Marketing Strategies of Bharti Airtel Limited 2010

8/3/2019 Marketing Strategies of Bharti Airtel Limited 2010

1/57

PROJECT ON

MARKETING STRATEGIES OF BHARTI AIRTEL

LIMITED

In the partial fulfillment of Bachelor of Business Administration

(Banking & Insurance)

(2007-2010)

SUBMITTED TO: SUBMITTED BY:

Mrs.Manisha Dayal Kritika

Faculty Guide, Marketing Enrolment No. 0071471807

BBA(B&I)-Vl th Semester

MAHARAJA AGARSEN INSTITUTE OF MANAGEMENT STUDIES

GURU GOBIND SINGH INDRAPRASTHA UNIVERSITY

DELHI ,Rohini ,Sec-22

1


2/57

CERTIFICATE

MAHARAJA AGARSEN INSTITUTE OF MANAGEMENT STUDIES

GURU GOBIND SINGH INDRAPRASTHA UNIVERSITY

DELHI ,Rohini ,Sec-22

TO WHOM IT MAY CONCERN

This is to certify that this project report is made by KRITIKA, student of Bacholar of Business

Administration (Banking&Insurance) VI th SEMESTER, ENROLLMENT NO.- 0071471807 is

an authentic work carried out by her under my supervision.

Her work has been found satisfactory for the partial fulfilment of the degree of Bacholar of

Business Administration (Banking&Insurance)

___________________

Mrs.Manisha Dayal

Faculty Guide, Marketing

2


3/57

ACKNOWLEDGEMENT

Perseverance, inspiration and motivation have always played a key role in the success of any venture.

Working on this project was a challenge and made me a bit filtery in the beginning.

At this level of understanding, it is often difficult to understand a wide spectrum of knowledgewithout proper guidance and advice. Hence, I take this opportunity to express my heartfelt gratitude

to Advest Marketing Services Pvt. Ltd. (Corporate Sales Associates of Bharti Airtel Limited.)

Finally, I would like to thank Mrs. Manisha Dayal for her motivation and encouragement throughout

my endeavor and making impossible look easy for me.

NAME- KRITIKA

ENROLMENT NO- 0071471807

BBA-VIth SEMESTER

3


4/57

MAHARAJA AGARSEN INSTITUTE OF MANAGEMENT

STUDIES

(AFFILIATED TO GGS INDRAPRASTHA UNIVERSITY)

SECTOR-22, ROHINI

DELHI- 110085

DECLARATION

I KRITIKA, Enrolment No. 00471807 of BBA(B&I)- VI th Semester of MaharajaAgarsen Institute Of Management Studies, Sector-22,

Rohini, Delhi-85, hereby declare that the Project Report entitled MARKETING

STRATEGIES OF BHARTI AIRTEL LIMITED

is an original work and the same has not been submitted to any other Institute for the

award of any other degree and the suggestions as approved by the faculty were duly

incorporated.

Signature of Researcher

CountersignedSignature of faculty Guide

4


5/57

TABLE OF CONTENTS

1. CHAPTER I

PROBLEM AND PURPOSE OF RESEARCH

1.1 COMPANY PROFILE

1.2 VISION AND MISSION

1.3 INDUSTRY PROFILE

1.4 INTRODUCTION

1.5 OBJECTIVES OF STUDY

1.6 PURPOSE AND SCOPE OF STUDY

2. CHAPTER II

REVIEW OF LITERATURE

3. CHAPTER III

CURRENT SCENARIO

1.1 SWOT ANALYSIS

1.1.1 STRENGTHS

1.1.2 WEAKNESSES

1.1.3 OPPORTUNITIES

1.1.4 THREATS

5


6/57

4. CHAPTER IV

RESEARCH METHODOLOGY

1.1 RESEARCH DESIGN

1.2 DATA COLLECTION METHODS

1.3 DATA ANALYSIS AND INTERPRETATION

5. CHAPTER V

DISCUSSIONS AND FINDINGS OF THE STUDY

1.1 FINDINGS OF STUDY

1.2 SUGGESTIONS AND RECOMMENDATIONS

1.3 LIMITATIONS AND CONSTRAINTS

1.4 ANNEXURE

1.5 BIBLIOGRAPHY AND REFERANCES

6


7/57

CHAPTER - I

PROBLEM AND PURPOSE OF THE RESEARCH

1.1 COMPANY PROFILE

1.2 VISION AND MISSION

1.3 INDUSTRY PROFILE

1.4 INTRODUCTION

1.5 OBJECTIVES OF STUDY

1.6 PURPOSE AND SCOPE OF STUDY

7


8/57

COMPANY PROFILE

Bharti Airtel

Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The Bharti Group has a

diverse business portfolio and has created global brands in the telecommunication sector. Bharti has

recently forayed into retail business as Bharti Retail Pvt. Ltd. under a MoU with Wal-Mart for the

cash & carry business. It has successfully launched an international venture with EL Rothschild

Group to export fresh agri products exclusively to markets in Europe and USA and has launched

Bharti AXA Life Insurance Company Ltd under a joint venture with AXA, world leader in financial

protection and wealth management.

Airtel comes to you from Bharti Airtel Limited, Indias largest integrated and the first private

telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its

inception has been at the forefront of technology and has steered the course of the telecom sector in

the country with its world class products and services. The businesses at Bharti Airtel have been

structured into three individual strategic business units (SBUs) - Mobile Services, Airtel Telemedia

Services & Enterprise Services. The mobile business provides mobile & fixed wireless services using

GSM technology across 23 telecom circles while the Airtel Telemedia Services business offers

broadband & telephone services in 95 cities and has recently launched India's best Direct-to-Home

(DTH) service, Airtel digital TV. The Enterprise services provide end-to-end telecom solutions to

corporate customers and national & international long distance services to carriers. All these services

are provided under the Airtel brand.

