07-09-2013, 03:51 PM
MINOR PROJECT REPORT ON MARKETING STRATEGIES AND SALES PROMOTION
OF VIRGIN MOBILES
MARKETING STRATEGIES.docx (Size: 1.38 MB / Downloads: 53)
Rationale for the Study
In today’s intensely competitive, rapidly changing and highly complex environment characterized by diminishing customer loyalty, the need to be market –focused and customer centric is more critical now than any other time the in past. It is highly imperative for every organization to retain and use valuable information about their customer to enhance their business strategies and product and service offerings. Today, the key focus area of many organizations is identification of a link between customer satisfaction and performance. However, satisfaction as the confirmation of expectation has started to be conceptualizing almost as a threshold for customers. The delivery of satisfaction is the minimum the customer expects. This project is focuses on the consumer’s preferences towards different sales promotion techniques in the city of New Delhi. As the sales promotion techniques are used for the marketing of the product so the research has been done in the area of marketing. Nowadays every firm faces a cut throat competition in terms of sales, turnovers, profits, etc. So it becomes very important for every firm to promote its product or it may not survive in the market. These techniques are used in the marketing of product in the last stages known as retailing. It is the stage from which the product directly gets in the hand of the customer and today India is standing on the threshold of retail revolution and witnessing a great change in its retail landscape i.e. from unorganized retailing to organized retailing. Retail is growing with an annual rate of 40%. Its contribution towards GDP is 11% and towards employment is 8%. So after agriculture retailing is one of the biggest sources of employment in the country and is one of the largest industries in India. Although retail industry has existed in our country for centuries but it is only the recently that it is witnessing such a tremendous growth.
About The Mobile Store:
Mr. Rajiv Agarwal, CEO and Director, The Mobile Store Limited, heads India's first countrywide chain of telecom retail outlets. "The Mobile Store" is an Essar Group venture, set to introduce a pan-Indian network of retail telecom outlets. The Mobile Store offers a world class shopping environment, with state of the art technology.
The Mobile Store format is a one stop mobile solution shop that provides, multi brand handsets, accessories, connections, repairs, VAS etc all under one roof. The Mobile Store currently has more than 1050 outlets and the vision is to have a network of 2500 stores by 2010 across 650 cities, thus covering virtually every major town in every state across India.
UNDERSTANDING VIRGIN’S BUSINESS MODEL:
Virgin has promoted itself as the brand for young India, keeping the Indian youth as its target customer segment. The idea behind targeting this segment can be found inherited in virgin’s business model. The different marketing perspectives are explained in fig 1.
The salient features of Virgin’s business model from customer’s perspective are:
1) With intensive competition and reducing voice tariffs, the profit margins for voice services are decreasing day by day. So, the future profit strategy is maximizing profit margins through data services and it is youth segment which provides maximum data service revenues.
2) Future projection of increasing young and working population of India as 65% of overall population by 2020.
ADVERTISING THE BRAND:
Virgin mobile has communicated itself as the youth oriented brand of India through various communication channels. They are:
a) “Think Hat ke” is the advertisement campaign targeting the youth in the country.
b) Red and vibrant webpage designs attract the youth. (Fig 2).
c) Tailor made plans for the young segment.
d) Getting paid for incoming calls: a source of recharge option for the youth.
TARGET MARKET:
The Brand targets Indian youth aged between 14 and 25 years. There are 215 million people in this age group. Out of this 70 million own a mobile phone and this segment is expected to add another 50 million new subscribers in the next three years. Though young subscribers constitute only 30 percent of the total mobile subscribers, they contribute more than 50 percent of the revenues of the telecom industry. By 2012 this group is expected to contribute 60-70 percent of total revenues.
The distinct mobile phone usage habits of the young users provides a huge advantage to Virgin Mobile. They make more and longer out-bound voice calls, which means huge billing potential for service providers. The usage of SMS, data services in the form of mobile internet, mobile shopping and other value added services like ring tones, caller tunes, wallpapers, etc tend to be very high in this age group which again provides a huge opportunity to be tapped.
CUSTOMER ACQUISITION AND RETENTION STRATEGIES:
The company knows that they are trying to position themselves into a very well established and a competitive market. They understand the fact that they cannot start making profits from the very day they enter the market neither do they have the plans for it.They anticipate to achieve a subscriber base of 5 million in next three years and w make profit afterwards. According to the patron, Sir Richard “We want to deliver a more tailored and relevant offering for a single segment.” Company targets only 10% of the above mentioned segment and have plans to acquire and retain them by various innovative propositions.
VALUE CREATION THROUGH PRODUCT DESIGN:
Various steps that Virgin is taking to add value to the customer are on price, quality, technology and social front. Company is providing the best prices in whichever plan you go, quality of signals is not only comparable but better than most of the service providers, on technology front it is the first in India to go for one-touch VAS access from every Virgin Mobile.
Why Telecom Industry?
Indian Telecom industry is one of the fastest growing telecom markets in the world. In telecom industry, service providers are the main drivers; whereas equipment manufacturers are witnessing growth and decline in successive quarters as sales is dependent on order undertaken by the companies.
Today the Indian telecommunications network with over 452.91 million(as on May 09) subscribers is second largest network in the world after China. India is also the fastest growing telecom market in the world with an addition of 10- 12 million monthly subscribers. The tele-density of the Country has increased from 18% in March 2006 to 38.88% in May 2009, showing a stupendous annual growth of about 50%, one of the highest in any sector of the Indian Economy. The Department of Telecommunications has been able to provide state of the art world-class infrastructure at globally competitive tariffs and reduce the digital divide by extending connectivity to the unconnected areas. India has emerged as a major base for the telecom industry worldwide.