8/8/2019 1-2-plag (1) (2)

1/32

Chapter 1

INTRODUCTION

Communication is among the vital aspects of human life . In olden time, pictures were drawn by humans to express themselves

to one another. But as the time moved, the ways to communicate also changed. The telecom industry came into existence in

1876 when Alexander Graham Bell introduced voice transmission, an easy design made for single side voice communication .Shortly, two way speech transmissions took over the one way voice transmission project. Here both speakers could

communicate. Now, processing and telecom industries are both efficient service suppliers which are making an effort to

change the outdated PSTN telephony with the IP networks, a regional web connecting the computers and the internet that

grids all of them together.

Telecom can be considered as the worlds largest messed up machine with complicated networks. Phones and transistors are

connected through transmission of networks, while, wires, mobiles and computers connect through internet . Each one of us

some way or the other come in contact with these universal systems which simplifies the exchange of emotions and makes

work easy irrespective of the location in the world . The overhead mentioned amenities can all be easily attained with the help

of telecom service operators. There has been a great progress in the telecommunication industries cause of the new innovative

ideas coming up rapidly. Many of the monopolies of the government are being privatized as the result telecom service

providers now face excess of competition. Industries have started facing a large amount of competition due to the use of old

fashion telecommunication products. Many service providers have moved towards the latest technology and innovative

income producing services. The problems that are being faced by the telecom industry now days is changing the very base of

their business. More modified content rich and merged lifestyle multimedia is being demanded by both enterprises and

consumer. This emergence of latest services and applications seem to be a worthwhile opportunity for better growth . On one

side, there are consumer dominated telecom market presents that gives opportunities to the service providers whereas on the

other side, provides devastating challenges (Alcatel-Lucent, 2007).

Telecommunication service suppliers should move from the old fashion services and provide the new technology networks

which provide tailored, elaborated applications and systems that support professional actions . These measures help in getting

8/8/2019 1-2-plag (1) (2)

2/32

new chances of earning profit, organizing, functioning and upholding the new era networks. However, the issues that restrict

the development of these networks must be addressed. Telecom service providers are rapidly being asked to provide support to

networks but it is getting difficult due to scanty resources. Other than these there are supplementary issues that these servicers

have to face, such as selling of the product, sales force capabilities etc . As the outcome this, company faces problem in

maintaining equilibrium between invention and providing the least number of old products based services with minimum

diversity. The network complexity, time spent on network support and the time spent on network innovation relation is shown

in Figure 1.

Figure 1 Network complexity, Resource allocation and Innovation

(Source: Alcatel-Lucent, 2007)

We can conclude that, to survive in the telecommunication industry, services suppliers should not only consider network

transformation as a technical issue but also as a business issue.

NetworkComplexity

Time spent onNetwork Support

Time spent onNetwork Innovation

Network Complexity

Resource Allocation

8/8/2019 1-2-plag (1) (2)

3/32

1.1 Background and Research Context

Recently the telecom industry has faced many drastic changes and seen unbeatable competitiveness.Such variations

attract several writers and researches, as the casual accessibility and largely spread choice of high-tech telecom

technologies which are usually connected with the lucrative value for the societies (Fransman, 2002). According to

Allee and Taug (2006) knowledge and information are the source of competitive advantage. Now is a golden

opportunity for innovation. But what we, the Telcos, are doing is re-arranging the deck chairs on the Titanic while the

innovation landscape is changing!"

In recent time strategy is widely used in business world such as marketing strategy, corporate strategy, advertising strategy,

online strategy , product strategy and so on. Basically the word strategy is derived from Greek word strategos which means

talent of the general, and first time it was used for business context by William Newman in his book published in 1951. For the

purpose of this study, researcher is mainly focusing on marketing strategy and how it important it is for an organization to

reach new height in business world. Marketing strategy is a process by which the organization aligns with the market that it

has decided to serve by Paul Fifield. Marketing strategy means different for different organizations. Good market strategy

helps organizations to earn more profit in business world and it mainly depends the organization management team what

decisions will taken according to the market condition and environment.

If anyone did not know their destination then any way will take them there. A good planned strategy always helps a manager

analyze his action and propose action against strategy. Moreover business goals always ensure the consistency which is

necessary to continued success .If the manger has not planned his strategy he will always agonizing over the decision which

he could make .He will be regretful over the time and money spent. Marketing strategy connects with the public who uses

services of an organization, its supplier and the people connected to the marketer by the source of information . And this

information is used to innovate, improve and promote marketing actions and improve to gain better knowledge of marketing as

a process. The role of marketing strategy is to make a suitable plan to choose one or more available options and then to achieve

the goals by finding the expenditure and making a schedule. A planned marketing strategy helps manger to think over it and

make decision for better control by which it takes the organization in right direction.

8/8/2019 1-2-plag (1) (2)

4/32

1.2 Significance of the research

The direct investments by the foreign investors and the deregulation of the telecom industry resulted in the development in the

nations telecom industry. Indian telecom market has fascinated workers from countries as far as Scandinavia, Eastern Europe,

United Arab Emirates and Asia. Billions of dollars have been invested by these telecommunication companies in the country

with an effort to make profit. Everyone has been forced to reduce their prices due to strong competition. Every

telecommunication company finds ways to increase its number of consumers to improve their revenues. The research tries to

look at the marketing strategy of Airtel, examine the effectiveness of marketing strategy and identify the gap in the marketingstrategy of the company.

1.3 Aims and Objectives of Research

The overall aim of the research is to investigate the marketing strategy, which is really an important tool for any telecom

company like Airtel in the volatile telecommunication sector of India. The main research topic is Marketing strategy of Airtel

mobile company. Based on the topic selected, the researcher has designed a couple of question with their related objectives

that need to be verified at the end of research. The key aims and objectives in this study are as under stated:

Critical analysis of existing literature on marketing strategy.

