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Value Added Services of Airtel: The Cat To Bell

Submitted in the partial fulfillment of Post Graduate Diploma in Managment

By

Varun RajITM Business School, Navi Mumbai

Under the guidance of

Mr Manoj Gupta Prof. Sudipto ChakrabortyManager, Marketing (VAS) Professor

Airtel, Delhi ITM Business School

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Certificate of Approval

The following Summer Project Report titled "Value Added Services of Airtel in Delhi NCR Circle" is

hereby approved as a certified study in management carried out and presented in a manner satisfactory

to warrant its acceptance as a prerequisite for the award ofPost-Graduate Diploma in Management for

which it has been submitted. It is understood that by this approval the undersigned do not necessarily

endorse or approve any statement made, opinion expressed or conclusion drawn therein but approve

the Summer Project Report only for the purpose it is submitted.

Summer Project Report Examination Committee for evaluation of Summer Project Report

Name Signature

1. Faculty Mentor Prof. Sudipto Chakarborty ___________________

2. Company Guide Mr Manoj Gupta ___________________

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Certificate from Summer Project Guides

This is to certify that Mr. Varun Raj, a student of the Post-Graduate Diploma in Management, has

worked under our guidance and supervision. This Summer Project Report has the requisite standard andto the best of our knowledge no part of it has been reproduced from any other summer project,

monograph, report or book.

Prof. Sudipto Chakarborty Mr. Manoj Gupta

ITM Business School Manager, Marketing (VAS)Navi Mumbai Bharti Airtel Ltd.

270, Udyog Vihar, Gurgaon

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Acknowledgement

I take this opportunity to express my happiness and gratitude towards Bharti Airtel Limitedand

its management for providing me the opportunity to pursue my summer training in the

Company.

I feel great pleasure in expressing my deep sense of gratitude and profound thanks to my

project guide/mentorMr. Manoj Gupta (Manager Marketing - VAS) for his continuous

encouragement and assistance which helped me in completing this project successfully.

I also express my gratitude to my summer internship guide, Prof. Sudipto Chakraborty, Faculty,

ITM Business School, Navi Mumbai for providing necessary guidance from time to time

essential to the completion of my project.

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OBJECTIVES

Understanding the Value Added Services of Airtel in Delhi NCR Circle. Finding the Ways to increase the market penetration of these services:

- Studying the Customer Behaviour- Understanding the Retailers Market of Value Added Services.- Customer Profiling using various segmentation criteria.

METHODOLOGY

PRIMARY RESEARCH

Customer Survey (Telephonic Survey) Retailers Survey (Questionnaire Based)

SECONDARY RESEARCH

Secondary data analysis: Understanding the Usage Pattern (November 08 April09) Customer Profiling on the basis of cell site analysis Demographic (Age & Gender) and Socio-Cultural (Religion Based) Segmentation Age on Network Vs Decrement Analysis

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INDIAN TELECOM INDUSTRY

INTRODUCTION

The Indian telecommunications industry is one of the fastest growing in the world and India is the

second largest telecom market globally just behind China. In fact, in April 2008, India had already

overtaken the US as the second largest wireless market.

A large population, low telephony penetration levels, and a rise in consumers' income and spending

owing to strong economic growth, have been instrumental in Indian telecom market growth. Mobile

telephony was introduced in Indian markets in mid- 1990s. In the last few years, the sector has

witnessed tremendous growth.

India added 113.26 million new customers in 2008, the largest globally. To put this growth into

perspective, the countrys cellular base witnessed close to 50 per cent growth in 2008, with an average

9.5 million customers added every month. According to the Telecom Regulatory Authority of India

(TRAI), the total number of telephone connections (mobile as well as fixed) had touched 385 million as

of December 2008, taking the telecom penetration to over 33 per cent. This means that one out of every

three Indians has a telephone connection, and telecom companies expect this pace of growth to

continue in 2009 as well.

According to CRISIL Research estimates, eight infrastructure sectors, which include the telecom sector,

are expected to draw more than US$ 345.28 billion investment in India by 2012. With the rural India

growth story unfolding, the telecom sector is likely to see tremendous growth in India's rural and semi-

urban areas in the years to come. By 2012, India is likely to have 200 million rural telecom connections

at a penetration rate of 25 per cent. And according to a report jointly released by Confederation of

Indian Industry (CII) and Ernst & Young, by 2012, rural users will account for over 60 per cent of the total

telecom subscriber base.

Further, according to Business Monitor International, India is currently adding 8-10 million mobile

subscribers every month. It is estimated that by mid 2012, around half the country's population will own

a mobile phone. This would translate into 612 million mobile subscribers, accounting for a tele-density

of around 51 per cent by 2012.

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After the Telecommunication policies were revised to allow private operators, companies such

as Bharti Telecom, Tata Indicom, Vodafone, MTNL, Idea and BPL entered the space. Liberalized

policies have ensured lower tariffs and reduced roaming rentals. This will lead to increased

usage of mobile phones. Mobile telephony can be further categorized into CDMA and GSM.

