Airtel Analysis

advertisement
INTRODUCTION
The Indian telecommunications Network is the second largest in the world 904.51 million
telephone connections based on the total number of telephone users. It has one of the lowest call
tariffs in the world enabled by the mega telephone networks and hyper-competition among them.
It has the world‟s third-largest Internet user-base with over 137 million as of March 2014. Major
sectors of the Indian telecommunication industry are telephone, Internet, and television
broadcasting. Today it is the fastest growing market in the world with 8.35 million monthly
additions. The mobile tele-density is 73.32% as on October 2013.
Telephone density in the country which is in an ongoing process of transforming into next
generation network, employs an extensive system of modern network elements such as digital
telephone exchanges, mobile switching centers, media gateways and signaling gateways at the
core, interconnected by a wide variety of transmission system using fibre-optics or Microwave
radio relay networks. The access network which connects the subscriber to the core, is highly
diversified with different copper-pair, optic-fibre and wireless technologies. DTH, a relatively
new broadcasting technology has attained significant popularity in the Television segment. The
introduction of private FM has given a fillip to the radio broadcasting in India.
Telecommunication in India has greatly been supported by the INSAT system of the country,
one of the largest domestic satellite systems in the world. India possesses a diversified
communications system, which links all parts of the country by telephone, Internet, radio,
television and satellite. Indian telecom industry underwent a high pace of market liberalization
and growth since 1990s and now has become the world's most competitive and one of the fastest
growing telecom markets. The Industry has grown over twenty times in just ten years, from
under 37 million subscribers in the year 2001 to over 846 million subscribers in the year 2011.
India has the world's second-largest mobile phone user base with over 904.51 million users as of
March 2014. It has the world's third-largest Internet user-base with over 137 million as of march
2014.
Telecommunication has supported the socioeconomic development of India and has played a
significant role to narrow down the rural-urban digital divide to some extent. It also has helped to
increase the transparency of governance with the introduction of e-governance in India. The
government has pragmatically used modern telecommunication facilities to deliver mass
education programs for the rural folk of India.
Private operators have made mobile telephony the fastest growing (over 164% p.a.) in India.
With more than 900 million users (both CDMA and GSM), wireless is the principal growth
engine of the Indian telecom industry. Intense competition between the four main private groups
– Bharti Airtel, Vodafone, Tata and Reliance and with the State sector incumbents-BSNL and
MTNL has brought about a significant drop in tariffs. There has been almost 74% in cell phone
charges, 70% in ILD calls and 25% drop in NLD charges, resulting in a boom time for the
consumers.
The Government has played a key enabling role by deregulating and liberalizing the industry,
ushering in competition and paving the way for growth. While there were regulatory
irregularities earlier, resulting in litigation, these have all been addressed now. Customs duties on
hardware and mobile handsets have been reduced from 14 percent to 5 percent.
The Indian government has merged the IT and Telecom Ministries to speed up reforms and
decision on the Communication Convergence Bill to enable the common regulation of the
Internet, broadcasting and telecoms will be taken after the new Government assumes
responsibilities in may this year. An independent regulatory body (TRAI) and dispute settlement
body (TDSAT) is fully functional.
Company Profile
Name
Bharti Airtel
Type
Public
Industry
Telecommunication
Founded
New Delhi
Founder
Sunil Bharti Mittal
Headquarter
New Delhi
Area Served
South Asia, Africa & the Channel Islands
Subsidiaries
Airtel Africa
Airtel Digital TV
Airtel Sri Lanka
Airtel Bangladesh
Sunil Mittal founded the Bharti Group. In 1983, Mittal was in an agreement with Germany's
Siemens to manufacture push-button telephone models for the Indian market. In 1986, Mittal
incorporated Bharti Telecom Limited (BTL), and his company became the first in India to offer
push-button telephones, establishing the basis of Bharti Enterprises.
Bharti Airtel, formerly known as Bharti Tele-Ventures Limited (BTVL) is among India's largest
mobile phone and Fixed Network operators headquartered at New Delhi, India. It operates in 20
countries across South Asia, Africa and the Channel Islands. Airtel has GSM network in all
countries in which it operates, providing 2G, 3G and 4G services depending upon the country of
operation. Airtel is the world‟s third largest mobile telecommunications company with over 287
million subscribers across 150 countries as of December, 2013. It is the largest cellular service
provider in India, with 287 million subscribers as of December 2013. Airtel is the third largest
in-country mobile operator by subscriber base, behind China Mobile and China Unicom.
Airtel is the largest provider of mobile telephony and second largest provider of fixed telephony