To investigate the marketing strategy which used by Airtel.

To critically evaluate the effectiveness of marketing strategy use by Airtel.

Improving market strategies by making recommendations.

1.4 Research Questions

The preferred goals or ideas can be achieved by answering a research questionnaire given as follows:

What does existing literature say about the marketing strategy?

What marketing strategy use by Airtel?

8/8/2019 1-2-plag (1) (2)

5/32

What are the factor affect the market strategy of Airtel

How will the marketing strategy of Airtel improve?

1.5 Background of the study: A brief history about the telecom sector in India

In the early 1990s, A new economic policy was taken up by the Indian government which directed towards improving India's

competitiveness in the worldwide markets. It also aimed at increasing growth of exports. A world-class telecom infrastructurewas the only way to achieve these goals.

The telecommunication sector in India is categorized on basis of the four Indian metropolitan cities - New Delhi, Mumbai,

Chennai and Kolkatta . There are around 20 circles which cater to each Indian State. These circles are further categorized

under "A," "B" and "C," where the "A" circle is the most alluring and "C" being the least attractive. Two cellular licenses for

each metro and circle were allotted by the directing body the Department of Telecommunications (DOT). In 1995, there

was an auction of Thirty-four licenses for GSM900 cellular services to 22 firms. The foremost mobile service company in

India was Modi Telstra, which was launched in August 1995. No firms were allowed to attain more than one metro and three

circles or both in the auction. There are only one bidders for West Bengal and Assam while circle of Jammu and Kashmir and

Andaman and Nicobar have no bidders.

In 1996, a bill was passed by the Lok Sabha by the Telecom Regulatory Authority of India (TRAI), where the president

formally stated the TRAI ordinance on 25 January 1997. TRAI was established by the government of India to distinguishregulatory operations from functions that dealt with policy formulation, licensing and telecom operations. DOT was purely

responsible for these functions before the formation of TRAI.

It resulted in a gigantic financial pressure on the operators because of huge license charges and huge tenders for the cellular

licenses that moved funds away from network growth and improvement. A large number of suppliers were not able to pay the

huge fees so a many of them withdrew their licenses. A new telecom policy was found in March 1999, (New Telecom Policy

[NTP] 1999), under this policy, the old fixed-licensing system had to be replaced with an income sharing plan. According the

plan, the government had to be paid 8-12 percent of the cellular income.

8/8/2019 1-2-plag (1) (2)

6/32

1.6 Bharti Airtel Company

Bharti Airtel is also famous by the name of Bharti Televenture Ltd. It is one of the biggest mobile companies in India more

than 110 million customers in 2009 by annual report of the company. Telecom services are being provided by it, under the

brand name Airtel, and it is managed and controlled by their head, Mr. Sunil Mittal.

Company Profile

"As we spread wings to expand our capabilities and explore new horizons, the fundamental focus remains unchanged: seek out

the best technology in the world and put it at the service of our ultimate user: our customer."

The entire plan of action of Bharti Enterprises has been based on these grounds. Bharti Enterprises is ahead of competition as

far as its technology is concerned and has played a major role in reformation of telecommunications sector in India with its top

of the line products and services. It has numerous accolades to its credit and has been the first in introducing a range of

revolutionary services. It provided the first mobile service in Delhi, it was the countrys first private basic telephonic service

supplier , it was the first Indian company to provide complete telecommunication \ services in Seychelles and the first private

sector service supplier to find National Long Distance Services in India. Bharti provides its services to approximately 3.21

million total customers out of which nearly 2.88 million are mobile customers while about are 334,000 fixed line customers.

Andhra Pradesh, Chennai, Delhi, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Kolkata, Madhya Pradesh circle,

Maharashtra circle, Mumbai, Punjab, Tamil Nadu and Uttar Pradesh (West) circle are the main parts of its service sector

business. In addition to that, the states ofMadhya Pradesh and Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu have a

fixed line operation plus a nationwide broadband and long distance network.

Some time back, Bharti started country wide long distance services. It now provides data and voice transmission services for

calls that originate and terminate on majority of Indian mobile networks. To provide international bandwidth, a submarine

cable project is being executed, joining Chennai-Singapore by the company.

8/8/2019 1-2-plag (1) (2)

7/32

Bharti Enterprises is the largest producer of telephone sets and sells overseas telephone terminals and cordless phones to USA.

Bharti Tele-Ventures' strategic objective is to capitalise on the growth opportunities that 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.

Business structure

Bharti Airtel was divided into three alter strategic business units (SBU's):

Mobile Services: It offer mobile and landline services with help of GSM technology in telecom circle of 23.

Airtel Tele media Services: It provides broadband and telephones services in 95 cities and newly launches DTH

services and Airtel digit.

Enterprise Services. It offers services to corporate user by national wide fiber optic, fixed line and mobile with

international bandwidth.

Airtel brand ambassador

Shahruk Khan is the brand ambassador for mobile company

Karenna Kapoor and Saif Ali Khan - Bollywood couple is used for advertising DTH services.

Sachin Tendulkar and A.R Rehaman are also brand ambassadors for Airtel company . They are used to advertise their

products and services, especially Rehaman who has composed the Airtel tunes which is world wide famous.

8/8/2019 1-2-plag (1) (2)

8/32

Global Status

Bharti Airtel is the third bigger mobile companies in home country on the bases of their costumers follow by China Mobile and

China Unicom and at international level it place sixth integrated with essar.