Incorporated on July 7, 1995, Bharti Airtel Ltd is a division of Bharti Enterprises. The businesses of

Bharti Airtel are structured into two main strategic groups - Mobility and Infotel. The Mobility

business provides GSM mobile services in all 23 telecommunications circles in India, while the

Infotel business group provides telephone services and Internet access over DSL in 15 circles. The

company complements its mobile, broadband, and telephone services with national and international

long-distance services. The company also has a submarine cable landing station at Chennai, which

8


9/57

connects the submarine cable connecting Chennai and Singapore. Bharti Tele-Ventures provides end-

to-end data and enterprise services to corporate customers by leveraging its nationwide fibre-optic

backbone, last mile connectivity in fixed-line and mobile circles,

VSATs, ISP and international bandwidth access through the gateways and landing station. All of

Bharti Tele-Ventures' services are provided under the Airtel brand. As of September 2005, Bharti

Tele-Ventures was the only company to provide mobile services in all 23 telecom circles in India.

By the end of October 2005, Bharti Tele-Ventures was serving more than 14.74 million GSM mobile

subscribers and 1.10 million broadband and telephone (fixed line) customers. The equity shares of

Bharti Tele-Ventures are currently listed on the National Stock Exchange of India Ltd (NSE) and the

Stock Exchange, Mumbai (BSE). As of September 30, 2005, the main shareholders of Bharti Tele-

Ventures were: Bharti Telecom Ltd (45.65%), a subsidiary of Bharti Enterprises; Singapore Telecom

(15.69%), through its investment division Pastel Ltd; and, Warburg Pincus (5.65%), through its

investment company Brentwood Investment Holdings Ltd). Other shareholders with more than a 1%

stake were: Citi Group Global Markets Mauritius Pvt. Ltd (2.99%); Euro pacific Growth Fund

(2.04%); Morgan Stanley & Co International Ltd (1.93%); CLSA Merchant Bankers Ltd A/C Calyon

(1.33%); Life Insurance Corporation of India (1.34%); and, The Growth Fund of America Inc

(1.11%).

Sunil Bharti Mittal, the founder-chairman of Bharti Enterprises (which owns Airtel), is today, the

most celebrated face of the telecom sector in India. He symbolizes the adage that success comes to

those who dream big and then work assiduously to deliver it.

Sunil Bharti Mittal began his journey manufacturing spare parts for bicycles in the late 1970s. Hisstrong entrepreneurial instincts gave him a unique flair for sensing new business opportunities. In the

early years, Bharti established itself as a supplier of basic telecom equipment. His true calling came

in the mid 1990s when the government opened up the sector and allowed private players to provide

telecom services.

9


10/57

Bharti Enterprises accepted every opportunity provided by this new policy to evolve into India's

largest telecommunications company and one of India's most respected brands. Airtel was launched

in 1995 in Delhi. In the ensuing years, as the Airtel network expanded to several parts of India, the

brand came to symbolize the very essence of mobile services.

Product

Airtel provides a host of voice and data products and services, including high-speed GPRS services.

Airtel also offers a wide array of 'postpaid' and 'prepaid' mobile offers, with a range of tariff plans

that target different segments. A comprehensive range of value-added, customized services are part

of the unique package from Airtel. The company's products reflect a desire to constantly innovate.

Some of these are reflected in the fact that Airtel was the first to develop a 'single integrated billing

system'

Airtel comes to you from Bharti Airtel Limited - a part of the biggest private integrated telecom

conglomerate, Bharti Enterprises. Bharti is the leading cellular service provider, with an all India

footprint covering all 23 telecom circles of the country. It has over 21 million satisfied customers.

Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunications

with its world class products and services.

Established in 1976, Bharti has been a pioneering force in the telecom sector with many firsts and

innovations to its credit. Bharti has many joint ventures with world leaders like SingTel (Singapore

Telecom); Warburg Pincus, USA, Telia, Sweden; Asian infrastructure find, Mauritius; International

Finance Corporation, USA and New York Life International, USA. Bharti provides a range of

telecom services, which include Cellular, Basic, Internet and recently introduced National Long

Distance. Bharti also manufactures and exports telephone terminals and cordless phones. Apart from

being the largest manufacturer of telephone instruments in India, it is also the first company to export

its products to the USA.

10


11/57

Corporate Structure

11


12/57

The Company is a part ofBharti Enterprises, and is India's leading provider of telecommunications

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

units (SBUs) - mobile services, broadband & telephone services (B&T) & enterprise services.

The mobile services group provides GSM mobile services across India in 23 telecom circles, while

the B&T business group provides broadband & telephone services in 90 cities. The Enterprise

services group has two sub-units - carriers (long distance services) and services to corporate. All

these services are provided under the Airtel brand. It includes:

SERVICES OF BHARTI AIRTEL LIMITED

12


13/57

Bharti Airtel became the first private fixed-line service provider in India. It is now promoted under

the Airtel brand. Recently, the Government opened the fixed-line industry to unlimited competition.

Airtel has subsequently started providing fixed-line services in the four circles of Delhi, Haryana,

Madhya Pradesh, Karnataka, and Tamil Nadu & UP (West). Airtel Enterprise Services believes that

these circles have high telecommunications potential, especially for carrying Voice & Data traffic.

These circles were strategically selected so as to provide synergies with Airtels long distance

network and Airtels extensive mobile network.

Airtel Enterprise Services, India's premium telecommunication service, brings to you a whole new

experience in telephony. From integrated telephone services for Enterprises and small business

enterprises to user-friendly plans for Broadband Internet Services (DSL), we bring innovative, cost-

effective, comprehensive and multi-product solutions to cater to all your telecom and data needs.