Mobile telephony provides services such as messaging- text and multimedia- mobile commerce

through GPRS enabled mobile Internet, with local calls and long distance calls- national and

international. Not only service providers but also equipment manufacturers are contributing

towards the growth of the sector. Mobile telephony started up with bulky handsets and has

now reached to smart phones with cameras, radio facility and lots of other multimedia

applications. Also, PDAs have entered Indian markets with operating systems that make it a

pocket PC.

Although India's tele-density has improved from under 4% in March 2001 to over 35% by the

end of January 2009, we are still way behind other developing nations. Cellular telephony has

emerged as the fastest growing segment in the Indian telecom industry. The mobile subscriber

base (GSM and CDMA combined) has grown from under 2 million at the end of FY00 to touch

400 million at the end of May 2009. Tariff reduction and decline in handset costs has helped the

segment to gain in scale.

Source: Cellular Operators Association of India

Bharti Airtel

33%

Vodafone24%

BSNL/MTNL

16%

Idea

15%

Aircel

7%

Reliance

4% Others

1%

GSM Market Share (As on May'09)

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Source: Cellular Operators Association of India

Industry Size

y The telecom network in India is the fifth largest network in the world meeting up with globalstandards. Presently, the Indian telecom industry is currently slated to an estimated

contribution of nearly 1% to Indias GDP.

y FY09 saw the continuance of strong growth for the Indian telecom market, which witnessed a46% YoY increase in its subscriber base during the 12-month period. At the end of January 2009,

the countrys total telecom subscriber base (fixed plus mobile) stood at 400 million. Tele density

crossed the 35% mark by the end of the fiscal.

y Growth remained robust in the GSM mobile space, with the same growing its subscriber base by71 m, thus contributing to 76% of the total incremental subscriber addition for the entire Indian

telecom market. After a strong 75% YoY increase in subscriptions during FY07, the GSM industry

recorded another good performance during FY08, growing subscriber base by 59% YoY to over

192 m.

y During FY08, India's mobile subscriber base grew by 58% YoY, from 165 m to 261 m, while thefixed subscriber base declined by 3%, from 40.8 m to 39 m.

y The year also saw a strong 67% YoY rise in the Internet broadband subscriber base. Currently,the base stands at around 4 m users, as against 1.4 m at the end of March 2007.

Reliance

57%

Tata Tele

33%

BSNL/MTNL

7%

Others

3%

CDMA Market Share (As on May'09)

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Growth Estimates

It is well established that India has had one of the most remarkable growth in Telecom sector

since it was opened to private investments in 1994. India has been breaking all types of records

on new subscriber additions in the last two years by adding up to 8-10 million phones a month.

The Department of Telecommunication has estimated that Total mobile subscriber base in India

will cross 1 billion by the year 2014. Mobile teledensity is also expected to cross 80% in the

same year, which means that 8 out of every 10 Indians will have access to a mobile device.

YEAR POPULATION (millions) MOBILE DENSITY SUBSCRIBER BASE

2010 1200.9 46.5 558.9

2011 1217.8 55.8 680

2012 1233.3 64.7 797.8

2013 1248.9 72.9 909.1

2014 1264.8 80.2 1014.4

2015 1280.9 88.7 1109.1

(DOT forecast on Mobile Penetration, Times of India, May 26, 2009)

Growth Prospects

As far as the fixed line business goes, the low penetration levels in the country and the increasing

demand for data based services such as the Internet will act as major catalysts in the growth ofthis segment, which had a subscriber base of over 39 m at the end of FY08. The huge market

share of public sector behemoths, MTNL and BSNL is likely to get reduced further as the

penetration by private players spreads. In spite of this the PSUs will continue to retain their

dominant position this is on account of high capital investments required in setting up a

nationwide network. As a result, the private sector players will have to rely on key business

centers and pockets of high urbanization for their growth.

Increasing choice and one of the lowest tariffs in the world have made the cellular services an

attractive proposition for the average consumer. The segments subscriber base has grown by

over 57% YoY in FY08. Policy measures like lowering of taxes on the cellular industry and

benefits of enhanced FDI limits shall further the prospects of the cellular industry. Although

increased competition will result in depressed revenues in the near term, low tariffs would

ultimately result in increased volumes and higher usage.

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PROVIDER ADDITION IN JUNE 09 TOTAL BASE

AIRTEL 2.81 102.3

VODAFONE-ESSAR 2.36 68.7

AIRCEL 1.11 21.7

IDEA-SPICE 1

.61 47

RELIANCE COMM. 3.6 69.2

TATA TELESERVICES 1.4 32.7

BSNL-MTNL 1.2 50.8

Source: TRAI (All figures in millions)

GrowthDrivers

y Vast geographic expanse of India acts as a catalyst to boost mobilityy Low call costs since 2002 has fueled the wireless segmenty Narrowing gap of call costs between fixed and wireless customers and convince them to

subscribe to the wireless connections

y Improving standard of living with people having more dispensable income.y Nationwide roaming facilities on GSMy SMS facilityy Internet + Subscription bundlingy Reduced cost of handsets (affordability factor)y Customs duties have been reduced from 10% to 5%y In remote areas where providing fixed line connections were difficult, wireless did the

magic.