in India, and is also a provider of broadband and subscription television services. It offers Indian
telecom services under the airtel brand, and is headed by Sunil Bharti Mittal. Bharti Airtel is the
first Indian telecom service provider to achieve Cisco gold certification. 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. Currently Airtel is the fourth largest mobile operator in the world and
has recorded the highest user growth percentage.
Operator
Connections (millions)*
% Increase
China Mobile
683.08
11 %
Vodafone Group
386.88
5%
America Movil Group
251.83
7%
Bharti Airtel
250.04
13 %
Telefonica Group
243.51
7%
Market Share
Column1
Airtel
Reliance
Vodafone Idea
TATA
Aircel
Uninor
Others
5%
7%
20%
9%
11%
18%
13%
17%
BSNL
Awards & Achievements
Bharti
Airtel
Shared
Services
Team
won
two
awards
in
categories
of Value
Creation and Innovation & Improvement at the SSON (Shared Services & Outsourcing Network)
Excellence Awards 2012.
Bharti Airtel won four Effie awards at the Effie Awards 2012. Airtel's extremely popular 'Har ek
friend zaroori hota hai' campaign conceptualized by Taproot India, stood out as a campaign
amongst all nominations, winning three Gold Effie awards.
Apart from a Gold in the'Telecom & Related Services' category, the campaign won a Gold each
in 'Digital Advertising' and 'Integrated Advertising'. Bharti Airtel also won one Silver Effie
award for its 'Baat sirf paison ki nahin hai' campaign for airtel moneyin the telecom category.
Sanjay Kapoor was awarded the "Telecom Person of the year 2012" at the "Voice & Data
Telecom Leadership Awards 2012". The award was accorded by Honourable Minister of New
and Renewable Energy, Dr. Farooq Abdullah.
Bharti Airtel won the QuEST Forum India Quality Award for the Top Telecom Service
Provider. QuEST Forum is a unique collaboration of information and communication
technologies (ICT) service providers and suppliers across the world, dedicated to improving
operational and supply chain quality and performance.
Bharti Airtel was awarded the No. 1 Service brand in Brand Equity's List of "Most Trusted
Brands".
Bharti
Airtel
was
mMoney' at Aegis
felicitated
Graham
for 'Best
Bell
Mobile
Service
Awards held
on
Provider' and 'Innovation
November
1,
in
2012.
The Aegis Graham Bell awards honor the best innovations in the field of TIME (Telecom,
Internet, Media & Edutainment) recognizing the most exceptional contributions in the respective
fields.
Bharti Airtel was awarded the 'Brand of the Year' at the CNBC TV18's flagship initiative,
the India Business Leader Awards (IBLA) for itsHar Ek Friend Zaroori Hota Hai campaign. The
IBLA Brand Of The Year Award seeks to recognize a brand mass media/ communication
campaign based on its key message, popularity amongst the target audience and impact on the
brand.
Bharti Airtel won the 'Excellence in First People Initiative' award at the first, People 2012
Awards. Airtel HR's multiple initiatives in enhancing the internal customer's experience through
innovation and leveraging mobile technology helped us to win the prestigious award.
The Airtel Centre of Excellence (ACE) received the 'Excellence Award for Shared Service
Centre Operations in India' in the 2nd National Shared Services Council by All India
Management Association and Delhi Management Association in recognition of their outstanding
efforts to identify key strategic drivers and implementing them to deliver value to all
stakeholders.
Bharti Airtel won the highly prestigious Porter Prize in the 'Exploiting Trade-offs' category. The
Porter Prize Awards, named after Professor Michael Porter – the father of modern strategic field,
are the most coveted awards in the field of strategy and competitiveness. The award recognises
and honours Indian companies which have embraced the best strategic management practices.
Bharti Airtel Sri Lanka bagged a silver at the prestigious HRM awards. Airtel Sri Lanka was
recognized for their HR practices by HRM awards.
Bharti Airtel won the Star News Viewer‟s Choice Best Mobile Network, Best Quality Mobile
Network Service Provider, at the 6th National Telecom Awards 2012 hosted by CMAI in May
2012.
Bharti Airtel won 5 awards at the Telecom Operator Awards 2012, announced in March 2012 by
Tele.net.
Airtel bagged the 'Best National Mobile Operator', 'Best VAS Provider', 'Best Enterprise
Services Provider', 'Best Ad Campaign by an Operator' and 'Most innovative Solution' for airtel
money.
ANALYSIS – I
SWOT ANALYSIS
A SWOT analysis (alternatively SWOT matrix) is a structured planning method used to evaluate
the strengths, weaknesses, opportunities, and threats involved in a project or in a business
venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves
specifying the objective of the business venture or project and identifying the internal and
external factors that are favorable and unfavorable to achieve that objective. The technique is
credited to Albert Humphrey, who led a convention at the Stanford Research Institute (now SRI
International) in the 1960s and 1970s using data from Fortune 500 companies. The degree to
which the internal environment of the firm matches with the external environment is expressed
by the concept of strategic fit.
Setting the objective should be done after the SWOT analysis has been performed. This would
allow achievable goals or objectives to be set for the organization.

