A project report

On

Factors influencing the choice of mobile phone service providers

Submitted by:

Sec C- Group 3

Adig

Anirban Mohanty

Arushi Jain

Bharath Bhushan Peddini

Harish Reddy

Kriti Singh

Section C – Group 3

Introduction:

In today’s world where there are many telecom players, and when the information about every company’s offers are being evaluated by consumers, they might have different heuristics and weights assigned to different factors which they take into consideration while selecting a service network

This topic will give us better insights on various factors taken into consideration and the importance various consumers attach to the factors and the results will help us to decide on the optimized scheme for attracting and retaining larger base of customers

Telecom industry in India is growing at healthy rate and the FDI being opened up in this sector there any many players who are entering and capturing good amount of customers. But the returns from existing customer base of any company is not able to generate healthy revenues, the reasons being

1. Highly competitive industry which are forcing for lower prices for service.

2. High investment costs for companies for purchasing the spectrums and also high operational costs

There are some researches done on this topic but are done in other countries, (please see the references for more information), we would like to extend the research for Indian Industry scenario where there are variety of customers and a large variation of preferences is expected.

Literature Review:

1. Ahasanul Haque, Sabbir Rahman, Mahbubur Rahman (2010) established the factors that determine the selection of a mobile telecommunication service provider are: Service quality, Price, Availability of the product, and Promotions

2. Solomon A. Keelson (2012) concluded that the basic reasons for changing telecom servers are Reliability and Cost Savings. Reference group influence, social reputation and regular contact with others were also influential factors

3. Shibashish Chakraborty, Kalyan Sengupta (2013) identified four distinct determinants responsible for customer Satisfaction. These are Generic requirements, Functional quality, Price and Flexibility

4. Riquleme (2001) identified six key attributes; call rates, access cost, connection fees, handset features, special offers and call cost of mobile to mobile have significant impact on consumers while making decision to choose particular service provider

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5. Raj Kumar and Harish (2011) have concluded that price has positive significant impact on consumer while choosing particular service provider

6. Karjaluoto et al. (2005) in their study conducted in Finland mobile industry, they have identified certain factors which significant impact on choosing particular service provider are call rates, services and network coverage.

7. Lin (2002) explained in his study of factors that affect brand decision in the mobile phone industry in Asia‟, that the quality of network coverage and cost of calls are the main attributes which plays vital role in choosing particular service provider

8. Ilias Santouridis , Panagiotis Trivellas (2010) explained in their study that Customer service, pricing structure and billing system are the service quality dimensions that have the more significant positive influence on customer satisfaction, which in turn has a significant positive impact on customer loyalty. The mediation role of customer satisfaction on the service quality and customer loyalty relationship has also been confirmed

9. Anthony Dadzie (2011) determined that the reason for switching subscribers to competitor brand is due to network and tariff related issues

10.Daniel Kipkirong Tarus, Nicholas Rabach(2013) in their study of determinants of customer loyalty said that perceived service value, service quality and social pressure were significant predictors of customer loyalty. Corporate image was found to moderate the relationship between service value, service quality, social pressure and customer loyalty

Research Objectives:

To determine the qualitative and quantitative factors that consumers consider while choosing a pre paid mobile service provider

To determine the correlation between different factors and consumer buying decision To prioritize the different factors and highlight the most important factors for a consumer

Research Questions:

What are the factors that consumers look for in a telecom operator while purchasing a prepaid/postpaid connection?

How do the factors involved in selecting a mobile service provider vary with changing demographic factors?

What is the degree to which each of these factors affects consumer purchase decision?

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Methodology:

Primary Research: Primary research in the form of a survey questionnaire was floated online. Sample size was 36.

Secondary Research: Various internet resources like online customer forums; etc were visited to collect useful data and gain market and customer insights. Research Papers and Journals discussing the similar topic in other developing country scenarios were studied.