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MOBILE VALUE ADDED SERVICES (MVAS)

Today Telecommunication has moved beyond providing just basic voice calls. The mobile phone has

evolved from a mere communication device to an access mode with an ability to tap a plethora of

information and services available in the ecosystem. This is the reason why it is now being referred to asthe fourth screen, after Cinema halls, Television and PC.

Value Added Service (VAS) in telecommunication industry refers to non-core services, other than the

standard voice calls and fax transmission. The value added services are characterized as under:-

Not a form of core or basic service but adds value in total service offering.

Stands alone in terms of profitability and also stimulates incremental demand for core or basic services

Can sometimes be provided as stand alone.

Do not cannibalize core or basic service.

Can be add-on to core or basic service and as such can be sold at premium price.

May provide operational synergy with core or basic services.

A value added service may demonstrate one or more of these characteristics and not necessarily all of

them.

As per the definition of Telecom Regulatory Authority of India (TRAI), Value Added Services are

enhanced services which add value to the basic teleservices and bearer services for which separate

licence are issued

Today Value Added Services are used as a tool for differentiation and allow mobile operators to develop

another stream of revenue contributing 20% of their total topline.

The Current Indian Mobile VAS industry is estimated at Rs 9760 crores and is expected to grow steadily

at around 70% over the next few years to touch Rs 16500 crores by end June 2010. (Source-IMRB)

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UNDERSTANDING THE DIFFERENT MVAS CATEGORIES

Entertainment VAS Information VAS mCommerce

Definition These services provideEntertainment for leisure

time.

These services usually

generate

mass appeal

These are the services which

provide

some useful information to

the end

user. The user interest comes

from

personal or relevant

component of the

content.

These are the services which

involve some transaction on

mobile

Current Status Entertainment VAS is drivingthe

VAS market both in terms of

volume and revenue.

Information VAS is getting

popular

with different categories

depending

on the relevance

mCommerce is currently in

embryonic stage

Future Status Entertainment VAS isexpected to

remain the VAS driver for the

next

few years

Information VAS is going to

be key to address the needs

of

growing rural market

mCommerce has the

potential to

emerge as a key VAS

component

once security concerns are

addressed

Examples Jokes, Ringtones, Caller RingBack tones (Hello Tunes),

Wallpapers etc.

News, Stock Updates, Travel

Information, Bank Account

Information, Traffic Update

Train Ticket, Air Ticket, Movie

Ticket, Bill Payment

Perceived Value - Perceived value of a MVAS depends on perceived rather than the actual utility to the

end user. When the immediate benefit may not be clear to the subscriber, the value that a subscriberderives from it largely depends on the marketing efforts and persona related to the service.

A good example of a MVAS with high perceived value is CRBT (Caller Ring Back Tone).

Practical Value - Practical value is completely based on tangible benefits derived from the service. The

benefits considered could be based on convenience, time or money. E.g. Service availed to get the

cheapest air fares available, money transfer using mobile.

MVAS

Entertainment Infotainment mCommerce

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Source: IMRB Research

NEED FOR MOBILE VALUE ADDED SERVICES

Over the last 5 years, the telecom industry has understood the importance of MVAS. Given the declining

ARPU and increasing competition among operators its imperative to focus on alternate revenue

streams.

Thats where there is a felt need for capitalizing on the Value Added Services Market.The reasons for the increasing importance of MVAS can be classified as:

DECREASE IN ARPU DESPITE INCREASE IN MOU: Though the subscriber base is growing at a rapid

pace andhas positively impacted industry revenues, operator margins also have shrunk owing to

competition andlower Average Revenue per User (ARPU) as the major growth is coming from

bottom of the pyramid.As ARPU declines and voice gets commoditized, the challenge is to developalternative revenue streamsand retain customers by creating a basis for differentiation in high-churnmarkets.

0

2

4

6

8

10

0 2 4 6

Percieve

d Value

Practical Value

VAS Market 2008

Entertainmen

t

Infotainment

mCommerc

e

0123456

789

10

0 2 4 6

Percieve

d Value

Practical Value

VAS Market 2013

Entertainment

Infotainmen

t

mCommerc

e

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NEED FOR DIFFERENTIATION: There is a greater need among the telecom operators to differentiate

themselvesfrom each other.

Increasing Competition: With increasing number of licensees in the telecom space the averagenumbers of operators in many circles have increased to 5-6 operators offering more choices to the

consumer. Thus the competition among the operators has increased tremendously. Therefore it is

very important for them to differentiate themselves from the others. Now that voice has got

commoditized these operators are using MVAS for their differentiation and marketing these services

heavily for creating awareness among the consumers.

