A Repot

On

Non-price Competition Tools Used By Cell Phone

Providers in Bangladesh

“A Case Study on Bangla Link Mobile Phone”

(MKT-503)

Date of Submission: April 13, 2010

A Repot

On

Non-price Competition Tools Used By Cell Phone Providers in

Bangladesh

“A Case Study on Bangla Link Mobile Phone

(Economics: Course code: MKT-503)

Prepared By:

Mahabubul Alam

Id No:41017017

Executive Summary:

Orascom Telecom Holding S.A.E. ("Orascom Telecom") or ("OTH") was established in

1998 and has grown to become a major player in the telecommunication market in the

world. .

OTH is considered among the largest and most diversified network operators in the

Middle East, Africa and Pakistan. It is a leading mobile telecommunications company

operating in seven emerging markets in the Middle East, Africa and South Asia having a

population under license of 460 million in total population with an average penetration of

mobile telephony rate across all markets of 29% as at March 2007.

Orascom Telecom operates GSM networks in Algeria ("Djezzy"), Egypt ("Mobinil"),

Pakistan ("Mobilink"), Iraq ("IraQna"), Bangladesh ("Banglalink"), Tunisia ("Tunisiana")

and Zimbabwe ("Telecel Zimbabwe"). Orascom Telecom subscriber number reached

over 56 million subscribers as of March, 2007. OTH continuing growth established a

strong presence in the GSM Association (the world's leading wireless industry

representative body), only four years after its inception.

OTH's Chairman and CEO Mr. Naguib Sawiris was selected to join the GSM

Association’s CEO Board in 2002. This association's members help in promoting and

planning the future of the GSM industry. OTH stocks are traded on the Cairo and

Alexandria Stock Exchange (CASE), (under the symbol ORTE.CA, ORAT EY) and

London Stock Exchange (where its GDR is traded under the symbol ORTEq.L, OTLD

LI). Orascom Telecom is the largest capitalized company on the Cairo and Alexandria

Stock Exchange (CASE).

1.1 Background Of Banglalink

Mobinil, in Egypt was Orascom Telecom’s first operation. The Egyptian Company for

Mobile Services (ECMS) was granted a GSM license in 1998 and launched the same

year. Mobinil is among Egypt’s five largest companies by market capitalization. It is also

among Egypt’s five most heavily traded companies by value. Mobinil’s network covered

approximately 91% of the total population of Egypt as of March, 2005. "Mobinil Life"

was launched in September 2003 in partnership with sister companies ARPU+ and

LINKdotNET which cater to value added services and internet respectively. Mobinil

offers both prepaid and postpaid packages and as of September 2005, prepaid subscribers

represented approximately 85% of Mobinil's total subscribers.

Orascom Telecom’s operation in Pakistan, Mobilink, started its operations in 1994, and

until early 2001, had a market share of 40%. In April 2001, OTH took over management

control of the company and as of March, 2007; Mobilink served more than 24 million

subscribers, representing a market share of approximately 44.3% of total mobile

subscribers in Pakistan.

Orascom Telecom Tunisie - Limited Company Tunisiana was granted a license in May

2002. Tunisiana exceeded the 3.1 million subscribers, representing a market share of

approximately 46.3% of total mobile subscribers in Tunisia, as of March, 2007.

In January 2004, Orascom Telecom Iraq (OTI) launched its initial phase of the network

IraQna after being awarded the first license for the Central Region in Iraq. OTI is now

serving approximately 2.9 million subscribers with a market share of 32.8% on its

network and is providing state of the art mobile technology. Pursuing its success OTI

expanded its services to the Southern region of Iraq in November 2004 to become the

first operator to deploy its services nationally in the whole country. As of September,

2005, the central region contains over 35% of Iraq’s population, or approximately 9.3

million inhabitants.

Orascom acquired Sheba Telecom as Banglalink in 2002. Banglalink was the last

addition to the GSM companies when, Orascom Telecom (OTH) purchased 100% of the

shares of Sheba Telecom in Bangladesh last September. Orascom Telecom re-branded

and launched its services under "Banglalink" in February 2005. Immediately after the

launch, OTH started its aggressive plans to develop it into a leader in the mobile sector. It

rapidly expanded its GSM network to provide high quality communications services at

affordable prices. Banglalink has 16.8% market share of total mobile subscribers in

Bangladesh with approximately 3.9 million subscribers as of March, 2007.