Voice - Product Portfolio

Airtel Enterprise Services telephone services go beyond basic telephony to offer our users a whole

host of Value Added Services as well as premium add-ons. Each telephone connection from Airtel

Enterprise Services is backed by a superior fibre-optic backbone for enhanced reliability and quality

telephony. Few of the Value Added Services offered are Calling Line Identification, Three PartyConferencing, Dynamic Lock, Hunting Numbers, and Parallel Ringing etc. Airtel Enterprise Services

Voice Services provide Free Dial-up Internet access that is bundled along with your Telephone

connection from Airtel. Its fast, reliable and gives you unlimited Internet access.

Mobile Services

Airtels mobile footprint extends across the country in 21 telecom circles. Its service standards

compare with the very best in the world. In fact, thats how Bharti has managed to win the trust of

millions of customers and makes it one of the top 5 operators in the world, in terms of service and

subscriber base.

13


14/57

The company has several Firsts to its credit:

The First to launch full roaming service on pre-paid in the country.

The First to launch 32K SIM cards.

The First in Asia to deploy the multi band feature in a wireless network for efficient usage of

spectrum.

The First to deploy Voice Quality Enhancers to improve voice quality and acoustics

The First telecom company in the world to receive the ISO 9001:2000 certification from

British Standards Institute.

14


15/57

Satellite Services

Airtel Enterprise Services provides you connectivity where ever you take your business Our Satellite

Services bring you the benefits of access in remote locations. Airtel Enterprise Services is a leadingprovider of broadband IP satellite services and DAMA/PAMA services in India. Our solutions

support audio, video and voice applications on demand.

Satellite Services include:

PAMA/DAMA

BIT - Internet

VPN

Satellite based IPLCs for redundancy reasons

Managed Data & Internet Services

Airtel Enterprise Services brings you a comprehensive suite of data technologies. So we are able to

support all types of networks and ensure that our customers can migrate their network in future

seamlessly. Our Managed Data & Internet services make our customers future proof.

Managed Data & Internet Services include:

MPLS

ATM

FR

Internet

IPLC

Leased Lines

Customized Solutions

International Managed Services

Metro Ethernet

15


16/57

Managed e-Business Services

Airtel Enterprise Services offers an internationally benchmarked, carrier class hosting, storage and

business continuity services. A range of services that help to keep your business running the way youwant- 24x7. Thanks to our world-class high tech Data Centers.

Managed e-Business Services include:

Co-lo: Dedicated and Shared

BCRS Services

Web hosting

THE BRAND-Airtel

Airtel was born free, a force unleashed into the market with a relentless and unwavering

determination to succeed. A spirit charged with energy, creativity and a team driven to seize the

day with an ambition to become the most globally admired telecom service. Airtel, in just ten years

of operations, rose to the pinnacle to achievement and continues to lead.

As India's leading telecommunications company Airtel brand has played the role as a major catalyst

in India's reforms, contributing to its economic resurgence. .

Today Airtel touches peoples lives with the Mobile services, Telemedia services to connect India's

leading 1000+ corporates. The brand also connects Indians living in USA, UK and Canada with our

call home service.

Vision & Promise

By 2010 Airtel will be the most admired brand in India

Loved by more customers

Targeted by top talent

Benchmarked by more businesses

16


17/57

We at Airtel always think in fresh and innovative ways about the needs of our customers and

how we want them to feel. We deliver what we promise and go out of our way to delight the

customer with a little bit more

Corporate Social Responsibility

Overview

At Bharti, CSR is a way of life. Each department and employee strives to be sensitive to the

stakeholders and environment within their work context. Bharti encourages employees to take

decisions and design business-linked processes that are sensitive to communities and environment.

Corporate Social Responsibility (CSR) in Bharti encompasses much more than only social outreachprograms. It is an integral part of the way Bharti conducts its business. The essence of Bhartis

commitment to Corporate Social Responsibility is embedded in the Corporate Values, which stem

from its deepest held beliefs. These values are:

17


18/57

The company encourages its employees to take decisions and design business processes, keeping in

mind the following:

Ethics, fairness and being correct

Meeting and going beyond compliances and legal requirements

Showing respect and sensitivity towards stakeholders and communities, and

Nurturing the environment

The company practices CSR beliefs and commitments through a three-pronged approach:

Engaging with stakeholders

Ensuring stakeholder sensitive policies and practices

Undertaking programs for our employees, community and environment

18


19/57

INDUSTRY PROFILE

The telecom network in India is the fifth largest network in the world meeting up with global

standards. Presently, the Indian telecom industry is currently slated to an estimated contribution

of nearly 1% to Indias GDP

Introduction

The Indian Telecommunications network with 110.01 million connections is the fifth largest in the

world and the second largest among the emerging economies of Asia. Today, it is the fastest growing

market in the world and represents unique opportunities for U.S. companies in the stagnant global

scenario. The total subscriber base, which has grown by 40% in 2005, is expected to reach 250

million in 2007.

According to Broadband Policy 2004, Government of India has 9 million broadband connections and

18 million internet connections in 2007. The wireless subscriber base has jumped from 33.69 million

in 2004 to 62.57 million in FY2004- 2005. In the last 3 years, two out of every three new telephone

subscribers were wireless subscribers. Consequently, wireless now accounts for 54.6% of the total

telephone subscriber base, as compared to only 40% in 2003. Wireless subscriber growth is expected

to bypass 2.5 million new subscribers per month by 2007.

The wireless technologies currently in use are Global System for Mobile Communications (GSM)

and Code Division Multiple Access (CDMA). There are primarily 9 GSM and 5 CDMA operators

providing mobile services in 19 telecom circles and 4 metro cities, covering 2000 towns across the

country.