3G bidders who are non operators: The arrival of new technologies will give rise to greatercompetition as many non operators are also bidding for the 3G licenses. Department of Telecom has

planned to allow five 3G operators in each circle depending on the availability of spectrum.

Therefore there would be a greater need to differentiate one self in order to attract new customers

and retain the existing ones.

Saturation in Metro and Urban Market: The metro/urban areas offer high level of penetrationand have significant mobile subscribers. In such a highly saturated market with the entry of

MVNOs the competition will get fierce. Therefore capitalizing on value added services will give

operators opportunity to increase ARPU by providing premium services.

0

50

100

150

200

250

300

350

ARPU in INR

Declining Average Revenue Per User (ARPU)

Source: TRAI Quarterly

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Metro Circle Penetration

Delhi 90%

Mumbai 70%

Chennai 89%

Kolkata 67%

Bangalore 80%

Source: Broadband & Internet India

y INCREASING NEED AND DEMAND FROM CONSUMERS: In addition to the above supply sidereasons, the pull effect from consumers asking for more than just basic telephony is also a key

driver for MVAS services. Today most of the consumers are seeking more from their communication

device apart from just mobility and desire to stay connected.

MOBILE VALUE ADDED SERVICES VALUE CHAIN

Content Owners

These are the actual owners of the content who hold the copyright of the same. Though the content is

developed for some other media, the MVAS has started contributing significantly to their overall

revenuegeneration. For Example Aaj Tak News Channel Providing News Alert. They mostly providecontent to Content Aggregators but also some times interact directly with the operators.

Content Aggregators/Developers:

The MVAS growth has given birth to a new entity which aggregates content originally designed for some

other media, from different sources. Some of the content aggregatorsalso develop content especially

formobile phones for e.g. mobile games. For Example, Symbiotic, OnMobile etc.

Content OwnerContent

AggregatorTelecomOperator

PlatformEnabler

End User/Subscriber

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Technology Enablers

Technology partner & platform enablers handle software platforms and authoring tools. Thus they

provide thebackbone to all the MVAS being provided. The technology backend include solutions likeTelevoting system,Voice portal, etc.

REVENUE SHARING MODEL

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DRIVERS TO THE GROWTH OF MVAS IN INDIA

Push Factors:

Marketing Efforts by Operators : Operators are investing heavily in reaching out tocustomers moreeffectively to make them aware ofvarious services being offered by them. Among the promotionscarried out by operators, 60-70% would be for VAS be it Hello Tunes, Alert Services or m-Commerce.

Increase in User Base: On an average about 8.5 Million mobile subscribers are being added every month

and therefore the mobile industry is witnessing an unprecedented growth. With increasing growth rate

oflow end subscribers Traditional MVAS (P2P and P2A SMS) will have a huge growth potential amongthelow end mobile subscribers.

Price Decline of MVAS services: Looking at the high growth rate of low end mobile subscribers the

MVAS services are being offered at attractive prices such as subscription packs of free SMS or news

alerts etc.

New Technology Adoption By operators: From 3G, new services for premium MVAS consumers will

come like video services which use fair amount of bandwidth, (live TV, cricket match). Today because of

lack of data speed it just does not work

Pull Factors:

In the age of convergence, the prominent growth driver of MVAS would be the consumers desire of

gettingmore and more from their personal cellular device. While among the youth in India

entertainment servicewould be popular, the other consumers would also look out for utility basedservices like location information,mobile commerce (M-Commerce) for mobile transactions and Localcontent rich services.

Need for Entertainment: The youth segment that makes up 30% of the total handsets market in India

seeks entertainment on mobile. Currently, about 44% of MVAS revenue in India is driven by short

messaging service applications. The youth segment will also continue to drive the market, particularly in

the entertainment MVAS.

M-commerce and Transaction based services: In year to come money transfers, driven by lack of

banking infrastructure seems to be a key service need. M-commerce would be a large growth driver in

2-3 years time. With a lot of companies offering billpayment for utility services through mobile will

help grow m-commerce. This will largely come from urban because m-commerce is related verystrongly with bank accounts, credit cards which is largely anurban phenomenon.

Local Content : Unfortunately today Local content not available adequately. The content partners

currently are not developing content specific to even big metropolitan towns such as Durg or Raipur

not totalk about relatively smaller towns. Therefore there is a great need of investing right resources indeveloping rich content which millions of users will start subscribing.

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BARRIERS TO THE GROWTH OF MVAS IN INDIA

Demand Perspective

Limited awareness of services: The consumers are not fully aware of the services offered in the MVAS

market. The promotional SMS sent on the mobile phones are the primary source of making end

consumeraware of value added services. This method of promoting MVAS has now reached the

saturation stage.The stakeholders need to ensure that the consumers are educated about the value of

the services in theMVAS market. This would ensure more acceptability and usage of services among the

users.

