1.

INTRODUCTION TO THE INDUSTRY

The telecom network in India is the fifth largest network in the world meeting up
with global standards. Presently, the Indian telecom industry is currently slated to
an estimated contribution of nearly 1% to Indias GDP.
The Indian Telecommunications network with 110.01 million connections is the
fifth largest in the world and the second largest among the emerging economies
of Asia. Today, it is the fastest growing market in the world and represents unique
opportunities for U.S. companies in the stagnant global scenario. The total
subscriber base, which has grown by 40% in 2011, is expected to reach 250
million in 2011.
According to Broadband Policy 2010, Government of India aims at 9 million
broadband connections and 18 million internet connections by 2010. The
wireless subscriber base has jumped from 33.69 million in 2004 to 62.57 million
in FY2004- 2005. In the last 3 years, two out of every three new telephone
subscribers were wireless subscribers. Consequently, wireless now accounts for
54.6% of the total telephone subscriber base, as compared to only 40% in 2010.
Wireless subscriber growth is expected to bypass 2.5 million new subscribers per
month by 2009. The wireless technologies currently in use are Global System for
Mobile Communications (GSM) and Code Division Multiple Access (CDMA).
There are primarily 9 GSM and 5 CDMA operators providing mobile services in
19 telecom circles and 4 metro cities, covering 2000 towns across the country.

1.1) Evolution of the Industry - Important Milestones:

Year

Description

1851

First operational land lines were laid by the govt. near

Calcutta(seat of British Power)

1881

Telephone Service introduced in India

1883

Merger with the postal system

1923

Formation of Indian Radio Telegraph Company (IRT)

1995

Merger of ETC and IRT into the Indian Radio and Communication
Company(IRCC)

2002

Nationalization of all foreign telecommunication companies to form

the Posts, Telephone and Telegraph(PTT), a monopoly run by the
governments Ministry of Communication

2004

Department

of

Telecommunications

(DOT)

established,

an

exclusive provider of domestic and long-distance service that

would be its own regulator (separate from the postal system)
2006

Conversion of DOT into two wholly government-owned companies:

the Videsh Sanchar Nigam Limited (VSNL) for international
telecommunications and Mahanagar Telephone Nigam Limited
(MTNL) for service in metropolitan areas.

2009

Telecom Regulatory Authority of India created

2010

Cellular Services are launched in India. New National Telecom

Policy is adopted.

2011

DoT becomes a corporation, BSNL

"Telecommunications is the backbone of our future economy. International

competitiveness

increasingly

depends

on

the

development

of

telecommunications infrastructure that is compatible with international standards"

The cellular industry all over the world has been witnessing very high growth
rates in subscriber base in recent years. For developing countries in particular,
cellular services are becoming a very significant proportion of the overall telecom
infrastructure. The mechanics of competition within this market involve complex
feedback effects between individual service providers and with their operating
environment, and these forces play an important role in governing the growth of
this industry.
The Indian telecommunications sector has undergone a major process of
transformation because of significant Government policy reforms during the
recent years. The New Telecom Policy, 1999 focused on creating an ideal
environment for investment, establishing communication infrastructure by
leveraging on technological development and providing affordable telecom
services to all. These objectives of the policies have resulted in rapid growth of
subscribers and lower tariffs. We believe that with these major initiatives of the
Government, the mobile market in India will have a promising future.
In a country like India which is not yet telephone-saturated and the ongoing
changes in related areas are resulting in a rapidly changing profile of users,
providers and their respective needs, continuous revision of the telecom policy is
imperative. Given the emerging new technologies and the integrating economies
there must be fairness among competitors.
The tele-density in India is about four per hundred people in respect of the fixed
telephones and a little less than one in respect of the mobile telephony. The low
densities are not because there is no need for a telephone but because of its
high cost that many cannot afford that one. The situation here is nothing but
holding true of the law of demand. Isnt it?

The cost for the companies can come down if the revenue share imposed on
them as a condition of license is abolished or drastically reduced. Today every
telephone company is bound to pay a share out of its revenue to the exchequer.
These costs are, however, not to be scheduled to take a step further in the
development of the telecom. In addition when we go through the telephone bill
3

there is a 5 to 8% service charge. This amount also does not go for the telecom
development. If these external cost are removed there can be seen a spurt in
demand of not less then 40% as expected.
While taking the side of suppliers a lot of new companies are coming into the
battlefield resulting in reduction of prices and hence a little less burdensome on
to the customer. The cost of interconnection with the incumbent is proving to be
contributory to the high cost of services provided by the competitors.
The delay in the interconnection disregards the quality of service and high cost
will detract from affordability. This is an area in which no consumer body can
knowledgeably contribute unless it has the assistant of experts or economists
who alone can discover all the relevant fact of all the contesting companies. It
indicates the pre-eminent domain of TRAI (Telecom Regulatory Authority of
India).
As the driven down of the prices for long distance including international services
reduces the amount available for subsidizing the local service, the rental for local
services are being increased. Considering that about 90% of the long distance
calls are made by less than 20% of customers, 80% of customers are having to
pay higher rental this depresses the demand for telephones and affordability. The
urban business subscribers will be bearing the bond of the subsidies to be given
to the rural private consumers.

History of Cellular Telephony in India

The technology that gives a person the power to communicate anytime,
anywhere - has spawned an entire industry in mobile telecommunication. Mobile
telephones have become an integral part of the growth, success and efficiency of
4

any business / economy. The most prevalent wireless standard in the world
today,

is

GSM.

The

GSM

Association

(Global

System

for

Mobile

Communications) was instituted in 1987 to promote and expedite the adoption,

development and deployment and evolution of the GSM standard for digital
wireless communications.
The GSM Association was formed as a result of a European Community
agreement on the need to adopt common standards suitable for cross border
European mobile communications. Starting off primarily as a European standard,
the Group Special Mobile as it was then called, soon came to represent the
Global System for Mobile Communications as it achieved the status of a worldwide standard. GSM is today, the world's leading digital standard accounting for
68.5% of the global digital wireless market. The Indian Government when
considering the introduction of cellular services into the country, made a
landmark decision to introduce the GSM standard, leapfrogging obsolescent
technologies / standards. Although cellular licenses were made technology
neutral in September 1999, all the private operators are presently offering only
GSM based mobile services. The new licensees for the 4th cellular licenses that
were awarded in July 2001 too, have opted for GSM technology to offer their
mobile services.

Cellular Industry in India

The Government of India recognizes that the provision of a world-class
telecommunications infrastructure and information is the key to rapid economic
and social development of the country. It is critical not only for the development
of the Information Technology industry, but also has widespread ramifications on
the entire economy of the country. It is also anticipated that going forward, a
major part of the GDP of the country would be contributed by this sector.
Accordingly, it is of vital importance to the country that there be a comprehensive
and forward looking telecommunications policy which creates an enabling
framework for development of this industry.