In Indian mobile market Airtel has a 24.9% share of the cellular services, followed by Reliance communication consisting of

17.1% share and then Vodafone Essar share 18.4%. Manoj Kohili is the MD and CEO for Indian and South Asian operations

since January 2010

Airtel products and it services

8/8/2019 1-2-plag (1) (2)

9/32

Airtel offer multinational services amongst India, Bangladesh and Sri Lanka manage by Bharti Airtel under the level of Airtel:

cellular Services, internet, fixed line Services; Leased Line and Long Distance Services and Enterprise Services.

The company offers Broadband (DSL) and telephone services (fixed line) in over 94 indian cities through 15 circles. On

March 31, 2008, the Company had 2,283,328 customers (a growth of 22%), of which 34.8% (~795,000) were using

broadband / internet services. The focus of the organization is on those cities that have a potential for growth in the telemedia

services. Supply with installation of fixed-line telephones which caters local, national and international long distance voice

connectivity and broadband Internet access through DSL is offered by the product in this segment .

8/8/2019 1-2-plag (1) (2)

10/32

(source www.bhartiairtel.in)

It is apparent in the figure above that the telecommunications industry in India has experienced a colossal jump with a revenue

of $42 billon in 2008-2009 as compared to about $20 billion in the year 2005-06.

8/8/2019 1-2-plag (1) (2)

11/32

The above figure shows that the market share of wireless lines was only 14% as compared to the fixed lines of 86% in 2007-

08.

1.7 Outline of the dissertation

The dissertation consists five chapters; a short note on each chapter is described below:

Chapter 1. In this chapter the context of study is established, its purpose is defined, the contributions of this research are

discussed and its objectives are stated. Chapter begins with an appropriate title explaining the topic. It introduces the research

which then follows to a rational study of the topic, emphasizing on the goals and purpose of the research . This chapter also

forms a base for the rest of the dissertation

Chapter 2provides an analytical outlook of the related literature on marketing schemes in general and the marketing schemes

of Airtel. The literature has been extracted from a number of bulletin articles, administrative books and specialized bodies

keeping the research purposes in notice. The theory and practice has been exhibited in a wider perspective. The literature

comprises of the classification and production of suitable ideas and theoretical outlines . This chapter will also try to identify

8/8/2019 1-2-plag (1) (2)

12/32

the gap between the marketing strategy identify corporate entrepreneurship as a option to effectively compete in the Indian

telecom market.

Chapter 3 gives an outline of the investigation system used in the study by giving examples of aptness and limitation of the

project. The selection of research method is explained and connected to research objects recognized in preceding chapters. The

research tools used in the research are also illuminated in detail using the suitable research language . The illustration size and

its rationalization are also talked about in the chapter taking into thought the instrument design, dependability and validity

Chapter 4gives a clear demonstration of the conclusions and examinations directly associated to the research questions. This

chapter exhibits perfect skills of organization, association and synthesis of data according to each segment of the investigation .

Chapters 5 finally provide a conclusion and propose suitable references. This chapter delivers a perfect relation between

study purposes, literature and outcome of the research. Some execution issues are discussed in this chapter too. This chapter

also comprises of a sector which studies the research work and overall limitation.

1.8 Limitation of Study

In the conducted research, following are some of the limitation:

Sample: While judging the perception of consumers the link for the questionnaire was posted on the internet which means

that data was collected from individuals that had access to computers. In India most of the population lives in rural areas and

the research conducted failed to gather their opinion.

Method: The questionnaires were sent by email to various respondents which ignored the importance of body language and

environment of the respondents. Respondents might be manipulating and fabricating the answers rather than reporting the

ground realities.

8/8/2019 1-2-plag (1) (2)

13/32

Time and Resources: The research was conducted in a limited time period and researcher was also bound with word limit

which affected the analysis and accuracy of results.

Sample Size: Due to time constraints and nature of study only one mobile company was studied. Though these companies are

major mobile operators of the country but still they do not reflect the whole prospective of the industry.

Introduction

Aims, Rational of study, Definition of problem, Objectives, Research Question, Research Methodology & Contribution of research

Literature Review

Marketing Strategy

Marketing Strategy of Airtel

Research Methodology

Conclusion and Recommendations

Appropriate recommendations and conclusionsResearch Questions linked with objectives

Road Map for the dissertation

Identification of Gap in literature and identifying corporate entrepreneurship as a way to successin Indian competitive market

Examine the effectiveness of marketing strategy of Airtel

8/8/2019 1-2-plag (1) (2)

14/32

Chapter 2

Literature Review

The main aim of this dissertation is to focus on the branding schemes of the IT firms in

the developing companies. Under this chapter a collection of literature philosophies and

a skill required to identify information is presented. There is a mix of data and borrowed

philosophies is collected here is related to the study.

Rational flow of concepts, trustworthy and appropriate references with significant, use of

proper terms, and a fair and wide view of research on the topic are important. Following

are a few editorials and journal based on marketing policies of an item, telecom selling

plans, and telecommunications marketing strategy in the country:

2.1 Marketing Strategy

Kotler, Gregory and Rodgers. (1997), have explained marketing strategies as an idea

which helps a firm in concentrating on its present sources to increase its profit by

increasing its sale. Customer satisfaction should be its most important goal. A

marketing strategy is compressive systematic independent and periodic examination of a

company or business units marketing environment objectives strategies and activities

with a view of determine problem areas and opportunities and recommending a plan

faction to improve company marketing performance.

Marketing Strategies draws out various facts and helps in making decisions in the best

possible way, it enables to find supporters and find the worth of the produced goods or

service (manage the marketing mix variable). According to Henry mintzberg, Marketing

strategy is that set of management decision which identify which customers will be

targeted and what value propositions will be made to them

To say, it is map which enables an organization or a company to use their limited

resources to attain their best and to get maximum benefit. It is a planning done by the

company to get maximum profit in every field and protect its self from tough competitors

and also to strengthen itself.