High cost of content: Currently, the value added services are priced at a higher side. This is hampering

growth of MVAS market. The consumers look for value in a service if they are paying for it. Presently,

the consumers perceive that MVAS is priced higher than the actual value it is delivering to theconsumers.The Indian MVAS market consists primarily of prepaid users, who have relatively lower

budget forMVAS in their overall mobile expenditure. The stakeholders need to package the services in a

mannerthat ensures correct mix of money and value to the consumer.

Exit barriers for MVAS consumers are high: The service providers dont make the consumers well

aware of the process of unsubscribing from any service. The consumers may restrain from using the

services in case the exit barriers are too high. The service providers need to ensure that there is a

correct mechanism for making the users aware of exiting from the service.

Supply Perspective

Transparency in Revenue sharing arrangements: Revenue sharing arrangement in India is one of the

biggest hindrances for the growth of MVAS market. The stakeholders are in conflict with each other

about the revenue sharing system in India. Presently, telecom operators take majority of the revenue

andthe other entities get a lower share in the overall revenue. This is hampering the growth of content

development in India, and in turn the overall MVAS market. There is a need for designing a fair revenue

structure so that all the stakeholders in the ecosystem get theirshare of the revenue. This can be

achieved by aligning the revenue structure in accordance with theservices.

Limited availability of local content: Growth of MVAS market in India is hampered by lack of

localization of the content. Lack of local content restrains the growth of MVAS market in regional areas,

which has a great potential. This requires investment from the content providers. The stakeholders are

unsure about the return on investment, therefore, are concentrating only on mass market services.

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Introductionto Bharti Airtel

Bharti Airtel Limited is Indias largest integrated and the first private telecom services provider with a

footprint in all the 23 telecom circles. It also acts as a carrier for national and international long distance

communication services. The company has a submarine cable landing station at Chennai, which

connects the submarine cable connecting Chennai and Singapore. Globally, Bharti Airtel is the 3rd

largest in-country mobile operator by subscriber base, behind China Mobile and China Unicom.

Bharti Airtel since its inception has been at the forefront of technology and has steered the course of

the telecom sector in the country with its world class products and services. Established in 1985, Bharti

has been a pioneering force in the telecom sector with many firsts and innovations to its credit, ranging

from being the first mobile service in Delhi, first private basic telephone service provider in the country,first Indian company to provide comprehensive telecom services outside India in Seychelles and first

private sector service provider to launch National Long Distance Services in India. Bharti Tele-Ventures

Limited was incorporated on July 7, 1995 for promoting investments in telecommunications services. Its

subsidiaries operate telecom services across India. Bhartis operations are broadly handled by two

companies: the Mobility group, which handles the mobile services in 16 circles out of a total 23 circles

across the country; and the Infotel group, which handles the NLD, ILD, fixed line, broadband, data, and

satellite-based services. Together they have so far deployed around 23,000 km of optical fiber cables

across the country, coupled with approximately 1,500 nodes, and presence in around 200 locations. The

group has a total customer base of 100 million.

Bharti Tele-Ventures' strategic objective is to capitalize on the growth opportunities the company

believes are available in the Indian telecommunications market and consolidate its position to be the

leading integrated telecommunications services provider in key markets in India, with a focus on

providing mobile services.

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BHARTI AIRTEL STRATEGIC BUSINESS UNITS

The businesses at Bharti Airtel have been structured into three individual strategic business

units (SBUs): -

Bharti Airtel

Tele-MediaServices

Mobile ServicesEnterprises

Services

Bharti Airtel offers

GSM mobile services

in all the 23-telecom

circles of India and is

the largest mobileservice provider in

the country, based

on the number of

customers.

The group offers high

speed broadband

internet with a best

in class network.

With Landlineservices in 94 cities it

help you stay in

touch with your

friends & family and

the world. Get world

class entertainment

with Indias best

direct to home (DTH)

service digital TV in

more than 150 cities

Enterprise Services

provides a broad

portfolio of

services to large

Enterprise andCarrier customers

(B2B). This division

comprises of the

Carrier and

Corporate business

unit. Enterprise

Services is

regarded as the

trusted

communications

partner.

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Missions

To meet the global standards for telecom services that delight customers through:

y Customer service focusy Empowered employeesy Innovative servicesy Cost Efficiency

Values

CUSTOMER: We will be responsible to the needs of our customers.

PEOPLE: We will trust and respect our employees.

LEARNING: We will continuously improve our services innovatively and expeditiously.

COMMUNITY: We will be transparent and sensitive in our dealings with all stakeholders.

OPPORTUNITIES: Imagine having the resources to influence tomorrows reality today. At Airtel

we are seeking people whose ideas can make a difference, individuals who thrive on the opportunity to

think creatively and be empowered to deliver. We are proud of our ability to nurture individuals and

provide them the space and empowerment they need to home their talents. Our size gives us the

unique ability to provide fast growth and high responsibility early in ones career as well as multiple

avenues to reach the top.