Cellular Market Structure in India

As in other countries, in India, the Cellular Mobile Service Providers (CMSPs) are
licensed to operate in designated geographical operating areas. The service
areas include four metro areas and 18 circles categorized as A, B and C. (The
categorization is based on the revenue Proceedings of the 36th Hawaii
International Conference on System Sciences).
The potential with category C circles in the lower end of the scale. For example
the metros account for 40% of the subscriber population, with Category-A, B and
C accounting for 33%, 23% and 4% respectively. The CMSPs had to pay an
entry fee and subsequently annual license fee as a percentage of their revenue
to the Department of Telecommunications.
The entry and license fees varied according to the service area, highest for
metros and lowest for Category-C circles. Some of the CMSPs could not fulfill
their licensing obligations and their licenses were revoked leading to a monopoly
situation in certain areas. Apart from these charges, each CMSP has to share the
revenue with the long distance operators for carrying inter-service area calls.
In profitable metros and circles, the competition is severe and the market is split
between the two operators. In a price-cap regulated market, the operators use
appropriate pricing strategy to win customers and win market share.
In highly price-elastic markets, such as in India, as the service provider reduces
the price, the subscriber base increases considerably, and so is the network
traffic. The increased network traffic decreases the performance and the quality
of service, inviting customers to switch. Being a new entrant in a metro area, the
government operator reduced the airtime charges to such an extent that the
subscriber base increased suddenly leading to poor network performance. The
operator did not have enough network capacity to handle calls leading to
blocking of calls, with frustrated customers switching over immediately to
competitors.

The operators also have to resort to non-pricing competition strategies to win

customers. In India, CMSPs offer a variety of service plans as a means to attract
new customers. Different service plans include: pre-paid calling card schemes,
discounted airtime rates for evening and night time calls, discounted roaming
charges, no or minimum activation fees, and reduced mobile to mobile long
distance call rates.
The service providers incur additional advertising and infrastructure cost for
implementing these plans. Short Message Service (SMS) and Wireless
Application Protocol (WAP) service are fast catching up. For example, in India,
about 500,000 SMS messages are being carried by a service provider in one
metro area alone. When the sector moves over to an oligopoly market, the
operators have to provide improved quality of service and value added services
in order to survive and gain market share.
Larger operators who have experience and infrastructure may be able to provide
a higher quality of service and other value-added service at a lower price. They
also have access to larger project financing for enlarging their networks and
services. For example, a single large operator now has license to operate in 14
service areas in the country with the largest footprint to cover most of the areas
of the country. Mergers and acquisitions are commonplace as the operators are
consolidating their revenues to survive in the market places.
Cellular subscribers and those with a propensity to go mobile in Delhi have never
had it so good. They now have four service providers to choose from, each
offering an array of both pre- and post-paid schemes. More importantly, average
tariffs across plans have, by some reckoning, dropped by at least 50 per cent in
the last six months. The entry of Vodafone saw a further drop in tariffs and the
operators have come out with new schemes to retain their subscribers and
attract fresh ones.
What does this mean for subscribers and for the cellular industry in Delhi? All the
four operators Essar Mobile Services Ltd., Bharti Celluar Ltd, MTNL and Idea
Cellular services are convinced that the market will only expand and the
subscribers will benefit even more. Their reasoning is that cellular penetration in

Delhi, which traditionally occupies the third position in other areas, is less than
fifty per cent. Therefore, entry of new players will only increase awareness about
the facility, the companies say.
Moreover, the state-owned MTNL has also been playing with its cellular service
for quite some time. that, with the imminent launch of limited mobility using
CDMA (code division multiple access) technology by companies like Tata Tele
Services will only add to the subscriber base, probably result in further reduction
of tariffs, and an even greater widening of the cellular market, according

to

officials in four cellular companies now servicing Delhi.

However, the companies also sound a note of caution any further drop in
tariffs will be harmful to the companies, points out one of the officials taking care
of the Sales & Marketing division of the, Essar Mobile Services Ltd, average
tariffs in Delhi across different plans have fallen by 30 per cent since December
with launching of the CDMA services.
Besides the fall in tariffs, what has really happened with the entry of CDMA is a
heightened awareness in the market. Mobile penetration in Delhi and its suburbs
is estimated to be less than twenty-five percent of the population and the cellular
operators believe that this number should definitely go up.
It is here that Vodafone decided to target the customers with what it believes are
unique products and features. Its emphasis has been on value proposition and
brand building. Mobility is not only about carrying voice, as per the reports from
the marketing department and adds that the unified messaging system for the
post-paid customers of (now Vodafone) is one such unique product.
Accordingly, Vodafone signed in its subscribers in lakhs from the year onwards it
has been launched in Delhi. Industry analysts say that a majority of them will be
pre-paid customers, whose loyalty to a particular brand is always in doubt.
However, pre-paid for the cellular is nothing but the engine for growth and there
is always a possibility that most of them will shift to post-paid once they are
convinced of the quality of service provided.

On the other hand the entry of a new operator lends more visibility to the service
and there is also increased trade activity that is the number of dealers will
increase and more people will be on the road trying to sell the service and
product. There is also greater consumer awareness of what cellular service can
deliver and expectations go up in terms of pricing or service standards or network
availability.

The Churn in the Cellular Industry:

As like the other products Cellular industry has not been left untouched from the
Churn (switching over). During the survey this fact comes to the fore. According
to the cellular operators, there is a normal seven to eight percent churn in the
customers, especially in the pre-paid category. Among the post-paid customers,
the Churn is much lower about two-three percent.
They say that one significant change that has happened in the last few months,
more so since lowering of the tariffs, is that the bias in favor of incoming calls as
far as call charges are concerned incoming calls has been set free while they
are charging reasonably only for the outgoing ones has changed. A tariff rebalancing has definitely taken place.
This means that the cellular operators are encouraging their subscribers to not
just receive calls, but also make calls increasing the usage of the service. With
falling tariffs, cellular operators are convinced that increasing usage is one way to
ensure that average revenue per user (ARPU) does not fall very low. The
industry figure for ARPU is believed to be about Rs.1,100 while it may vary from
operator to operator. The operators are also concentrating on introducing more
value added services to the customers. Value-added services have not really
taken off. Only the SMS (short messaging service) has really caught on, but
operators like Bharti are bringing in services like music messaging and concierge
facility for its subscribers.

MOBILE SUBSCRIBER STATISTICS

9

Recently, mobile phone connections in India have crossed the 400-million mark,
which means over forty in 100 Indians have a phone. Adding on to this
benevolent and happy information, telecom companies are anticipating the
number will nearly treble in the next two years. According to a survey, by 2011,
the cellular networks are expected to cover 4,50,000 (out of 6,07,000) villages,
covering 550 million people.

Figure 1 Market Share of both mobile and wire line Service Providers in India

GSM Subscribers
The cumulative All India GSM subscriber base rose to 72.12 million in April
2010 from 69.19 million in March 2011 which is a growth of 4.23% for a month
under review [4]. Table I shows the subscribers growth rate for one month along
with market share of each provider with coverage

CDMA Mobile Subscribers

10

The total cumulative all India CDMA subscriber base rose by 0.97 million
from 23.25 million in March 2009 to 24.22 million in April 2010,
representing a growth of 4.2% in the month under review. A summary
picture of the company wise performance is given in Table II.

TELECOM IN RURAL INDIA

Table I. GSM Subscribers growth rate

Company
Bharti
BSNL
Vodafone
IDEA
Aircel
Reliance
Spice
MTNL
BPL
Total

No of Subscribers (in million)

March 2009
April 2009
19.57
17.16
15.36
7.37
20.61
1.90
1.93
1.94
1.34
69.19

20.68
17.59
16.06
7.64
2.83
2.01
1.98
2.02
1.31
72.12

Market Service Areas

Share
28.7%
24.4%
22.3%
10.6%
3.9%
2.8%
2.7%
2.8%
1.8%
100%

23
21
16
11
7
8
2.
2
1

India has an urban population of about 26.8% and rural population is

about 73.2%. And there are over 600,000 villages in India. But a vast section of
the rural sector is still cut off from the benefits of telecom services. The rural
population of around 700 million is waiting for its share of economic growth.
Initially the big telephone companies focused only on urban centres, which they
felt were more profitable. However, this mindset is gradually changing with the
realisation that there is equal, if not bigger money in rural areas.