19


20/57

Evolution of the industry-Important Milestones

History of Indian Telecommunications:

1851 First operational land lines were laid by the government near Calcutta (seat of British

power)

1881 Telephone service introduced in India

1883 Merger with the postal system

1923 Formation of Indian Radio Telegraph Company (IRT)

1932 Merger of ETC and IRT into the Indian Radio and Cable Communication Company

(IRCC)

1947 Nationalization of all foreign telecommunication companies to form the Posts,

Telephone and Telegraph (PTT), a monopoly run by the government's Ministry of

Communications

1985 Department of Telecommunications (DOT) established, an exclusive provider of

domestic and long-distance service that would be its own regulator (separate from the postal

system)

1986 Conversion of DOT into two wholly government-owned companies: the Videsh Sanchar

Nigam Limited (VSNL) for international telecommunications and Mahanagar Telephone

Nigam Limited (MTNL) for service in metropolitan areas.

1997 Telecom Regulatory Authority of India created.

1999 Cellular Services are launched in India. New National Telecom Policy is adopted.

2000 DoT becomes a corporation, BSNL

20


21/57

BSNL

On October 1, 2000 the Department of Telecom Operations, Government of India became a

corporation and was renamed Bharat Sanchar Nigam Limited (BSNL). BSNL is now Indias leading

Telecommunications Company and the largest public sector undertaking. It has a network of over 45million lines covering 5000 towns with over 35 million telephone connections.

The state-controlled BSNL operates basic, cellular (GSM and CDMA) mobile, Internet and long

distance services throughout India (except Delhi and Mumbai). BSNL will be expanding the network

in line with the Tenth Five-Year Plan (1992-97). The aim is to provide a telephone density of 9.9 per

hundred by March 2007. BSNL, which became the third operator of GSM mobile services in most

circles, is now planning to overtake Bharti to become the largest GSM operator in the country. BSNL

is also the largest operator in the Internet market, with a share of 21 per cent of the entire subscriber

base.

MTNL

MTNL was set up on 1st April 1986 by the Government of India to upgrade the quality of telecom

services, expand the telecom network, and introduce new services and to raise revenue for telecom

21


22/57

development needs of Indias key metros Delhi, the political capital, and Mumbai, the business

capital. In the past 17 years, the company has taken rapid strides to emerge as Indias leading and one

of Asias largest telecom operating companies. The company has also been in the forefront of

technology induction by converting 100% of its telephone exchange network into the state-of-the-art

digital mode. The Govt. of India currently holds 56.25% stake in the company. In the year 2003-04,

the company's focus would be not only consolidating the gains but also to focus on new areas of

enterprise such as joint ventures for projects outside India, entering into national long distance

operation, widening the cellular and CDMA-based WLL customer base, setting up internet and allied

services on an all India basis.

MTNL has over 5 million subscribers and 329,374 mobile subscribers. While the market for fixed

wire line phones is stagnating, MTNL faces intense competition from the private playersBharti,

Hutchison and Idea Cellular, Reliance Infocommin mobile services. MTNL recorded sales of Rs.

60.2 billion ($1.38 billion) in the year 2002-03, a decline of 5.8 per cent over the previous years

annual turnover of Rs. 63.92 billion.

RELIANCE INFOCOMM

Reliance is a $16 billion integrated oil exploration to refinery to power and textiles conglomerate(Source: http://www.ril.com/newsitem2.html). It is also an integrated telecom service provider with

licenses for mobile, fixed, domestic long distance and international services. Reliance Infocomm

offers a complete range of telecom services, covering mobile and fixed line telephony including

broadband, national and international long distance services, data services and a wide range of value

added services and applications. Reliance India Mobile, the first of Infocomm's initiatives was

launched on December 28, 2002. This marked the beginning of Reliance's vision of ushering in a

digital revolution in India by becoming a major catalyst in improving quality of life and changing the

face of India. Reliance Infocomm plans to extend its efforts beyond the traditional value chain to

develop and deploy telecom solutions for India's farmers, businesses, hospitals, government and

public sector organizations. Until recently, Reliance was permitted to provide only limited mobility

services through its basic services license.

22


23/57

However, it has now acquired a unified access license for 18 circles that permits it to provide the full

range of mobile services. It has rolled out its CDMA mobile network and enrolled more than 6

million subscribers in one year to become the countrys largest mobile operator. It now wants to

increase its market share and has recently launched pre-paid services. Having captured the voice

market, it intends to attack the broadband market.

TATA TELESERVICES

Tata Teleservices is a part of the $12 billion Tata Group, which has 93 companies, over 200,000

employees and more than 2.3 million shareholders. Tata Teleservices provides basic (fixed line

services), using CDMA technology in six circles: Maharashtra (including Mumbai), New Delhi,

Andhra Pradesh, Tamil Nadu, Gujarat, and Karnataka. It has over 800,000 subscribers. It has now

migrated to unified access licenses, by paying a Rs. 5.45 billion ($120 million) fee, which enables it

to provide fully mobile services as well.

The company is also expanding its footprint, and has paid Rs. 4.17 billion ($90 million) to DoT for

11 new licenses under the IUC (interconnect usage charges) regime. The new licenses, coupled with

the six circles in which it already operates, virtually gives the CDMA mobile operator a national

footprint that is almost on par with BSNL and Reliance Infocomm. The company hopes to start offservices in these 11 new circles by August 2004. These circles include Bihar, Haryana, Himachal

Pradesh, Kerala, Kolkata, Orissa, Punjab, Rajasthan, Uttar Pradesh (East) & West and West Bengal.

VSNL

On April 1, 1986, the Videsh Sanchar Nigam Limited (VSNL) - a wholly Government owned

corporation - was born as successor to OCS. The company operates a network of earth stations,

switches, submarine cable systems, and value added service nodes to provide a range of basic and

value added services and has a dedicated work force of about 2000 employees. VSNL's main

gateway centers are located at Mumbai, New Delhi, Kolkata and Chennai. The international

telecommunication circuits are derived via Intelsat and Inmarsat Satellites and wide band submarine

cable systems e.g. FLAG, SEA-ME-WE-2 and SEA-ME-WE-3.