Strengths: characteristics of the business or project that give it an advantage over others.

Weaknesses: characteristics that place the business or project at a disadvantage relative to
others

Opportunities: elements that the project could exploit to its advantage

Threats: elements in the environment that could cause trouble for the business or project
Identification of SWOTs is important because they can inform later steps in planning to achieve
the objective. First, the decision makers should consider whether the objective is attainable,
given the SWOTs. If the objective is not attainable a different objective must be selected and the
process repeated. Users of SWOT analysis need to ask and answer questions that generate
meaningful information for each category (strengths, weaknesses, opportunities, and threats) to
make the analysis useful and find their competitive advantage.
SWOT Analysis of Bharti Airtel
STRENGTHS
1. Strong Brand Image.
2. Good Network Connectivity.
3. Wide Network Coverage.
4. Attractive Promotional Schemes.
5. Good Value Added Services.
6. Operating In 65 Countries With 157 Operators.
7. Market Leader having 20% consumers.
8. Strong New Business Development Team.
9. Strong Finance Position.
10. Offers the most expansive roaming network.
11. Strong Alliance.
12. Cost Advantage.
13. Ability to Constantly Innovate.
14. Highly Skilled Workforce.
15. Entrepreneurial Zeal.
16. Increased Equity and Market Capital.
WEAKNESSES
1. Perceived as an Expensive Brand.
2. Absence in the Rural and Interior Areas.
3. Outsourcing of Core System.
4. Airtel does not own its own Towers.
5. Airtel has Tough Competition from the operators like BSNL and MTNL.
6. Price Pressure.
7. Lack of Government support.
8. Awareness.
9. Sales & Marketing.
10. The main weakness of the company is that company does not provide same Tariff plans
for both Postpaid and Prepaid users.
11. To Prove Credibility.
OPPORTUNITIES
1. Poor Network Connectivity of its Competitors.
2. Large Chunk of Dis-satisfied Customer.
3. Though being the 4th Entrant, they are Operating at 900 Frequencies.
4. Low Broadband Penetration in Rural Areas.
5. Bharti Infratel – Cutting Down Cost in Rural Areas.
6. Tie-up with Google can only enhance the Airtel brand.
7. Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea
Cellular to create a new independent tower company called Indus Towers.
8. The company is investing in its operation in 120,000 to 160,000 small villages every
year.
9. To sustain passion and commitment.
10. Attain higher value services.
11. Collaborative business needs to be explored.
12. Vertical repeatable solutions.
THREATS
1. Strong Visibility of Competitors.
2. Sour Experience with Airtel by Few can lead to Bad Word Of Mouth.
3. Continuous Improvement in Competitor‟s Services.
4. Intense Competition and Shortage of Bandwith.
5. Uncertain Economic Conditions.
6. Bharti Airtel could also be the target for the takeover vision of other global
telecommunications players that wish to move into the Indian market.
7. Foreign Investment.
8. Global trends moving from GPS to WLL.
9. Lack of Global Parity in Telecom Tariff.
10. New Players coming in India.
PORTERS’s FIVE FORCES MODEL
Porter five forces analysis is a framework to analyze level of competition within an industry and
business strategy development. It draws upon industrial organization (IO) economics to derive
five forces that determine the competitive intensity and therefore attractiveness of a market.
Attractiveness in this context refers to the overall industry profitability. An "unattractive"
industry is one in which the combination of these five forces acts to drive down overall
profitability. A very unattractive industry would be one approaching "pure competition", in
which available profits for all firms are driven to normal profit. This analysis is associated with
its principal innovator Michael E. Porter of Harvard University.
Porter referred to these forces as the micro environment, to contrast it with the more general term
macro environment. They consist of those forces close to a company that affect its ability to
serve its customers and make a profit. A change in any of the forces normally requires a business
unit to re-assess the marketplace given the overall change in industry information. The overall
industry attractiveness does not imply that every firm in the industry will return the same
profitability. Firms are able to apply their core competencies, business model or network to
achieve a profit above the industry average. A clear example of this is the airline industry. As an
industry, profitability is low and yet individual companies, by applying unique business models,
have been able to make a return in excess of the industry average.
Porter's five forces include - three forces from 'horizontal' competition: the threat of substitute
products or services, the threat of established rivals, and the threat of new entrants; and two
forces from 'vertical' competition: the bargaining power of suppliers and the bargaining power of
customers.
Porter developed his Five Forces analysis in reaction to the then-popular SWOT analysis, which
he found un-rigorous and ad hoc. Porter's five forces is based on the Structure-ConductPerformance paradigm in industrial organizational economics. It has been applied to a diverse
range of problems, from helping businesses become more profitable to helping governments
stabilize industries. Other Porter strategic frameworks include the value chain and the generic
strategies.
Threat of New Entrants:- Profitable markets that yield high returns will attract new firms. This
results in many new entrants, which eventually will decrease profitability for all firms in the
industry. Unless the entry of new firms can be blocked by incumbents (which in business refers
to the largest company in a certain industry, for instance, in telecommunications, the traditional
phone company, typically called the "incumbent operator"), the abnormal profit rate will trend
towards zero (perfect competition). The following factors can have an effect on how much of a
threat new entrants may pose:1. The existence of barriers to entry (patents, rights, etc.). The most attractive segment is
one in which entry barriers are high and exit barriers are low. Few new firms can enter
and non-performing firms can exit easily,
2. Government policy,
3. Capital requirements,
4. Absolute cost,
5. Cost disadvantages independent of size,
6. Economies of scale,
7. Economies of product differences,
8. Product differentiation,
9. Brand equity,
10. Switching costs or sunk costs,
11. Expected retaliation,
12. Access to distribution,
13. Customer loyalty to established brands,
14. Industry profitability (the more profitable the industry the more attractive it will be to
new competitors).
Threat of Substitute Products or Services:- The existence of products outside of the realm of
the common product boundaries increases the propensity of customers to switch to alternatives.
For example, tap water might be considered a substitute for Coke, whereas Pepsi is a
competitor's similar product. Increased marketing for drinking tap water might "shrink the pie"
for both Coke and Pepsi, whereas increased Pepsi advertising would likely "grow the pie"
(increase consumption of all soft drinks), albeit while giving Pepsi a larger slice at Coke's
expense. Another example is the substitute of traditional phone with VoIP phone. Potential
factors:1. Buyer propensity to substitute,
2. Relative price performance of substitute,