Table II. CDMA Subscribers growth rate

11

Company

(No.of

Subscribers,per (% in Market Service Areas

million)

Share)

Reliance

March 2009 April 2009

18.307
18.809

77.65%

20

TATA

4.851

5.323

21.98%

20

HFCl

0.062

0.062

0.26%

Shyam

0.027

0.028

0.11%

Total

69.19

72.12

100%

It is estimated that a one per cent increase in rural connectivity can generate 0.5
per cent economic growth. Thus a well-planned 10 per cent increase in rural
connectivity can propel India into double-digit growth and unprecedented
prosperity.
Rural India possesses enormous potential in terms of economy and human
resources. Recent experiments have confirmed that ICT (information and
communication technology) helps improve the timeliness and efficiency of rural
farm operations and enhance income through producer-oriented markets. Hence
the communication ministry has requested the finance ministry for higher
allocations from the USO Fund for executing rural telephony network. The
finance ministry has made a budgetary allocation of 15 billion from the USO
Fund. The rural telephony targets include, providing 50 million telephones by
2009(i.e. one phone per three rural households) and 80 million by 2012 (i.e. one
phone per two rural households) and provisioning mobile access to all villages
with population more that 5,000 by 2009 and more than 1,000 by 2010.The
Government is confident that the Bharat Nirman Programme target of providing
coverage to remaining 41,000 villages would be met by March 2010 which will be
much earlier than a schedule of November 2010.
India plans to establish 0.25 million, village knowledge centres. The ICT industry
can establish rural call centres modelled on the Kisan Call Centre established by

12

the Ministry of Agriculture to provide domain knowledge in the services,

agriculture and manufacturing sectors. This spread will increase the volume of
users and automatically bring down bandwidth cost, with a spiralling effect on
efficiency and economy. Advanced telecom services are no longer considered a
luxury but a necessity for all. Thus, providing telecom services to every individual
in a country like India is a huge challenge, and at the same time holds immense
opportunities for those in the telecom industry.

Major Players:
There are three types of players in telecom services:
State owned companies (BSNL and MTNL)
Private Indian owned companies (Reliance Infocomm, Tata Teleservices)
Foreign invested companies (Vodafone-Essar, Bharti Tele-Ventures,
Escotel, Idea Cellular, BPL Mobile, Spice Communications)
India's mobile telecom sector is one of the fastest growing sectors. Unlike in the
1990s when the mobile phone was an elitist product, mobile operators now tap a
mass market with mass marketing techniques. "Unified licensing" rules allow
basic and mobile operators into each others territory, and have ushered in
perhaps the final phase of industry consolidation.
It seems that only companies with deep pockets can effectively compete as
primary operators mobile markets. Economies of scale, scope, and end-to-end
presence in long-distance as well as local telecom, are desirable.
There are, besides, new challenges. Operators have to find new growth drivers
for the wire line business. There are problems of getting broadband to take off, of
technology choice, of when to introduce new technologies, and of developing a
viable business model in an era of convergence.

13

Growth of mobile technology:

India has the fastest growing mobile markets in the world. The mobile services
were commercially launched in August 1995 in India. In the initial 5-6 years the
average monthly subscribers additions were around 0.05 to 0.1 million only and
the total mobile subscribers base in December 2002 stood at 10.5 millions.
However, after the number of proactive initiatives taken by regulator and licensor,
the monthly subscriber additions increased to around 2 million per month in the
year 2003-04 and 2004-05.
Although mobile telephones followed the New Telecom Policy 1994, growth was
tardy in the early years because of the high price of hand sets as well as the high
tariff structure of mobile telephones. The New Telecom Policy in 1999, the
industry heralded several pro consumer initiatives. Mobile subscriber additions
started picking up. The number of mobile phones added throughout the country
in 2003 was 16 million, followed by 22 millions in 2004, 32 million in 2005 and 65
million in 2006. The only countries with more mobile phones than India with
156.31 million mobile phones are China 408 million and USA 170 million.
India has opted for the use of both the GSM (global system for mobile
communications) and CDMA (code-division multiple access) technologies in the
mobile sector. The mobile tariffs in India have also become lowest in the world. A
new mobile connection can be activated with a monthly commitment of US$ 5
only. In 2005 alone 32 million handsets were sold in India. The data reveals the
real potential for growth of the Indian mobile market.

Cellular Service Providers:

As on Apr 2007 India has 167 million mobile phone subscribers. Out of this 125
million are GSM users and 41 million CDMA users. BSNL, Bharti Airtel, Hutch,

14

Idea, Aircel, Spice and MTNL are the main GSM providers in India. Reliance
Communications and Tata Indicom are the main CDMA providers in India.

Bharti Airtel
Airtel is providing cellular services in Delhi, Mumbai, Kolkata, Chennai, Andhra
Pradesh, Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Karnataka,
Kerala, Madhya Pradesh, Maharashtra, Goa, Orissa, Punjab, Rajasthan, Tamil
Nadu, UP and West Bengal. Airtel is the No.1 cellular service provider in India
using GSM technology. Airtel has 23% market share in India with a total
subscriber base of 38 million.

Reliance Communications
Reliance has both CDMA and GSM networks and total subscriber base of 29
million or 17% market share. It has GSM network in Assam, Bihar, Himachal
Pradesh, Kolkata, North East, Madhya Pradesh, Orissa and West Bengal.
Reliance has CDMA networks in other states and cities.

Bharat Sanchar Nigam Limited (BSNL)

BSNL is a state owned telecom company which has GSM presence in almost
every cities and towns. BSNL has 27 million subscribers with a market share of
16%.

Vodafone

15

Vodafone is another emerging GSM provider in India with coverage in Kerala,

Mumbai, Delhi, Kolkata, Chennai, Gujarat, Andhra Pradesh, Karnataka and
Punjab with a total subscriber base of 27 million.

Tata Indicom
Tata Indicom is a main CDMA provider in India with 16 million subscribers all over
India. Tata Indicom has presence in almost every state and cities in India.

2. INTRODUCTION TO THE ORGANIZATION

16

Vodafone is a mobile network operator headquartered in Berkshire, England,

UK. It is the largest mobile telecommunications network company in the world by
turnover and has a market value of about 75 billion (August 2008). Vodafone
currently has operations in 25 countries and partner networks in a further 42
countries.

17

The name Vodafone comes from Voice data fone, chosen by the company to
"reflect the provision of voice and data services over mobile phones."
As of 2006 Vodafone had an estimated 260 million customers in 25 markets
across 5 continents. On this measure, it is the second largest mobile telecom
group in the world behind China Mobile.
In the United States, Vodafone owns 45% of Verizon Wireless.

2.2) Mission:
Vodafone is primarily a user of technology rather than a developer of it, and this
fact is reflected in the emphasis of our work program on enabling new
applications of mobile communications, using new technology for new services,
research for improving operational efficiency and quality of our networks, and
providing technology vision and leadership that can contribute directly to
business decisions.

2.3) Vision:
Our Vision is to be the worlds mobile communication leader enriching
customers lives, helping individuals, businesses and Communities be more
connected in a mobile world.

