TERM PAPER ON TATA TELECOM

SUBMITTED TO, Ms. Jaspreet Kaur

SUBMITTED BY, Karan Wadhera RT1803A16 10808494 (reg. no.)

CONTENTS  EXECUTIVE SUMMARY  TELECOM INDUSTRY  PORTER MODEL  SLEPT ANALYSIS  SEGMENTATION, TARGETING AND POSITIONING  SUSTOMER GAPS  QUALITY CONCERNS  MARKETING MIX I.E. 7P’S  SERVICE MARKET BLUEPRINT  PRICING STRATEGY  OTHER STRATGIES.

Executive Summary

Tata Teleservices is part of 98 co the Rs. 119,000 Crore (US$ 29 billion) Tata Group that has over mpanies, over 289,500 employees and more than 2.9 million shareholders. With a committed investment of INR 36,000 Crore (US$ 7.5 billion) in Telecom (FY 2006), the Group has a formidable presence across the telecom value chain. 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 3.8 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, post-paid Internet services, 3-way conferencing, group calling, Wi-Fi Internet, USB Modem, data cards, calling card services and enterprise services. Tata Teleservices has a strong workforce of 6000. In addition, TTSL has created more than 20,000 jobs, which will include 10,000 indirect jobs through outsourcing of its manpower needs. In this report I’m going to study the service market environment , market mix , segmentation of Tata telecom , quality concerns , positioning map , service blueprint , integrated communication , pricing strategies etc. The core aim of this term paper is to study the working of the service organization such as Tata Telecom to develop better understanding of the working of service organization.

TELECOM INDUSTRY

' Indian Telecom Industry' is the third largest and fastest growing in the world with nearly 200 million connections.

 Subscriber growth rate is 45%

The wireless technologies currently in use ' Indian Telecom Industry '  Global System for Mobile Communications (GSM)  Code Division Multiple Access (CDMA).

 There are primarily 11 GSM and 4 CDMA operators providing mobile services in 19 telecommunication circles and 4 metro cities, covering more than 2000 towns across the country.

Telecom Industry in India ' is regulated by 'Telecom Regulatory Authority of India' (TRAI). Three types of players exist in ' Indian Telecom Industry ' :  State owned companies like - BSNL and MTNL.  Private Indian owned companies like - Reliance Infocomm and Tata Teleservices.

Foreign invested companies like –Vodaphone, Bharti Tele-Ventures, Aircel, Escotel, Idea Cellular, BPL Mobile, Spice Communications etc.

PORTER MODEL

 Threat from New Entrants Supply Side Economies Of Scale • declining ARPU • Infrastructure tenancy costs • Other FC like BPO Demand Side Benefits • Brand pull exists to some extent for brands like airtel /idea/ vodafone Customer Switching Costs • Cost of new connection low • Proposed number portability Capital Requirement

• Extremely high infrastructure setup costs • Spectrum License cost Incumbent Advantages  Established brand image  Reliability of network Restrictive Govt. Policy  Spectrum and license allocation  3G and Number portability policy still unclear.  74% FDI cap.  Minimum requirement of number of towers.  Power of the buyer • Lack of differentiation among the service provider • Cut throat competition • Customer is price sensitive • Low switching costs • Number portability to have negative impact  Supplier Bargaining Power • Large number of suppliers. • Shared tower infrastructure. • Limited pool of skilled managers and engineers especially those well versed in the latest technologies. • Medium cost of switching since changing their hardware would lead to additional cost in modifying the architecture. • Overall influence on the industry - medium

 Rivalry among Existing Competitors • High Exit Barriers

• High Fixed Cost • 6-7 players in each region 3 out of 4 BIG-Four present in each region • Very less time to gain advantage by an innovation (Eg. Caller tunes, life time card)Price wars  Threat of Substitutes • Some Substitutes:  VOIP (Skype, Messenger etc.)  Online Chat  Email  Satellite phones • None of the above a major threat in current scenario. • Price-Performance trade-off very high. • Issues of mobility and penetration with the substitutes.