Data Analysis: The data collected was analyzed using the following statistical tests:-

1. ANOVA2. Independent t-test for equality of means

Data Analysis

Collection of Primary data is from respondents by administering online questionnaire which comprised closed and open-ended questions

Total 36 respondents are drawn on convenience sampling basis

The study was conducted among MDI students with the following demographic profile :

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H0 : All factors have equal significance for customers

Call Tariff Network Quality Promotion Value added services Plans Customer Care0

0.51

1.52

2.53

3.54

4.55

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• The P- value is very low (< 0.05)

• Therefore there is sufficient evidence to reject the null hypothesis

• The top three significant factors that impact the choice of service provider are – Network Quality, Call Tariff and Customer care services

•

Impact of attributes for postpaid and prepaid users

Postpaid Prepaid

Call Tariff 3.53333333333333 4.23809523809524

3.1

3.5

3.9

4.3

Call Tariff

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• The significance value is < 0.05 for call tariff

• Therefore we can say that the call tariff impacts prepaid and postpaid users differently

• Pre paid users are impacted more by call tariffs than post paid users

Impact of Age group of the customer on considering attributes for choosing present service provider

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Impact of gender on considering attributes for choosing service provider

Findings

As the MSP market becomes more complex and more competitive, it is essential that services providers know what their customers’ needs are

The significance of factors that impact the selection of MSP varies from customer to customer

Pre paid customers tend to be more price sensitive than post paid customers

Also, young mobile users are more affected by tariffs than older customers

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• The significance value is < 0.05 for call tariffs

• Therefore the significance for call tariffs is different for different age groups

• The significance of call prices is maximum for the age group 20-23 and min for 25years and above

• All the significance values are >0.05

• Gender impacts all the choosing attributes equally

None of the factors significantly influenced users based on their gender

Bibliography

Karjaluoto, H. Karvonen, J. Ketsi, M. Koivamki, T. Manninen, M. Pakola, J. Ristola, H. and Salo J.(2005) Factors affecting consumer choice of mobile phones: Two studies from Finland, The Haworth Press, Finland

Ahasanul Haque, Sabbir Rahman, Mahbubur Rahman (2010) Factors Determinants the Choice of Mobile Service Providers: Structural Equation Modeling Approach on Bangladeshi Consumers, Business and Economics Research Journal, Volume 1, Number 3

Solomon A. Keelson(2012) Factors affecting consumer choice of multiple mobile services, Global journal of business research ,Volume 6,Number 4

Anthony Dadzie (2011), Brand Preference for Mobile Phone Operator Services in the Cape Coast Metropolis, International Journal of Business and Management, Vol. 6, No.11; November 2011, pp.190-205.

Riquelme, H (2001), Do Consumers Know What They Want? Journal of Consumer Marketing, 18(5),pp.437-448

Lin, C.F. (2002), “Segmenting customer brand preference: demographic or psychographic”, Journal of Product and Brand Management, Vol. 11 No. 4, pp. 249-68.

Shibashish Chakraborty, Kalyan Sengupta(2013)An exploratory study on determinants of customer satisfaction of leading mobile network providers – case of Kolkata, India, Journal of Advances in Management Research Vol. 10 No. 2

Ilias Santouridis , Panagiotis Trivellas(2010) Investigating the impact of service quality and customer satisfaction on customer loyalty in mobile telephony in Greece, The TQM Journal, Vol. 22 No. 3

Daniel Kipkirong Tarus, Nicholas Rabach(2013) Determinants of customer loyalty in Kenya: does corporate image play a moderating role? The TQM Journal, Vol. 25 No. 5

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ANNEXURE 1

Questionnaire

1. What is your gender? Male Female

2. What is your age? 20-23 23-25 25 and above

3. Which type of mobile connection do you use? Prepaid Postpaid

4. Reasons for choosing your service provider Strongly Agree Agree Neutral Disagree Strongly Disagree

i. Call Tariffii. Network Qualityiii. Advertisementsiv. Customer Servicev. Spectrum of plans vi. Value added services

5. Any one thing that you don’t like about your service provider and would like them to improve...

Section C – Group 3