23


24/57

The company's ADRs are listed on the New York Stock Exchange and its shares are listed on major

Stock Exchanges in India. The Indian Government owns approximately 26 per cent equity, M/s

Panatone Finvest Limited as investing vehicle of Tata Group owns 45 per cent equity and the

overseas holding (inclusive of FIIs, ADRs, Foreign Banks) is approximately 13 per cent and the rest

is owned by Indian institutions and the public. The company provides international and Internet

services as well as a host of value-added services. Its revenues have declined from Rs. 70.89 billion

($1.62 billion) in 2001-02 to Rs. 48.12 billion ($1.1 billion) in 2002-03, with voice revenues being

the mainstay. To reverse the falling revenue trend, VSNL has also started offering domestic long

distance services and is launching broadband services. For this, the company is investing in Tata

Teleservices and is likely to acquire Tata Broadband.

IDEA CELLULAR

Indian regional operator IDEA Cellular Ltd. has a new ownership structure and grand designs to

become a national player, but in doing so is likely to become a thorn in the side of Reliance

Communications Ltd. IDEA operates in eight telecom circles, or regions, in Western India, and has

received additional GSM licenses to expand its network into three circles in Eastern India -- the first

phase of a major expansion plan that it intends to fund through an IPO, according to parent company

Aditya Birla Group .

24


25/57

MAJOR PLAYERS OF INDIAN TELECOMMUNICATION

COMPANY MARKET SHARE

Company Million Subs (Nov 2008) % share

BSNL 3,03,03,230 19.77

Reliance 43,47,593 2.84

Bharti 4,88,75,664 31.88

MTNL 27,72,120 1.81

Vodafone 3,56,57,546 23.26

Idea Cellular 1,86,71,860 12.18

25


26/57

BPL 11,53,357 0.75

Spice 34,81,710 2.27

Aircel 80,39,355 5.24

Telecom Policy Environment

Indian telecommunications today benefits from among the most enlightened regulation in the region,

and arguably in the world. The sector, sometimes considered the poster-boy for economic reforms,

has been among the chief beneficiaries of the post-1991 liberalization. Unlike electricity, for

example, where reforms have been stalled, telecommunications has generally been seen as removed

from mass concerns, and thus less subject to electoral calculations. Market oriented reforms have

also been facilitated by lobbying from Indias booming technology sector, whose continued success

of course depends on the quality of communications infrastructure.

Despite several hiccups along the way, the Telecom Regulatory Authority of India (TRAI), the

independent regulator, has earned a reputation for transparency and competence. With the recent

resolution of a major dispute between cellular and fixed operators (see below), Indian

telecommunications, already among the most competitive markets in the world, appears set to

continue growing rapidly.

While telecom liberalization is usually associated with the post-1991 era, the seeds of reform were

actually planted in the 1980s. At that time, Rajiv Gandhi proclaimed his intention of leading India

into the 21st century, and carved the Department of Telecommunications (DOT) out of the

Department of Posts and Telegraph. For a time he also even considered corporatizing the DOT,

before succumbing to union pressure. In a compromise, Gandhi created two DOT-owned

corporations: Mahanagar Telephone Nigam Limited (MTNL), to serve Delhi and Bombay, and

Videsh Sanchar Nigam Limited (VSNL), to operate international telecom services. He also

introduced private capital into the manufacturing of telecommunications equipment, which had

previously been a DOT monopoly. These and other reforms were limited by the unstable coalition

26


27/57

politics of the late 1980s. It was not until the early 1990s, when the political situation stabilized, and

with the general momentum for economic reforms, that telecommunications liberalization really took

off. In 1994, the government released its National Telecommunications Policy (NTP-94), which

allowed private fixed operators to take part in the Indian market for the first time (cellular operators)

had been allowed into the four largest metropolitan centers in 1992)? Under the governments new

policy, India was divided into 20 circles roughly corresponding to state boundaries, each of which

would contain two fixed operators (including the incumbent), and two mobile operators.

The corporatization of the DOT and the creation of a new state-owned telecom company, Bharat

Sanchar Nigam Ltd (BSNL), in 2000;

The opening up of Indias internal long-distance market in 2000 and the subsequent drop in long-

distance rates as part of TRAIs tariff rebalancing exercise;

The termination of VSNLs monopoly over international traffic in 2002 and the partial privatization

of the company that same year with the Tata group assuming a 25% stake and management control;

The gradual easing of the original duopoly licensing policy, allowing a greater number of operators

in each circle;

The legalization, in 2002, of IP telephony (a move that many believe was held up due to lobbying

by VSNL, which feared the consequences on its international monopoly);

The introduction in 2003 of a Calling Party Pays (CPP) system for cell phones, despite considerable

opposition (including litigation) by fixed operators;

And, more generally, the commencement of more stringent interconnection regulation by TRAI,

which has moved from an interoperator negotiations-based approach (often used by the stronger

operator to negotiate ad infinitum) to a more rules-based approach.

All of these events have created an impressive forward-momentum in Indian telecommunications,

resulting in a vigorously competitive and fast-growing sector. India has also suffered from its fair

share of regulatory hiccups. Many operators (mobile players in particular) still complain about the

27


28/57

difficulties of gaining access to the incumbents (BSNL) network, and the governments insistence

on capping FDI in the telecom sector to 49% (a move made in the name of national security) limits

capital availability and thus network rollout. In addition, ISPs, who were allowed into the market

under a liberal licensing regime in 1998, continue to hemorrhage money, and have been pleading

with the government for various forms of relief, including the provision of unmetered phone numbers

for Internet access. Despite initially impressive results, the growth of Internet in the country has

recently stalled, with only 8 million users. Broadband penetration, too, remains tiny.

MAJOR MARKET TRENDS

The telecoms trends in India will have a great impact on everything from the humble PC, internet,

broadband (both wireless and fixed), and cable, handset features, talking SMS, IPTV, soft switches,

and managed services to the local manufacturing and supply chain.