3. Buyer switching costs,
4. Perceived level of product differentiation,
5. Number of substitute products available in the market,
6. Ease of substitution,
7. Substandard product,
8. Quality depreciation.
Bargaining Power of Customers:- The bargaining power of customers is also described as the
market of outputs: the ability of customers to put the firm under pressure, which also affects the
customer's sensitivity to price changes. Firms can take measures to reduce buyer power, such as
implementing a loyalty program. The buyer power is high if the buyer has many alternatives.
Potential factors:1. Buyer concentration to firm concentration ratio,
2. Degree of dependency upon existing channels of distribution,
3. Bargaining leverage, particularly in industries with high fixed costs,
4. Buyer switching costs relative to firm switching costs,
5. Buyer information availability,
6. Force down prices,
7. Availability of existing substitute products,
8. Buyer price sensitivity,
9. Differential advantage (uniqueness) of industry products,
10. RFM (customer value) Analysis,
11. The total amount of trading.
Bargaining Power of Suppliers:- The bargaining power of suppliers is also described as the
market of inputs. Suppliers of raw materials, components, labor, and services (such as expertise)
to the firm can be a source of power over the firm when there are few substitutes. If you are
making biscuits and there is only one person who sells flour, you have no alternative but to buy it
from them. Suppliers may refuse to work with the firm or charge excessively high prices for
unique resources. Potential factors:1. Supplier switching costs relative to firm switching cost,
2. Degree of differentiation of inputs,
3. Impact of inputs on cost or differentiation,
4. Presence of substitute inputs,
5. Strength of distribution channel,
6. Supplier concentration to firm concentration ratio,
7. Employee solidarity (e.g. labor unions),
8. Supplier competition: the ability to forward vertically integrate and cut out the buyer.
Intensity of Competitive Rivalry:- For most industries the intensity of competitive rivalry is the
major determinant of the competitiveness of the industry. Potential factors:1. Sustainable competitive advantage through innovation,
2. Competition between online and offline companies,
3. Level of advertising expense,
4. Powerful competitive strategy,
5. Firm concentration ratio,
6. Degree of transparency.
FIVE FORCES ANALYSIS of BHARTI AIRTEL
Rivalry among
1. Cut throat Competition.
Competitors
2. There is high fix cost for Manage ILP which needs to be
recover.
3. Continuously engaged in aggressive marketing and
expansion and thus trying to eat into Airtel‟s market share.
4. Commencement of Wireless local loop (WLL) services has
resulted in intense competition in the bigger cities.
Threat of New Entrant
1. Rapid change in Technology, High Infrastructure Setup
cost.
2. Spectrum Availability issues and Regulatory Issues.
3. Huge License Fees paid to Government.
4. Entry of MVNO‟s and WiMAX Operators.
5. Highly regulated industry and it is very dynamic in nature.
Threat of Substitutes
1. Landline, for post-paid mobile phone, but Land line
dominated by MTNL.
2. DSL taking market for ILP, Using two service ILP
provider instead of Manage ILP
3. Social Networking site and messenger for post & prepaid.
4. Entry of VOIP – Skype, Gtalk, Yahoo Messenger.
5. CDMA services provided by the Tata consultancy services
is also a threat for Airtel as Airtel does not deals in CDMA
market.
Bargaining Power of
1. Network
maintenance:
Alcatel
lucent,
Information
Technology: IBM.
Suppliers
2. Call Center: Tele-caller are outsourced.
3. Outsourcing of Passive Infrastructure – Indus Towers.
4. The bargaining power of Handset Suppliers is less as they
are also competing amongst themselves.
Bargaining Power of
1.
Lack of differentiation among Service Providers.
Buyers
2. Low switching costs.
3. Number Portability will have negative effects.
BCG MATRIX
The growth–share matrix (aka the product portfolio, BCG-matrix, Boston Consulting Group
analysis, port-folio diagram) is a chart that was created by Bruce D. Henderson for the Boston
Consulting Group in 1970 to help corporations to analyze their business units, that is, their
product lines. This helps the company allocate resources and is used as an analytical tool in
brand marketing, product management, strategic management, and portfolio analysis. Analysis of
market performance by firms using its principles has recently called its usefulness into question.
Cash Cows are where company has high market share in a slow-growing industry. These units
typically generate cash in excess of the amount of cash needed to maintain the business. They are
regarded as staid and boring, in a "mature" market, and every corporation would be thrilled to
own as many as possible. They are to be "milked" continuously with as little investment as
possible, since such investment would be wasted in an industry with low growth.
Dogs, more charitably called pets, are units with low market share in a mature, slow-growing
industry. These units typically "break even", generating barely enough cash to maintain the
business's market share. Though owning a break-even unit provides the social benefit of
providing jobs and possible synergies that assist other business units, from an accounting point
of view such a unit is worthless, not generating cash for the company. They depress a profitable
company's return on assets ratio, used by many investors to judge how well a company is being
managed. Dogs, it is thought, should be sold off.
Question Marks (also known as problem children) are business operating in a high market
growth, but having a low market share. They are a starting point for most businesses. Question
marks have a potential to gain market share and become stars, and eventually cash cows when
market growth slows. If question marks do not succeed in becoming a market leader, then after
perhaps years of cash consumption, they will degenerate into dogs when market growth declines.
Question marks must be analyzed carefully in order to determine whether they are worth the
investment required to grow market share.
Stars are units with a high market share in a fast-growing industry. They are graduated question
marks with a market or niche leading trajectory, for example: amongst market share frontrunners in a high-growth sector, and/or having a monopolistic or increasingly dominant USP
with burgeoning/fortuitous proposition drive(s) from: novelty, fashion/promotion, customer
loyalty goodwill and/or gearing, etc. The hope is that stars become next cash cows.
Stars require high funding to fight competitions and maintain a growth rate. When industry
growth slows, if they remain a niche leader or are amongst market leaders it‟s have been able to
maintain their category leadership stars become cash cows, else they become dogs due to low
relative market share.
As a particular industry matures and its growth slows, all business units become either cash cows
or dogs. The natural cycle for most business units is that they start as question marks, then turn
into stars. Eventually the market stops growing thus the business unit becomes a cash cow. At
the end of the cycle the cash cow turns into a dog.
As BCG stated in 1970:Only a diversified company with a balanced portfolio can use its strengths to truly capitalize on
its growth opportunities. The balanced portfolio has:
stars whose high share and high growth assure the future;

cash cows that supply funds for that future growth; and

question marks to be converted into stars with the added funds.
M
A
R
K
E
T
G
R
O
W
T
H
H
I
G
H
L
O
W
HIGH
Cow Products:
Mobile Services
Dog Products:
Fixed Line Services
Star Products:
DTH & IPTV

Broadband
Question Mark Products:
Retail Insurance
LOW
PEST Analysis
PEST analysis (Political, Economic, Social and Technological analysis) describes a framework
of macro-environmental factors used in the environmental scanning component of strategic
management. The basic PEST analysis includes four factors:
Political factors are basically to what degree the government intervenes in the economy.
Specifically, political factors include areas such as tax policy, labor law, environmental
law, trade restrictions, tariffs, and political stability. Political factors may also include
goods and services which the government wants to provide or be provided (merit goods)
and those that the government does not want to be provided (demerit goods or merit bad).
Furthermore, governments
have great
influence on the health, education, and
infrastructure of a nation.

Economic factors
include economic
growth, interest
rates, exchange
rates and
the inflation rate. These factors have major impacts on how businesses operate and make
decisions. For example, interest rates affect a firm's cost of capital and therefore to what
extent a business grows and expands. Exchange rates affect the costs of exporting goods
and the supply and price of imported goods in an economy.

Social factors include the cultural aspects and include health consciousness, population
growth rate, age distribution, career attitudes and emphasis on safety. Trends in social
factors affect the demand for a company's products and how that company operates. For
example, an aging population may imply a smaller and less-willing workforce (thus
increasing the cost of labor). Furthermore, companies may change various management
strategies to adapt to these social trends (such as recruiting older workers).

Technological factors include technological aspects such as R&D activity, automation,
technology incentives and the rate of technological change. They can determinebarriers to
entry, minimum efficient production level and influence outsourcing decisions.
Furthermore, technological shifts can affect costs, quality, and lead to innovation.
Political:- The Indian political scenario and regulations from TRAI are the most significant
aspects which would affect Airtel. The recent 2G scam and the subsequent regulations passed by
TRAI were points of debate. For example, the reserve price for the auction proposed by the
telecom regulator should be reduced by at least 80%, felt CEOs of Airtel and other operators.
Following TRAI's controversial spectrum recommendation, Fitch has revised the outlook of
Airtel to “negative” from “stable” due to adverse regulatory environment in India and risks
involved in its African operation.
Regulatory risk is high for the Indian telecom industry compared with other markets in Asia
Pacific. Fitch believes that an evolving regulatory framework, regular policy changes and
cancellation of 2G licenses by India's Supreme Court in February 2012 could change the industry
structure in 2012 and negatively affect Bharti's free cash flow generation. Regulatory risks for
Airtel include a one-time charge for excess spectrum, spectrum reframing and imposition of high
spectrum renewal fees as recommended by TRAI.
Economic:- Airtel enjoys a very large consumer base in India and Africa, and this continues to
be the driver of revenues for Bharti Airtel. Expanding more into the rural market will provide
Airtel with more such opportunities to increase revenues and market shares. Airtel's African
operations contributed about 20 percent to both its consolidated revenue and EBITDA during the
first nine months of FY12.
The telecom sector is also considered to be one of the major sectors which provide direct
employment which indirectly helps in economic growth of India. Also, increasing investments in
this sector by means of Foreign Direct Investment (FDI) ensures that there are enough economic
stimuli for Airtel and the industry as a whole. FDI to a limit of about 74% is permitted in this
sector.
Social:- Airtel has been very successful in branding itself as “a brand for successful people”. It
has consistently come up with advertising campaigns which emotionally affect the Indian
consumers. Earlier, Airtel focused on its plans and tariffs, but now, it advertises in such a way
that the user associates emotions and values with Airtel. The “Express Yourself” campaign, the
“Barriers Break when People Talk” campaign, and the more recent “Har Ek Friend Zaroori Hota
Hai” campaigns are excellent examples of how Airtel managed to brand itself in all
socioeconomic classes. The Airtel tune became a rage amongst Indians and it has become the
most downloaded ringtone.
The rising Indian middle class and higher incomes at their disposals have also ushered in good
returns for companies like Airtel.
Technological:- Bharti Airtel is the first wireless service provider which supplies roaming
services, international and long distance communication services and Value Added Services.
Bharti Airtel has a highspeed optic fiber network. Airtel is the first mobile telephony company to
outsource everything except its marketing, sales and financial operations. Airtel outsourced their
IT processes to IBM, entire network operations to Ericsson and Siemens along with Alcatel
Lucent recently and the transmission towers to another company. This has worked in its favor as
Airtel can concentrate on other parameters and new innovations in its services, such as venturing
into telemedia services, new options like Airtel Money, broadband and 3G/4G services, etc.
Airtel also builds on providing value and efficient services to its customers.
ANALYSIS – II
Marketing is "the activity, set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers, clients, partners and
society at large." Marketing is a management process or social process or an effective
communication through which goods and services move from concept to the customer
and companies create value for customers and build strong customer relationships in
order to capture value from customers in return and also identifying, anticipating and
satisfying customer requirements profitably. Marketing mix is a deciding factor in
formulating marketing techniques for the success of a particular brand, commodity or
company. It includes the coordination of four elements called the 4P's of marketing:1. Identification, selection and development of a Product.
2. Determination of its Price.
3. Selection of a distribution channel to reach the customer's Place.
4. Development and implementation of a Promotional strategy.
In recent times, however, the 4P‟s have been expanded to the 7P‟s.
MARKETING MIX of BHARTI AIRTEL
PRODUCT
Mobile Services:- Bharti Airtel offers GSM mobile services in all the 23-telecom circles of India
and is the largest mobile service provider in the country, based on the number of customers.

PREPAID

POSTPAID

BLACKBERRY

SMART PHONES

CALLING CARDS
AIRTEL TELEMEDIA SERVICES: The group offers high speed broadband internet with a
best in class network. With Landline services in 94 cities we help you stay in touch with your
friends & family and the world. Get world class entertainment with India‟s best direct to home
(DTH) service digital TV in more than 150 cities

BROADBAND

FIXED LINE
ENTERPRISE SERVICES: Enterprise Services provides a broad portfolio of services to large
Enterprise and Carrier customers. This division comprises of the Carrier and Corporate business
unit. Enterprise Services is regarded as the trusted communications partner to India's leading
organizations, helping them to meet the challenges of growth.
DIGITAL TV SERVICES: Discover the magical experience of digital entertainment with
Airtel. From DVD quality picture and sound, the best and widest variety of channels and
programmers to the best on-demand content on Airtel Live, your TV viewing experience change
forever with digital TV from Airtel!

DIGITAL TV

DIGITAL TV INTERACTIVE
PLACE

Strategic Issues in Distribution

Flow of information in channel members.

Availability of products on required time frame.

Control over the channel.

Availability of promotional items to the channel.

Claim settlement should be solved within the committed time.

Conflict between the channel members should be taken care by the company.
PRICE

Customer based pricing strategies.

Flexible pricing mechanism

Controlled by TRAI.

GPRS Tariff for BSNL.
Airtel has customer base pricing strategies.
PREPAID TARIFF
ONE TIME CHARGES
Pulse Rate
Per Minute
Price of Pack (Rs.)
31
Free Airtime on Pack
(Rs.)
Incoming Calls (Rs.)
0
Free
CALL CHARGES
Airtel
Local .50
GSM/CDMA Landline
.60 paise
.60 paise
Rates paise
STD
.50
Rates paise
.60paise
.60 paise
SMS
Local
National
International
POSTPAID TARIFF
1RS
1.5 RS
5 RS
ONE TIME CHARGES
Activation Charges
500
Membership Fee
0
Security Deposit
0
Other charges depend on which plan is selected by customer. It offers various types of plans.
PROMOTION
 Large scale print and video advertising.

Big celebrities like SRK and Sachin Tendulkar are roped in to endorse the product.

In 2002 Airtel got its Signature tune from A.R. Rehman, this signature tune is perhaps the
most downloaded tune in India.

Provides innovations such as Bollywood movie premiers, music services such as ring
back tones & many more.

Friendz" pre-paid connection for youth," Ladies Special" plan, seniors plan.

Executive‟s corporate plan (First to give prepaid in this category).

Special discounts in calling rates & sms services.

Providing wallpapers and screensavers on website.
Marketing Strategy adopted by Bharti Airtel
Bharti has spent a considerable amount on advertising its mobile phone service, Airtel. Besides
print advertising, the company had put up large no of hoardings and kiosks in and around Delhi.
The objective behind designing a promotion campaign for the „Airtel‟ services is to promote the
brand awareness and to build brand preferences.
It is trying to set up a thematic campaign to build a stronger brand equity for Airtel. Since the
cellular phone category itself is too restricted, also the fact that a Cellular phone is a high
involvement product, price doesn't qualify as an effective differentiator. The image of the
service provider counts a great deal. Given the Cell phone category, it is the network efficiency
and the quality of service that becomes important. What now the buyer is looking at is to get the
optimum price-performance package.
This also serves as an effective differentiator Brand
awareness is spread through the' campaigns and brand preference through brand stature. Airtel's
campaign in the capital began with a series of 'teaser' hoardings across the city,' bearing just the
company's name and without explaining what Airtel was. In the next phase the campaign
associated Airtel with Cellular only thereafter was the Bharti Cellular connection brought up.
Vans with Airtel logos roamed the city, handing out brochures about the company and its
services to all consumers. About 50,000 direct callers were sent out. When the name was well
entrenched in the Delhiites‟s mind, the Airtel campaign began to focus on the utility of Cell
phone. In the first four months alone Airtel's advertisements spend exceeded Rs. 4 crores.
As of today the awareness level is 60% unaided. This implies that if potential or knowledgeable
consumers are asked to name a Cellular phone service provider that is on the top of his/her mind
60% of them would name Airtel. As for aided it - is 100% (by giving clues and hints etc.).
Brand strength of a product or the health of a brand is measured by the percentage score of the
brand on the above aided and the unaided tests. The figures show that Airtel is a healthy and a
thriving brand.
Every company has a goal, which might comprise a sales target and a game plan with due regard
to its competitor. Airtel‟s campaign strategy is designed keeping in mind its marketing strategy.
The tone, tenor and the stance of the visual ads are designed to convey the image of a market
leader in terms of its market share. It tries to portray the image of being a "first mover every
time" and that of a "market leader".
The status of the product in terms of its life cycle has just reached the maturity stage in India. It
is still on the rising part of the product life cycle curve in the maturity stage.
The diagram on the left hand side shows the percentage of the users classified into heavy,
medium and low categories. The right hand side shows the revenue share earned from the three
types of users.
Airtel, keeping in mind the importance of the customer retention, values its heavy users the most
and constantly indulges in service innovation. But, since heavy users comprise only 15 - 20% of
the population the other segment cannot be neglected.
The population which has just realized the importance of cellular phones has to be roped in. It is
for this reason that the service provider offers a plethora of incentives and discounts. Concerts
like the "Freedom concert" are being organized by Airtel in order to promote sales. The media
channel is chosen with economy in mind. The target segment is not very concrete but, there is an
attempt to focus on those who can afford. The print advertisements and hoarding are placed in
those strategic areas which most likely to catch the attention of those who need a cellular phone.
The product promise (which might cost different 1 higher) is an important variable in
determining the target audience.
Besides this, other promotional strategies that Airtel has adopted are:1. People who have booked Airtel services have been treated to exclusive premiers of
blockbuster movies. Airtel has tied up with Lufthansa to offer customer bonus miles on
the German airlines‟ frequent flier's programs.
2. There have been educational campaigns, image campaigns, pre launch advertisements,
launch advertisements, congratulatory advertisements, promotional advertise--ments,
attacking advertisements and tactical advertisements.
Promotional Strategy
Airtel to “Touch Tomorrow” with a new brand vision
The Bharti Mobile promoted AirTel cellular service will go in for repositioning of its brand
image. The new brand ethos is portrayed in two distinct fashions - the tag line "Touch
Tomorrow", which underscores the leading theme for the new brand vision, followed by "The
Good Life", which underscores a more caring, more customer centric organization. Aimed at reengineering its image as just simply a cellular service provider to an all out information
communications services provider, Touch Tomorrow is meant to embrace the new generation of
mobile communication services and the changing scope of customer needs and aspirations that
come along with it
The new communication is about a new dimension in the cellular category that goes beyond the
Internet, SMS, roaming, IVRS, etc but which engulfs the whole gamut of wireless digital
broadband services that will constitute tomorrows cellular services. The new campaign is in two
phases - the first of which will communicate overall brand philosophy and the second products
and services. According to Mr. Jagdish Kini, Chief Operating Officer, Bharti Mobile Limited,
Karnataka "We are adopting a new brand- platform - Touch Tomorrow - not only to reflect our
corporate ethos but also business strategy".
SUMMARY, CONCLUSION & RECOMMENDATION
From this exhaustive study on Bharti Airtel Ltd., we got to learn a lot about how Airtel
established itself a market leader in the Indian telecom space. The journey was not a bed of roses
for Airtel. They faced numerous stumbling roadblocks along the way and overcame most of
them. This is because they applied and adopted sound strategies relating to Outsourcing,
Marketing, Advertising, creating Customer Value and Satisfaction, Positioning, etc. The above
facts are proved through the survey we conducted which emphasizes the fact that Airtel
continues to be the most preferred telecom operator in our country, and also amongst the youth.
Even though the growth of the company is stagnating in recent times, and the pressure from
competitors and regulatory bodies is always on the increase, new strategies and innovations,
acquisitions, penetration into international markets better schemes for customers should ensure
that Airtel keeps its nose above its strong competition. The prospects of Airtel continue to remain
strong because it is built around very strong fundamentals, and this growth should be visible in
the near future.
Among its priorities it now counts new economic and social concerns as the information society
develops: national coverage is a major issue and Airtel intends to play its part to protect the
interests of all consumers.
To this backdrop, a new regulatory organisation is emerging. It must supply regulatory activity
with new tools to encourage lasting competition in the telecommunications sector. It must also
contribute to the development of a more consistent UP west market that is better able to face up
to the challenges of the information society within the context of globalisation.
After thorough analysis and interpretation of result obtained I studied overall consumer trends in
Airtel Telecommunication Ltd. How people react to its services and schemes. How company
attract its customer by adopting effective strategies. In the last the conclusion is drawn through
this research that being the biggest and oldest network of mobile telecommunication in Uttar
Pradesh West, having good quality of service, taking along a big part of people aware about
Airtel, it is subsisting hard. For Airtel connection most of customers are professional and
business segment.
RECOMMENDATIONS:1. PRICING:- Depending on the market conditions / competition from cellular or wllmobile service providers and also to suit local conditions, there should be flexible pricing
mechanism (either at central or local level).
2. IMPROVEMENT IN TECHNOLOGY:-
Airtel should immediately shift to third
generation switches by replacing its c-dot switches. This will improve the quality of
service to desired level and provide simultaneous integration with the nationwide
network. The special distribution of the transmission towers should be increased to avoid
“no signal pockets”
3. ESTABLISHMENT OF DISTRIBUTION CHANNELS:-
Airtel should establish
widespread and conspicuous distribution to match that of the competitors. The
distribution network shall make the product visible and available at convenient locations.
4. UNTAPPED RURAL MARKET:- Large part of Indian rural market is still untapped
therefore airtel is required to bring that area under mobility.
OTHER CONCLUSION:
Market leader among Mobile service providers in India.

Most successful brand in India with largest market share.

Success is based on three pillars- connectivity, affordability and innovation. The core is
connectivity, i.e. the network

Doesn‟t promote its product always by celebrities.

Pre-paid services are more expensive than post-paid service.

Only high tariff cost matters in sales maximization. Airtel has a good reputation as a
telecom brand worldwide.

People prefer Airtel in Delhi because of its network coverage all over the state including
rural areas.
BIBLOGRAPHY:1. www.wikipedia.com
2. www.moneycontrol.com
3. www.airtel.in
4. www.trai.gov.in/
5. www.google.co.in
Download
Random flashcards
Pastoralists

20 Cards

Nomads

17 Cards

Marketing

46 Cards

African nomads

18 Cards

History of Europe

27 Cards

Create flashcards