Vision and Promises

By 2010 Airtel will be the most admired brand in India:

y Loved by more customersy Targeted by top talenty Benchmarked by more businesses

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Marketing Department in Delhi Circle

The marketing department in Airtel Delhi circle is divided into a number of sub -divisions that

look after the various aspects of marketing the services offered by Airtel in the NCR circle. The

main functional divisions are:

Some Recent Achievements:

y In May, 2009 Bharti Airtel became the first telecom operator in India to cross 100 millioncustomer mark. This milestone made Airtel the fifth largest telecom operator in the

world and the second largest in Asia.

y In June, 2009 Airtel crossed 5 million customer mark in Delhi NCR circle.y In June, 2009 Bharti Airtel successfully entered into the much awaited and ambitious

strategic marger with South African Telecom Giant, MTN.

Marketing

AcquistionUsage

& RetentionValue Added

ServicesRevenuePlanning

MarketingCommunication

& Branding

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CUSTOMER SEGMENTATION ON THE BASIS OF VARIOUS CRITERIA

Value Added Services (SMS based alerts) is a highly niche product. Thus for a person to shell out

money for such services required to have a strong need as well as interest for the same. In such

a scenario the segmentation and profiling of customers as per the services become imperative.The following table shows the various criteria on which the segmentation can be done for eachservice.

DEVOTION

Demographic(Age)

Socio-Cultural(Religion and

Beliefs)

GeographicUsing the Cell

sites

NEWS/STOCK

Demographic(Age and

Occupation)

Socio-Cultural(CorporateCustomer)

Geographic

Using the Cellsites

SPORTS/CRICKET

Demographic(Age and

Occupation)

Geographic

Using the cellsites

JOBS

Demographic(Age and

Occupation)

Geographic

Using thecell sites

BOLLYWOOD/

LOVE

Demographic

(Age)

Psychographic(Movie Buff)

Geographic

Using the cellsites

HEALTH/ BEAUTY

Demographic(Age and Sex)

Socio-Cultural(Corporate

People, HighClass)

Psychographic(Health

Conscious &

BeautyConscious)

Geographic(Establishments)

Using the cell site

JOKES/SHAYARI

Behavioural(On the basis

of SMSusage)

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DEMOGRAPHIC & RELIGION BASED SEGMENTATION OF ENTIRE CUSTOMER BASE OFDELHI NCR CIRCLE

Total MobileCustomers

(54.7)

Postpaid

(9.3)

DND

(4.65)

Non DND

(4.67)

Age

Gender

Faith

Prepaid

(45.4) Non DND(41.26)

Age

Gender

Faith

DND

(4.13)

Inactive Base

(9.0)

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24 | P a g e

Post-paid Customers

Remaining customer base (mostly consisting of Hindu) could not be segmented on the basis of religion

using their last name.

Non DND

(4.67 lakh)

Age

Gender

Religion

Age Grou

No. of customers

ercentage

< 7 6

>

6

6

otal 4

Gender alutation

otal ustomers years

ale

r.

6

6

(76

!)

" # 7

$7(

# !)

% $7

#4

#(4

!) 7

# % (

% .

!)

s.

$ " (7

!)

% $ 4

$(

.4

!)

% 66

#(

#.

!) 4

$ (

% !)

rs.

4 % "

(7. !

) 4 %

4(% !

)# #

(4. !

)"

67%

(% !

)&emale

Religion No. of '

ustomers <

years

years >

year

un(

abi 6 ( .4) ) 4 6 6 4

Gu

taAgra

0al etc.

66 (7

))

46

4 4

4

1uslims 6

6 (

.

))

6

67

2

ain 4 ( . ) ) 4 4

'hristian

(

.

)) 4

6

4

73

6 in number =4 3 5 6

73

6 in last =7 3 6

7

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26 | P a g e

CUSTOMER PROFILING USING CELL SITES

A cell site is a term used for a site where antennas and electronic communications equipment are placed

on a radio tower to create a cell in a network. A cell site is composed of a tower or other elevated

structure for mounting antennas, and one or more sets of transmitter/receivers transceivers, digital

signal processors, control electronics, a GPS receiver for timing, regular and backup electrical power

sources, and sheltering.

Customer Data of 50 lakh was used for this analysis. Database contained the phone number and the

corresponding cell site from where that customer did maximum calling for the month i.e May09.

Results after using Cell Site based Segmented customer Base

The following table shows the number of hits i.e. subscription achieved when the customer base of 1 lac

for each of the service was sent the promotional SMS. The number of hits achieved rose significantly

when the promotion was done on the segmented base using Cell Sites Analysis.

ServiceNo. of Cell

Sites

Numb er of Prospective Customers

(on the b asis of cell site analysis)

Sports 183 2,39,236

Devotion 126 2,09,104

Health/Beauty 161 4,52,950

Love/Bollywood 82 1,27,055

News 98 3,55,197

Jobs 139 94,223

Jokes/Shayari 1,97,342

News Stock Health/Beauty Jobs Bollywood

n 1-June,09 543 340 233 175 98

n 15-June,09 1545 1143 797 980 413

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27 | P a g e

Cross Product Analysis

For Above Analysis the following VAS except P2P messaging was taken.