SLEPT ANALYSIS
POLITICAL FACTORS

1) Open for new entrants

2) Telecom Industry in India ' is regulated by 'Telecom Regulatory Authority of India' (TRAI).
ECONOMICAL FACTORS 1) Contribution to the Indian economy. 2) Increasing competition resulting in low tariff cost. 4) The growth of the middle income group family affects the Telecom sector.
SOCIAL FACTORS

1) Development of cities leads to better services and communication. 2) Employment opportunities. 3) Better and improved sevices.
TECHNOLOGICAL FACTORS 1) Introduction of 3G.

2) Sharing of towers for no network problem 3) Modernisation and privatisation of the telecom industry. 4) Better network coverage.
ENVIRONMENTAL FACTORS 1) huge vast Indian market is difficult to be covered.

2) Shortage of the infrastructural capacity
LEGAL FACTORS 1) FDI limits

2) Bilateral treaties among all players in the market.

Segmentation, Targeting, positioning • Segmentation

Geographic Region Density Social Classes Income Level

• Targeting
Company executives Lower middle, upper middle, lower upper segment

• Positioning
Lifestyle Benefits Quality

Here , Tata telecom have various plans and tariff rates as per the need and requirement of various segmentations, such as corporate plans for business people , night plans , low tariff plans for middle and lower income group , Blackberry with their telecom service for middle and high income group.

TARGETING MARKET SEGMENT  FULL MARKET COVERAGE

Tata telecom is following full market coverage strategy as they have wide range of offerings for the customers i.e. various tariff plan depending upon the segment the customer belongs to for example the charges for the corporate plans are different from that of residential use plans.

 DIFFERENTIATED MARKETING

For full-market-coverage they are following the differentiated marketing strategy, under which for each market segment there will be different marketing mix. For example the charges for corporate plans are different from those of home plans and the feature are also different on the both.

Customer GAP:-

The service gap means the gap between expected service and perceived service is known as customer gap. There are five kinds of gaps in customer gap.

These 5 gaps are involved in service gaps. These are as follows:The five gaps that organizations should measure manage and minimize: • • Gap 1 is the distance between what customers expect and what managers think they expect - Clearly survey research is a key way to narrow this gap. Gap 2 is between management perception and the actual specification of the customer experience Managers need to make sure the organization is defining the level of service they believe is needed. Gap 3 is from the experience specification to the delivery of the experience -managers need to audit the customer experience that their organization currently delivers in order to make sure it lives up to the spec. Gap 4 is the gap between the delivery of the customer experience and what is communicated to customers - All too often organizations exaggerate what will be provided to customers, or discuss the best case rather than the likely case, raising customer expectations and harming customer perceptions.

Finally, Gap 5 is the gap between a customer's perception of the experience and the customer's expectation of the service - Customers' expectations have been shaped by word of mouth, their personal needs and their own past experiences. Routine transaction surveys after delivering the customer experience are important for an organization to measure customer perceptions of service

Quality concerns customer’s point of view

There should be proper planning and implementation of control program in order to attain the desired results for the company. There should be regular check and improvement for the service in order to meet the customer’s expectations.

As we know that success of any service organization depends upon how strong that bank is in managing its employees and retaining them over the period of time to have much better customer and employee relationship.

From the figure it’s clear that for attaining high profitability Tata telecom should try to have customer satisfaction which can only be attained if the employees are satisfied and they work wholly and solely for the company.

Marketing Mix 7p’s

Service blueprint

PRICING STRATEGY
They are following differential pricing strategy , they are offering varied tariff plans from which the customers can choose as per their requirements.
POSTPAID Postpaid allows you to choose from a variety of affordable talk plans, convenient payment options and host of rich features. So get set to enjoy a world of limitless possibilities! Reference Tarif Packages (RTP) ON TIME CHARGES Activation Charges Membership Fee Security Deposit MONTHLY CHARGES (FIXED) Bill plan Charge Monthly Rental Clip MONTHLY CHARGES (OPTIONAL) Clip Rs. 99 Tata GSM Digit) Local Rates STD RATES 50 – 200 Km Rs. 1.99 Rs 1.99 Rs 1.99 / Landline /

