final100 mks airtel vs vodoafone

8/7/2019 FINAL100 Mks Airtel vs Vodoafone

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INTRODUCTION

THE INDIAN CELLULAR MARKET AND ITS CHANGING SCENERIO IN

INDIA

Some ten years ago, Jyoti Basu in Calcutta called Sukh Ram in Delhi in what was

the first mobile phone call in India. Brick sized cell phones used to cost Rs. 45,000 and

each call costed Rs. 16.5/minute. Back then; cell phone was a status symbol. Today, there

are over 60 million mobile connections in India (expected to double in number in next 12

months). A local call costs around Rs 1/min and a cell phone can be purchased for less

than Rs. 2000. Wireless technology has been a boon for India.

In a country where setting up wired infrastructure is very expensive and time

consuming, wireless is the perfect solution to connect remote villages. The timing was

also just right as India escaped the burden of legacy technology and reaped the benefits of

latest GSM technology. Cell phones have not been just about technology. They have

brought about a cultural change in the country. SMS is the favorite means of

communication for everybody today.

The revolution in computing in countries like India will also come through mobile

phones. What PC did to offices and then to masses in developed countries, mobile phones

will do in developing countries. Time was when it took several years to get a new

telephone connection in India. Now, there is less pressure than ever before for fixed

landlines as mobile phone subscribers appear poised to outnumber those with a fixed line.

By year's end, India may become one of the few countries where the mobile revolution is

complete and the mobile reigns supreme, just ten years after it was first introduced.

Every month, India adds another 1.5 million mobile subscribers to the 28 million

mobile phone users. When mobile telephony was introduced in India in 1994, there were

just a few service providers, such as Airtel. It was a heavily regulated sector with

prohibitive license fees, high call charges of 30 cents per minute, and expensive handsets.

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Then, only the privileged could use a mobile in India. But in the last four years, call

charges have fallen and license fees have become more manageable.

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PRICING STAGES OF DIFFERENT MOBILE SERVICE PROVIDERS

Through the rollout of mobile cellular networks (GSM) in India began only seven

years ago, the industry has already passed through three growth phases. The initial phase

(1995-98), period with the bare minimum network coverage, catered only to the high-end

segment with call charges around Rs.14 a minute. With the explosion in subscriber

volume during 1998-2000 (Phase 2), the rollout spread to metropolitan cities, major

highways and relatively dynamic small cities bringing down call charges to Rs. 9 a

minute. The third phase (2001 and 2005) was a watershed for the Indian mobile industry;

the growth in these two years exceeded all the achievement of the earlier five years. The

Call charges came down to Rs 1 a minute directly attacking the fixed landline services

particularly the PCO. This pushed the operators to add capacity to their networks

furiously

Traditionally, wireless operators have used a number of metrics that collectively

provide a measurement of `network service quality' from the users' perspective. A

combination of the following 4-key performance indicators (KPIs) largely determines the

overall service quality: system coverage; call blockage; voice quality; and dropped call

rate.

Following four is the main area of attention kept in mind by the companies whileproviding and deciding pricing

System coverage

Call blockage

Voice quality

Dropped call rate

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MAJOR TELECOM OPERATORS IN INDIA

RELIANCE

Reliance Communications is the flagship company of the Anil Dhirubhai Ambani

Group (ADAG) of companies. Listed on the National Stock Exchange and the Bombay

Stock Exchange, it is Indias leading integrated telecommunication company with over

55 million customers.

It has a complete range of telecom services covering mobile and fixed line

telephony. It includes broadband, national and international long distance services and

data services along with an exhaustive range of value-added services and applications.

Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002,

TATA INDICOM

Tata Teleservices is part of the INR Rs. 1,20,000 Crore (USD $29 billion) Tata

Group, that has over 87 companies, over 3,30,000 employees and more than 2.8 million

shareholders. Incorporated in 1996, Tata Teleservices was the first to launch CDMA

mobile services in India with the Andhra Pradesh circle. Starting with the major

acquisition of Hughes Telecom (India) Limited [now renamed Tata Teleservices

(Maharashtra) Limited] in December 2002, the company swung into an expansion mode.

Having pioneered the CDMA 3G1x technology platform in India, It has partnered with

Motorola, Ericsson, Lucent and ECI Telecom for the deployment of a reliable,

technologically advanced network.

The company, which heralded convergence technologies in the Indian telecom

sector, is today the market leader in the fixed wireless telephony market with a total

customer base of over 3.1 million. Tata Teleservices bouquet of telephony services

includes Mobile services, Wireless Desktop Phones, Public Booth Telephony and Wire

line services. Other services include value added services like voice portal, roaming,

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post-paid Internet services, 3-way conferencing, group calling, Wi-Fi Internet, USB

Modem, data cards, calling card services and enterprise services.

Tata Indicom redefined the existing prepaid mobile market in India, by unveiling

their offering Tata Indicom "Non Stop Mobile" which allows customers to receive free

incoming calls. With a total Investment of Rs 19,924 Crore, Today, Tata Teleservices

Limited along with Tata Teleservices (Maharashtra) Limited in over 5,000 towns. With

an ambitious rollout plan both within existing circles and across new circles, Tata

Teleservices offers world-class technology and user-friendly services in 20 circles.

Tata Teleservices (TTSL), along with Tata Teleservices (Maharashtra) Limited

(TTML) operates in Andhra Pradesh, Gujarat, Karnataka, New Delhi, Maharashtra,

Mumbai, Tamil Nadu, Orissa, Bihar, Rajasthan, Punjab, Haryana, Himachal Pradesh,

Uttar Pradesh (E), Uttar Pradesh (W), Kolkata, Kerala, MP, CG and Rest of WB. It will

also be launching its services in J & K and North East circles soon. Tata Teleservices has

also acquired GSM licenses for specific circles in India.

MARKET DATA

Tata Indicom in March 2008, crossed the 24 million subscribers mark in thewireless category with a overall subscriber base of over 25 million.It has a current

subscriber base of 24.3 million and a 9.33% cumulative market share. Tata Indicom

continues to register the highest CAGR at 113% in the wireless segment with a net base

of 12.8 million against a starting base of 11.8 million. Tata Teleservices also gained the

No. 2 slot in terms of Market Share in Delhi NCR region with a subscriber base of 3

million. It beat Vodafone to the No. 2 spot and positioned itself just behind Airtel in the

circle.

MTNL

Mahanagar Telephone Nigam Limited (NYSE: MTE) is an Indian Government-

owned telephone service provider in the cities of Mumbai, Thane, New Delhi, and Navi

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Mumbai in India. The company was a monopoly until 2000, when the telecom sector was

thrown open to other service providers.

'Maha' = big or great, 'Nagar' = city or town, 'Mahanagar' = metropolis or

megacity, 'Nigam' = venture or enterprise.

PRODUCTS

MTNL provides fixed line telephones, cellular connection of both GSM

Dolphin(Postpaid) and Trump (prepaid) and WLL (CDMA) Garuda-FW And Garuda-

Mobile and internet services through dialup and DSL Broadband internet TriBand.

MTNL has also unveiled very cost-effective Broadband Internet access plans (TriBand)

targeted at homes and small businesses.

At present MTNL enjoy's the largest of the market share of ISP services in

Mumbai and Delhi.MTNL has upgraded existing TriBand (Broadband) connections for a

speed of up to 2 MB/s without any extra cost. This 2 MB/s broadband service is being

provided by MTNL at a cost of just US$5.00 per month.

BSNL

Bharat Sanchar Nigam Limited (known as BSNL, India Communications

Corporation Limited) is a public sector communications company in India. It is the

India's largest telecommunication company with 12.44% market share as on October 31,

2008 It has the status of Mini-ratna - a status assigned to reputed Public Sector companies

in India.

BSNL is India's oldest and largest Communication Service Provider (CSP).

Currently has a customer base over 30 million as of June 2008.[1] It has footprints

throughout India except for the metropolitan cities of Mumbai and New Delhi which are

managed by MTNL. BSNL is India's largest Telco and is one of the largest Public Sector

Undertaking with estimated market value of $ 100 Billion.