An article on defensive marketing strategies in marketing science was written by Hauser

J. and Shugan S. (1983). In this an analysis has been shown on the adjustments done by

companies towards its selling cost and its rate to save its position in the markets form the

new competitive products. The main goal is to provide efficient expert recommendations

8/8/2019 1-2-plag (1) (2)

15/32

on the strategy of response. Especially, we show that representing the item in different

attributed area, a firm can increase its profit.

Advertising can be used to raise awareness about a product/service

If the new product cannot be kept out of the market then decreasing the budget is

the most significant option.

Increasing the price is most favourable option

There may be a downfall in profit also under optimum plans due to

competitiveness of recent items.

Nevertheless, the quality of the product should be upgraded and the advertising should be

done in such a manner the product seems to be ideal for the consumer. The prices should

be lowered to guard the strength of the product.

A paper on selling plans was written by Robertson. T and Wind.Y (1983) in the journal

of marketing: new directions of theory and research which stated that new directions for

marketing strategy are made, which aim at overcoming the current limitations of

marketing theory. A pilot application of the process along with an integrated planned

marketing approach is being offered. A memo for research on marketing strategy

concludes the paper.

The marketing agendas of the companies can be in improved by the studying the

consumers and understanding issues like:

The understating of a consumers mental set while selecting from different optionsavailable (e.g., brands, products) ;

By learning the role played by the environment of the consumer.(e.g., culture,

family, signs, media);

How the customers behave while purchasing a product.

The ability to decide and purchase products is decreased due to the lack of

information.

The customers inspiration and decision schemes differentiate among the items

which differ in the level of significance or importance that are demanded only for

the consumer; and

The improvement in the selling schemes to improve the research of customers.

After taking the customers into attention comprehending these matters help us in

adopting our plans. Like, to get the most interest of our consumers, we get to

know that effectual, publicity should be done again and again. We also observe

that sometime logical reasons and rest times emotional and symbolic appeal

peruse more consumers. Therefore by understanding the consumer it makes it

8/8/2019 1-2-plag (1) (2)

16/32

easier for us as to what scheme should be applied to make better and simpler

decisions.

2.2 Consumer Behavior

The "official" explanation of consumer behavior is "The study of individuals, groups, or

organizations and the processes they use to select, secure, use, and dispose of products,

services, experiences, or ideas to satisfy needs and the impacts that these processes have

on the consumer and society." Although it is not necessary to memorize this definition, it

brings up some useful points:

Behavior occurs either for the individual, or in the context of a group (e.g., friends

influence what kinds of clothes a person wears) or an organization (people on the

job make decisions as to which products the firm should use). Consumer behavior study includes a close examination of how products for sale

are purchased, utilized and then discarded. Marketers generally have a great

interest in the use of products, because this may affect the position of the product

and encourage an increase in consumption Since, many environmental problems

are caused due to disposal of items (e.g., to save the reusing fee the motor oil is

dumped into sewage systems, or landfills being pilled with garbage) it is also

considered as an area of consideration.

Study of consumer behavior consists of an in-depth look into products, services

and ideas

There is a growing relevance of the study of consumer behavior in social setups.

For example, assertive marketing of high calorie food products, or aggressive

marketing of simple credit, might have serious consequence on the national health

and economy.

The study of consumer behavior is important for 2 key reasons, first being the marketing

strategy i.e., for making better marketing campaigns. For example, after knowing that

consumers are more alert towards food advertisement when they are hungry, it was

realize that arranging the snack advertisements late in the afternoon was a good idea. It

elucidates that products are initially accepted only by a limited set of population and onlygradually do they spread to the remaining majority. So, we understand that (1)

companies introducing new products should be financed thoroughly so that they can

sustain till the time their products become commercially successful and (2) to please few

initial target audience is important. Since few initial consumers will then influence many

other customers mindsets about choosing the brands.

8/8/2019 1-2-plag (1) (2)

17/32

The second application of the study of consumer behavior is in public policy In the

1980s, Acetone, a near miracle cure for acne, was introduced. Unfortunately, this cure

severely affected pregnant women. Even though doctors and physicians were instructed

to let the pregnant women know of the harms of acetone, a lot of them conceived while

taking the drug. Therefore, to make the consumers understand its adverse effect, the

Measures of showing the pictures of defected babies on the container was taken by the

Federal Drug Administration (FDA).

Social marketing is a way of getting ideas across to the consumers rather than selling

them. A marketing professor, Marty Fishbein, went on study leave to work for the

Disease Controlling centers, trying to reduce the transmission of diseases caused due to

the use of illegal drug. Clearly it is most appropriate to prevent the use of the illegal drug.

Since this did not seem to be a feasible choice, it was found that that needle sharing

practice was too deep-seated to be put an end to. Using the knowledge of consumer

attitude, a campaign was created by Dr. Fishbein to promote that the needles werecleaned with bleach before they were shared, which was definitely a more realistic

option. The benefit of the study of consumer behavior was that it would make us better

consumers. It is common sense that you need to pay less amount for 64 ounce bottle of

liquid laundry detergent when compared with 32 ounce bottle as the rate reduces per

ounce. But in actual situations it is often more profitable to buy a larger bottle as the price

per once decreases when you buy more. In simpler terms, for this analogy, you need to

check the unit cost labels in order to know what bargain are you getting. Several units

available in the marketplace can be examined. In this strategy the focal point is the

customer.

