marketing plan of tata telecom

TERM PAPER

ON

TATA TELECOM

SUBMITTED TO, SUBMITTED BY,

Ms. Jaspreet Kaur 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 Rs. 250

Membership Fee Rs. 250

Security Deposit NA

MONTHLY CHARGES (FIXED) Rs. 524

Bill plan Charge Rs. 444

Monthly Rental Rs. 150

Clip NA

MONTHLY CHARGES (OPTIONAL)

Clip Rs. 99

Tata GSM /

CDMA (10

Digit)

Landline /

WLL

Local Rates Rs. 1.99 Rs 1.99 Rs 1.99

STD RATES

50 – 200 Km

200 – 500 Km

500 + Km

ISD

USA, Canda, Europe (Fixed Line),

Austalia, Singapore, Hong Kong, Thailand,

Malaysia, Indonesia, new Zealand

Rs. 7.20

Gulf, Europe (Mobile), SAARC Countries,

Africa & Rest of the world

Rs 9.99

Cuba, Sao tome & Principle, Guinea

Bissau, Diego Garcia, Nauru, Solomon

Islands, Vanuatu, Cook Island, Tuvalu,

Tokelau, Norfolk Island, Sakhalin

Rs. 40.00

SMS

Local Rs. 1.00

National Rs. 2.00

International Rs. 5.00

Value Added Services (Rs.) Rs. 3.00

One Standard 150

ONE TIME CHARGES

Activation Charges Rs 250

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

Security Deposit NA


Bill Plan Charge Rs. 50


Clip NA


Clip Rs. 50

Bissau, Diego Garcia, Nauru, Solomon Islands,

Vanuatu, Cook Islands, Tuvalu, Tokelau, Norfolk

Island, Sakhalin

one Standard 299

ONE TIME CHARGES

Activation Charges Rs 250

Membership Fee Rs 250 (Converts into security after 24

months)

Security Deposit NA

MONTHLY CHARGES (FIXED) Rs 299



Clip NA


Clip Rs. 50

Tata GSM / CDMA

(10 Digit)

Landline /

WLL

LOCAL RATES Re. 1.00 Rs. 1.00 Rs. 1.00

STD RATES

50-200Km Rs. 2.00 Rs. 2.40 Rs. 2.40

200 – 500 Km Rs. 2.00 Rs. 2.40 Rs. 2.40

500 + Km Rs. 2.00 Rs. 2.40 Rs. 2.40

ISD

USA, Canda, Europe (Fixed Line), Austalia,

Singapore, Hong Kong, Thailand, Malaysia,

Indonesia, new Zealand

Rs. 7.20

Gulf, Europe (Mobile), SAARC Countries,

Africa & Rest of the world

Rs 9.99

Cuba, Sao tome & Principle, Guinea Bissau, Diego

Garcia, Nauru, Solomon Islands, Vanuatu, Cook

Island, Tuvalu, Tokelau, Norfolk Island, Sakhalin

Rs. 40.00

SMS

Local Rs. 1.00

National Rs. 2.00


Value Added Services (Rs.) Rs. 3.00

You also enjoy 25 FREE local mobile to mobile SMS

Senior Citizen Plan

ONE TIME CHARGES

Activation Charges Rs. 250

Membership Fee Rs. 250 (Concerts into security deposit

after 24 months)

Security Deposit NA



Monthly RentalRs. 99

Clip NA

Cuba, Sao Tome & Principle, Guinea Bissau, Diego

Garcia, Nauru, Solomon Islands, Vanuatu, Cook

Islands, Tuvalu, Tokelau, Norfolk Island, Sakhalin

SMS

LocalRs. 1.50

National Rs. 2.00


VAS Rs. 3.00

With Senior Citizen Plan

STRATEGIES

Product Offer a basic product/

service.

Offer value added

services

Increase in number of

value added services.

Price Charge cost- plus Price to penetrate

market

Price to match or best

competitors

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.

Documents

marketing plan of tata telecom