Orascom Telecom has positioned itself as a leader in the region for its diverse GSM

operations, with various GSM support and Internet operations. One of Orascom

Telecom’s main strategies is to create its own non-GSM subsidiaries to act as a support

for its regional GSM operations. OTH has achieved this by dedicating financial,

technical, and management resources for its subsidiaries. This includes network support

and installation of GSM operations, equipment procurement, handset procurement and

distribution companies, value Added Services, and Internet operations.

OTH is dedicated to provide the best quality services to its customers, value to

shareholders, and a dynamic working environment for its nearly 20,000 employees.

Mission

Banglalink mission is to satisfy all communication needs of the developing markets

which the organization serves. It is company belief that there is viable economic model to

serve emerging markets while availing affordable quality. The organization is racing to

serve the largest possible number of customers, covering the most populous countries in

the world. The organization believes that by positioning ourselves as the primary

provider of communication services. It can

Vision

To become one of the world’s leading telecom operators providing the best quality

services to the target customers, value to the shareholders and a dynamic, challenging and

fun environment for the employees.

Banglalink is employee oriented Telecommunication Company. It believes employees are

human being not machine. Employees of Banglalink are also very loyal with the

organization. Banglalink recruit employee on the basis of six month contractual

agreement. In this agreement an employee can terminate or continue the job within six

month.

The sitting arrangement of MD and other directors are flat that means they sit along with

other employees. This arrangement is helpful in which all employees can accomplish

work within a friendly environment. Office area is free of smoking. Banglalink follow

multi culture in which it practices country of origin culture along with host country

culture (Bangladesh).

1.2 Banglalink Mission and Vision

1.3 Culture of Banglalink

Chief Technical officer

Deputy General Manager

CEO

IT & Billing ProjectsStore &

Inventory Mgt.

Procurement

Customer Care

Manager

Sales & Marketing Manager

Quality Control Manager

GM

Internal Audit Manager

Administration

Company Secretary

Finance & Accountin

g

1.4 Organizational Structure

Non-price competition is a marketing strategy "in which one firm tries to distinguish its product or service from competing products on the basis of attributes like design and workmanship" The firm can also distinguish its product offering through quality of service, extensive distribution, customer focus, or any other sustainable competitive advantage other than price. It can be contrasted with price competition, which is where a company tries to distinguish its product or service from competing products on the basis of low price. Non-price competition typically involves promotional expenditures, (such as advertising, selling staff, sales promotions, coupons, special orders, or free gifts), marketing research, new product development, and brand management costs.

Firms will engage in non-price competition, in spite of the additional costs involved, because it is usually more profitable than selling for a lower price, and avoids the risk of a price war.

Competition among firms that choose to differentiate their products by non price means, for example, by quality, style, delivery methods, locations, or special services. Non price competition is often practiced by firms that desire to differentiate virtually identical products.

More specifically Non price competition can be said, Competition between companies that involves something other than lower prices. That is, rather than advertising the lowest price for a product, a company may advertise that is has the best quality, the most convenience, or even the best branding. Non price competition is especially important where competition is stiff and companies cannot afford to charge much less than they already do.

Here some of the non price competition tools used by Bangla link are discussed bellow:

2.0 Non-price competition:

The meaning of Banglalink logo is tiger which is national animal of

Bangladesh. Banglalink wants to become the national asset of Bangladesh;

this is why it used the symbol.

Bangla link offered misti komola package with sampling orange to the customers in the cities. This was a different way to reach the people & touch with their identical product.

After Sales service is one of the major tools or techniques applied by Banglalink. Banglalink establishes many customer service centers in and outside Dhaka City.

We have set the benchmark in customer care with our state-of-the-art call center, largest customer care network, and a passionate & vigilant team serving you every single moment.

Banglalink care line offers a dedicated 24 / 7 service to answer all your queries. 24 hours a day. 7 days a week. Any queries you may have about:

subscribing for a new connection any form of account information coverage details product information value added services

2.1 Logo

2.2 Free Sampling

2.3 Before & After Sales Service

Banglalink segmented their target market for post paid into two broad categories:i) Enterprise personal Customer: The

people who use network for personal

corporate activities. Who mainly purchase

the PCO connection?

ii) Small entrepreneur People who do

mobile business.

Banglalink First targeted the small

entrepreneur after obtaining growth

market share they targeted the people who

use network for personal enterprise

packages.

Small entrepreneur are the mainly purchaser of M2M connection. On the other hand enterprise personal customers are the purchaser of Call and control connection

Banglalink for the 1st time introduce advertisement that is different in nature and manner. Their advertisement was awarded for the touching of heart of the people of our country.