2.3. Relationship between Consumer behavior and Marketing Strategy

According to Richardson (2010), understanding and managing stakeholders is an

essential part of strategic analysis and include customers, employees, shareholders,

regulators, suppliers, lobby groups, the general public, neighbors, family of customers,

family of employees, contractors, associations and local government. Richardson (2010)

further argues that the actual list of stakeholders will depend on the type of business and

this analysis is every important during the current climate. Weatherston & Wilkinson

(2004) argue, the an analysis of a stakeholder involves the analysis of stakeholders itself:

All, organizations whatever their size, have a number of stakeholders. A person

,institute, company , interest group or other body that has a stake in the corporation is

called the stakeholder. In addition to having an interest in the activities of the

organization, some stakeholders have power to influence those activities. Brooks, I.,

Weatherston, J. & Wilkinson, G. (2004)

8/8/2019 1-2-plag (1) (2)

18/32

Further Weatherston & Wilkinson (2004) steps involved in conducting a stakeholder

analysis are as follows:

1. Identification of stakeholders

2. Identify your stakeholders power, influence and interest and what set of

stakeholders are most likely to be affected by your decisions as an organization

and focus on them.

3. Stakeholder Mapping

4. Identify how to best engage your stakeholders and gain their support

Banala (2008) in her paper stake holder analysis of Airtel has identified internal and

external stakeholders of Airtel. The list of stakeholders for Airtel is shown in the diagram

below.

List of stakeholders of Airtel (Banala,2010)

Banala (2010) has identified customers as important external stakeholders and

emphasizes that to achieve strategic competitive advantage it is essential to be able to

identify, engage and retain their consumers or customers. Consumers are not only the

paying public that avails of your goods and services but your employees, suppliers and

8/8/2019 1-2-plag (1) (2)

19/32

communities are also part of your consumer list. So it is essential that customers should

be well taken care off when devising marketing strategies.

2.4 Market Coverage Strategy

The status of the brand in respect to the customers has to be decided by the firm which

can be done by subdivisions. Kotler et al. (2002) mentions three different market-

coverage schemes which can be used. A company overlooks market division and seeks

the full market in the standardized marketing. This focuses on the common aspect rather

than the different aspect. When it comes to publicity, it is a cost saving scheme,

according to Kotler et al. (2002), Since, it is impossible to make a brand which fulfills allthe needs of the consumers, most of the developers have high hesitation about the

schemes. Different plans can also be implemented by the firm, which is when a company

decides to look over the necessities of most of the market sections and come up with

different offers for each. According to Kotler et al. (2002) this plan is generally more

effective than the plan of taking everyone into consideration. At times firms requires a

scheme which focus on smaller sections. In this scenario organizations can use niche

marketing as an effective strategy. Dimmick (2003) tells that the use of niche as a plan

effects the firms relation to its environment.

As Iansiti & Levien (2004) further added, that when a firm choses to niche a market, itsuggests that the firm sinks in a market sector when they are associated to other lager and

more influential organizations. What is typical for a company is that it focuses on

specialisation where it can satisfy specific enquires and provide customers with solutions

to complex problems (Iansiti & Levien, 2004). Hence, by the use of an integrated

marketing scheme, where the firm aims at smaller sub-markets can be more effective

rather than only getting a little portion of a comparatively huger section, (Kotler et al.,

2002). Another definition of niche scheme has been given by Cassill, Perish & Oxenham

(2006). They say that as a bottom-up method where the firm looks for a need in a lesser

part other than a hike in the consumers base. This is more attractive for the firms with

less sources, according to Kotler et al. (2002), In this way, since the firm has a huge

information of itself and has an important position, the firm niches the brand and achieve

powerful market segment of that part. However, the risk with this plan is that a large

amount of danger is involved in the styles of the society that makes a part sour or

increases the involvement of bigger competition.

Porter (1980) explains marketing strategy by dividing into three step strategies. These are

name as cost leadership, differentiation, and market segmentation other name is focus.

8/8/2019 1-2-plag (1) (2)

20/32

Market segmentation is small scope as compare to cost leadership and differentiation is

relatively wide scope in market

Cost Leadership Strategy

This strategy is based on efficiency. The firm produces high number of standard product

in low cost that available to large number of costumers. To maintain this strategy firm

always search for cost reduction in all aspect of business. This strategy concentrates onmarket share, raw material, labors, or other important input like:

process engineering skills

products designed easy to manufacture

tight checkup of labour

strong grip control over cost

Bonus based on targets.

Always try to put the costs at low possible level. According to researcher the Bharat

Sanchar Nigam Limited (B.S.N.L.) mobile company in India used this strategy veryintelligently. BSNL is the main rival of Airtel in India. Bsnl provide many services

slightly low difference then Airtel services like:

1) New sim cards only in 100Rs plus three month validity and hundreds rupee talk

time.

8/8/2019 1-2-plag (1) (2)

21/32

2) Call rates 45p/min any networks mobile and landline without any additional

charges that have only 5p difference then Airtel tariff

3) Two BSNL no (one mobile and one landline) call 1p/min.without any extra

charges weather Airtel is charged for these services

4) Provide cheaper roaming services in India.

Hence these are the main factor by which BSNL attract thousands costumers in few

month and become main telecom industry.

Differentiation Strategy

In differentiation strategy the firm always tries to create, introduce new things and

services that make the firm unique from their competitor. Companies may charge more

due to this differentiation. It also leads to a loyal customer following.

According to researcher virgin mobile founded in 2005 use differentiation strategy and

reach at new height in telecom industry only small period of time especially in uk where

the market is mature. They provide new services that cannot provide by any telecom

industry in past in uk and rest Europe like

1) Virgin was the first operator in uk to abolish peak rate

2) The first to offer free voicemail services

3) Virgin Mobiles started pay as you go tariff and flex never expired

4) Other offers included theft insurance, colorful packing recharge or pay bill by

credit or debit cards.