This report discusses key trends in the Indian telecom industry, their drivers and the major impacts of

such trends affecting mobile operators, infrastructure and handset vendors.

Higher acceptance for wireless services

Indian customers are embracing mobile technology in a big way (an average of four million

subscribers added every month for the past six months itself). They prefer wireless services

compared to wire-line services, which is evident from the fact that while the wireless subscriber base

has increased at 75 percent CAGR from 2001 to 2006, the wire-line subscriber base growth rate is

negligible during the same period.

In fact, many customers are returning their wire-line phones to their service providers as mobile

provides a more attractive and competitive solution. The main drivers for this trend are quick service

delivery for mobile connections, affordable pricing plans in the form of pre-paid cards and increased

purchasing power among the 18 to 40 years age group as well as sizeable middle class a prime

market for this service.

28


29/57

Some of the positive impacts of this trend are as follows. According to a study, 18 percent of mobile

users are willing to change their handsets every year to newer models with more features, which is

good news for the handset vendors. The other impact is that while the operators have only limited

options to generate additional revenues through value-added services from wire-line services, the

mobile operators have numerous options to generate non-voice revenues from their customers.Some

examples of value-added services are ring tones download, coloured ring back tones, talking SMS,

mobisodes (a brief video programmed episode designed for mobile phone viewing) etc. Moreover,there exists great opportunity for content developers to develop applications suitable for mobile users

like mobile gaming, location based services etc. On the negative side, there is an increased threat of

virus spread through mobile data connections and Bluetooth technology in mobile phones,

making them unusable at times. This is good news for anti-virus solution providers, who will gain

from this trend.

MERGERS

Demand for new spectrum as the industry grows and the fact the spectrum allocation in done on the

basis of number of subscribers will force companies to merge so as to claim large number of

subscribers to gain more spectrum as a precursor to the launch of larger and expanded services.

However it must also be noted that this may very well never happen on account of low telecom

penetration.

NEW CIRCLES

As mentioned earlier there is a significant number of tier-2 and tier 3 cities that can accommodate

more players we expect aggressive response by the companies to such opportunities as and when

they are created.

29


30/57

INTRODUCTION

This report on Bharti Airtel is done to find out certain objective regarding the strategic approach

Adopted by Airtel to stand strongly in the competitive telecom market. Airtels marketing strategies

are analyses using various models like SWOT analysis, survey etc.

The outcomes of these are properly analyzed to find out the various aspects like companies position

and competitors position in the market. This report on Airtel not just gives the description about the

company but it also talks about the various marketing strategies adopted by the company.

SWOT analysis of Airtel helps to find out the weak points of the company and to find out the way to

overcome this problem.

30


31/57

OBJECTIVE OF THE STUDY

The research project report is mainly based on the primary information on the basic

marketing strategy of Bharti Airtel Limited and the second is survey analysis on

consumer awareness.

The basic objective of this project is:

a. To study about brand promotion by Airtel

b. SWOT analysis of AIRTEL.

c. A survey on consumer preference and awareness about telecom services

d. Analyzing the data on the basis of survey findings

The study will end with a conclusion giving a reflection of whole project and

recommendations on the basis of data findings.

31


32/57

PURPOSE AND SCOPE OF THE STUDY

Purpose of the study

The main purpose of this study is to analyze the consumer behavior about the telecom services and

awareness about that.

Scope of the project

This project will be very helpful to the following:

This project will be an information guide to the company for increasing the sale of products. They

will avail with the popularity of the products and services by them and also the consumer behavior

and market potential of these products.

32


33/57

CHAPTER - II

REVIEW OF LITERATURE

33


34/57

India's first private operator to make cellular profits has an aggressive strategy in all areas of fixed

and wireless telecoms.Indian telecoms company Bharti Enterprises is undertaking a bold expansion

through a series of acquisitions, new network build and forays into the international arena. In so

doing the New Delhi-based company is aiming to become a force to compete with the government-

run Department of Telecommunications (DoT) and state-owned Mahanagar Telephone Nigam Ltd.

(MTNL).

"We would like to become a customer-driven one-stop-shop for a range of telecoms services,

including fixed-line networks, mobile, Internet access [and] VSATs [very small aperture terminals],"said group chairman and managing director, Sunil Mittal.

Most Recent Technology Articles

34


35/57

Bharti started out in the Indian telecoms market offering cellular phone services in Delhi in 1992. Its

mobile division, Bharti Cellular, is the first private operator to make operational profits in the capital

intensive mobile phone business in India, making a net profit of around 165.8 million rupees (US$3.8

million) in the last financial year (1998-99), and its Airtel brand, operating in Delhi and the state of

Himachal Pradesh, now has more than 175,000 customers.

"For most of India's private operators, telecoms is one of their many business interests, but for Bharti

it is the only one," said Mahesh Uppal, a New Delhi-based independent telecoms consultant.This

focused approach and some aggressive marketing have helped it grow its user base, According to

Mittal the company is adding "about 10,000 cellphone subscribers per month in Delhi."

35


36/57

Sanjay Kapur, chief operating officer of Bharti Cellular Ltd., said Airtel is offering Web-based short

messaging services--such as e-mail alerts and news--and has linked up with financial institutions

ICICI Ltd. and Housing Development Finance Corporation Ltd. to offer banking services over its

mobile phones.Meanwhile parent company Bharti Enterprises has been raising funds for acquisitions

by selling equity stakes in its holding companies--including Bharti Televentures, which has stakes in

the cellular interests, and Bharti Telespatial, the holding company for Bharti's foray into Internet

access and VSAT services-to strategic investors, including Intel Corp., BT, Telecom Italia and

Warbur Pincus.