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IDEA

Idea Cellular is a wireless telephony company operating in various states in India.

It initially started in 1995 as a join venture between the Tatas, Aditya Birla Group and

AT&T by merging "'Wings Cellular'" operating in Madhya Pradesh,UP West,Rajasthan

and Tata Cellular as well as Birla AT&T Communications.

Initially having a very limited footprint in the GSM arena, the acquisition of

Escotel in 2004 gave Idea a truly pan-India presence covering Maharashtra, Goa, Gujarat,

Andhra Pradesh, Madhya Pradesh, Chattisgarh, Uttar Pradesh (East and West), Haryana,

Kerala, Rajasthan and Delhi (inclusive of NCR). Idea launched services in Mumbai on

20th August, 2008.

The company has its retail outlets under the "Idea n' U" banner. The company has

also been the first to offer flexible tariff plans for prepaid customers. It also offers GPRS

services in urban areas. The Subscriber Base of Idea as on 31st October 2008 is

3,15,82,937

SPICE

Spice Telecom is the brand name of Spice Communications Limited, a mobile

phone service provider in India. Considered as one of the best service providers of mobile

telephony in India, Spice Telecom is currently operating in the states of Punjab (India)

and Karnataka i.e., in 2 circles of 23 Telecom Circles of India. Spice Communications

Limited was promoted by Dilip Modi of Modi Wellvest Private Limited, which owns

40.80% of the company.

Spice Telecom is a flagship company of MCorp Global (www.mcorpglobal.com)

a cellular mobile telephone services provider in India.Launched over ten years ago,

Spices cellular services have a customer base of 36,37,129 as at October 2008 in Punjab

and Karnataka.

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BPL

Having started its services in 1995, BPL Mobile currently operates in Mumbai

city with more than 1 million happy and satisfied subscribers. It is the no. 1 service

provider in Mumbai in terms of no. of subscribers. In the latest The VOICE&DATA

Mobile User Satisfaction Survey 2007 revealed that in overall satisfaction BPL Mobile

has surpassed the TRAI benchmark of 90%.

In MUMBAI, BPL Mobile is the only mobile service provider to have surpassed

this benchmark. Being in the service industry and customer centricity being at the core,

BPL Mobile has once again proved that we are Best in the Business having ranked first

in Customer Care and Sales/Presales.BPL presently has the best schemes presently as

compared to all the other service providers in Mumbai.

AIRCEL

Aircel is a joint venture between Maxis Communications Berhad of Malaysia and

Apollo Hospital Enterprise Ltd of India. It is Indias seventh largest GSM mobile service

provider with a subscriber base of over 10 million (over 4 million in Chennai & Tamil

Nadu alone) and the fastest growing mobile operator in the country. It has a market shareof 5.48% among the GSM operators in the country. As on date, Aircel is present in 9

telecom circles (Assam, Bihar, Chennai, Himachal Pradesh, Jammu & Kashmir, North

East, Orissa, Tamil Nadu and West Bengal) and with licences secured for the remaining

14 of the 23 telecom circles, the company is on track to become a pan-India operator by

2009.

Aircel has won many awards for its services. Aircel got the highest rating for

overall customer satisfaction and network quality in 2006 by Voice and Data. Aircel was

rated as the top mid-size utility company in Business Worlds List of Best Mid-Size

Companies in 2007. Moreover, Aircel has been selected as the best regional operator in

2008 by Tele.net. Aircel are one of the sponsors of the Indian Premier League Cricket

Team Chennai Super Kings captained by Mahendra Singh Dhoni.

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HFCL

HFCL Infotel Ltd., the first basic telephony services provider for Punjab launched

its operations on 16th October, 2000. Today CONNECT has added a milestone to the

rich economy of Punjab by providing world-class telephony and data services in the state.

CONNECT is a business venture of Himachal Futuristic Communications Ltd.,

India's leading telecommunications giant. CONNECT is further supported by the

expertise of Lucent Technologies USA, IIT Chennai, Compaq, Cisco, CGI, Bell Nexxia

and Cincom.

With an investment of over Rs.1200 Crores HFCL Infotel, has set up a state-of-

the-art network in over 66 towns and cities in Punjab. The average revenue per line

(ARPL) for CONNECT subscribers is already amongst the highest in the country.

The service encompasses voice, data and video, via single connectivity, as also

mobile telephony based on CDMA technology, to customers. CONNECT was the first

operator in the country to provide a CDMA based pre-paid mobile service. Besides

telephony and Internet access CONNECT services include an array of broadband,

enhanced and data services like Internet Leased Lines, ISDN, VPN, Centrex, Web

Hosting, DSL and server Co-location.

Shyam

Shyam already has the spectrum for the following 12 circles : Tamil Nadu, West

Bengal, Andhra Pradesh, Uttar Pradesh (East) Uttar Pradesh (West), Himachal Pradesh,

Madhya Pradesh, Bihar and Haryana, North-East, Assam and Jammu and Kashmir.

Shyam Telecom enables reliable mobile communication for GSM, CDMA,

iDEN, UMTS, TETRA, and Public Safety. Shyam telecom service provider is an

innovative wireless communication solutions provider globally.

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Today, Shyam Telecom focuses on providing wireless coverage solutions for various

entrenched and evolving technologies globally. At Shyam Telecom, it provide

infrastructure that enables reliable and affordable wireless communication.

Recognized by the Government Of India, the Department of Science &

Technology awarded Shyam Telecom the 1997 award of excellence in Research &

Development. Today, leveraging their experience in Cable TV, Radio, and Mobile

Communications, they continue to develop new and innovative solutions for the

customers; solutions that assist the customers in realizing seamless mobility.

According to this article in The Hindu Business Line Shyam Telelink has been

allocated the spectrum to start CDMA service in Maharashtra. Shyam Telelink is partly

owned by Russian conglomerate Sistema

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GEOGRAPHICAL DISTRBUTION OF SERVICE PROVIDERS

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Group Company Total Subscribers

Airtel(GSM) 80199747

Reliance (CDMA + GSM) 57427888

Vodafone Essar(GSM) 56703506

BSNL(GSM) 39836494

IDEA(GSM) 31582937

Tata (CDMA) 30162845

Aircel(GSM) 14659298

MTNL(GSM) 3743879

Spice(GSM) 3637129

BPL(GSM) 1807902

HFCL (CDMA) 374334

Shyam (CDMA) 194434

Total (All India) 32,03,30,393

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AIRTEL

Established in 1985, Airtel is a pioneering brand of telecommunication services

in India operated by Bharti Airtel. Bharti Airtel, formerly known as Bharti Tele-Ventures

Limited (BTVL) is India's largest GSM mobile operator with more than 80 million

mobile subscribers as of October 2008. It offers its mobile services under the Airtel brand

and is headed by Sunil Mittal. Bharti gave Delhi its first Mobile Services - Airtel. Bharti

Airtel provides the following services under the brand name Airtel: Mobile Services

(using GSM Technology), Broadband & Telephone Services (Fixed line, Internet

Connectivity (DSL) and Leased Line), Long Distance Services and Enterprise Services

(Telecommunications Consulting for corporates). Bharti Airtel mobile services group

footprints GSM mobile services across India in 23 telecom circles, while the B&T

business group provides broadband & telephone services in 90 cities. The company also

has a submarine cable landing station at Chennai, which connects the submarine cable

connecting Chennai and Singapore.

Company shares are listed on The Stock Exchange, Mumbai (BSE) and The

National Stock Exchange of India Limited (NSE). Its service standards compare with the

very best in the world. In fact, thats how Bharti has managed to win the trust of millions

of customers and makes it one of the top 5 operators in the world, in terms of service and

subscriber base.Although Bharti Airtel is the largest mobile service provider, BSNL, the

state run mobile and wireline service provider is the market leader as of 30 June 2008

customer's base.

The company has several Firsts to its credit:

The First to launch full roaming service on pre-paid in the country.

The First to launch 32K SIM cards.

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The First in Asia to deploy the multi band feature in a wireless network for

efficient usage of spectrum.