*More than 12 lakhs customers are on >1 VAS.

SMS Alert Analysis On the Basis of Age

All the subscribers of SMS alert services were atleast graduate or above VOCVOC.xls

P2A A2P Airtel Live MKR MOD MCA HT Vchat

Age G o p

A2P P2A HT MOD MKR Vchat Ai tel ive MCA

0 10 849 44 343 39 09 11 687 12 00 9 4 9 12 016 10 426

Total 1 31 646 16 392 9 401 1 42 373 1 33 072 1 09 3 4 1 40 2 8 1 37 101

VAS

Age Go

p

ew

Spo

ts Devotio

Jo

s Jo

es Total

0 1612 67

892 1

34

848

372

SMS Alet*

P2A

AgeGo

ps 1 2 3 4 >5 A2P

50 1

1998 67

773 18

809

780 1

860 HT

Total 18 2 237 8 61 70 2 46 642 70 071 23 64 Vchat

m e ofSubscribe VAS*

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28 | P a g e

AON Vs Decrement Analysis

Selected Area indicated the monthly decrement bracket containing maximum subscribers for a

particular service.

0- - -6 6- j k j l

otal

0- m n 5 5o 5

n

- 0

n 5

n

5

11- j 0 m 5 n n

m

21-0

n m o n 5

55

31-

n n

n m o

o

m

6-60 n n n

n o

61-9 55 m o o

n n 5o

96-120 5 n m o 5 n

m n n n o o

121-150

m o n m o o

n m n

151-180 n n 5

n o o

181-210n n

5

o

o m

211-240 n 5 5

m

241-270 n n n m m m

271-300 n n n n 5 n 5 m n m n

AB 300 n o n n m o

m 5

5 n o

NEWS

Decrement

AON (mont

)

0-1 1-3 3-6 6-12 >12 Total

0-3 z { | | | 5}~

{

|

4-10{5

{ } {

~

} }

{ } z

11-20 {

{

~

{ {

~

{ | z

21-30 {

|5

{ z | z

} |

}

|

31-45| {

{ {

z {5

|5

~ ~

z

46-60z }

~

} { |5

z

z

} |

z

61-95

{ { }

|

{5

~

}

5z

~ ~

96-120z

z z

| |

{ }

~

{ |

121-150|

~

{

z

5 ~

| {5

~

151-180 z

{ {

5| |

~

5

{ |

|

181-210 z z

{

~

| |

~ ~

{ |

|

211-240z { }

{ | z |

} }

{ {

5

241-270{ z } } { |

~

z

5~

5 ~

{

{

271-300 { z~

} { z

~

z z

~

5

5 ~

AB 300{ |

5}

z z {5

5~

5{ |

~

|

JOBS

Decrement

AON(mont )

0-1 1-3 3-6 6-12 >12 Total

0-3

4-10

11-20

21-30

31-45

5

5

46-60

5

61-95

5

5

96-120

5

121-150

151-180 5

5

5

181-210

5

5

211-240

5

241-270

5

5

5

271-300

AB 300

55

5

CRICKET/SPORTS

Decrement

AON (mon t

)

0-1 1-3 3-6 6-12 >12 Total

0-3

5

4-10

11-20

5

21-30

31-45

5

5

46-60

5

5

61-95

96-120

121-150

5

151-180

5

181-210

5

211-240

241-270

5

271-300

AB 300

55

5

DEVOTION

Decrement

AON (mont

)

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29 | P a g e

Voice of Retailer Findings

VAS related findings:

Some other Findings:

y Popular SMS Packs:Vodafone@35, Idea@35, 42 and 79 (where Vodafone@35 is a great hit).

y Higher margin on super value coupons by other operators especially by Vodafone which gives 12-15% margin as compared to Airtel who gives 5-8%.

y Full Talktime@222;great demand in the market.y Local A2A 1000 mins@197 was a hit.y Reclaim of damaged SIMs and recharge coupons poses great difficulty for retailers.y Most of the retailers are not happy with their distributors.

Retailers Covered

West Delhi

(40)

South Delhi

(40)

North Delhi

(40)

East Delhi

(40)

Con

e ns Findings e

ommendations

wareness La

of awareness about

S in the

ar

et. Needof advertisin

S throu

h different

edias so that

ar

et be

o

es aware.

Custo

ers ull La

of

usto

ers de

and for

S throu

h retail

ar

et.

Need of usin

proper se

entation tar

etin

and

ar

etin

i

ta

ti

s.

Retailersush Retailers not willin

to push

S throu

h their

hannel

Retailers Mar

in

his loyalty with

irtel should be paid

pri

e att ention.

O s La

of O s related to

S Greaterneed of

S related O s in the retail

hannel(e

.

odafones Zoo

oos)

Confusion

oo

any short

odes raises

onfusion a

on

the

usto

ers

S

ards and easy

S should be introdu

ed at a bi

er

level.

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31 | P a g e

JOBS

Job Alert shows highest addition and churn among all services

JOKES AND SHAYARI

SPORTS/CRICKET

Mon t s J n Feb March

pril

Tot l b cr ber , ,

, ,

et ined er

ro

revio! "

# ont $

- 20,% %

22,

0,244

Uniq e er to ll

# ont $ 12, & ' & 12, & ' & 12, & ' & 12, & ' &

Additiono(

new

er

) e Mont $ 9, 28 15,105

%

C $ rn er - 8, % 48 7,503 7,855

Mon ths Jan Feb March

pril

Tot l

b cribe r 13 ,442 12,739 16,300 13,564

et inedU er (

ro # 0 revoi

# ont $

- 10,209 10,586 13,126

Uniq

eU er (

or

1 ll ont 2 "7,175 7,175 7,175 7,175

Additiono(

new

! " er ")

e Mont $ 2,530 5,714 438

3 $ rn er - 3,233 2,153 3,174

Mon ths Jan Feb March

pril

Tot1 l 4 ! b " criber " 9,267 10,364 14,124 11,530

5 et1 inedU " er "

ro revoi ! "

ont2

- 7,247 7,344 11,109

Uniq! eU " er " to

1 ll ont 2 "4,122 4,122 4,122 4,122

Additiono

new

! " er "6 1 "

e Mont 2 3,117 6,780 421

7 2 ! rn ! " er " - 2,020 3,020 3,015

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33 | P a g e

EDUCATION

As evident from the findings, most of the subscribers were having sound educational background with

maximum being graduates & above.

S T U thV

T W X

S T Y thV

Y W X

S raduate

& AboveV

a b X

c d e c f g h i p q r d h p

s t

u

th v

t

w

x

s t yth v

t

x

s raduate

& Above v

x

g r h e r

S T U th V

T U X

S T Yth V

Y Y X

s raduate

& Above v

x

g p

S T U th V

T b X

S T Y th V

Y X

s raduate

& Above v

u x

r p

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My Airtel My Offer (MAMO)

MAMO is a customized offering of Airtel where customer is informed about the offers according to their

needs. Customer needs to call 12131 for MAMo where he gets customised offers related to four services

viz. Recharge, Validity, Call Rates and Value Added Services.

Two new SMS alert offers were introduced and uploaded on MAMO portal for targeted promotion.

Total Customer Base Allocated = 10,41,446

Ty

of

stom rs

o

ff r Bas Allo at d

Existing Us rs

ASNJF Ne j k P l idl ndJokek m

reen o , n

ASJLF Joke k P l id l ndLovem

ree

,o

N w Us rs

ANNJF Ne P id ndJoke ree , z , o

ANJLF Joke k P l id l ndLovem

ree { , , o

Existing Us | rs

} ~ s ri

|d

} |rv i

|Allo at | d Off| r No.of ~ stom | rs

Ne

ASJLF 36, 34

Love ASNJF 8, 4

Other Servi e ASNJF 81, 18

N | w Us | rs

~ stom | r at | gor i | sAl lo at | d Off| r No.o f ~ stom | rs

Hi

hP A ( ove SMS/month) ANNJF & ANJLF ( % e h) 3,15,640

Hi

hP P ( 5 nd 42SMSP k er)

ANNJF & ANJLF (50% e h)6,00,000 (3,00,000

rome h te

or

)

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Recommendations:

Key Recommendations (Based on the Finding):

Some other inference Based Recommendations:

Some bundled offers can be introduced such as News Alert with Stock Alert. Airtel should think of some new utility based services apart from existing services such as

Examination Alerts, Traffic Alerts, Locator (SingTel).

Cross Product Promotion can be used such as Devotion Alerts to Devotion Hello Tunescustomers etc.

Fin ings R c mm n

i ns

etail Channel still not a medium

or promotion and

sales o

AS

Need o

tilisin

the or

anised retail in a more

e

ective way

Demo

raphic Se

mentation on the basis o

A

e ender

and eli

ion

Can be used

or tar

etin

speci

ic content such as

reli

ion based or a

e speci

ic.

12 lacs people on multiple

AS

1) Can introduce some combo o

ers

a

imum

AS SMS Alert) subscriber clustered in

monthly decrem ent bracket o

60 and above.

Daily Allocation

or promotion o

AS consists o

customers above 60 decrement

Around 39,000 subscribers are persistently on some or

the other SMS alert service

ro the last si

months

Need o

incentivi in

such custmers such as

ree one

month subscription

or their retention.

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BIBLIOGRAPHY & REFERENCES:

y Websites of Airtel (www.airtel.in)y DOT websitey www.telecomtiger.comy www.gsmworld.comy www.bloomberg.comy www.telecomwatch.comy www.cellebrum.comy www.secondrepublic.iny Reports from TRAI, COAI, AUSPI, BDA Analysis.y Report by IAMAI & eTechnology Group@IMRB on Mobile Value Added Services in India.

Published in August 2008.