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Current Market Situation
Market Definition
Telecommunication is the assisted transmission of signals over a distance for the purpose
of communication. Telecommunication is an important part of the world economy and
the telecommunication industry's revenue has been placed at just under 3 percent of thegross world product.
GSM Technology:
GSM is a cellular network, which means that mobile phones connect to it by searchingfor cells in the immediate vicinity.
Global System for Mobile communications (GSM: originally from Groupe Spcial
Mobile) is the most popular standard for mobile phones in the world. Its promoter, the
GSM Association, estimates that 82% of the global mobile market uses the standard.[1]
GSM is used by over 2 billion people across more than 212 countries and territories.GSM also pioneered a low-cost alternative to voice calls, the Short message service
(SMS, also called "text messaging"), which is now supported on other mobile standardsas well.
Market Size
The telecom sector worldwide is growing with an increase in opportunities for telecom
service providers. New trends are prevailing in the market and demand for new and
additional services is continuing on the rise. Pakistan, the sixth most populous country ofthe world with a population of 160 millions, is expected to be the next consolidation hot
spot. Pakistan's telecom sector is becoming an ideal targetmarket for the IT and telecom companies around the globe. Pakistan is Asia's top market for 2007, rising 23% this quarter
and of a rise of 15% in the first three months. This country has
an immense market potential in telecom and IT sector. The popularization rate of mobile communication is 5% which
indicates the growth prospects in Pakistan. The mobile
subscriber base, after growing by almost 170% in 2005 and 23% in 2006, had reached
over 48 million (30% penetration) by early 2007 and was continuing to grow. Thegovernment was continuing to work towards its targeted national teledensity of 7%
(around 10 million lines) by 2010. To achieve this target, more than one million
additional lines need to be installed every year.
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Market SegmentationAs it has been observed that the telecommunication market of Pakistan is having more
than 7 crores subscribers now, & now mobile phones & its services has become the part& parcel of life. On this behalf we are going to segmentize Ufone market according tothe following variables.
Geographic
World region: Pakistan
Country Region: Every corner of Pakistan.Density: Urban, Suburban, Rural.
Demographic
Age: 13+
Income: The average of population having at least Rs.4, 000 income per monthare using communication services.
Occupation: Ufone telecoms service is not associated with any classifiedemployment because communication is the need for all. While consumers are
divided according to Ufonepackages (discussed in consumer analysis section).
Nationality: Resident or Non-Resident of Pakistan.
Psychographic
Social Class: Upper lower, working class, middle class, upper middles, lower
uppers, upper uppers.
Life style & personality: {varies according to the service or package}.
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Consumer Analysis
Nature Of Buying Decision
B uying Behavior
Buying behavior for our product will be complex with high involvementregarding price, quality of service. The buyer will pass through learning process. He will
develop beliefs & attitudes towards the product then he will make a decision to purchase
product..
PsychographicsWhile segmenting the market on psychographic basis we will consider social
class, life cycle & personality.
Social Class: They are offering golden number chance for upper class in which theycan also get number of their own choice & middle or lower middle normal numbers will
be offer. But service for every class will be as we believe on equality.
Life Style & Personality: Life style is the persons pattern of living in the world as
expressed in activities, interest and opinions. In the mean time if we talk about the mobile
services people owns different styles of its usage. Some of the people loves talking,talking & talking, some loves to chit chat, youngsters like to have prepaid services,
Business Executives used to have postpaid package. Beside these factors some people use
their credit frequently & some are big savers, and etc. So focusing on these factor Ufone
develop their packages according to above motioned psychographic factors.
Demographics
Communication in this fast growing world is necessity for everyone & focusing on
this aspect our product will be free from the boundaries or bounds of demography. There
will be no age difference for those who want to remain in touch with others, no gender,
no limitations on the basis of income as our prices will under reach of every person.What so ever are occupation, education & nationality.
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Competitors Analysis
Competitors Strategy
Since the telecom industry of Pakistan has revolutionized, the competition has become
more expeditious. There are five rivals in the market and every one is pulling each
others leg by offering the cheapest rates of a fine service. They are basically followingthe Cost leadership to pursue cost reduction and uses tight cost controls to produce
services more efficiently than its competitors. In this situation the company can undercut
competitors prices and still offer comparable quality and earn reasonable profit.