Banglalink award winning Advertisement:

2.4 Extensive Distribution

2.5 Appealing Advertising

Banglalink Ad on Independence Day 2007

Targeting the corporate and SME segments, banglalink

has launched "Banglalink Enterprise" with state of the

art services including GPRS, corporate SMS broadcast,

dedicated customer relationship management, and

customized packages. Banglalink enterprise offers

customized telecom solutions for different businesses as

per their requirements and the objective of banglalink

enterprise is to assist the clients at every step as their

businesses grow. Banglalink also provides services to the

farmers.

Students are also benefited by Bangla link for their music

station, amar tunes.

Banglalink provides services in the health perspective.

Any Banglalink operator can dial 789 for help in case of

health services.

2.6 Special Services

Banglalink was the first operator to

introduce a flat rate for all calls

(inside own network and to other

operators) for the convenience and

ease of customers. Thus "desh" was

launched - the best prepaid package

for making calls to any network.

In addition, a new prepaid package,

banglalink desh "rong" has also been

launched. This package offers

attractive tariff plan for customers who need to talk within the banglalink network.

"Rong" is a Bengali word that means "color" - the objective is to give customers a brand

that they can refer to as colorful and lively. Banglalink desh is already a very popular and

well-liked brand - banglalink desh rong is a brand extension to enrich the brand.

Delivering services to the customers involves decision on the

place and time of the delivery to as well as methods and

channel used.

Banglalink distribute their services to the final customers

through the retail outlet, Bsp (Banglalink service point) etc.

The dealer of the retail outlet get the commission on the basis

of the specific sales proportion.

In addition to Banglalink take security money from their

dealer.

2.7 Identical Product:

2.8 Delivery of Services

No marketing program can be succeeding without effective communication. Banglalink

marketing communication effort is used to perform the following three activities:

a. Providing needed information and advice

b. Persuading target customers of the merit of the services.

c. Encouraging target customers to take action at specific times. (i.e. Influence to

purchase the service)

Usually Banglalink provide their advertising in the newspapers(Prothom Alo, Daily

Star),TV Channels(ATN,Channei,NTV,RTV,ETV,BTV.Channel1),Bill board to promote

their services to the target audiences.

In their advertising Banglalink try to educate their customers about the tariff rate during

the peak period and off peak. Which is helpful to stimulate customer’s behavior to use

network during the period of low demand? The ad also used to highlight the manipulation

of other marketing mix elements to get specific response to the customers. This is why in

their ad Banglalink provide information regarding their service offerings, supplementary

services, dedication of service personnel etc.

Banglalink provided an ad regarding the rules and regulation to get a new connection

and re registration the old packages if it was purchased on before February 28, 2006.It is

also can be considered as educational promotion program.

Banglalink is a media partner of the cricket council, in which it indirectly promotes

and educates the customers (both current and prospective) about the service through the

sponsored one day or test matches.

Banglalink also provide ad to educate different market segment to attract their services.

For instance it is currently providing the Dialogue with “DIN BADOLER PALA” to

attract small entrepreneur. For medium to upper level entrepreneur Banglalink providing

ad dialogued with “BAGLALINK TO GROWTH”.

2.9 Promotion & Education

The following are the samples of various ads of Banglalink broadcasted in different TV

channels to inform customers about the various value added services.

The appearance of Banglalink building, vehicles, interior furnishing, equipment, staff

members, signs, printed materials all are the visible cues provide

tangible evidence of a firm,s service quality. Banglalink operate

two core branches which control primary supportive value chain

activities of various zonal offices. All offices are well furnished

through the interior and exterior decoration. All the exterior point

of BSP centre BP centre, distributors offices ,core branches, zonal offices are decorated

by the orange color with Banglalink logo.

2.10 Physical Environment

When Banglalink entered the Bangladesh telecom industry in February 2005, the scenario

changed overnight with mobile telephony becoming an extremely useful and affordable

communication tool for people across all segments. Within one year of operation,

Banglalink became the fastest growing mobile operator of the country with a growth rate

of 257%. This milestone was achieved with innovative and attractive products and

services targeting the different market segments; aggressive improvement of network

quality and dedicated customer care; and effective communication that emotionally

connected customers with Banglalink. Banglalink is today the 2nd largest mobile

operator in the country. It competes over the market by differentiating its quality, style,

delivery methods, locations, or special services. It is continuously analyzing the market

movements and simultaneously taking initiatives to compete in the mobile industry to

retain their position.

Conclusions:

1. Lovelock, C. & Writz, J, Service Marketing, 2004, Fifth

Edition, Pearson Education, Inc.

2. www.banglalinkgsm.com

3. McConnell-Brue, 2002, p. (437-438).

4. www.blinlk.com

References: