Marketing Strategy Comparison

AirTeI & Hutch

Rahul, Priyanka, Zardar, Rashmi
Indian Institute of PIanning & Management
Ahmedabad
Project Introduction
".TeIecoms are roIIing out Iike never before.
And that 100-miIIion mark doesn't Iook too
far away. The mobiIe subscriber base
crossed 65 miIIion in September 2005, an
over-30 per cent increase over the previous
year."
Indian CeIIuIar Industry wiII touch $24 biIIion
by the end of 2006.
AirteI (22 per cent market share, over 15
miIIion mobiIe subscribers, source: CeIIuIar
Operators Association of India) witnessed its
highest-ever net addition of 1.8 miIIion
mobiIe customers in a singIe quarter.
Project Introduction
Cont'd.
Project ntroduction
Cont'd.
Hutch, with over 10 million subscribers (15
per cent market share) may be No. 4
(behind Reliance and BSNL) at present,
but it has the highest average revenue per
user.
AirTeI Marketing
Strategy
usiness Process Management
Process Innovations and Continuous
Improvement through PeopIe InvoIvement
ProbIem Investigation by "Fact Based - Root
Cause AnaIysis"
Cont'd.
Customer-Defined Business Processes
Based on Customer Specifications, AirTeI have
webbed many business processes on the foIIowing
concepts:
elivery time
Turn around time
Lead-time
Time to market
Other performance indicators
AirTeI Marketing
Strategy Cont'd.
Result Oriented Approach
Each process has been designed by first pIanning
the desired resuIt. The targeted resuIts are then
arrived at through identification of the foIIowing:
The next-customer and end-customer expectations.
QuantifiabIe purpose of the process and key resuIt
areas.
Past experience of "What went wrong and can go
wrong".
AirTeI Marketing
Strategy Cont'd.
NaturaIIy, the target customer was cIearIy defined:
eIite, up market professionaIs and entrepreneurs.
"e positioned AirTel as an aspirational and lifestyle
brand, in a way that trivialized 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," -
recaIIs Hemant Sachdev, chief marketing officer
(mobiIity) and director, Bharti TeIe-Ventures.
AirTeI Marketing
Strategy Cont'd.
In 1999, the ruIes of the game changed. The New
TeIecom PoIicy came into effect, repIacing Iicence
fees with a revenue-sharing scheme and extending
the Iicence period from 10 to 20 years.
Now, ceIIuIar service operators couId drop their
prices and target new customer segments. As SEC B
became part of the catchment area, AirteI's
communication changed from "power" to "touch
tomorrow".
AirTeI Marketing
Strategy Cont'd.
In 2002, AirteI signed on music composer
A R Rahman and changed its tune to "Live
every moment": Rahman's signature tune for
AirteI is, perhaps, the most downIoaded
ringtone in India. But that was just part of the
ongoing communication.
AirTeI Brand Review
AirTeI has the most recognizabIe brand in
the Indian operator space, with 30.8% of our
respondents abIe to identify it as a mobiIe
brand unaided.
WhiIe this is Iower than many of its
competitors, examination of the various
brand strength indicators shows AirTeI has a
much stronger brand than its competitors
do.
Source: E Market Research Corp. 30
th
Oct 2006 - 14 Pages -
D: EMR1370648
AirTeI Brand
Review
cont'd.
Of respondents, 27.4% identified AirTeI with
"cooI", 26% with "creative", and 22% with
"technicaIIy advanced". OnIy 8.6% of
respondents identified AirTeI with "cheap".
Between 2004 and 2005, it has increased its
market share from 20.5% to 21.5% of the
market.
Source: E Market Research Corp. 30
th
Oct 2006 - 14 Pages -
D: EMR1370648
AirTeI Ad Campaigns
Hutch Marketing
Strategy
.A big success factor was how
aspirational overtones in brand imagery
stayed, even though price wars had
started. Again, the colour orange was a
seminal attribute; the brand's slogan was
'The future's bright, the future's orange'.
Hutch Marketing
Strategy
Cont'd.
.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
.
Hutch Marketing
Strategy Cont'd.
VaIue-added services
"PriviIeges" (discount coupon bookIets),
cricket scores and stock market information - have formed as criticaI a
part of Hutch's marketing efforts as its advertising.
Hutch WorId (GPRS service),
Hutch AIive (non-stop, streaming action)
Hutch4HeIp, a unique diaI-in 'convenience' service, aII emphasize the
premium attributes of the service.
