limited: http://www.bsnl.co.in

(g) The Economic Times, Ericsson wins Airtel's $1.3-billion outsourcing project, April 1, 2010 : http://economictimes.indiatimes.com/news/news-by-industry/telecom/Ericsson-winsAirtels-13-billion- outsourcing-project/articleshow/5748843.cms (h) Ernst & Young, India 2012 Telecom Growth Continues : https://webforms.ey.com/Content/vwWFPreview/GL/en/India_2012:_Telecom_growth_co ntinues?OpenDocument (i) (j) Nokia : http://www.nokia.co.in/about-nokia/company Ketaki Gokhale, Bharti Airtel First-Quarter Profit Falls 32% as Price Cuts Erode Margins, Bloomberg, August 11,2010 http://www.bloomberg.com/news/2010-08-11/bharti-airtel-first-quarter-profit-falls-32-asprice-cuts-erode-margins.html

(k) Amit Ranjan Rai & Aarti Menon Carroll, Airtel vs Hutch: And the winner is... , Rediff Business, Jan 04,2006 http://www.rediff.com/money/2006/jan/04spec.htm (l) CBS Interactive Business Network, http://www.bnet.com/cp/developing-a-channelstrategy/168339

(m) Pricing Strategy, http://www.marketingteacher.com/lesson-store/lesson-pricing.html (n) Integrated Marketing Communications, http://www.multimediamarketing.com/mkc/marketingcommunications/ 2. Books: (a) Kotler, Armstrong, Agnihotri & Haque; Principles of Marketing; 13th ed; Prentice Hall, ISBN 978-0131469181 53 | P a g e

(b) Kotler, Marketing Insights from A-Z, John Wiley & Sons, Inc , ISBN 0-471-26867-4

3.

Reports and Reference : (a) The Hindu - Survey of Indian Industries 2010 (b) Indian Brand Equity Foundation Telecommunications Report, April 2010 (c) Manas Bhattacharya (IES), Committee on India: Vision 2020 Telecom Sector in India: Vision 2020 (d) Sanjay Singh, The diffusion of mobile phones in India, Dr. Sanjay Singh, 2003

54 | P a g e