2.4) History:
In 1982 Racal Electronics plc's subsidiary Racal Strategic Radio Ltd. won one of
two UK cellular telephone network licenses. The network, known as Racal
Vodafone was 80% owned by Racal, with Millicom and the Hambros Technology
Trust owning 15% and 5% respectively. Vodafone was launched on 1 January
1985. Racal Strategic Radio was renamed Racal Telecommunications Group
Limited in 1985. On 29 December 1986 Racal Electronics bought out the minority
shareholders of Vodafone for GB110 million.

18

In September 1988 the company was again renamed Racal Telecom and on 26
October 1988 Racal Electronics floated 20% of the company. The flotation valued
Racal Telecom at GB1.7 billion On 16 September 1991 Racal Telecom was
demerged from Racal Electronics as Vodafone Group.
In July 1996 Vodafone acquired the two thirds of Talkland it did not already own
for 30.6 million. On 19 November 1996, in a defensive move, Vodafone
purchased Peoples Phone for 77 million, a 181 store chain whose customers
were overwhelmingly using Vodafone's network. In a similar move the company
acquired the 80% of Astec Communications that it did not own, a service provider
with 21 stores.
In 1997 Vodafone introduced its Speech mark logo, as it is a quotation mark in a
circle; the O's in the Vodafone logotype are opening and closing quotation marks,
suggesting conversation.
On 29 June 1999 Vodafone completed its purchase of AirTouch Communications,
Inc. and changed its name to Vodafone Airtouch plc. Trading of the new company
commenced on 30 June 1999. To approve the merger, Vodafone sold its 17.2%
stake in E-Plus Mobilfunk. The acquisition gave Vodafone a 35% share of
Mannesmann, owner of the largest German mobile network.

Vodafones original logo used until the introduction of the speech mark
logo in 1998.

On 21 September 1999 Vodafone agreed to merge its U.S. wireless assets with
those of Bell Atlantic Corp to form Verizon Wireless. The merger was completed
on 4 April 2000.

19

In November 1999 Vodafone made an unsolicited bid for Mannesmann, which

was rejected. Vodafone's interest in Mannesmann had been increased by the
latter's purchase of Orange, the UK mobile operator. Chris Gent would later say
Mannesmann's move into the UK broke a "gentleman's agreement" not to
compete in each other's home territory. The hostile takeover provoked strong
protest in Germany and a "titanic struggle" which saw Mannesmann resists
Vodafone's efforts. However, on 3 February 2000 the Mannesmann board agreed
to an increased offer of 112bn, then the largest corporate merger ever. The EU
approved the merger in April 2000. The conglomerate was subsequently broken
up and all manufacturing related operations sold off.
On 28 July 2000 the Company reverted to its former name, Vodafone Group Plc.
In April 2001 the first 3G voice call was made on Vodafone United Kingdom's 3G
network. In 2001 the Company took over Eircell, then part of eircom in Ireland,
and rebranded it as Vodafone Ireland. It then went on to acquire Japan's thirdlargest mobile operator J-Phone, which had introduced camera phones first in
Japan.
On 17 December 2001 Vodafone introduced the concept of "Partner Networks"
by signing TDC Mobil of Denmark. The new concept involved the introduction of
Vodafone international services to the local market, without the need of
investment by Vodafone. The concept would be used to extend the Vodafone
brand and services into markets where it does not have stakes in local operators.
Vodafone services would be marketed under the dual-brand scheme, where the
Vodafone brand is added at the end of the local brand. (i.e., TDC Mobil-Vodafone
etc.)
In February 2002 Finland was added into the mobile community, as Radiolinja is
signed as a Partner Network. Radiolinja later changed its named to Elisa. Later
that year the Company rebranded Japan's J-sky mobile internet service as
Vodafone live! and on 3 December 2002 the Vodafone brand was introduced in
the Estonian market with signing of a Partner Network Agreement with Radiolinja
(Eesti). Radiolinja (Eesti) later changed its name to Elisa.

20

On 7 January 2003 the Company signed a group-wide Partner agreement with

mobilkom Austria. As a result, Austria, Croatia, and Slovenia were added to the
community. In April 2003 Og Vodafone was introduced in the Icelandic market
and in May 2003 Vodafone Italy (Omnitel Pronto-Italia) was rebranded Vodafone
Italy. On 21 July 2003 Lithuania was added to the community, with the signing of
a Partner Network agreement with Bit.
In February 2004 Vodafone signed a Partner Network Agreement with
Luxembourg's Lux GSM and a Partner Network Agreement with Cyta of Cyprus.
Cyta agreed to rename its mobile phone operations to Cytamobile-Vodafone. In
April 2004 the Company purchased Single point airtime provider from John
Caudwell (Caudwell Group) and approx 1.5million customers onto its base for
405million, adding sites in Stoke on Trent (England) to existing sites in Newbury
(HQ), Birmingham, Warrington and Banbury. In November 2004 Vodafone
introduced 3G services into Europe.
In June 2005 the Company increased its participation in Romania's Connex to
99% and also bought the Czech mobile operator Oskar. On 1 July 2005 Oskar of
the Czech Republic was rebranded as Oskar-Vodafone. Later that year on 17
October 2005 Vodafone Portugal launched a revised logo, using new text
designed by Dalton Maag, and a 3D version of the Speech mark logo, but still
retaining a red background and white writing (or vice versa). Also, various
operating companies started to drop the use of the SIM card pattern in the
company logo. (The rebranding of Oskar-Vodafone and Connex-Vodafone also
does not use the SIM card pattern.) A custom typeface by Dalton Maag (based
on their font family InterFace) formed part of the new identity.
On 28 October 2005 Connex in Romania was rebranded as Connex-Vodafone
and on 31 October 2005 the Company reached an agreement to sell Vodafone
Sweden to Telenor for approximately 1 billion. After the sale, Vodafone Sweden
became a Partner Network. In December 2005 Vodafone won an auction to buy
Turkey's second-largest mobile phone company, Telsim, for $4.5 billion. In
December 2005 Vodafone Spain became the second member of the group to

21

adopt the revised logo: it was phased in over the following six months in other
countries.
In 2006 the Company rebranded its Stoke-on-Trent site as Stoke Premier Centre,
a centre of expertise for the company dealing with Customer Care for its higher
value customers, technical support, sales and credit control. All cancellations and
upgrades started to be dealt with by this call centre. On 5 January 2006
Vodafone announced the completion of the sale of Vodafone Sweden to Telenor.
On February 2006 the Company closed its Birmingham Call Centre. In 1
February 2006 Oskar Vodafone became
Vodafone Czech Republic, adopting the revised logo and on 22 February 2006
the Company announced that it was extending its footprint to Bulgaria with the
signing of Partner Network Agreement with Mobiltel, which is part of mobilkom
Austria group.
On 12 March 2006 former chief, Sir Christopher Gent, who was appointed the
honorary post Chairman for Life in 2003, quits following rumours of boardroom
rifts. In April 2006 the Company announced that it has signed an extension to its
Partner Network Agreement with BITE Group, enabling its Latvian subsidiary
"BITE Latvija" to become the latest member of Vodafone's global partner
community. Also in April 2006 Vodafone Sweden changed its name to Telenor
Sverige AB and Connex-Vodafone became Vodafone Romania, also adopting the
new logo. On 30 May 2006 Vodafone announced the biggest loss in British
corporate history (14.9 billion) and plans to cut 400 jobs; it reported one-off
costs of 23.5 billion due to the revaluation of its Mannesmann subsidiary. On 24
July 2006 the respected head of Vodafone Europe, Bill Morrow, quit
unexpectedly and on 25 August 2006 the Company announced the sale of its
25% stake in Belgium's Proximus for 2 billion. After the deal, Proximus was still
part of the community as a Partner Network. On 5 October 2006 Vodafone
announced the first single brand partnership with Og Vodafone which would
operate under the name Vodafone Iceland and on 19 December 2006 the
Company announced the sale of its 25% stake in Switzerland's Swisscom for