Competitors strengths and WeaknessesCompetitors StrengthsWeaknesses
Large market share. Focusing just on On-Net
packages.
Good service availability. Fails to attract new customer
Innovative Technology. Interaction between Call & SMSAttractive Marketing. packages.
Abu Dhabi Group of UAE Weak Marketing.High tax deduction.
CM- World largest telecom Paktel as a brandname.company.
Covering Federal Areas Negative imageLowest market share
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Competition & Market Share
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SWOT and Issue Analysis
Strength
Financially Strong.
Highly stabilized infrastructure.
Highly Qualified Staff
Roaming Facility in more than 150 Countries
More then 350 Franchises and 21 owned-Sales and Customer Services.
Ufone has Wide network.
Ufone has a comprehensive promotional strategy.
Ufone has a unified network of franchises.
Electronic Voucher Distribution (EVD) is a great new re-charge option for prepaid subscribers that doesn't relay on the availability of scratch cards for
topping up their Ufone credit. This service is great because it ensures that the
credit require for Ufone connection will always be available on-demand.
Ufone has launched a state of the art call center in Karachi. This call center hasmore then 250 customer service agents and will offer round-the-clockavailability to cater the growing number of customers and provide them requisite
information in accordance with their needs. The most significant feature of the
call center will be local languages- speaking customer service agents who willassist the customers speaking Sindhi, Punjabi, Pashto in addition to the widely
spoken English and the National language Urdu.
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Weakness
Less coverages in remote areas
Not targeting the rural areas at the moment
No proper planning to cater the excess demand.
Ufone being a government organization has relatively less human and financial
capital available as compared to its major competitors that are subsidiaries of
large multinationals such as Mobilink and Telenor.
Customer services provided by Ufone are not according to the requirements oftheir customers.
High Turnover rate.
Opportunities
Less restrictions due to be a Pakistan based company.
As they are the Subsidary of Pakistan telecommunication limited, they canacquire as much fund needed to improve technology.
They can also target corporate sector
New Technology
There are vast opportunities of growth as market penetration rate of the cellularmarket of Pakistan is only 2.3%
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The introduction of new technologies in the cellular industry has increased thedemand for it along with reducing the operation costs for these companies.
Ufone can develop direct relationship with retailers on large scale through
Electronic Voucher Charge.
Ufone can further improve its network in order to make more loyal customers.
Threats
Legal environment , Government interference.
PTCL has been given license to Cellular operation.
Strong Rivals.
High taxes are imposed on the cellular industry in Pakistan.
Mobilink also going to introduce new technology and committed to more invest in
Pakistan.
Changing technology is also a threat for Ufone because things are changing sofrequently in the market with the change in technology
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ObjectivesGoals
In order to extend cellular network to new cities, towns and highways and enhance its
current installed capacities in existing cities, Ufone has finalized a huge network
expansion contract amounting to about USD 550 million, which will enhance thesubscribers capacity by 10 million. This is the largest ever expansion project of Ufone
Objectives
Ufone because it is dynamic organization with a powerful culture that
allows people to make most of their skills, personality and career. I
developed such knowledge and skills which directed to my career.Customer Service
Ufone is proud to have an efficient and friendly customer service through 21companies - owned sales and customer service Centers and nearly 250
franchises acrosses the country. The outlets are able to service the
customers with innovative solutions, and are empowered with Web based
Fracnhise management systems. Ufone is poised to face the over increasingchallenges of the market and it is confident.
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Vision
To be the first preference of customerin value optimization
Mission
Ufone its all about U! We are, where u wants to be.At Ufone we aim to
provide you with wider coverage, superior connectivity, clear quality, voice
signal.where ever you are Ufone keeps you connected. To lead the industryby instilling pride in our people,
Creating values for our customer by exceedingTheir expectations in delivery of their emotions and
Sharing responsibility for our beloved country.
Values
The stimulating corporate culture of success comes from what we value as a
company and how we live those values as individuals.
Integrity & Mutual Respect: We do the right thing.
Teamwork: We work together to get the job done.
Creativity: We seek creativity and outside the box thinking
Empowerment: We enable our people to make decisions with responsibility
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Which increases loyalty and fosters ownership
Marketing Strategy
As the market is very attractive & our enterprise has much potential. Then we will investour best resources in support of our offering. Our market strategy will be based on
positioning of cost leadership, to produce low cost services more efficiently than our
competitors.
Product
Product Overview
Our first product, Ufone cellular SIM, offers the following standardfeatures:
Value Added Services
CLS (Caller Location Service)
Contact recovery (pre- activated).
Free connectivity to GPRS.
Google search & Google talk.
Dictionary.
News alert messaging service.
E-call.
Balance sharing code.
Also Available (Ufone Fun kit)
Infotainment.
Music.
Fun corner.
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News.
Sports.
Friend search.
Religion.
Banking & finance.
Captive Product & Service
Scratch cards: Rs. 100, 250, 500, 1000.
Share with code: That will allow you to prevent your credit.E-Zee load: Rs. 10 to 2000.
Smart Share : Rs 10 to 1000.Loan Service : loan up to 10 Rs (in case of insuffiecent balance)
Product Mix & Product Line
For the first time in Pakistan Ufone telecom is offering smart & exciting Prepaidpackages & handsome Postpaid packages.
UFONE Telecom
Prepaid packages Postpaid Packages
Ufone plus Black BerryUfone Ghanta Package Ufone Uredge
Super Ghanta Package
60 paisa offerPaanch ka pundra
SMS bundle offer3 Minute Package
Badal do QismatSms Night Packages
UWON
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TARIFF
Prepaid Packages
Ufone offering smart & exciting packages for the first time in Pakistan.
3 Minute package
Charging Pulse 3 minute
Ufone to Ufone 24 Hours Rs 2.00 / 3 Min
Ufone to Other Mobiles 24 Hours Rs 3.20 / 30 Sec
Ufone to PTCL 24 Hours Rs 3.20 / 30 sec
Ufone to International 24 Hours Standard Rates Apply
Ufone to Ufone 24 Hours Rs 0.50 / SMS
Ufone to Other Networks 24 Hours Rs .100 / SMS
International 24 Hours Rs 2.50 / SMS
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5 ka 15
Charging Pulse 1 minute
Ufone to Ufone* 24 Hours Rs 1.125 / 30 sec
Ufone to Other Mobiles 24 Hours Rs 1.25 / 30 sec
Ufone to PTCL 24 Hours Rs 1.25 / 30 sec
Ufone to International 24 Hours Standard Rates Apply
*Get 10 minutes free after every 5 minutes of call
Ufone to Ufone 24 Hours Re 0.25 / SMS
Ufone to Other Networks 24 Hours Re 0.25 / SMS
Ufone to PTCL 24 Hours Rs 2.5 / SMS
International 24 Hours Rs 2.5 / SMS
Super Ghanta
Charging Pulse 1 minute
Service Charges Daily Rs. 5.99
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Ufone to Ufone 0400 Hrs to 1659 Hrs Rs 3.50 / Hr
Ufone to Ufone 1700 Hrs to 0359 Hrs Rs 1.00 / Min
Ufone to Other Mobiles 24 Hours Rs 1.60 / Min
Ufone to PTCL 0400 Hrs to 1659 Hrs Rs 3.50 / Hr
Ufone to PTCL 1700 Hrs to 0359 Hrs Rs 1.60 / MinUfone to International 24 Hours Standard Rates Apply
Ufone to Ufone 24 Hours Rs 0.50 / SMS
Ufone to Other Mobiles 24 Hours Rs 1.00 / SMS
Uwon
Charging Pulse 1 minute
Ufone to Ufone 24 Hours Re 1.00 / Min
Ufone to Other Mobiles 24 Hours Rs 1.60 / Min
Ufone to PTCL 24 Hours Rs 1.60 / Min
Ufone to International 24 Hours Standard Rates Apply
Ufone to Ufone 24 Hours Re 0.50 / SMS
Ufone to Other Networks 24 Hours Re 1.00 / SMS
Ufone to PTCL 24 Hours Rs 1.00 / SMS
International 24 Hours Rs 2.50 / SMS
UFONE Codes:
Balance enquiry: *333#
Helpline: 333
Package Conversion: 124
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Price
Pricing Method:Ufone has planned to follow 2 pricing methods as follows:
Value Based PricingWe will set the price based on the buyers perception of value
rather than on our cost.