Rs. 250 Rs. 250 NA Rs. 524 Rs. 444 Rs. 150 NA

CDMA (10 WLL

200 – 500 Km 500 + Km ISD USA, Canda, Europe (Fixed Line), Rs. 7.20

Austalia, Singapore, Hong Kong, Thailand, Malaysia, Indonesia, new Zealand Gulf, Europe (Mobile), SAARC Countries, Rs 9.99 Africa & Rest of the world Cuba, Sao tome & Principle, Guinea Rs. 40.00 Bissau, Diego Garcia, Nauru, Solomon Islands, Vanuatu, Cook Island, Tuvalu, Tokelau, Norfolk Island, Sakhalin SMS Local National International Value Added Services (Rs.) Rs. 1.00 Rs. 2.00 Rs. 5.00 Rs. 3.00

One Standard 150 ONE TIME CHARGES Activation Charges Membership Fee Security Deposit MONTHLY CHARGES (FIXED) Bill Plan Charge Monthly Rental Clip
MONTHLY CHARGES (OPTIONAL)

Rs 250
Rs 250 (Converts into security after 24 months)

NA Rs. 150 Rs. 50 Rs. 150 NA

Clip
Bissau, Diego Garcia, Nauru, Solomon Islands, Vanuatu, Cook Islands, Tuvalu, Tokelau, Norfolk Island, Sakhalin

Rs. 50

one Standard 299 ONE TIME CHARGES Activation Charges Membership Fee Rs 250 Rs 250 (Converts into security after 24 months) Security Deposit MONTHLY CHARGES (FIXED) Bill Plan Charge Monthly Rental Clip MONTHLY CHARGES (OPTIONAL) Clip Rs. 50 Tata LOCAL RATES STD RATES 50-200Km 200 – 500 Km 500 + Km ISD
USA, Canda, Europe (Fixed Line), Austalia, Rs. 7.20 Singapore, Hong Kong, Thailand, Malaysia, Indonesia, new Zealand
GSM / CDMA (10 Digit)

NA Rs 299 Rs. 150 Rs. 299 NA

Landline WLL

/

Re. 1.00 Rs. 2.00 Rs. 2.00 Rs. 2.00

Rs. 1.00 Rs. 2.40 Rs. 2.40 Rs. 2.40

Rs. 1.00 Rs. 2.40 Rs. 2.40 Rs. 2.40

Gulf, Europe (Mobile), SAARC Countries, Rs 9.99 Africa & Rest of the world
Cuba, Sao tome & Principle, Guinea Bissau, Diego Garcia, Nauru, Solomon Islands, Vanuatu, Cook Island, Tuvalu, Tokelau, Norfolk Island, Sakhalin

Rs. 40.00

SMS Local National International Value Added Services (Rs.)

Rs. 1.00 Rs. 2.00 Rs. 5.00 Rs. 3.00

You also enjoy 25 FREE local mobile to mobile SMS Senior Citizen Plan ONE TIME CHARGES Activation Charges Membership Fee Rs. 250 Rs. 250 (Concerts into security deposit after 24 months) Security Deposit MONTHLY CHARGES (FIXED) Bill Plan Charge Monthly Rental Clip
Cuba, Sao Tome & Principle, Guinea Bissau, Diego Garcia, Nauru, Solomon Islands, Vanuatu, Cook Islands, Tuvalu, Tokelau, Norfolk Island, Sakhalin

NA Rs. 150 Rs. 51 Rs. 99 NA

SMS Local National International VAS

Rs. 1.50 Rs. 2.00 Rs. 5.00 Rs. 3.00

With Senior Citizen Plan

STRATEGIES
Product
Offer a basic product/ service.

Offer value added services Price to penetrate market

Increase in number of value added services. Price to match or best competitors

Price

Charge cost- plus

Distribution

Build selective distribution

Build Intensive distribution.

Build more intensive distribution.

Advertising

Build product awareness among early adopters and dealers.

Build awareness and interest in the mass market

Stress brand differences and benefits.

Sales Promotion

Use heavy sales promotion to entice people to subscribe.

Increase to build and maintain relationships with customers.

Increase to encourage brand-switching.

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