22

CHF4.25 billion (1.8 billion). After the deal, Swisscom would still be part of the
community as a Partner Network. Finally in December 2006 the Company
completed the acquisition of Aspective, an enterprise applications systems
integrator in the UK, signaling Vodafone's intent to grow a significant presence
and revenues in the ICT marketplace.
Early in January 2007 Telsim in Turkey adopted Vodafone dual branding as
Telsim Vodafone and on 1 April 2007 Telsim Vodafone Turkey dropped its original
brand and became Vodafone Turkey. On 1 May 2007 Vodafone added Jersey
and Guernsey to the community, as Airtel was signed as Partner Network in both
crown dependencies. In June 2007 the Vodafone live! Mobile Internet portal in
the UK was relaunched. Front page was now charged for and previously
"bundled" data allowance was removed from existing contract terms. All users
were given access to the "full" web rather than a Walled Garden and Vodafone
became the first mobile network to focus an entire media campaign on its newly
launched mobile Internet portal in the UK. On 1 August 2007 Vodafone Portugal
launched Vodafone Messenger, a service with Windows Live Messenger and
Yahoo! Messenger.
On 17 April 2008 Vodafone extended its footprint to Serbia as VIP mobile was
added to the community as a Partner Network and on 20 May 2008 the Company
added VIP Operator as a Partner Network thereby extending the global footprint
to Macedonia. In May 2008 Kall of the Faroe Islands rebranded as Vodafone
Faroe Islands.
On 30 October 2008, the company announced a strategic, non-equity partnership
with MTS group of Russia. The agreement adds Russia, Armenia, Turkmenistan,
Ukraine, and Uzbekistan to the group footprint.

VODAFONE:

23

Today, in India, becomes Vodafone. Now, the pink color logo of Hutch is
replaced by Vodafone Essars corporate red colored one.
In 2005-06, the Orange brand in Mumbai was phased out to introduce (now
Vodafone). The company also changed the colors of its logo from orange to pink
and then red.
After acquiring 67 per cent of stake (around Rs. 250 crores) in ison Essar from
Hong Kong-based ison Whampoa, Vodafone Essar is expecting to touch over 35
million customers across 400,000 shops and thousands of s own employees
along with employees of its business associates.
Vice chairman, Ravi Ruia, Vodafone Essar, said Weve had a good innings as
in India and today marks a new beginning for us, not as a departure from the
fundamentals that created , but an acceleration into the future with Vodafones
global expertise.
Vodafone CEO, Marten Pieters of the Vodafone Essar will be landing in India
for the meeting that would discuss branding exercise, expansion plans, spectrum
requirements for its expanding subscriber base and future plans.
Vodafone offers a host of premier value added services (VAS) including national
and international roaming in over 70 countries in over 160 networks, Wireless
Application Protocol (WAP), short message service, voice mail service, auto
roam, fax and data, cricket updates, M-banking, general information, tarot line,
etc. The company launched WAP in Delhi in October 2000, much before its rival

24

Bharti. It has 5000 WAP customers, as in December 2000. The company has
been a prime mover in introducing these value-added services in the Delhi circle.
The values are stated simply. To be fair and transparent in what they do and how
they do it. To provide the quality services with more customer friendly practices.
To make ones communications experience simple, pleasurable and fun. Where
he doesn't simply get technology - but technology that is relevant. Where
solutions are not just promised in the future - but delivered in the present.

CORE VALUES :

We shall uphold the dignity of the individual.

We shall honor all commitments.
We shall be committed to Quality, Innovation and Growth in every
endeavor .
We shall be responsible corporate citizens.

Vodafone Logo

25

Accomplishments:
-

Over the years, Vodafone Essar, under the Hutch brand, has been named
the Most Respected Telecom Company, the Best Mobile Service in the
country and the Most Creative and Most Effective Advertiser of the Year.

Vodafone is the worlds leading international mobile communications

group with approximately 315 million proportionate customers as at 30
June 2009.

Vodafone currently has equity interests in 31 countries across five

continents and around 40 partner networks worldwide

The Essar Group is a diversified business corporation with a balanced

portfolio of assets in the manufacturing and services sectors of Steel,
Energy, Power, Communications, Shipping Ports & Logistics, and Projects.

Essar employs more than 50,000 people across offices in Asia, Africa,
Europe and the Americas.

The company now has operations across the country with over 78.68
million customers.

Services:

26

Staying connected becomes a lot easier with Vodafone. We have a wide range of
services you can access right from your Vodafone phone. From cell banking to
flight updates to call management services, get all that you want, instantly.

Prepaid services (latest):

-

Vodafone Essar, one of Indias leading cellular service providers

announced a new Bonus Card 25 for its prepaid customers in Punjab.
With this new bonus card, Vodafone customers can enjoy the benefit of
unlimited national SMS at just 20paisa/SMS. The new bonus card
comes with 30 days validity.

Has introduced two new Bonus Cards. Bonus Card 17 and Bonus Card 27
come with one month validity and are priced at Rs 17 and Rs 27
respectively. All Vodafone prepaid customers including the lifelong
customers in Kolkata and rest of Bengal can enjoy the new Bonus Cards
offer available across Stores and Ministores.

Lifelong Prepaid @Rs.46 plan for its prepaid customers in Kerala. This
new prepaid offer comes with lifetime validity and a talk time of Rs.5.
Vodafone customers can make local calls to all Vodafone numbers, other
mobiles and landlines at Re 1 per minute and all STD calls are at Rs1.50
per minute. Customers need to recharge with Rs 200 cumulative in 180
days to stay connected.

Postpaid services(latest):

27

- Vodafone Essar, one of Indias leading cellular services providers has

launched three new monthly rental plans - Budget 500, Budget 750 and
Budget 1000 - for its postpaid customers in Kolkata and West Bengal.
These Budget plans offer combinations of free minutes over local and
STD calls along with free local SMS. This offer is valid for new and
existing customers.

- Announced a special offer for its customers in Madhya Pradesh and

Chhattisgarh. Customers can now avail free VIP numbers with every new
post paid connection. The VIP numbers provide customers an option to
choose a number of their preference from a range of special Golden
numbers that usually comes with a huge price tag.

Value added services:

Vodafone Essar, one of Indias leading cellular services providers, has
announced a special offer for Zoozoo fans across India. Vodafone customers can
now get special Zoozoo DVDs from a Vodafone Store and watch these adorable
characters from Vodafone Essars recent television commercials as they live lifes
little moments in their inimitable style. Vodafone Prepaid customers can get the
DVD through a recharge of above Rs 300 at the Vodafone Store. Vodafone
Postpaid customers can enroll for Direct Debit or activate Callertune or Vodafone
Alerts at the Vodafone store to get the Zoozoo DVD.

Dial 600 to activate:

28

To activate these values added services on your Vodafone phone simply dial 600
and access our Interactive Voice Response system.

SMS:
Message your family and friends through Vodafone SMS Services. It's
convenient and affordable. Communicate with cell phone users in over 100
countries and anywhere in India - by sending and receiving text msg.
Pay just Rs. 1.50 per message for sending SMS anywhere across the country.

SMS Chat:
Now, you can chat on your Vodafone phone with as many people as you want. Its
fun and as simple as sending an SMS. Your identity will remain anonymous as
your phone number is never displayed during the chat. You can have your own
profile and chat name.
You can also create your own chat rooms or chat in the different rooms that
already exist including: Teens, 20s, 30s, Office, Bollywood, Delhi.
All you have to do is type in your messages and send them to 2428. You will be
charged Rs. 2 per outgoing message. Incoming messages are free.

Vodafone Online:
29

Get all the useful information you need directly on your Vodafone phone - with
Vodafone Online. Including cricket, finance, entertainment, weather, astrology
and more.
Simply go to the Vodafone Online menu on your Vodafone phone. If you do
not see the Vodafone Online menu on your phone, send HELP to 123. We will
send you the list of keywords.
Scroll to the topic on which you need information.
Select the information and key input as requested on the screen.
You will be charged Rs. 2 per outgoing message. Incoming messages are free.

MTNL Directory:
With this facility you can get to know the address and telephone no. of MTNL
users.you will be charged Rs.2 per outgoing message.

STD / ISD Codes:

You don't need to look up your diary or a phone directory to find out STD and ISD
codes. You can find it directly through your Vodafone phone.

Ringtones & Logos:

30

Now you can change the ringtone on your Vodafone phone according to your
moods. You can download logos as well. With the Vodafone and Yahoo! tieup
you have hundreds of tunes and logos to choose from.
For every ringtone downloaded, you will charged Rs. 7.00 (including the cost of
SMS sent). For every logo/picture message downloaded, you will charged Rs.
3.00 (including the cost of SMS sent).

Flash & Blink

Vodafone now offers you two exciting ways to send messages. You can make
your message flash directly on your recipients screen instead of the inbox. You
can also highlight the important parts of your message through blinks. So your
text messages become not only more visible, but more effective too.
You will be charged Rs. 2 per outgoing message. Incoming messages are free.

Dial-in Services
Vodafone brings you more conveniences at your fingertips. Use our Dial-inServices to check cricket scores, horoscope, up-to-the minute news and other
relevant information on services that touch your everyday life.
All Dial-in-Services carry a flat charge of Rs 6 per minute (1 min pulse).
Here's a shortlist of services you can access

Service

Number

NDTV Online

123

31

Info Line

301

Dial-n-Deliver

306

Cricket Online

123

Tarot Line

314

Cell Rashi

315

Dial-a-Pizza

303

Dial-a-Cab

335

Voice Response Service

123

There are occasions when you may not want to take a call, or your Vodafone
phone maybe busy or simply unreachable. By paying a nominal monthly access
fee, you can now retrieve your messages at your convenience. Even if you are
roaming, you can retrieve your messages from your voice mailbox through a
fixed line, anywhere on earth.

Your Vodafone voicemail can

Hold up over 17 messages at a time.
Receive a message that lasts up to 90 seconds.
Store a message for as long as you want.
32

 You can also record your voice signature and welcome message.

Calling Line Identification

You can check your caller's telephone name and number on your phone screen
whenever you receive a call. This gives you the flexibility to either accept or
reject an incoming call. This service is also helpful in identifying your missed calls
You can access this service by just paying Rs. 49 per month, if you are a
postpaid customer. This service is absolutely free if you are a Vodafone Prepaid
customer.

33

3. RESEARCH AND METHODOLOGY

Marketing research means the systematic gathering, recording,
analyzing of data about problems relating to the marketing of goods and
services

3.1 Title of the Study

The title of the study is ANALYSIS ON MARKETING STRATEGIES &
CUSTOMER RELATIONSHIP IN VODAFONE

3.2 Duration of the Project

Duration is from 1st June to 15th July 2012 (45 DAYS)

3.3 Objective of Study:

Following are the main objective to study about the customer satisfaction
on Vodafone.
To study telecommunication industry.
To study the company profile of Vodafone.
To study customer satisfaction of Vodafone.
To study various Marketing activities provided by Vodafone.
To study the various services provided by Vodafone.
To know the expectation of Vodafone Customers.

34

3.4 Types of Research

The basic types of Research are as follows:
1. Descriptive Research:
The major purpose of this research is sales promotion activities in telecom with
special Reference to idea Cellular.
2. Analytical Research:
In this Research the researcher has to use facts or information already available
and analyze these to make a critical evaluation of the material.
3. Applied Research:
It aims at finding a solution for an immediate problem facing a society or a
industrial / business organisation.
4. Fundamental Research:
It mainly concerned with generalization and with the formulation of a theory.
5. Quantitative Research:
It is based on the measurement of quantity or amount. It is applicable to
phenomena that can be expressed in terms of quantity.

35

Process of Marketing Research:

The marketing research is done in systematic process. The Researcher
has pursued the below process of marketing for my study at Vodafone:

Problem Identification

Research Design

Data Collection

Data Analysis & Interpretation

Research Report & Presentation

36

Problem Identification:
The first and the most important step of marketing research is properly
defining the problem. In order to identify the research problem two categories of
problem should be carefully noticed.

Here the researchers problems are: A number of customers are not satisfied with services, new schemes and
offers.
A number of customers are not satisfied with the network coverage.
A number of customers are not satisfied with the current call rates of
Vodafone.
A number of customers are not satisfied with the Free SMS schemes.
A number of customers are not satisfied with the service of customer care
of Vodafone.

Data Collection and Sampling:

A) Sources of Data Collection:Basically there are two types of data i.e. secondary and primary:

B) Primary Data Collection:Primary data collection contains the following four types of methods: -

1 Observation Method:
It contains Causal observation, Systematic observation, direct observation
and contrived observation.

37

2 Survey Method:
It contains Personal Interview, Telephone Interview and Mail Interview.

C) Secondary Data Collection: It can be collected from internal as well as external sources
1 Internal Source:
Various internal sources like employee, books, sales activity, stock
availability, product cost, etc.
2 External Sources:
Libraries, trade publications, literatures, etc are some important sources of
external data.
The Researcher has used primary data for the core purpose of the project
and this primary data has been gathered by survey method. The researcher has
also used secondary data

D) Data collection Tools:

To conduct a survey, the Researcher has selected a structured questionnaire
as an instruction for gathering valuable information from the customers.
Questionnaire, which is used for the survey, is consisting of questions and
checklist questions to check the customer feedback.

E) Sampling Plan:
The researcher has design a sampling plan that is consist of five decisions.
I)

Sampling unit:
38

Who is to be surveyed?
The Researcher has selected youngsters, businessmen, and housewives,
employees to conduct survey and to measure satisfaction level.

II)

Sampling types:

There are two types of sampling i.e. Probability Sampling and Non
probability Sampling.

i)

Probability Sampling : -

Probability sampling means each unit of the universe has equal chance of
getting selected. The most frequently used probability sampling methods are as
below:
a) Simple Random Sampling.
b) Stratified Random Sampling.
c) Multi-stage Random Sampling.
d) Cluster Sampling.
e) Multi phase Sampling.
f) Replicated Sampling.

ii)

Non Probability Sampling:Non Probability sampling contains following methods:-

a) Judgment Sampling.
b) Convenience Sampling.
c) Panel Sampling.
d) Quota Sampling

39

For this purpose the researcher has used non probability convenience
sampling.