There are many more services by which it becomes popular among the people without

fear of cost because these people want best services which are reliable.

Focus Strategy

It is most reliable for small companies but at times it is also profitable to big companies.

A focus strategy should target market segments where competition is low or weakest to

earn average investments and gain competitive advantage by launching their services and

established their business

By researcher point of view, Airtel - new private telecom industry in India has made its

marketing strategy based on focus strategy which focuses on market segment, and

8/8/2019 1-2-plag (1) (2)

22/32

8/8/2019 1-2-plag (1) (2)

23/32

Market Development:The main focus of the business is to bring the presiding products

into the new market. The scheme includes:

Locating a new geological market; like export of new items to another country.

Giving more emphasis to the latest item and its promotion.

Supply of new channels

New pricing schemes to get more customers.

Product Development: It is one of the prime aims of businesses to bring and introduce

new products in the marketplace. This strategy based on development and modification

of products can get new dimension into the existing markets.

Diversification: In diversification the firm cans business in new markets with new

products. The strategy implied is risk oriented as the business is being launched into a

new markets where the firm lies inexperienced. The firm, which plans to adopt a

diversification strategy, must have a clear vision about it target and a good idea of the

risks involved.

According to researcher, Airtel company uses Ansoff growth matrix as a tool for its their

marketing strategy in India because in India the competition in telecom industry has

become hard as there are many telecom industry introducing their services. Hence Airtel

concentrates on market penetration and development by introducing new services like

Airtel broadband, 3g services, air T.V, and national and low international roaming

services and many loyalty schemes in their services which attract more costumers underone brand. It also focus on product and diversification by launching new product like

Blackberry Iphone and apple mobile under his brand name and it also shift in new market

like Bangladesh, Pakistan, Sri Lanka and etc to become multinational brand and provide

different services like broadband, air TV etc under one brand Airtel.

2.5 Market Competitiveness

The five force model by M.P. Poter (1980) (Morden, 1999) is the most widely spreadway for finding the market competition. Which is also known as porter five force model

and Figure shows five forces model into action in competitive market of

telecommunication.

8/8/2019 1-2-plag (1) (2)

24/32

Porters five force model on Indian Telecommunication industry (Ahmed, 2008)

Threat from substitute products: According to Porter (1980) there is a constant

threat from substitute products in telecom industry. It depends upon factors likesuperficial level of item for consumption differentiation, and buyer knobbing power.

The threat of the entry of new competitors in telecom industry: The telecom

business is a lucrative business with lofty return and evidently attracts firms, which

result in many new entrants and successfully decline effectiveness. Till the time the

entry of new firms can be infertile by incumbents, the profit rate will depreciate

towards a competitive level. It depends upon following

The survival of fence to entry

Trademark impartiality

Capital necessity

Access to circulation

Wisdom curve advantage

Government policy

8/8/2019 1-2-plag (1) (2)

25/32

Intensity of the competitive rivalry: For the telecommunications industry in India

it is the major determining factor of the competitiveness of the industry. Sometime

rival forceful and sometimes non price aspect such as advance, promotion, etc.

depend on following factor:

Quantity of competitor.

Rate of growth of the development of Industry

Variety of competitors

In rank of density and unevenness

Altitude of advertising expense

The bargaining power of customers:In telecom industry the bargaining power of

customers is also described as market of outputs. It is the capability of buyer to put

pressure on firm and it also affects the customers feeling to price modifications.There are following factor involved:

Buyer size

Amount of reliance upon existing channels of allotment

Bargain hunter price understanding

Benefit of industry product

The bargaining power of supplier: This in the telecom industry described as

market input. In telecom industry suppliers of unrefined materials, mechanism,labor, and services to the firm is source of power to other firm

Supplier switching costs comparative to firm switching costs

Degree of segregation of inputs.

Existence of replacement inputs

Employee unity

Cost of inputs virtual to selling price of the item for consumption.

According to the researcher the managing committee of Airtel mobile company has

taken sufficient knowledge from porter five force model to make their marketing

strategy. Airtel mobile company innovates its range of products at regular basis and

tries to keep price according to the market level and also puts pressure on

government to make new policies which is not suitable for substitute products.

Airtel always tries doing new things in their advertisement campaign to make better

strategies for tackling new competitor. In hard competitive atmosphere this telecom

company expands its product and services range according to demands of different

section of society and is always enthusiastic to enter new markets as well as new

8/8/2019 1-2-plag (1) (2)

26/32

geographical area.Airtel has made its marketing strategy to handle the bargaining

power of customers and supplier by providing best customer services, up to date

technology and provides best prizes according to market level and make contact

with four to five suppliers at same time so they get psychological advantage and

provide messages of so many option. Airtel is always in news or in media about

their future projects and new requirements so that more and more supplier come in

contacts and offer their services by which they can easily bargain with supplier.

2.6 New Product Development

Barczak. G (2003) wrote a paper on New Product action plan, Edifice, Process, and

Accomplishment in the Telecommunications Industry that states that a regular flow

of new products is the lifeblood for firms that hope to remain zealous in high-

technology industries such as telecommunications. Faced with regular depreciatingproduct life cycles, the voyage for more beneficial new product development (NPD)

should be combatively perused by these firms. Choosing an appropriate combination

of new product tactics, executive constitution, and NPD practices showcase the

factors for success for these companies.

Rather than taking into the account, the interrelationships among these result-

oriented factors, however, the most previous studies of NPD have looked at these

issues independently. The fact that the past studies of NPD have commonly cut

across industry lines result in developing this deficiency. Gloria Barczak addresses

these issues by stating that a firm's selection of new product strategy, structure, andprocess are related to each other, as are the outcomes of that selection on NPD

performance. Because these selections and their outcomes also may be contingent on

the sole essential quality of the industry in which a firm wrangles, her study focuses

fashionably on firms in a specific, high-technology industry, telecommunications.

The study clearly brings forth that for the telecommunications industry there is no stand

alone NPD strategy, that can be singled out as being superior to any other strategy.

Instead, it emerges that a company's center of attention should be on confirming the best

possible fit between its chosen NPD strategy and its corporate goals and abilities.

In keeping with the main focus on cross-functional teams, the study outcomes signifies

that the project teams and the R&D teams are the most result oriented means for

organizing NPD efforts in the telecommunications industry. Not to anyones surprise,

R&D teams essentially vital for first-to-market organizations when compared to the fast

followers and late tenderfoots. An R&D team comes up with the technical skills, which

are necessary for playing the role of pioneer. Nonetheless of the firm's NPD strategy and

8/8/2019 1-2-plag (1) (2)

27/32

structure, the existence of a product champion is a major element in the success of new

product efforts.

2.8 Service Positioning Decisions

In a research paper on the topic Strategies for ensuing at the Bottom of Pyramid (BOP)

market in Telecom Services Sector by Rao. U. S and Sangeet. S. (2007) wrote that of late,

there has been regard in marketing to the Bottom of the Pyramid (BOP) market, and

several successful measures have shown that the poor can be served equitably and

profitably by enhancing their income generation prospective. BOP (Bottom of the

Pyramid) is a term that was coined by C.K. Prahalad and Allen L. Hammond (2002), it

alludes to around 4 billion people at the bottom of the economic pyramid with an

obtaining potential of USD 1500 per year or less. Is it practical to serve to the needs and

wants of this section of people? This paper discusses affairs such as the business

prospective of the BOP market, the cartogram of options for income generation for the

poor, pricing, promotion, low cost delivery mechanisms and effective communication in

this segment, in the Telecom services sector.

The World Economic Pyramid, Source: Prahalad (2005)

Faisal. N (2007), in an article on Service Positioning Decisions: Understanding strategy

in a journal of Indian Management that in the last five years Indian services sector has

shown tremendous growth particularly in the areas like telecommunications,

entertainment and air travel. With the expulsion of governmental shackles, the country

8/8/2019 1-2-plag (1) (2)

28/32

has seen a massive growth in these sectors with the benefit sooner or later reaching to the

final consumer. Who would have dreamt of mobile phones advancing from luxury to

commodity items, air tickets to be sold for as less as Rs.500 or the luxury of watching

more than 100 channels now accessible to common man.Though the vying has resulted

in a lot of alternatives for the consumers, the service providers are finding it arduous to

maintain their zealous position in the marketplace. One of the major reasons is lack of

clear understanding about the positioning strategies of services.

Mobile service operators: on the whole these services can be graded in two categories

namely the CDMA service providers like Reliance or TATA Indicom and GSM service

providers like, Airtel, MTNL, Hutch, BSNL, and Idea. For an average customer the most

important selection criteria for the service are the cost. This has led these operators to

offer a host of schemes and the prices have seen a downward trend. CDMA service

providers like Reliance or TATA Indicom are late arrivals in the telecommunication

arena, but it seems they were not able to situate their services in the best manner and arenow simply keeping up with on the basis of cost. Though Idea at the establishment of

their service used the caption An Idea can change your life but it was not able to

differentiate itself from the other operators. One of the harsh facts that these operators

have to accept is that mobile services are now commodity services. Gone are the days

when the customers used to pay five to ten times of a landline call and even for an

incoming call. Now the customers need value added services like entertainment, banking

etc to be provided by their mobile service operator in addition to the regular service of

communicating. The commoditization of mobile services has taken very fast and thus

operators now need specific strategies to differentiate their services form their

competitors.

2.9 Corporate Entrepreneurship

It is widely renowned that the corporate entrepreneurship is a tread of entrepreneurship

theory. In very early stages the corporate entrepreneurship was a means to re-energize

large organizations. The term rejuvenation was used by Stopford and Baden-Fuller

(1990) for it. McGinnis and Verney (1987) argue that the purpose of corporate

entrepreneurship is to harness the entrepreneurship spirit of the small organization and

blend it into the culture of the larger, more established firm. Carrier (1996) suggests that

the small organizations can also reap benefits out of corporate entrepreneurship. Words

like corporate entrepreneurship, entrepreneurship and corporate venturing are often

used interchangeably and frequently seen as a strand in the entrepreneurship theory

(Cunningham & Lischeron, 1991). According to Maes (2003) there exists a definitional

gap as there is no generally acceptable definition on important concepts like corporate

entrepreneurship.

8/8/2019 1-2-plag (1) (2)

29/32

So one can establish a fact that if an organization shows creativity in its design processes

to generate innovative products internally then it could be said that the organization has

corporate entrepreneurial traits. The research adopts a divide and conquer rule by

breaking the main objective into sub components and looking individually at each of the

sub objective. Following section will try to identify the sub objectives of objective

number one from appropriate literature review.

Rixon (2003) argue that if organizations want to innovate then they must be committing

to a creative process. The author further argues that strategic commitment is vital for

innovation to be achieved as without strategic focus and commitment creativity may

surface naturally but innovation will not be delivered. Moris et al. (2008) contends when

the action is taken in large firms to form competitive advantage and to exploit it through a

strategy based on entrepreneurial actions, then the firm is employing an entrepreneurial

strategy. While establishing direction and preferences for the product ahead, service and

process innovation efforts of the firm, the company is laying down its strategy forentrepreneurship.