Chhota Recharge, smaII vaIue recharge cards (starting at Rs 10),
which wiII aIso heIp mobiIize smaII spenders.
Hutch Mobile Shop
- A great initiative
Hutch Ad Campaigns
Marketing
Research AnaIysis
Which cord is used.
50%
29%
0% 0%
21%
HUTCH
ARTEL
BSNL
TATA NDCOM
DEA
Marketing Research
AnaIysis
Cont'd.
Service provided by the customer care
92%
4%
4%
yes, m sat isf ied.
no, not sat isf ied.
can' t say
Marketing
Research AnaIysis
Cont'd.
network connectivity
yes, m satisfied.
no, not satisfied.
can't say
Marketing Research
AnaIysis
Cont'd.
QuaIity provided by Service Provider
61%
39%
0%
yes, m
satisfied.
no, not satisfied.
can't say
Marketing Research
AnaIysis Cont'd.
BiIIing System
49%
30%
21%
yes, m satisfied.
no, not satisfied.
can't say
Marketing Research
AnaIysis Cont'd.
Card do you prefer
52%
48%
prepaid
postpaid
Marketing Research
AnaIysis Cont'd.
Cost satisfaction
57%
33%
10%
yes, m satisf ied.
no, not satisfied.
can't say
SERVQUAL modeI
The Measurement and EvaIuation of Service
QuaIity - SERVQUAL modeI: Service QuaIity =
(Performance - Expectation)
The word 'SERVQUAL' is an abbreviated form of
service quality. The measurement was
developed by Parasuraman, Zeithaml, and Berry
(hereafter, PZB) in 1985.
Dimensions Descriptions
TangibIes The appearance of PhysicaI faciIities, equipment, personneI
and communication materiaIs.
ReIiabiIity The abiIity to perform the promised service. DependabIy and
accurateIy .
Responsiveness The wiIIingness to heIp customer & provide prompt service.
Assurance The knowIedge & courtesy of empIoyees and their abiIity to
convey their trust and confidence.
Empathy The provision of caring individuaIized attention to customers
Five Dimensions of
SERVQUAL ModeI
(Revised from KotIer, P 1999 Marketing
Management, MiIIennium Edition Prentice HaII)
SERVQUAL
ModeI
MethodoIogy
The raw data used in computing
coefficient alpha were in the form of
difference scores.
A difference score for each item Q,
representing perceived service quality was
found by subtracting the expectation score
from the corresponding performance (or
perception) score (Q = P E)
Research Findings
GSM service providers (cellular),
customers seem satisfied with the 'ability
to make and receive calls in any part of
the city', however, the service providers
have fallen short in meeting customers
expectations when it comes to coverage
within buildings, in basements or in lifts.
Research Findings
Cont'd.
The corporate image of the service
provider continues to be an important
aspect in driving retention and most
service providers have been successful in
building a positive and favorable image
among the subscribers.
Research Findings
Cont'd.
The study also revealed that 'Error free'
and 'accurate' bills, being promptly
delivered is something that the customers
seem to be taking for granted and have
little impact on retention. On the contrary,
non-delivery on these could cause a lot of
disgruntlement and unhappiness with the
service provider.
Research Findings
Cont'd.
Another revelation was that customers
seemed very peeved with the amounts
they had to pay for local and STD calls.
Research Findings
Negative Outcomes
The cellular industry has performed below
average in various aspects related to
'customer care / helpline'. These include
'time taken before someone attends to
you', their 'ability to resolve complaints/
queries in the first instance'
Research Findings
Negative Outcomes
Cont'd..
'overaII time taken to resoIve compIaints',
caII center personneI's abiIity to take
decisions.
'knowIedge of customer care personneI
about tariff pIans and schemes' and
'the promptness in taking action on
compIaints'.
Samit Sinha,
Managing Partner,
AIchemist Brand
ConsuIting
..There isn't a great deal of
differentiation in terms of pricing,
services, schemes and so on, but there
are differences in approach. Overall,
AirTel is focused on functionality and
efficiency, while Hutch has veered
towards warmth and emotions."
Meenakshi Madhvani,
Managing Partner, SpatiaI
Access
". it wouId not be right to concIusiveIy
say that Brand A is stronger than Brand
B. However, if you consider adoption of
the service by consumers as an
indicator of brand strength, then AirTeI
wouId rank reasonabIy high."
..What matters is
what the customers
want.."
- Mittal, CEO Bharti Teleservices
Other ndian Cellular Service
Providers
Thank You