III)

Sample Size:
Sample size means limited numbers of respondents covered under the

research study from a population and the researcher has taken a survey of 100
respondents to know the satisfaction level of customer.

Sampling Area:

IV)

The researchers area for survey was:

Jaipur National University,Jagatpura.
Vodafone Store, Gaurav tower,Malviya nagar.
Outside Big Bazaar, Gopalpura By Pass.
Sampling Unit:

V)

Here the researcher has randomly selected the respondents of the Jaipur
city.

3.6 SCOPE OF THE STUDY

The state-owned MTNL has also been playing with its cellular service for quite
some time.
The imminent launch of limited mobility using CDMA (code division multiple
access) technology by companies like Tata Tele Services will only add to the
subscriber base, probably result in further reduction of tariffs, and an even
greater widening of the cellular market, according

to officials in four cellular

companies now servicing Delhi.

40

 The companies also sound a note of caution any further drop in tariffs will
be harmful to the companies, points out one of the officials taking care of the
Sales & Marketing division of the, Essar Mobile Services Ltd, average tariffs in
Delhi across different plans have fallen by 30 per cent since December with
launching of the CDMA services.
The fall in tariffs, what has really happened with the entry of CDMA is a
heightened awareness in the market.
Mobile penetration in Jaipur and its suburbs is estimated to be less than
twenty-five percent of the population and the cellular operators believe that this
number should definitely go up.
Vodafone decided to target the customers with what it believes are unique
products and features.
Mobility is not only about carrying voice, as per the reports from the marketing
department and adds that the unified messaging system for the post-paid
customers of (now Vodafone) is one such unique product.
Accordingly, Vodafone signed in its subscribers in lakhs from the year onwards
it has been launched in Delhi.
Industry analysts say that a majority of them will be pre-paid customers,
whose loyalty to a particular brand is always in doubt.
Pre-paid for the cellular is nothing but the engine for growth and there is
always a possibility that most of them will shift to post-paid once they are
convinced of the quality of service provided.

41

3.7LIMITATIONS
There is different reason in the different to markets
for not using the Vodafone cellular. The limitation's which
was found by me are as under.
1.

Lack of proper advertisement and hoarding Vodafone

cellular are firstly emphasizing on the urban area &
developed markets only.

2.

Lack of tower's of the Vodafone cellular in many places.

3.

Lack of regular visit is the small markets.

4.

Lack of information provided by the company to the rural

area people.

5.

Lack of taking interest in the eastern U.P. region.

42

4.FACTS NAD FINDING

93% of the respondents are have a mobile phone while 7% of the
respondents do not have a mobile phone.
100% of the respondents are aware about telecommunications services.
16% of the respondents use Airtel, 6% respondents use Idea while 12%,
4% and 2% respondents use Reliance, BSNL and Tata Indicom
respectively.
100% of respondents are aware about Vodafone Services.
36% of the respondents are aware about Vodafone

through

Advertisements, 29% are aware because of Hoardings while 20% and

15% of the respondents are aware because of Newspapers and Mouth
Publicity respectively.
39% of the respondents use Vodafone services from past more than 1
year while the lowest is 14% respondents using Vodafone services less
than 1 month.
84% of the respondents use pre-paid services while only 16% of the
respondents use post-paid services.
37% of the respondents use Vodafone for SMS services while only 14% of
the respondents use Vodafone for Value Added Services.
87% of the respondent calls at customer care while 13% respondents do
not call at customer care.
31% respondents respondents call customer care once a month while
16% and 7% of respondents call once a week and daily respectively.
34% of respondents call at customer care for complaining purpose while
30%, 19% and 17% of respondents call customer care for other queries,
information

regarding

new

schemes

and

value

added

services

respectively

5. ANALYSIS & INTERPRETATION

Data Analysis and Interpretation
After all the above steps are completed now the important step is data
analyzing and interpretation. For this there are various analytical and statistical
43

tools. Some of these tools are Percentage, Average, Dispersion, Co-relation, Coefficient, etc.
Q1) Do you have a mobile phone?
The main purpose of this question is to know how many respondents use
mobile phone.

Interpretation:
93% of the respondents are have a mobile phone while 7% of the
respondents do not have a mobile phone.

Q2) Are you aware about telecommunications services?

Purpose:
The main purpose behind this question is to know about the awareness of
respondents regarding different telecommunications services and also to know
about which telecommunication(operators) service they use.
44

Suggestions

Yes

No

No. of respondents

95

Interpretation:
95% of the respondents are aware about telecommunications services
while 5% are not aware.

Operators service name

No. of respondents

3.

Vodafone

87

service do you use?

Airtel

29

Idea

17

Reliance

21

BSNL

Tata Indicom

Which

operators

45

Interpretation:
Major respondents using mobile are enjoying Vodafone services. 16% of
the respondents use Airtel, 6% respondents use Idea while 12%, 4% and 2%
respondents use Reliance, BSNL and Tata Indicom respectively.

Q4) Are you aware about Vodafone?

Purpose:

46

The purpose behind this question is to know about the awareness of

Vodafone among all the respondents.

Suggestions

Yes

No

No. of respondents

87

Interpretation:
Here 100% of respondents are aware about Vodafone Services.

47

Q5) From which source you came to know about Vodafone?

Purpose:
The purpose behind this question is to know from which source the
respondents came to know about Vodafone.
Sources

No. of respondents

Advertisements

63

Hoardings

52

Newspapers

35

Mouth Publicity

26

Interpretation:
36% of the respondents are aware about Vodafone through
Advertisements, 29% are aware because of Hoardings while 20% and 15% of
the respondents are aware because of Newspapers and Mouth Publicity
respectively.

48

Q6) Since how long you are using Vodafone Services?

Purpose:
The purpose behind this question is to know about the usage time of
Vodafone customers i.e. since how long they are using Vodafone services.
Time period

No. of respondents

Less than 1 month

12

2-6 months

19

6-12 months

22

More than 1 year

34

Interpretation:
Major Respondents using Vodafone are old customers. 39% of the
respondents use Vodafone services from past more than 1 year while the lowest
is 14% respondents using Vodafone services less than 1 month.

49

Q7) Which of the following services do you use of Vodafone?

Purpose:
The purpose behind this question is to know which services do the
Vodafone customer use, Pre-Paid or Post-Paid.
Services

No. of respondents

Pre-Paid

73

Post-paid

14

Interpretation:
84% of the respondents use pre-paid services while only 16% of the
respondents use post-paid services.

50

Q8) Which services are more helpful to you while using Vodafone
Services?
The purpose behind this question is to know which services are more
helpful to the respondent while using Vodafone.

Services

No. of respondents

Call Rates

27

SMS Rates

48

Network

36

Value Added Services

19

Interpretation:
Here major Respondents are youngsters so they mainly use SMS services
of Vodafone. 37% of the respondents use Vodafone for SMS services while only
14% of the respondents use Vodafone for Value Added Services.

51

Q8) Do you call at customer care?

Purpose:
The purpose of this question is to know how many times and how often the
respondents call at customer care of Vodafone.
Suggestions

Yes

No

No. of respondents

76

11

Interpretation:
87% of the respondent calls at customer care while 13% respondents do
not call at customer care.

52

If yes, how often you call at customer care?

Time Period

No. of respondents

Daily

Once a week

12

Once a month

24

Occasionally

35

Interpretation
Major respondents here call customer care occasionally. 31% respondents
respondents call customer care once a month while 16% and 7% of respondents
call once a week and daily respectively.

53

6. SWOT ANALYSIS
SWOT Analysis is a strategic planning method used to evaluate the Strengths,
Weaknesses, Opportunities, and Threats involved in a project or in a business
venture. It involves specifying the objective of the business venture or project and
identifying the internal and external factors that are favorable and unfavorable to
achieving that objective. The technique is credited to Albert Humphrey, who led a
research project at Stanford University in the 1960s and 1970s using data from
Fortune 500 companies.

Strengths

Weaknesses

Leadership Position

Centralized

Global Brand Strength

Internal

High Geographical reach

boundaries

Low Flexibility
High

Consumer

churn

rates

Opportunities
Expanding

Control

Threats

marketing Increased Competition

Market

saturation

in

Growth through 3G

Europe

Strategic Alliances

Emergencies of Low cost

External
Brands

54

Strengths:
The main strength of Vodafone within the telecommunications market lies
in its brand image and recognition. Vodafone, having established a global
presence and having invested highly in marketing a differentiated image by
promoting a Vodafone life style, currently enjoys a differentiating advantage that,
if exploited properly, can offer a lead in competition. The presence of Vodafone
in numerous countries within Europe as well as in all part of the world enhances
this image. It allows customers to travel and enjoy easily the services of their
home country operator. In the few countries that Vodafone is not physically
present (e.g. Norway) it has well established strategic alliances which allow for a
better service of mobile clients.

Weaknesses:
The expansion of Vodafone has been completed at the expense of direct
control of its operations. The company grew through a process of acquisitions of
national telecommunications companies (e.g. the acquisition of the third biggest
Czech mobile phone operator, Cesky mobile) rather than organic growth. This
increased its subscribers base quickly, offering direct market knowledge and
immediate additions of customer bases at the expense of direct effective control
of the subsidiaries. At the same time though, it implicitly imposed a centralized
operational structure for the group, nominating the UK headquarters as the
leading business unit running a much centralised marketing and handset
procurement at group level. This has resulted in the neglect of local markets and
local differences, allowing market share to be gained by smaller local
competitors. Due to the highly saturated Western European market this has
resulted in an increase in the price elasticity of demand, with consumers
becoming continuously price oriented. This has resulted in high customer churn
rates reaching the level of 32.8% in the UK compared to O2s 24%.

55

Opportunities:
The telecommunications market, even though highly saturated in some
regions offers great potential due to the ageing population and the sophistication
of the consumers. It offers great opportunities through a careful market
segmentation and exploitation of particular profitable segments. Different
strategies should be pursued simple phones and simplified pricing plans to the
ageing population and more updated, sophisticated solutions for younger
generations. The expanding Boundaries of the market could provide further
opportunities by allowing Vodafone to enter more aggressively into fixedline
service and to better enjoy the benefits of its high investment in 3G technology.
Moreover the company has undertaken its first steps in establishing strategic
alliances to develop customized solutions for endusers: Vodafone recently
announced two new partnerships, one with supermarket group ASDA to launch
an ASDA branded mobile service in the UK, and another with electrical retailer
DSG International to provide mobile solutions to small businesses. This could
further be enhanced to avoid being a lateentrant in this new method of
distribution which offers access to a wide potential customer base.

Threats:
The European part of Vodafones market is characterized by existing high
levels of competition. Major brands such as O2 and TMobile are exploiting the
price sensitivity of customers and in this way they are building a stronger image
and presence in the market. Indirect competition is also increasing further,
through the presence of Skype and other related (not only voice) Internetbased
services. This combined with the upcoming European legislative measures is
expected to limit further the tariffs for the network providers imposing further
need for price cuts which could harm the bottom line profitability of the company.

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7. CONCLUSION
Follwing are the conclusion that the researcher found after the survey.

From the above analysis the researcher concludes that major respondents
are dissatisfied with some of the major services like call rates, SMS rates

and new schemes & offers.

Major respondents from all respondents use services of Vodafone.
Major customers of Vodafone are old customers so many of the
respondents are satisfied with the services of Vodafone and thus they would

like to recommend Vodafone to others.

Major respondents using Vodafone use pre-paid services compared to post-

paid services.
Major respondents are youngsters so they need more SMS facilities and low
call rates, but Vodafone dissatisfies these age group (18-25) as their call
rates and SMS rates are much high.

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8. RECOMMENDATIONS AND SUGGESTIONS

Following are some of the suggestions given by the researcher so that Vodafone
can serve people and its customers in an improved way:
Vodafone should decrease call rates for local users.
Vodafone should provide more offers to Post-Paid customers so that the
number of Post-Paid customers increase.
Vodafone should bring introduce some new SMS schemes for the
youngsters.
Vodafone should introduce more schemes and offers.
Vodafone should provide more schemes and offers to its old customers.
Vodafone should decrease call rates of STD and ISD.

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9.APPENDIX
Q1) Do you have a mobile phone?
o Yes
o No
Q2) Are you aware about telecommunications service?
o Yes
o No
If yes, then which operators Service do you use?
o Vodafone

(Multi-choice)

o Airtel
o Idea
o Reliance
o BSNL
o Tata Indicom ( If not Vodafone then go to Q12 )
Q3) Are you aware about Vodafone?
o Yes
o No

(If No, then go to Q11 )

Q4) From which source you came to know about Vodafone?

o Advertisement

(Multi-choice)

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o Hoardings
o Newspapers
o Mouth Publicity
Q5) Since how long you are using Vodafone services?
o Less than 1 month
o 2-6 months
o 6-12 months
o More than 1 year
Q6) Which of the following services do you use of Vodafone?
o Pre-paid
o Post-paid
Q7) Which services are more helpful to you while using Vodafone services?
o Call rates

(Multi-choice)

o SMS service
o Network
o Value Added Services
Q8) Dou you call at customer care?
o Yes
o No
If yes, how often you call at customer care?
o Daily
o Once a week
o Once a month
o Occasionally
Q9) For what reason you call at customer care?
o Value added services

(Multi-choice)

o Information regarding new schemes

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o Other queries
o Complaining

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Q10) Rate the following services on the basis of your satisfaction.

Services

Excellen

Very Good

Fairly

Average

Poor

good

Network
SMS rates
New schemes and
offers
Customer Care
Recharge outlets
Call Rates
Value Added Services

Q11) What makes you unaware about Vodafone?

o Less Advertisements
o Less Publicity
o Others
(If others then mention ________________________)
Q12) Why you are not using Vodafone services?
o

Lack of awareness

(Multi-

choice)
o

High Prices

10.BIBLIOGRAPHY
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Books:
KOTHARI C.R.: Research Methodology Management, 3 rd Edition
KOTLER PHILIP: Marketing Management 11th Revised edition, 2002
GUPTA S.P.: Statistical Methods Thirteen revised edition, 2001

Websites:
http://www.vodafone.com/start/media_relations/news/local_press_relea

ses/portugal/portugal_press_release/vodafone_had_highest.html
http://en.wikipedia.org/wiki/Customer_satisfaction
http://en.wikipedia.org/wiki/Hutch_(Indian_cellular_company)
http://en.wikipedia.org/wiki/Vodafone
http://bora.nhh.no/bitstream/2330/1919/1/Saplitsa%202008.pdf
www.anacom.pt/render.jsp?contentId=606658
www.iimcal.ac.in/community/consclub/reports/telecom.pdf

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