A commitment to continuously explore the marketplace for emerging opportunities is

majorly required for Corporate entrepreneurship. It involves probing what your present

customers and non-customers may need in the future, developing innovative products that

make existing products (even your own) obsolete, exploring your market's fringe for

customers who have problems that are begging for breakthrough solutions, and scanning

the horizon for clues for markets and even industries that do not exist today.

According to Varma, Gopinathan, Gopal (2008) both external business environment andthe internal business environment drive corporate entrepreneurship. So it is worthwhile to

see from the customers prospective as well; that are they ready for new service offerings

from the telecom operators and how do they contribute towards building the pressure on

the service providers to engage in corporate entrepreneurial activities.

It can be deduced that corporate entrepreneurship is all about creating a new value in the

organization, exploiting the latent energy of the firm, re-energizing and enhancing the

ability of a firm to acquire innovative skills and capabilities.

Marketing strategy and Entrepreneurship

According to Shaaw (2010) Bharti Airtel Ltd. shares lost 7.8 percent last year. The author

further argues that India may have as many as 15 mobile-phone operators this year,

compared with 10 at the start of 2009, based on data on the regulators Web site. The

8/8/2019 1-2-plag (1) (2)

30/32

Indian Telecommunications companies are cutting down prices to get a larger share of

the worlds second- largest wireless market, which will shot up 63 percent to 771 million

users by 2013, research firm Stamford, Connecticut-based Gartner Inc. predicted in June.

The above emphasis shows that Airtel need to explore new markets and adopt a path of

product and service innovation and entrepreneurship.

Bygrave & Hofer (1991) quoted - good science always gets off the ground with good

definitions. Maes (2003) argues that no definition is good in itself. Kirby (2003) despite

of the importance of entrepreneurship, there is lack of agreement on the subject. Chell et

al (1991) argue that the problem in pinpointing of an entrepreneur can be related to the

fact that there is no standard universally accepted definition of entrepreneurship. Gibb

(1996) argues that the word entrepreneurship is often linked to novel venture creation

and small business management. Table 1 illustrates the work done by some of the

authors on the subject of entrepreneurship, list of authors and publication is also listed.

It is worthwhile to mention here that Kirby (2003) argues that innovation is a vital part of

the entrepreneurial process. According to Drucker (1997) innovation is the specific tool

of entrepreneurship, the means by which they exploit change as an opportunity for a

different business or different service. Many authors relate entrepreneurship with new

value creation instead of innovation (Zahra, 1993c, Stopford & Baden-Fuller, 1994,

Carrier, 1996, Covin & Miles, 1999, Shane & Venkataraman, 2000). However, renowned

authors Aldrich and Martinez (2001) and Ucbasaran et al. (2001) had the view that

entrepreneurship is possible without innovation, leading to innovators on the one hand

and reproducer organizations on the other hand (Aldrich & Martinez, 2001; Maes

2003). Gartner (1989) warns not to associate entrepreneurship with innovation.correlating both constructs would lead to the almost unsolvable problem of identifying

which firms in an industry are innovative and which are not, increasing the ambiguity in a

field already confronted with a definitional dilemma Gartner (1989).

8/8/2019 1-2-plag (1) (2)

31/32

Table 1: Definition of entrepreneurship with respect to various authors

(Adapted from: Maes, 2003)

Technology and Entrepreneurship

Fredric and Zolin (2005) argue that technology firms are often known as technological

entrepreneurs that play an important role in the development and commercialization of

technologies all over the world. Zahra (1996) points out that these firms are essential to

may industries like software, biotechnology and telecommunications. Clarysse and

Source Definition of Entrepreneurship

Low (2001) The creation of a new enterprise

Shane & Venkataraman (2000) The discovery, creation and exploitation (including by whom

and with what consequences) of opportunities to bring into

existence future goods and services

Kouriloff (2000) The process of creating a new ventureWickham (1998) Creating and managing vision and communicating that vision

to other people. It is about demonstrating leadership,

motivating people and being effective in getting people to

accept change

Krueger & Brazeal (1994) The pursuit of an opportunity irrespective of existing

resources

Jones & Butler (1992) The process by which firms notice opportunities and act to

creatively organize transactions between factors of production

so as to create surplus value

Stevenson & Jarillo(1990) The process by which individuals either on their own or

inside organizations pursue opportunities without regard tothe resources they currently control

Timmons (1989) the ability to create and build something from practically

nothing. It is initiating doing, achieving, and building an

enterprise or organization, rather than just watching, analyzing

or describing one. It is the knack for sensing an opportunity

where others see chaos, contradiction and confusion

Schuler (1986) The practice of creating or innovating new products or

services within existing businesses or within newly forming

businesses

Gartner (1985; 1989) The process of new venture creation; the process by which

new organizations come into existenceKanter (1985) The creation of new combinations

Miller (1983) A firms actions relating to product-market and technological

innovation

8/8/2019 1-2-plag (1) (2)

32/32

Moray (2004) suggest that as technology adopters these firms use new technologies for

the product and process innovation. According to Kelley and Rice (2002) technology is

the key strategic resource that can be used to develop a competitive advantage through

innovation. These firms heavily rely on the technology as most of the decision made by

the firm on technologies to develop and exploit can impact probabilities of success or

failure (Zahra and Chandler 1999). Zahra (1996) argues that a logical and consistent

technology strategy is one of the most important components for successful performance.

Deeds et al (1999) adds on to this by saying that the technology strategy is shaped by the

organizations scientific, managerial and technological capabilities.