Competition Based PricingWe will also consider prices, based on the prices that our
competitors will be charging.
Pricing Strategy
White Bird pricing strategy will be the Market Penetration. As it has been definedearlier that how competitive the market is and the rivals are following the cost
leadership. In order to divert the attention of the customer market penetration will be
followed.
DistributionUfone adopt the Intensive Distribution Strategy and Vertical Marketing Systems, consistof different intermediaries. The services will be delivered through the following
channels:
Full Service Retail Sales: ( Sales & ServiceCenters)
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It involve the sales of our offering through a full service retail
distribution channel.
Wholesale Sales: (Franchises)
It involve the sale of our offering using intermediaries or middle men to
distribute our product or service to the retailers as well as customers.
Beside it, will also offering our services as a franchise.
Self-Service Retail Sales: ( Public Retail Stores)
It will involve the sale of our offer using self service retail methods of
distribution
P romotion
To sell their offering the are effectively promoting and advertising it. For promotion,their strategy is PULL strategy. To implement on the strategy, they are spending a lot on
advertising and promotion to build up consumer demand.
Advertising Strategy
For the new product launching in the market, we have planned and divided the
advertising into 4 phases:
1stPhase:Corporate Advertising
Initially we will make our corporate identity in the minds of our customer.
As Ufone telecom________Its all about U.
Because when we have a variety of offerings & our audience is fairly broad, it is often
beneficial to promote our enterprise identity rather than a specific offering.
2ndPhase:Product & Product Comparison Advertising
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After being identified in the audience we will introduce our offerings, where our offeringswill be one of the several similar capabilities. If our offering stacks up well when
comparing features, then a product comparison ad will be beneficial.
3rdPhase:Product Benefits Advertising
After launching the product, we will promote our offering without comparison to
competitor. To increase sales, the product benefits ad will be the correct approach.
4th Phase:Occasional Advertising
Being a part of Pakistani culture, we have planned to advertise regarding to the eventand occasion. We will also come up with new offering on different occasions like
Ramzan, Eid, Independence Day etc. its a part of our objective that we will offer our
postpaid package on Eid.
AdervertisingTools
Advertising
Electronic Media Print Media
T.V Newspapers
Radio MagazinesInternet Hoardings/ Signboards
Wall PaintingsAdvertising Vehicles
Public transport
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Action Programmes
They offer such incentives like free balance, extra minutes etc to our customers as wellas to retailers in the shape of higher profit in cards recharging & E-zee loading and
planned to introduce a scheme especially for retailers on higher selling.
They promote their brand by hiring a celebrity model as a brand ambassador foradvertising & fill the bill boards, hoardings, & ads with his/her picture.
The month of September hold the month of Ramzan in the Muslim calendar. And as we
have developed our plan to introduce the postpaid package in the month of October,which will be the occasional month of Eid. In these months they have to conduct
occasional marketing campaign and will also start the sales promotional activities for
our postpaid packages which will be launch in 4 th October, but advertising will be started
in September.
Personnel Requirement
To pursue the effective progress of the company, they develop an efficient work force inthe company. They hired different entrepreneurs and consultants that help the
organization to make effective decisions in any situation. They further hires different
level of employees including middle & lower management, who will share their creative
& innovative ideas & their services in order to achieve the goals & objectives of thecompany. After hiring they passed through the following process.
Assign Responsibilities
To run our organization smoothly & effectively they hired both fresh &
experienced employees. In order to implement on their plan they decided to
put fresh employee under the supervision of experienced one. This idea willhelp them to create a healthy environment of fresh & experienced
employees. They assigned the task as per their skills and specializations.
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Give incentives
No motivation means no improvement in the progress of employees. We
provide state of the art incentives and fringe benefits to employees. . Salary
increment will also consider but although all of the incentives will be theresult of the performance.
Training on sales
Sales will be the major aspect in order to achieve objectives. They trainedtheir sales representatives & develop the negotiation skills in them. Many
other training programs are planned to be conducted to polish employees
skills.
FORECAST AND BUDGETING
Financial Analysis
Ufone has over the last six and a half years made huge investments in the national
economy. PTML has successfully been able to build upon its excellent financial results
from the previous year. During the year Ufone successfully completed the networkexpansion of Phase IV in existing as well as in new cities and towns which amounted to
more than US Dollar 170 million. As a result the asset base of the Company has
increased from Rs. 20 billion to Rs. 27 billion.
Since Ufone is an SBU of PTCL therefore they are not authorized to disclose their profits
separately. For the same reason PTCLs financial statement incorporates the profits
earned through its mobile operations and the figure are displayed in their annualreports.
Ratio Analysis of Ufone
Ufone current ratio in 2008 was 0.30 Asset test ratio in 2008 was 0.31 Ufone debt to equity ration inn 2008 was 0.35
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Ufone debt to total assets ration in 2008 was 0.64 Ufone interest covering ratio in 2008 was 16.3 Their receivable turnover ration in 2008 was 07.07 times. Inventory turnover ratio in year 2008 was 18.6 times. Total assets turnover ratio in year 2008 was 0.32 Net profit margin in 2008 was 28.4% Ufone return on investment in 2008 was 10%
Future Financial Plans
Keeping in view the growth potential of the cellular industry there is no option but to be
aggressive in order to remain a potent force in the cellular industry. In order to extend
cellular network to new cities, towns and highways and enhance its current installedcapacities in existing cities, Ufone has finalized a huge network expansion contract
amounting to about USD 550 million, which will enhance the subscribers capacity by 10
million. This is the largest ever expansion project of Ufone.
A strong focus will be on maintaining high quality of service, which is always abenchmark of Ufone, increasing usage and exploring new revenue streams on value
added services, market visibility through various market initiatives to fulfill subscribers satisfaction and demand and above all to increase the value of investment for the
shareholders.
Implementation ControlsThis segment will enable the company to measure planning process. their objectivestated where they want to be, the plan sets out a road map to our destination and then
the control will tell us if we are on the right route or not.
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They are tightly controlled to measure to closely monitor quality and customer serviceand satisfaction. This will enable us to react very quickly in correcting any problem, that
may occur. There are so many approaches from which performance can be evaluated.
But ufone use these approaches.
Five Approaches Sales Analysis
This analysis consists of measuring and evaluating actual sales in relation toour objectives. As we have designed our objectives that we will have to
achieve the sales volume of 3 million subscribers in 1 year. If unfortunately
we will fail to touch the volume target, we will closely analyze why thecompany could not achieve the expected sales volume.
Market Share Analysis
As we mentioned above that if we could not achieve our target volume that
will affect our market share. We will analyze the causes of failure through
the market share equation, that will provide four possible explanation.
Overall Market Share = Customer Penetration X Customer Loyalty X
Customer Selecting X Price Selectivity.
Quality Control
We will be keeping checking our quality of service from various testing. There
may be some circumstances in which the network can get busy like Eid, New
years and such occasions. So these occasions would be the early warning for
us to get ready in order to tackle such situations.
Marketing Information System
MkIS will provide us the timely accurate information about the marketingenvironment. It will efficiently enable us to develop strategies and take
proactive measures to face changing consumer preferences and increasing
competition.
Customer Relationship Management
We will develop a CRM, that will allow our customer to directly share their
problems and suggestions regarding our services by any medium, if it needsbe improved or modified. There will be a toll free number of our CRM
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department, which will be controlled by different qualified and trained CROsthat will help our customer in solving their problems and providing any
information regarding our service.
Bibliography
Books Concerned:
Market Management and Principle of Marketing.
By Philip Kotler.
Management
By: Weihrich koontz.
Internet Approach:
www.ufone.com www.mobilinkgsm.com www.telenor.com.pk www.waridtel.com
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www.paktel.com www.ptcl.com.pk www.pta.gov.pk www.telecompk.net
http://www.pta.gov.pk/http://www.telecompk.net/http://www.pta.gov.pk/http://www.telecompk.net/