The First to deploy Voice Quality Enhancers to improve voice quality and

acoustics.

The First telecom company in the world to receive the ISO 9001:2000certification from British Standards Institute.

Partners

The company has a strategic alliance with SingTel. The investment made by

SingTel is one of the largest investments made in the world outside Singapore, in the

company. The company also has a strategic alliance with Vodafone. The investment

made by Vodafone in Bharti is one of the largest single foreign investments made in the

Indian telecom sector. The companys mobile network equipment partners include

Ericsson and Nokia. In the case of the broadband and telephone services and enterprise

services (carriers), equipment suppliers include Siemens, Nortel, Corning, among others.

The Company also has an information technology alliance with IBM for its

group-wide information technology requirements and with Nortel for call center

technology requirements. The call center operations for the mobile services have been

outsourced to IBM Daksh, Hinduja TMT, Teletech & Mphasis.

Bharti Enterprises has successfully focused its strategy on telecom while straddling

diverse fields of business. From the creation of 'Airtel', one of India's finest brands, to

becoming the largest manufacturer and exporter of world class telecom terminals under

its 'Beetel' brand, Bharti has created a significant position for itself in the global

telecommunications sector. Bharti Airtel Limited is today acknowledged as one of India's

finest companies, and its flagship brand 'Airtel', has over 25 million customers across the

length and breadth of India.

While a joint venture with Teletech Inc., USA marked Bhartis successful foray

into the Customer Management Services business, Bharti Enterprises dynamic

diversification has continued with the company venturing into telecom software

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Subscriber Base

The Airtel subscriber base according to COAI - Cellular Operator Association of India as

of October 2008 was:

Delhi 40,85,823

Mumbai 25,04,607

Chennai - 1868971

Kolkata - 1869376

Maharashtra & Goa - 4446823

Gujarat - 3172894

Andhra Pradesh - 6768181

Karnataka - 7621369

Tamil Nadu - 4418910

Kerala - 1731866

Punjab - 3259765

Haryana - 1074643

Uttar Pradesh (West) - 1684173

Uttar Pradesh (East) - 4157467

Rajasthan - 4485126

Madhya Pradesh - 3270948

West Bengal & Andaman and Nicobar 2276586

Himachal Pradesh - 811968

Bihar - 5127695

Orissa - 2005885

Assam - 968708

North Eastern States - 606982

Jammu & Kashmir - 1164949

The total is 8,01,99,747 or 25.04 % of the total 24,13,77,019 GSM mobile connections in

India till October 2008.

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AIRTEL PRODUCT RANGE

Airtel Pre-paid: Airtel prepaid, the ready cellular card from Airtel, includes everything

that customer dreamt and believed,possible.Its simple to use and comes with a host of

great features like total cost control , instant balance enquiry, easy recharge .

Airtel Post-paid: Airtel post-paid gives subscribers unlimited freedom to reach out to

their special ones, in their special way. It offers services like National & International

Roaming, easy billing.

Blackberry Wireless Handheld: Airtel Enterprise Services offer the most secure and

technologically advanced wireless data experience for people on the move, who are in

constant need of staying in touch with emails and other office applications.

Value Added Services (VAS): The different value added services provided by Airtel are-

Instant Balance Enquiry

24Hr recharge Facility

Caller line identification

Call divert, Call wait & Call Hold

Multimedia messaging service (MMS)

Hello Tunes & Ring Tones

Airtel Live Portal

SMS based Information Service

Voice Mail Service

Easy Post-paid bill collection

Gifting of Ring Tones & Hello Tunes

GPRS

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BRAND EQUITY BUILDING:

In 2002, the leading Indian telecommunications company, Bharti Cellular Limited(Bharti) signed the famous cricket player Saurav Ganguly and leading movie stars,

Madhavan and Kareena Kapoor as endorsers for its brand, Airtel Magic (pre-paid cellular

card). Its objective was to create the highest recall for Magic in the pre-paid cellular

telephony segment by cashing in on the two biggest passions of India - movies and

cricket. Bharti also changed the tagline for Magic from 'You Can Do Magic' to 'Magic

Hai To Mumkin Hai' (If there is Magic, it's possible). The move attracted considerable

media attention, as it was unusual for a company to spend so lavishly to promote a single

brand.

In October 2002, Bharti launched a television commercial (TVC), featuring Shah

Rukh Khan (leading actor, already endorsing Magic since a couple of years) and Kareena

Kapoor. The TVC, developed by one of India's leading advertising agencies, Percept

Advertising, was the first of the series of four TVCs for Magic's new campaign.

According to Bharti, the TVCs aimed at attracting young adults in SEC B and C

categories of the Indian market1.

Commenting on the new developments, Hemant Sachdev (Hemant), Director,

Marketing and Corporate Communications, Bharti Enterprises, said, "The aim is to be

relevant to the masses and make all their dreams, hopes and desires come true instantly,

at Rs 3002 per month."

However, industry observers felt that these actions were necessiated by the

intensifying competition in the pre-paid cellular card segment in India in the early 21st

century. Many new players (national as well as international) had entered the segment

and the competition had become quite severe. Besides Magic, the major players in the

pre-paid card segment in 2002 included Idea (Tata, AT&T and Birla Group), Speed

(Essar), Hutch (Hutchison), Wings (RPG), Cellsuvidha (Fascel) and Yes (Usha Martin).

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In October 2002, Magic led the market, with 30% of the market share. Bharti claimed

that its strategies were one of the most ambitious experiments ever in the Indian pre-paid

cellular telephony market. However, given the increasing competitive pressure, doubts

were being expressed regarding the ability of Bharti's marketing initiatives to help Magic

retain its 'Magic' in the future.

Accordingly, Airtel was the first cellular service provider to start customer centers

(called Airtel connects), where customers could pay their bills, apply for new connections

and touch and feel new handset models. Airtel perceives its future in product innovations

such as easy charge (recharging prepaid connection through SMS), hello tunes, the

Blackberry option, stock tickers and M-cheques (mobile credit cards). The customer care

centers, too, are metamorphosing into "relationship centers", one-stop shops where

subscribers can not only pay their bills an have their queries answered, they can shop for

new phones, surf the net and enjoy a cup f coffee. According to Airtel "What matters is

what the customers want,"

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PRODUCT PROMOTION STRATEGY AND AD CAMPAIGN

AIRTEL VISION STATEMENT & BRAND POSITIONING

By 2010 Airtel will be the most admired brand in India:

Loved by more customers Targeted by top talent

Benchmarked by more business

"In a service industry like telecom, people live a brand 24X7. It's all about

experience; and for Airtel 'brand=customer experience," says Rajan Mittal, joint

managing director, Bharti Tele-Ventures Ltd.

That's now, but when mobile telephony began in India a decade ago, the brand was all

about aspiration. That's understandable: a handset cost about Rs 45,000 - the price of a

second-hand Fiat - and call charges hovered around Rs 16 a minute.

Naturally, the target customer was clearly defined: elite, upmarket professionals and

entrepreneurs. "We positioned Airtel as an aspirational and lifestyle brand, in a way that

trivialised the price in the mind of the consumer. It was pitched not merely as a mobile

service, but as something that gave him a badge value," recalls Hemant Sachdev, chief

marketing officer (mobility) and director, Bharti Tele-Ventures.

Airtel was on a power trip: the logo was black, uppercase bold lettering; and the

baseline was "the power to keep in touch". "From day one, it was decided that the brand

should always connote leadership - be it in network, innovations, offerings or services,"

says Diwan Arun Nanda, CMD, Rediffusion-DY&R, the agency that has created all

Airtel ads over the past decade. The taglines emphasised that stance: "Airtel celebrates

the spirit of leadership" and "The first choice of the corporate leaders".

This was also a time when customers needed to be educated; interest levels were

high, but customers' exposure to the cellular world was limited. Airtel took out full and

half-page ads in newspapers, answering queries like "what is roaming?", "what is

coverage area?" and "how to make international calls".

