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Mobile Telephone Strategic Gap Model

Mobile Telephone Strategic Gap Model

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Published by: authori on Aug 11, 2010
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MobileTelephoneService±CustomerStrategic Gap Analysis.
Indian mobile industry was started almost 10 years before, because of Govt. regulation itcouldnt grow like China. As per current estimation India¶s mobile services market isexpected to grow at 28.3% CAGR through 2009. But the market is also very muchcompetitive, all the players are keen to increase the market share, so the prices are gettingslashed. The current players in the market are :-
Reliance InfocommBharati Telecom (AirTel)BSNLTata TeleserviceSpice TelecomHutchison / Orange(Vodafone)BPL Telecom
Current Scenario:
The industry is moving from the Growth stage to the Shakeout stage, although the marketis growing fast, but the Cut-throat Competition is slashing the profit margins, which isvery common in Later Growth stage and players those who dont have strong financial back up are going to be sold to the stronger players. So its very clear that players withstronger brand and financial back up will make the future profit.The bigger players are also operating in other Telecom areas like Landline, ISP,Broadband, Corporate data & voice services etc, to become one stop solution provider,hence forth increase the market share, this clearly indicates the Sorry situation for thesmaller players. Entry barrier for any new player is too strong.Once the Shakeout period is over in next few years the Mobile Industry in India is likelyto enter in matured market.
Challenges in growth:
But there is other theory too the economic growth in India, currently the market isgrowing more on the Network area growth, providers are moving to smaller cities from big cities, demand is generated from B class & C class cities middle class population. A
major section of middle class population of India in smaller cities couldnt enjoy theadvantages of Telecom service due to the Govt. monopoly, poor capacity, regulations;they are the immediate customers of the Mobile operators. The Landline is no more the preferable choice for the new Telco users; people like to use mobile phones because of itsadded advantages and easy subscription. Also the middle class size is expected to grow inIndia in next decades, so the Mobile market in India will be probably in Growth Shakeout phase for a longer period.Also the Roadmap, which was thought by the Govt. earlier has become more like aroadblock for the growth, to keep the market competitive they introduced lot regulationsand zoning concepts, which have become barrier for market growth and to play atEconomies of scale, which are likely to change by the market dynamics and marketforces. So the Growth Shakeout phase is likely to continue for a while. Few years beforethe number of players were many, as TRAI had stringent laws in number of zoneoperations by single provider, but these are changing rapidly.
Service Providers Offerings:
India is a vast and complex market. The Indian Department of Telecommunicationsclassifies the country¶s telecom markets into ³metro´ and ³A´, ³B´ and ³C´ circles or zones, based on how many potential subscribers they have. For example, the C circlesrefer to rural areas and are the least attractive sectors with very little wealth. The 1999 National Telecom Act defined a phased telecom deregulation with national operator,VSNL, privatized in April 2002.The cellular market is divided into 4 metro areas, 5 circle A areas, 8 circle B areas and 5circle C areas. When all the cellular licensees become operational, India will be served by77 networks. This segmentation of the market and licensees has certainly not helped thegrowth of the Indian market. These Network is increasing very fast, as companies want totap the middle class population in smaller cities, and technological development, they areable to increase the Network boundary with lesser investment and also the competition.Indian mobile operators offerings are segmented in two broad categories Pre-paid andPost-paid. Although mobile market is growing positively, the Post-paid market isdeclining and Pre-paid market is increasing by leaps and bounds.TRAI regulations and Indian consumer behavior are causing for the growth in Pre-paidmarket. As the revenue in pre-paid offer is increasing in Circle A and Circle B for Economies at scale, the Pre-paid market share is going to be the more important. WhenReliance InfoComm came into the market, they didnt realize this initially, but very soonthey came with Pre-paid offer.
Brief on Strategic Service Gap Model:
First task is to analyze the Provider Gap:
1. Market Information Gap Not knowing what Customers Expect
: The Company¶sincomplete or inaccurate knowledge of customers¶ service expectations.
Key Factors :-
Inadequate marketing research orientation
Lack of upward communication
Insufficient relationship focus
Inadequate service recovery
. Service Standards Gap Not having right standard and design:
The Company¶sfailure to translate accurately customers¶ service expectations into specifications or guidelines for employees.
Key Factors :-
Poor service design
Absence of customer-defined standards
Inappropriate physical evidence and Servicescape
. Service Performance Gap Delivery lag:
Lack of appropriate internal support systems(e.g., recruitment, training, technology, compensation) that enable employees to deliver to service standards.
Key Factors :-
Deficiencies in HR policies
 Not match Supply & Demand capacity
Customers failed to meet their roles
Intermediaries problem
. Internal Communication Gap Promises don¶t match:
Inconsistencies between whatcustomers are told the service will be like and the actual service performance [e.g., due tolack of internal communication between the service µpromisers¶ (such as salespeople) andservice providers (such as after-sales service representatives)].
Key Factors :-
Lack of Integrated services marketing communication
Ineffective management of Customer expectation
Over promising
Inadequate horizontal communication

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