In 1999, the rules of the game changed. The New Telecom Policy came into effect,

replacing license fees with a revenue-sharing scheme and extending the license period

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from 10 to 20 years. Now, cellular service operators could drop their prices and target

new customer segments. As SEC B became part of the catchment area, Airtel's

communication changed from "power" to "touch tomorrow".

The focus now was on the endless possibilities of technology to make life good and

advertising became two-pronged: a product-driven communication that showcased newofferings like the Magic prepaid card, and an emotional communication that showed

younger people.

In 2002, Airtel signed on music composer A R Rahman and changed its tune to "Live

every moment": Rahman's signature tune for Airtel is, perhaps, the most downloaded

ringtone in India. But that was just part of the ongoing communication.

The following year Airtel adopted the "Express yourself" positioning, which is also

its current tagline. Now, the emotional angle was predominant - and stark, black and

white imagery to stand out in what was becoming a highly commoditised, crowded

market.

The latest campaign continues that thought. Only, mobile telephony is now extending

to even low-income mass categories. So the first TVCs in Hindi and regional languages

are now on air, as are low-priced products, like the Rs 200-recharge coupon.

Communication was just part of the battle: customer service would prove more critical.

"We were very clear that Airtel will be a service-led brand," says Mittal.

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RELATIONSHIP MANAGEMENT

Accordingly, Airtel was the first cellular service provider to start customer centres

(called Airtel connects), where customers could pay their bills, apply for new connections

and touch and feel new handset models.

The way to the future, though, seems to be through product innovations such as

easy charge (recharging prepaid connection through SMS), hello tunes, the Blackberry

option, stock tickers and M-cheques (mobile credit cards).

The customer care centres, too, are metamorphosing into "relationship centres",

one-stop shops where subscribers can not only pay their bills and have their queries

answered, they can shop for new phones, surf the net and enjoy a cup of coffee. "What

matters is what the customers want," points out Mittal.

Based on their vision statement their product Promotion strategy and Ad

Campaign is based. Airtel is an amazingly successful brand. It has very visible

advertising, with a fairly high share of voice.

As mobile services are an extremely competitive (cutthroat?) category, there are a

number of advertising renditions that happen. One of the most interesting ones for me as

a consumer was the one with A. R. Rahman in Hyde Park, was it, playing with an

assortment of musicians even as an adoring recording artist listens to the music that is

carried through Airtel mobile's service. it was a brilliant track. Airtel had integrated this

piece of communication, making it a fairly popular ring tone. Every second Airtel user

had this ring tone and enthusiastic guys even used it in their cars as they reversed.

AR Rahmans SIGNATURE TUNE

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BRAND AMBASSADOR TWO OF INDIAs BIGGEST CELEBRITIES

SACHIN TENDULKAR & SHAHRUKH KHAN

AIRTEL EXPRESS YOURSELF

Brands often lose their way when their communication deviates from a tried and

tested property just to be different. This is not a situation that cannot be salvaged,

though. Brands stray when they try to be different for the sake of being different. The

desire to be different is pretty common in advertising. And this desire to be different

usually means a break from the past.

AIRTELs Ads are a trend setting Ads and considered a landmark Product

promotion, which they are doing for their Broad Band and telephone services are also a

land mark promotion campaign.

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MATCH-BOX APPROACH

Bharti Airtel, for instance, has adopted the `match-box approach' which

essentially will ensure Airtel's availability wherever a match-box is available, even in the

smallest and remotest corners of the country. "The other key initiative is our `Chapa

Chapa' approach which supports our objective of reaching out to all towns with a

population of less than 5,000. We believe that the next level of growth will happen from

these geographies," says a Bharti Airtel spokesperson.

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AIRTEL : POSITIONING (AND REPOSITIONING )

(With these launches, we will create an Airtel users community that will have a better

depth of service availability than all competition.)

- Sunil Mittal, Bhartis CMD, commenting on the launch of Airtels New Logo.

FROM TOUCH TOMMOROW TO LIVE EVERY MOMENT

In late-2002, Bharti Cellular Ltd. (Bharti), India largest cellular telephone

company released a television commercial (TVC), which despite using the oft-repeated

celebrity endorsement route was unusual in terms of its celebrity selection. Instead of

using the usual movie stars/sports celebrities, it chose one of countrys most successful

music composers, A.R. Rahman to promote its brand.

The campaign attracted considerable media attention because this was the first

time Rahman had agreed to do a television commercial and also because, Rahman had

been paid Rs 10 million for the campaign, a sum usually unheard of, for celebrity

endorsers in India. The campaign received brickbats as well as bouquets in the media,

both for the selection of Rahman and TVCS execution. However, Bharti claimed to have

scored an ace in terms of getting Rahman to compose five exclusive symphonies

downloadable as ring tones for Airtel users.

The TVC was a part of the brand repositioning and restructuring efforts for Airtel,

as part of which, Bharti changed the brands tagline in early-2002 from Touch tomorrow

to Live Every Moment. The company also decided to undertake a comprehensive brand-

building program, for the company and chose the slogan Unlimited Freedom for the

same. Commenting on these changes, company sources said Airtel brand identity and

campaign will now have a new younger and international look and feel that builds on the

earlier positioning.

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Bhartis massive media expenditure plans were no surprise, considering the fact

that it was the largest cellular telecom company in the country- reaching over 600 million

people in 16 (out of 29) states of India. The Airtel brand (and the prepaid card service

brand, Magic) had top-of-the-mind recall amongst cellular phone users and enjoyed a

leadership position in most markets. Industry observers primarily attributed it to Bhartis

strong brand building and positioning strategies.

BACKGROUND NOTE

Sunil Bharti Mittal (S.B.Mittal) laid the foundations of the New Delhi based

Bharti Group in the 1970s with a small bicycle-parts business. IN 1985, he entered the

telecom business by establishing Bharti Telecom Limited (BTL) entered into technical

collaboration with Siemens AG (Germany) for manufacturing electronic push button

telephones. BTL also signed an agreement with Takacom Corporation (Japan) for

manufacturing telephone answering machines. Over the years, BTL tied up with leading

telephone equipment manufacturers from countries such as South Korea and US.

The Group entered the telecommunication (telecom) industry during the early-

1990s. Bharti Tele-ventures, a part of Bharti group, offered various telecom services such

as fixed line, cellular, V-SAT and Internet services. The operation of Bharti Tele-Ventures was run by four wholly owned subsidiaries. These were Bharti Cellular Lts.

(Cellular), Bharti Telenet Ltd. (Access), Bharti Telesonic Ltd. (Long Distance) and

Bharti Broadband Networks Ltd. (Broadband solutions). The flagship services of the

Bharti group included Airtel (cellular), Mantra (Internet services) and Beetel (telephone

instruments).

In 1992, Bharti entered the cellular market by launching services in Delhi. Over

the next few years, it also entered other telecom circles. (At that time The Indian telecom

market was divided into 21 telecom circles, which in turn, was divided into three

categories A, B and C based on their size, density (population) and importance. Category

A comprised Maharashtra, Gujarat, Andhra pradesh, Karnataka and Tamil nadu; B

comprised Kerala, Punjab, Harayana, Utter pradesh, Rajasthan, Madhya pradesh and

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West Bengal; C comprised Himachal pradesh, Bihar, Orrisa, Assam, and North East.

Cellular licenses were separately issued for in the metros of Delhi, Chennai, Mumbai and

Kolkata.)

In the early 2000s, Bharti invested heavily in the acquisitions and alliances to

expand its cellular market in India. As a part of this, Bharti acquired JT Mobile (Andhra

Pradesh and Karnataka), SkyCell (Chennai) and Spice Cell (Kolkata). It even announced

plans to acquire Usha Martin, the leading cellular service in Kolkata. It also entered into

collaborative agreements with BPL to gain seamless access in Mumbai, Maharashtra,

Chennai, Delhi, Kerala, Tamil Nadu, Andhra Pradesh and Karnataka.

Bharti launched Airtel as a post paid cellular service in Delhi in November 1995.

Over the next few years, the company redefined the way cellular services were being

marketed in the country. This was made possible due to its innovative marketing

strategies, continuous technological up gradations, new value added service offerings and

efficient customer service. Initially confined only to the Delhi circle, Airtel's services

were soon extended to many other places.

Through the Airtel brand, Bharti set many benchmarks for the Indian cellular

industry. It was the first cellular operator to set up cellular showrooms. The companyopened its first showroom 'Airtel Connect' in Delhi, in late-1995. Airtel Connect was a

one stop cellular shop where customers could purchase handsets, get new connections,

subscribe to various value-added services and pay their mobile bills.

Bharti was also the first cellular company to install a second mobile switching

center. (The central switch that controls the entire operation of a cellular system. It is a

sophisticated computer that monitors all cellular calls, keeps track of the location of all

cellular-equipped vehicles traveling in the system, arranges hand-offs and keeps track of

billing information. By operating multiple switching centers, cellular service providers

can increase the efficiency of their operations significantly.) In April 1997, The company

was the first to provide roaming cellular services and other value-added services such as

Smart mail, Fax, Call hold, Call waiting and Information services.

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Bharti was the first company to launch an online e-commerce portal that enabled

customers to make online payments. It also provided them with information regarding

cellular services and the features of handsets manufactured by various companies, along

with their price. On account of such initiatives, during the late-1990s, Airtel was named

the 'Best Cellular Service' in the country, and won the 'Techies' award (Techies awards

are given to the best companies, technologies and products in the IT and Communication

industry in India. These awards were instituted in 1996, by the group that publishes three

IT magazines Computer world, PC world and Information Communication World.) for

four consecutive years (1997-2000).

However, it was not very easy for the company to build Airtel brand. The tariff

rates charged by the government were quite high. Cellular players have little choice but

to impose high call charges on their customers. Airtime rates were as high as Rs 16 per

minute as against Rs 1.20 for landline communication.

Thus, all players targeted the premium sector, which could afford the rates. Airtel

was also positioned in the premium category, aimed at the elite class of the society.

Though industry observers felt that this limited its market and that Bharti could have

focused on increasing customer awareness (by explaining to them the various advantages

of cellular phones), Bharti thought otherwise. As per a company source, the strategymight not have worked, as the value delivered by cellular phones during that phase did

not match the cost.

During the late-1990s, many international players such as 'Orange' announced

plans to enter the Indian market. The global telecom market was getting saturated and

these companies were searching for countries with untapped potentials to increase their

markets. India being one of the fast developing nations with a vast population base was

being seen as a high potential market.

Apart from international players, many domestic players also entered the segment.

This increased the competition in the sector. In the light of these changes, Bharti realized

the need for repositioning Airtel to increase its market share. Rather than focusing on the

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value (delivered by the services), the company chose to address the visual benefits

delivered to the customers. In the words of Hemant Sachdev (Sachdev), Director

(Marketing), Bharti Group, "Instead of the value-proposition model, we decided to

address the sensory benefit it gave to the customer as the main selling tack. The idea was

to become a badge value brand."

Repositioning Airtel

The above realization led to the launch of the 'Leadership Series' campaign, which

featured successful men and women with their deluxe cars, carrying laptops and using

cell phones. A company source said that the campaign was aimed at positioning Airtel as

an aspirational brand, which was meant for leaders and celebrities. The surveys

conducted after the launch revealed that people began associating three core benefits with

the Airtel brand Leadership, Performance and Dynamism. Other supportive values

associated with the brand-included courtesy, politeness and efficiency.

The campaign was reportedly successful and resulted in a marginal improvement

in Airtel's performance. By 1999, Bharti had become the leading cellular player in Delhi

(its major market) with a subscriber base of over 0.38 million. However, the growth was

still much below the company's expectations.

Meanwhile, as the competition in the sector intensified, the government also

decided to reduce tariff rates. As a result, the players made all efforts to extend their

horizons to reach customers across all sections. Essar, the nearest competitor of Airtel,

began offering tariff plans, schemes and services that were identical to that of Airtel.

Much to Airtel's chagrin, Essar's subscriber base began nearing that of Airtel.

In early-2000, in its attempt to understand the customer's psyche, Airtel conducted

many brand tracking exercises. These exercises revealed that though the Leadership

campaign had been effective, it failed to attract more customers, as it had failed to add an

emotional dimension to the brand Analysts perceived the brand to be distant, efficient and

cold. In words of Preet Bedi, Director, Lowe India, "The brand had become something

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like Lufthansa cold and efficient. What they needed was to become Singapore

Airlines, efficient but also human."

The surveys also revealed that the concept of leadership was itself undergoing a

transformation. The public increasingly perceived leaders as people who worked with a

team to achieve common objectives rather than those who dictated terms to their

subordinates. The surveys indicated that 50% of the new subscribers bought a cellular

phone service brand on the basis of suggestions made by their friends, colleagues or

family members. On account of this information, Bharti realized that its existing

customer base could be used to promote the brand and expand its market (as these

customers could endorse the brand) and thus focused on building a close relationship

with them.

According to company sources, these brand-tracking exercises helped it realize

the fact that in a business where customer relationships were of paramount importance,

lacking an emotional or humanized touch was a major weakness. Hence, to gain a

competitive advantage, Bharti decided to humanize the Airtel brand. Commenting on the

decision, a senior executive of Essar said, "The leadership series was okay when you

were wooing the crme de la crme of society. Once you reached them you had to expand

the market so there was need to address to new customers."

In August 2000, Bharti launched its new 'Touch Tomorrow', which aimed at

strengthening its relationship with its customers. Bharti's advertisement expenditure for

the year amounted to Rs 450 million. The advertisements spanning the print, electronic

and outdoor media (for these campaign) featured cellular users surrounded by caring

family members. Commenting on the rationale behind the new campaign, Sachdev said,

"The new campaign and positioning was designed to highlight the relationship angle and

make the brand softer and more sensitive."

According to company sources, the new positioning was aimed at developing a

strong relationship with the customers. Sachdev said, "Mobile telephony is taken for

granted in one of our researches, consumers have described mobile telephony as being

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'kept close to the heart.' What is adding a new dimension to the cellular category is the

advent of new features like roaming, SMS, and the Net, which are taking communication

beyond voice to data and video. This has tossed a challenge: how to bond with

consumers."

Explaining the need for repositioning, Sachdev said, "Airtel was perceived as a

premium brand. The new positioning is intended to add warmth to these attributes." In

line with the company's objectives, the new TVCs and advertisements focused on

highlighting Airtel as a brand that made it possible for customers to derive all benefits of

cellular telephony.

The new commercials developed for this campaign reflected humane,

aspirational, family-centric and softer brand values while promising easy reach. Bharti

also created a new logo for the Airtel brand, which had red, black and white colors with

'Airtel' enwrapped in an eclipse. The tagline 'Touch Tomorrow' was placed below in a

lower case typography to convey a warm and informal style.

The campaign was first rolled out in the states of Karnataka, Madhya Pradesh,

Himachal Pradesh and Chennai. As a part of this campaign, Airtel also shifted its focus

from SEC, audiences to SEC B audiences. The company also increased its Touch Pointnetwork (Airtel's shop-in-shop points at various departmental stores and lifestyle

establishments). In line with its repositioning efforts, Bharti also revamped the entire

Airtel network including Airtel Connect centers. As a part of this, Bharti focused on

giving a contemporary look to Airtel Connect centers with e-kiosks, facades, collaterals,

signages and merchandising material. It also changed the color scheme of these outlets by

adopting a coordination of red, black and white to give the outlets a soothing, soft but

classy look. The dress code at these outlets was also changed. Men wore black trousers

and a white shirt bearing the Airtel logo with and a red tie. While women sported red tops

and black trousers with ivory, schiffon scarves.

While the Touch Tomorrow campaign was still running, Bharti announced a

major brand restructuring exercise at the corporate level. This was done in order to

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facilitate its entry into new areas of the telecom sector and establish itself as a global

telecom brand In early-2000s, Bharti unveiled a three-tier Airtel brand architecture that

was aimed at defining every service with a special brand name and place them under a

mother brand (Refer Table III). Commenting on the new brand architecture, Sachdev

said, "All convergent technologies in the sphere of telephony will be a part of the new

brand architecture."

Commenting on this initiative, Sandeep Goyal, President, Rediffusion DY&R

(Brand Communications), said "An Equity Research undertaken by ORG-MARG and

quarterly Brand Track studies by IMRB have given us insight into the needs of

tomorrow's consumer. The new branding initiative takes into cognizance the findings that

consumers consider Airtel as a brand of the successful people and a preferred address."

As a part of the restructuring efforts, the basic telephone services of Bharti were

brought under the Touchtel brand and the National Long Distance (NLD) telephony

under the 'India One' brand. Though the cost of creating new brands was high, the

company was inclined to create independent brands for its various services. The Bharti

brand and Magic (the prepaid cellular brand) were not included in the Airtel brand

architecture, and they continued to operate as distinct brands. According to company

sources, the new structure was aimed at positioning Airtel as the power brand withregional sub-brands reflecting customer needs in various parts of the country. Bharti felt

that a single brand name for all cellular operations might not always work in the urban

markets, which were heading towards saturation.

Moreover, as a more towards product segmentation, the Internet-Interface

services (WAP5) offered to cellular users were brought under the brand name 'Tango' in

2001. Commenting on the launch of Tango, a senior Bharti official said, "The idea was

to bring Internet and mobile in perfect harmony." However, Tango was not as successful

as Bharti had expected it to be. The company sources mainly attributed this to the limited

utility and inefficiency of WAP services. Soon the company discontinued the

advertisements for Tango. However, the brand was retained for the company's permanent

Internet connectivity (GRPS6) services (on its cellular phones).

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Bharti also decided to introduce a tariff plan (specifically) to attract the youth.

The service, called Youtopia, planned to cash in on the fact that with reduced tariffs,

cellular phones would become accessible to teenagers. By targeting youth in the age-

group 14-19 years, Bharti planned to expand the customer base, which was presently

limited to the older age groups.

Youtopia was a clear deviation from Airtel's earlier positioning as a brand for

older people symbolizing dignity and power. Youtopia offered lower tariff rates (at Re

0.25 for 30 seconds) at night. Special merchandising exercises were also undertaken. For

instance, a special portal was created, where young people could buy or bid for goods.

The company also announced plans for providing customers with various other services

such as music download facilities, and SMS (Short Messaging Service) rates at

affordable prices. According to the analysts, the company's repositioning strategies paid

back well as Bharti became the leading player in most of the circles (it operated in) across

the country in early-2002.

REPOSITIONING AIRTEL ONCE AGAIN!

Due to consistent marketing efforts, the Airtel and Touch Tomorrow campaign

became very popular. Therefore, Bharti's decision to withdraw this campaign (Touch

Tomorrow) in 2002 came as a surprise to many. The new campaign was accompanied by

a change in the logo as well (Refer Figure II). The idea behind the new logo was to give

Airtel a younger look. The logo (with new design and colour pattern) symbolized

innovation, energy and friendliness.

As part of its restructuring and repositioning exercise, Bharti unveiled a new

brand architecture that replaced the three-tier architecture. The proposed two-tier

architecture was categorized under two heads wired and wireless. All the wireless

products were placed under the Airtel brand, which also included Tango, Freenet and

Magic. According to company sources, the objective of this new architecture was to

establish Bharti as a global telecom company.

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The company reportedly allocated Rs 1 billion for media coverage and other

brand building activities. Commenting on the new brand identity of Airtel, a Bharti

spokesperson said, "Airtel's brand identity and campaign will now have a new younger

and international look and feel that builds on the earlier positioning of 'Touch Tomorrow,'

injected with renewed energy and heightened optimism."

However, it still remains to be seen whether the latest round of repositioning and

the strategic partnerships would help Airtel sustain the competition and retain its

leadership in the market. The shift to Live Every Moment from Touch Tomorrow had

nevertheless, proved that Bharti is consistently on the lookout for best marketing

strategies for Airtel.

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SWOT Analysis Bharti Airtel

Strengths

Bharti Airtel has more than 65 million customers (July 2008). It is the largest

cellular provider in India, and also supplies broadband and telephone services - as

well as many other telecommunications services to both domestic and corporate

customers.

Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel,

with whom they hold a strategic alliance. This means that the business has access

to knowledge and technology from other parts of the telecommunications world.

The company has covered the entire Indian nation with its network. This has

underpinned its large and rising customer base.

Weaknesses

An often cited original weakness is that when the business was started by Sunil

Bharti Mittal over 15 years ago, the business has little knowledge and experience

of how a cellular telephone system actually worked. So the start-up business had

to outsource to industry experts in the field.

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Until recently Airtel did not own its own towers, which was a particular strength

of some of its competitors such as Hutchison Essar. Towers are important if your

company wishes to provide wide coverage nationally.

The fact that the Airtel has not pulled off a deal with South Africa's MTN could

signal the lack of any real emerging market investment opportunity for the

business once the Indian market has become mature.

Opportunities

The company possesses a customized version of the Google search engine which

will enhance broadband services to customers. The tie-up with Google can only

enhance the Airtel brand, and also provides advertising opportunities in Indian for

Google.

Global telecommunications and new technology brands see Airtel as a key

strategic player in the Indian market. The new iPhone will be launched in India

via an Airtel distributorship. Another strategic partnership is held with

BlackBerry Wireless Solutions.

Despite being forced to outsource much of its technical operations in the early

days, this allowed Airtel to work from its own blank sheet of paper, and to

question industry approaches and practices - for example replacing the Revenue-

Per-Customer model with a Revenue-Per-Minute model which is better suited to

India, as the company moved into small and remote villages and towns.

The company is investing in its operation in 120,000 to 160,000 small villages

every year. It sees that less well-off consumers may only be able to afford a few

tens of Rupees per call, and also so that the business benefits are scalable - using

its 'Matchbox' strategy.

Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea

Cellular to create a new independent tower company called Indus Towers. Thisnew business will control more than 60% of India's network towers. IPTV is

another potential new service that could underpin the company's long-term

strategy.

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Threats

Airtel and Vodafone seem to be having an on/off relationship. Vodafone which

owned a 5.6% stake in the Airtel business sold it back to Airtel, and instead

invested in its rival Hutchison Essar. Knowledge and technology previously

available to Airtel now moves into the hands of one of its competitors.

The quickly changing pace of the global telecommunications industry could tempt

Airtel to go along the acquisition trail which may make it vulnerable if the world

goes into recession. Perhaps this was an impact upon the decision not to proceed

with talks about the potential purchase of South Africa's MTN in May 2008. This

opened the door for talks between Reliance Communication's Anil Ambani and

MTN, allowing a competing Inidan industrialist to invest in the new emerging

African telecommunications market.

Bharti Airtel could also be the target for the takeover vision of other global

telecommunications players that wish to move into the Indian market.

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ABOUT VODAFONE ESSAR LIMITED

Vodafone Essar in India is a subsidiary of Vodafone Group Plc and commenced

operations in 1994 when its predecessor Hutchison Telecom acquired the cellular license

for Mumbai. Vodafone Essar now has operations in 21 circles covering 86% of India's

mobile customer base, with over 41.1 million customers.

It was one of the first cellular providers in the city of Mumbai. Over time it has

expanded operations across the country and is one of the most respected cellular service

providers known for providing world class and innovative services.

It is one of the most reputed telecom companies in India.

Hutchison Telecom is a part of the multinational conglomerate - Hutchison Whampoa

that has its origins dating back to 1828 in Hong Kong. The Group operates five corebusinesses in 42 countries across the world, of which, Hutchison Telecom has been one

of the pioneers in mobile multimedia communication and spans five continents.

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 world's leading international mobile communications company. It

now has operations in 25 countries across 5 continents and 40 partner networks with over

200 million customers worldwide. Vodafone has partnered with the Essar Group as its

principal joint venture partner for the Indian market.

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The Essar Group is a diversified business corporation with interests spanning the

manufacturing and service sectors like Steel, Energy, Power, Communications, Shipping

& Logistics and Construction. The Group has an asset base of over Rs.400 billion (US$

10 billion) and employs over 20000 people.

Despite the official name being Vodafone Essar, its products are simply branded

Vodafone. It offers both prepaid and postpaid GSM cellular phone coverage throughout

India and is especially strong in the major metros.

Vodafo ne Essar provides 2G services based on 900 MHz and 1800 MHz

digital GSM technology, offering voice and data services in 21 of the country's 23 licence

areas.Contents

Ownership

Vodafone Essar is owned by Vodafone 52%, Essar Group 33%, and other Indian

nationals 15%. On February 11, 2007, Vodafone agreed to acquire the controlling interest

of 67% held by Li Ka Shing Holdings in Hutch-Essar for US$11.1 billion, pipping

Reliance Communications, Hinduja Group, and Essar Group, which is the owner of the

remaining 33%. The whole company was valued at USD 18.8 billion. The transaction

closed on May 8, 2007.

Previous brands

In December 2006, Hutch Essar re-launched the "Hutch" brand nationwide,

consolidating its services under a single identity. The Company entered into agreement

with NTT DoCoMo to launch i-mode mobile Internet service in India during 2007.

The company used to be named Hutchison Essar, reflecting the name of its

previous owner, Hutchison. However, the brand was marketed as Hutch. After getting the

necessary government approvals with regards to the acquisition of a majority by the

Vodafone Group, the company was rebranded as Vodafone Essar. The marketing brand

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was officially changed to Vodafone on 20 September 2007. On September 20, 2007

Hutch becomes Vodafone in one of the biggest brand transition exercises in recent times.

Vodafone Essar is spending somewhere in the region of Rs 250 crores on this

high-profile transition being unveiled today. Along with the transition, cheap cell phones

have been launched in the Indian market under the Vodafone brand. There are plans to

launch co-branded handsets sourced from global vendors as well.

A popular daily quoted a Vodafone Essar director as saying that "the objective is

to leverage Vodafone Group's global scale in bringing millions of low-cost handsets from

across-the-world into India."

While there is no revealing the prices of the low-cost Vodafone handsets, the

industry is abuzz that prices might start at Rs 666, undercutting Reliance

Communications' much-hyped 'Rang Barse' with cheap handsets beginning at Rs 777.

Meanwhile, Vodafone Essar sources said there would be no discounts or subsidized

handset offers -- rather handset-bundled schemes for customers.

Incidentally, China's ZTE, which is looking to set-up a manufacturing unit in the

country, is expected to provide several Vodafone handsets in India. Earlier this year,Vodafone penned a global low-cost handset procurement deal with ZTE.

Apple iPhone 3G

Vodafone has successfully launched the Apple iPhone 3G in India. It has been

made available to its consumers from the 22nd of August. The phone's launch saw a big

celebration at select Vodafone stores and Vodafone sponsored malls across the country.

GROWTH OF HUTCHISON ESSAR (1992-2005)

In 1992 Hutchison Whampoa and its Indian business partner established a

company that in 1994 was awarded a licence to provide mobile telecommunications

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services in Mumbai (formerly Bombay) and launched commercial service as Hutchison

Max in November 1995. Analjit Singh of Max still holds 12% in company.

In Delhi, UP (E), Rajasthan and Haryana, ESSAR was the major partner. But later

Hutch took the majority Stake. By the time of Hutchison Telecom's Initial Public

Offering in 2004, Hutchison Whampoa had acquired interests in six mobile

telecommunications operators providing service in 13 of India's 23 licence areas and

following the completion of the acquisition of BPL that number increased to 16. In 2006,

it announced the acquisition of a company (Essar Spacetel - A subsidiary of Essar Group)

that held licence applications for the seven remaining licence areas.

In a country growing as fast as India, a strategic and well-managed business plan

is critical to success. Initially, the company grew its business in the largest wireless

markets in India - in cities like Mumbai, Delhi and Kolkata. In these densely populated

urban areas it was able to establish a robust network, well known brand and large

distribution network -all vital to long-term success in India. Then it also targeted business

users and high-end post-paid customers which helped Hutchison Essar to consistently

generate a higher Average Revenue Per User ("ARPU") than its competitors. By adopting

this focused growth plan, it was able to establish leading positions in India's largest

markets providing the resources to expand its footprint nationwide.

In February 2007, Hutchison Telecom announced that it had entered into a

binding agreement with a subsidiary of Vodafone Group Plc to sell its 67% direct and

indirect equity and loan interests in Hutchison Essar Limited for total cash consideration

(before costs, expenses and interests) of approximately US$11.1 billion or HK$87 billion.

1992: Hutchison Whampoa and Max Group established Hutchison Max

2000: Acquisition of Delhi operations Entered Calcutta and Gujarat markets through

ESSAR acquisition

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Kolkata 2301538

Chennai 1427500

Gujarat 6920502

A.P 3227062

Karnatka 3249809

Punjab 1843891

Haryana 1666946

U.P.(E) 5012687

Rajasthan 3928177

UP (W) 3548261

West Bengal 3649778

Maharashtra 3521585

Tamilnadu 4180859

Kerala 2512603

Orissa 60826

Assam 7140

North East 2952

The total is 5,46,24,809 or 23.38% of the total 233,676,930 GSM mobile connections in

India till Sept 2008. Vodafone does not operate in Himachal Pradesh and Jammu &

Kashmir

Vodafone Product Range

Vodafone prepaid: Its the ready cellular card from Hutch. Prepaid is easy. And

rewarding, with maximum talk time and exciting offers. Not to mention a host of value

added services, two-way national roaming and much more.

Vodafone Postpaid: It is the postpaid service from Hutch. It gives the customer a choice

to choose from a variety of affordable and attractive talk plans, and many convenient

payment options for your monthly bill.

Value added services: The different value added services provided by Hutch are-

Instant Balance Enquiry

News & Updates

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weeks, the new Ogilvy campaign redefined conventional communication strategies. For

example, in Mumbai, ads compared the cost of a mobile phone call to an inexpensive

cutting chai. The colour orange was a seminal attribute; the brand's slogan was 'The

future's bright, the future's orange'.

In 2002 an Umbrella Brand known as Hutch was created but Mumbai retained the

Orange brand. The separate identities of the two brands were duly emphasized, although

strategic sponsorships of theatre, music and art events overlapped - as did the use of

orange colour.

The new brand name also heralded the arrival of a new mascot, the "Hutch" pug.

When Hutch launched the Abby-winning "Wherever you go our network will follow'" ad,

viewers believed that was Hutch's new slogan, but it was just one brand attribute. Twelve

other campaigns followed; each one with a single communication of a value-add, all

stylized to be uniquely Hutch. Hutch believed in Effective branding built on bedrock of

fundamentals of service - great network, customer service and great billing systems.

Value-added services - such as "Privileges" (discount coupon booklets), cricket

scores and stock market information formed a critical part of Hutch's marketing efforts as

its advertising. Other services like Hutch World (GPRS service), Hutch Alive (non-stop,

streaming action) and Hutch4Help, a unique dial-in 'convenience' service, all emphasized

the premium attributes of the service. But now there's Chhota Recharge, small value

recharge cards (starting at Rs 10), which will also help mobilize small spenders.And now there's pink. In Dec 2005, Mumbai was overrun with billboards that

simply said "Bye". A week later, the same billboards, along with the rest of the country,

sported the Hutch tristar in a new, vivid pink. The reason given for this was that it was

just to refresh the brand, and inculcate a new 'Hutch spirit'." But the brand makeover had

less to do with creating excitement and more with renouncing the Orange brand to

Orange Telecom and creating the new pan-Indian Hutch brand.

The all India GSM subscriber base grew by 4.23% to 75.3% for the month of May

2006. May saw net addition of 3.2 m subscriber as compared to 2.93 m in the month of

April 2006. Bharti Airtel witnessed the highest growth of 5.7% taking its total subscriber

base past the 21mn mark. Bharti also improved its market leadership with 29% market

share.

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Transition from Hutch to Vodafone

After the recent buyout of Hutch, Vodafone has not only evolved an effectiverebranding strategy, but has also gone in for many changes in the external identity and

the promotional strategy of the brand. This is aimed at changing the brand to meet its

global image and also to ensure that it stays relevant in the competitive scenario in the

Indian telecommunications market. This article explores the various changes adopted

by Vodafone and their implications for the brand.

Cosmetic makeover

It was one of the most visible identity changes for a brand in the recent years in

India, when Vodafone was overwritten all over Hutch so brusquely. This new brand

name with red background, stared into the eyes of the Indian consumers in various forms:

as pavement signages, glow signs, hoardings, commercial name boards, in shop posters,

print advertisements, televisions commercials and what not! Wherever consumers went, it

seemed to follow them ubiquitously, as the companys famous tag line used to promise

their consumers earlier. But it appears that the new brand also aims at making lot of

deviations from the way the brand was communicated before.

Upon creating awareness, the Rs 350 crore promotion budget of Vodafone helped

it change the previous soft pink colour into new deep red colour completely. Consumers

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Newer Positioning

A successful brand is one, which evokes positive and warm feelings towards its

advertisements on the face of it and subsequently connects to its target customers well by

the merit of its unique appeal, persuasive message, creative execution and the consistentfocus on its core values. Hutch was able to achieve this and it established a positioning of

(A well networked communication tool that is lovable / faithful companion for the

sophisticated urban youth). There is definitely a nostalgic value associated with erstwhile

Hutch in the minds of the customers, which continue to provide a positive rub-off on the

fortunes of Vodafone. Consumers see and evaluate Vodafone by keeping the fond

memories of Hutch at the back of their minds. That is the reason why Vodafone wants to

go slow and attempt a gradual change of positioning for the brand.

What Prompted the Change?

It is true that Hutch became successful by striking a chord with their customers

effectively through its marketing communications. On the contrary, Hutch would have

been more successful, had its marketing communication been more inclusive by

appealing to a larger section of consumers. In a developing country like India, a

telecommunication service provider cannot survive long by positioning the brand only for

the sophisticate Indian consumers. It needs to cater to all the sections of people from,

various societal and regional backgrounds. A shinning example for this is Airtel which

has had a changeover from being a brand meant for class to the one now, which is for

mass. Airtel is attracting consumers from all strata of society, from high-end business

professionals to paan shop owners.

In fact, Hutch seemed to have, of late realized this and the recent advertisementsused for announcing its sales promotion schemes stand testimony to this. These sales

promotional advertisements deviated from its earlier choice of sophisticated brand

building advertisements; especially, the ones for Hutch bonus cards, Hutch Rs 99

recharge cards and Hutch SMS tones. Though they were distinct and creative, they were

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basically rustic. It might have been a conscious move by the brand for reaching the mass

audience as well but the task was nevertheless unfinished.

Secondly, the positioning of Hutch was becoming redundant in the changing

scenario, even for its originally intended target customers. The target customers did not

seem to find any adequate value in a brand, which was just an affable and a loyal friend

offering impeccable connectivity. As the need for newer usages engulfed the customers,

they looked for many additional benefits than a mere strong connectivity. Besides,

telecommunication as a product/ service category has now evolved and good connectivity

and infrastructure cannot be used as an index of differentiation anymore. It has become a

minimum expected value for customers and moreover, telecommunications service

providers have begun to pool their infrastructure resources together, which means the

ownership of towers may be common to all. Many companies will be using the same

network and it cannot become an advantage for only one.

Not Making Most of Hutch?

It is imperative that Vodafone wants to thrust its own image over Hutchs and

alter the positioning created by the latter, which was anyway due for a change. It seems

that what Hutch set out to achieve through its sales promotion advertisements will be

followed by Vodafone more visibly its brand building advertisements too. Vodafone has

started promoting their own tagline, (Make most of now) in place of Wherever you go

our network will follow) The proposed repositioning through this brand caption of

Vodafone is very valid for the brand, as it can project a value of multifunctional, faster

usage which can serve as a good differentiator for the brand in the market. A tag like this

with a slew of technologically superior feature will connect to the target customers better

in the fast moving world of telecommunications. Vodafone seems to be better suited for

this transformation by virtue of its existing image of offering cutting edge technology in

the 25 countries where it caters to about 200 million customers.

Vodafone has also made a beginning in using below the line promotions for

projecting this brand positioning among the consumers. Vodafone is the largest sponsor

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for Saarang, the annual cultural festival of IIT-Madras, an association that is expected to

strengthen its popularity more intensely. In the above the line category also, Vodafone is

planning to air advertisements comprising of characters and visuals that showcase the

dynamism and functional superiority of the brand. The challenge for Vodafone lies in

helping their existing customers and the potential ones replace their fond memories of

Hutch with a new and dynamic image of Vodafone effectively. The process of unlearning

is possible for human beings, when they are convinced that the proposed change is

inevitable and is for better. How O&M will help Vodafone customers and associates

appreciate this change, is going to be am interesting observation.

In simple terms, Vodafones scheme of changes for the brand is threefold:

Changing Brands Exterior: Vodafone has done it effectively using a new name,

font, logo, colour and slogan and it has created a good impact in the market through

large investments in promotions from day one.

Changing brand personality: Vodafone has moved from being a subtle brand to a

more pompous one, as communicated through new energetic characters in

commercials, loud music, bright colours and flamboyant scenes.

Changing Brands positioning: Vodafone has attempted to achieve this through its

new brand communications supplemented by some value added services. This can be

analyzed further by using the following three dimensions of brand positioning:

a) Brands Core Value: Brand is not merely a strongly networked

companion for people; it is also a dynamic and progressive guide, which

helps people become proactive in life.

b) Target Audiences: They are mot merely the urban sophisticated youth

anymore; but they are people from all walks of life.

c) Brand Differentiation: It is not merely a tool to connect with friends and

relatives better than others; it is now a gadget which an offer

technologically superior functions and all unique value-added services for

making most out of ones life faster, where there us no second chance.

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The Ad Campaigns of Vodafone

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Large players will have an advantage as they expand their presence and take

advantage of economies of scale. But they will face tremendous challenges owing to

intensifying competition.

However, scarcity of spectrum could impact expansion plans and the quality of

service. Gartner report mentions that release of 3G spectrum will be essential to sustain

growth in the industry and bridge the gap generated because of lower voice tariffs and

handset subsidies.

CONCLUSION

Above facts and figures give a clear picture about Bharti Airtel Ltd and Vodafone

Essar Ltd. However we can notice that Airtel is doing well as against Vodafone because

their strategies are more inclined towards the masses whereas Vodafone has portrayed

itself as an up market brand.

The strong performance of Indian economy along with strong performance of

telecom sector and an unsaturated market gives all the telecom operators a good

background and bright future. Moreover it is anticipated that the telecom sector will

perform well and keep showing good results at least till the year 2010. India is in

desperate need of good infrastructure, which can be developed rapidly through

privatization.

With the Indian cellular market predicted to cross 500 million subscribers by 2010

and rural markets being tapped slowly we cannot underestimate other private players like

Idea, Tata Indicom etc. Although Vodafone is at no.3 spot, it has to really work hard to

reach the top as Three more telecom operators namely Aircel (A 74% stake in Aircel is

held by Malaysia's MAXIS TELECOM), Idea Cellular (An Aditya Birla Group company

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that recently came up with an IPO) AND Spice Telecom (owned by B. K. Modi, this

company too has set its eyes on an IPO to raise money) too are looking forward for pan-

India presence in the telecom sector. And how can we forget Mr. Ratan Tata and

Anil Ambani who are very close in the queue.

But one thing is for sure, irrespective of which company manages to grab the top

spot, there will be only one king - He is called CUSTOMER. And if you ask me on which

horse should you put the money, I can suggest just one thing - It is Best to Keep the

Money in your Pocket for Now!

BIBLIOGRAPHY

Websites

www. google.com

www.googleimages.com

www.bhartiairtel.inwww.wikipedia.org

www.vodafone.in

www.india-cellular.com

www.coia.com

www.trai.com

Magazines

Advertising express

Books

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ICFAI Marketing books.

final100 mks airtel vs vodoafone

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