The funds have enabled Bharti Cellular to make a strategic entry into southern India. Last December

it acquired an 18% stake in JT Mobile (JTM) for Rs4 billion (US$93 million), and a 51% stake in

Skycell for Rs1.2 billion.Now with a combined subscriber strength of around 245,000, Bharti is

closing in on India's largest cellular operator, BPL Mobile, which has some 267,000

subscribers.According to the Cellular Operators Association of India (COAI), the total number of

subscribers in India is currently 1.6 million.

"Bharti's buyout of stakes in JTM and Skycell is a vote of confidence in the [government's] new

telecom policy, but it has to turn its purchases into profitable businesses," said T.H. Chowdhry,

director, Centre for Telecom Management & Studies, in Hyderabad. "The company is moving in the

right direction and will be a real competitor to DOT/MTNL," he added.

With these acquisitions the company's fixed and cellular footprint extends from north and central

India to south India and would give the company a major competitive edge for operating national

long-distance services.To this end, Bharti is laying around 18,000 kilometers of optical fiber network

and leasing more from infrastructure providers. The first phase to lay some 3,800 kilometers of fiber

will begin this month.

36


37/57

The project is scheduled to be completed by June 2001, and the total cost will be around Rs2O billion

(US$465 million).Long-distance building the domestic fixed-line long-distance market, currently

monopolized by the DoT, and is scheduled to be opened to competition in the near future. The

government has yet to take a decision on the timing, but analysts agree that licenses will be given to

operators for basic inter-state services by the end of the year.Meanwhile, VSNL has the monopoly on

international long-distance services until 2001.

Bharti started offering fixed-line network services in the state of Madhya Pradesh in 1998, competing

with state-owned DoT, and has already garnered around 70,000 subscribers, It is the first Indian

private operator to offer alternative services in the state, and in many other states the DoT remains

the sole provider, with the 1999 telecoms policy to establish competition still not fully implemented.

Although licenses have been issued in 7 of the 22 states in India, not all the private operators have

begun offering fixed-line services.

Bharti was also the first Indian company to offer telecoms services abroad. In October 1999 it was

awarded a license to provide a range of domestic and international mobile, fixed and satellite services

in the Seychelles, through subsidiary Bharti Global. It aggressively positioned its tariffs 50% lower

than those of competitor Cable and Wireless plc, of London, forcing it to reduce its cellphone tariffs.

Following its success in the Seychelles, Bharti is now planning to expand its overseas operations to

Yemen, Botswana and Indian Ocean rim nations such as Mauritius. The company is also exploring a

NASDAQ listing in the second quarter of this year to raise funds to the tune of $2 billion-$3 billion.

CHAPTER - III

CURRENT SCENARIO

1.1 SWOT ANALYSIS

1.1.1 STRENGTHS

1.1.2 WEAKNESSES

1.1.3 OPPORTUNITIES

37


38/57

1.1.4 THREATS

SWOT Analysis of Bharti Airtel

Strengths

1. Bharti Airtelhas more than 65 million customers (July 2008). It is the largest cellular

provider in India, and also supplies broadband and telephone services - as well as many

other telecommunications services to both domestic and corporate customers.

2. Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel, with

whom they hold a strategic alliance. This means that the business has access to

knowledge and technology from other parts of the telecommunications world.

38


39/57

3. The company has covered the entire Indian nation with its network. This has

underpinned its large and rising customer base.

Weaknesses

1. An often cited original weakness is that when the business was started by Sunil Bharti Mittal

over 15 years ago, the business has little knowledge and experience of how a cellular

telephone system actually worked. So the start-up business had to outsource to industry

experts in the field.

2. Until recently Airtel did not own its own towers, which was a particular strength of some of

its competitors such as Hutchison Essar. Towers are important if your company wishes to

provide wide coverage nationally.

3. The fact that the Airtel has not pulled off a deal with South Africa's MTN could signal the

lack of any real emerging market investment opportunity for the business once the Indian

market has become mature.

Opportunities

1. The company possesses a customized version of the Google search engine which will

enhance broadband services to customers. The tie-up with Google can only enhance the Airtel

brand, and also provides advertising opportunities in Indian for Google.

2. Global telecommunications and new technology brands see Airtel as a key strategic player in

the Indian market. The new iPhone will be launched in India via an Airtel distributorship.

Another strategic partnership is held with BlackBerry Wireless Solutions.

3. Despite being forced to outsource much of its technical operations in the early days, this

allowed Airtel to work from its own blank sheet of paper, and to question industry approaches

and practices - for example replacing the Revenue-Per-Customer model with a Revenue-Per-

Minute model which is better suited to India, as the company moved into small and remote

villages and towns.

39


40/57

4. The company is investing in its operation in 120,000 to 160,000 small villages every year. It

sees that less well-off consumers may only be able to afford a few tens of Rupees per call,

and also so that the business benefits are scalable - using its 'Matchbox' strategy.

5. Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea Cellular to

create a new independent tower company called Indus Towers. This new business will control

more than 60% of India's network towers. IPTV is another potential new service that could

underpin the company's long-term strategy.

Threats

1. Airtel and Vodafone seem to be having an on/off relationship. Vodafone which owned a 5.6%

stake in the Airtel business sold it back to Airtel, and instead invested in its rival Hutchison

Essar. Knowledge and technology previously available to Airtel now moves into the hands of

one of its competitors.

2. The quickly changing pace of the global telecommunications industry could tempt Airtel to

go along the acquisition trail which may make it vulnerable if the world goes into recession.

Perhaps this was an impact upon the decision not to proceed with talks about the potential purchase of South Africa's MTN in May 2008. This opened the door for talks between

Reliance Communication's Anil Ambani and MTN, allowing a competing Indian industrialist

to invest in the new emerging African telecommunications market.

3. Bharti Airtel could also be the target for the takeover vision of other global

telecommunications players that wish to move into the Indian market.

40


41/57

CHAPTER IV


1.1 RESEARCH DESIGN

1.2 TYPE OF DATA COLECTED1.3 RESEARCH TOOL

1.4 DATA COLLECTION

1.5 SAMPLE SIZE

1.6 PRESENTATION TOOL

41


42/57


Research methodology is considered as the nerve of the project. Without a proper well-organized

research plan, it is impossible to complete the project and reach to any conclusion. The project was

based on the survey plan. The main objective of survey was to collect appropriate data, which work

as a base for drawing conclusion and getting result.

RESEARCH DESIGN

Descriptive Research:

The type of research adopted for study is descriptive. Descriptive studies are undertaken in many

circumstances when the researches is interested to know the characteristic of certain group such as

age, sex, education level, occupation or income. The objective of such study is to answer the who,

what, when, where and how of the subject under investigation. There is a general feeling that

descriptive studies are factual and very simple. Descriptive studies are well structured.

TYPE OF DATA COLLECTED: There are two types of data used. They are primaryand secondarydata. Primary data is mainly consist of information collected through questionairre.

Secondary data is data collected from indirect sources like internet etc.

RESEARCH TOOL- QUESTIONNAIRE: This is the most popular tool for the

data collection. Various customers using Airtel connection were approached and asked to fill the

questionnaire designed which is attached in the report.

DATA COLLECTION: The data collection is done through random sampling.

SAMPLE SIZE: The sample size for customer profile is 100.

42


43/57

PRESENTATION TOOL: Bar Diagrams and Pie Charts have been used for presenting

the results of survey.

DATA ANALYSIS AND INTERPRETATION

PLAN TAKEN BY CUSTOMERS

5

10

15

20

25

30

35

40

45

cNO OF CUSTOMERS

c

In my study I found that most of the customers (40%) having Supersaver 399 plan. My plan 299 -

(20%), 249 delight- (10%) & others (30%) It is shown in the above bar diagram.

43


44/57

MODE OF PAYMENT

5

10

15

20

25

3035

40

45

50

NO OF CUSTOMERS

In my survey I observed that most of the customers paid their bill through cash (45%) & credit cards

(35%) respectively. And the rest pay it through cheque (18%) & Internet banking (2%).

44


45/57

In my survey I found that most of the customers have taken STD pack (65%). It is shown in the

above pie diagram.

45


46/57


47/57

TOPPINGS SOLD IN THE MONTHS OF 201

0

5

10

15

20

25

30

35

40

45

50

Toppings SoldThe interesting observation of this survey is the sales of the toppings were increasing regularly. It

reveals that popularity of toppings was increasing through sales. These are the data of only one

AIRTEL RELATIONSHIP CENTER.

47


48/57

OVERALL SATISFACTION

Excel

25

Good

50%

Average

20%

Unsatisfied

5%

In my survey I found that most of the customers view towards Airtel Post paid connections &

toppings are Good (50%) & Excellent (25%). But Airtel must take care towards unsatisfied

customers (5%), if they want to stay at top.

48


49/57

CONSISTENCY LEVEL OF CUSTOMERS

Less than 6

Months

5%

6 months to 1 year

10%

1 to 2 years

35%

More than 2 years

50%

In my survey I observed that (50%) of the customers are constantly buying Post paid connections for

the past two years, 35% between 1to2 years, 10% between 6months to 1 year and 5% less than 6

months. The survey indicates good consistency level & commitment of the customers.

49


50/57

CHAPTER V

DISCUSSIONS & FINDINGS OF THE STUDY

1.1 FINDINGS OF THE STUDY

1.2 SUGGESTIONS AND RECOMMENDATIONS1.3 LIMITATIONS AND CONSTRAINTS

1.4 ANNEXURE

1.5 BIBLIOGRAPHY AND REFERANCES

50


51/57

FINDINGS OF THE STUDY

1. Customers are satisfied with various plans.

2. It was observed that most of the customers expressed their unhappiness

over billing services. Either they were wrongly charged or they never received

bills on time.

3. Senior citizens are very particular about rentals.

4.Through my survey, I came to know that most of the customers are

satisfied with our plans and toppings.

5. Through my survey I observed that most of the customers are using STD

pack.

6. I observed that most of the customers are using supersaver-399 plan.

7. I observed that most of the customers like Airtel advertisement and

punch-line.

SUGGESTIONS AND RECOMMENDATIONS

1. To ensure better customer satisfaction & maintain higher level of Customer

relationship management, the billing department has to be more effective &

efficient.

2.To retain existing customers means offering the best scheme. This wouldautomatically attract new customers. Airtel need not spend on advertisement to

attract new customers.

3. Airtel should continue to offer the best toppings to stay at the top.

4.. There should be no compromise in quality and the network facility.

51


52/57

52


53/57

LIMITATIONS AND CONSTRAINTS

1. Slow pace of the reform process.

2. It would be difficult to make in-roads into the semi-rural and rural areas because

of the lack of infrastructure. The service providers have to incur a huge initial

fixed cost to make inroads into this market. Achieving break-even under these

circumstances may prove to be difficult.

3. The sector requires players with huge financial resources due to the above

mentioned constraint. Upfront entry fees and bank guarantees represent a

sizeable share of initial investments. While the criteria are important, it tends to

support the existing big and older players. Financing these requirements require

a little more liberal approach from the policy side.

4. Problem of limited spectrum availability and the issue of interconnection charges

between the private and state operators.

53


54/57


55/57

1.Which phone connection you are using currently?

(a)Airtel (b)Idea

(c)Vodaphone (d)MTNL

2. Which plan you are using?

(a) My plan-299 (b) 249 Delight

(c) Supersaver-399 (d) Others

3. What do you think before taking the connections?

(a) Rental (b) Brand Value

(c) Network coverage (d) All of these

4. How long have you been using Airtel postpaid connection?

(a) Less than 6 Months (b) 6 months to 1 year

(c) 1 to 2 years (d) More than 2 years

55


56/57

\5. What is the mode of your paying your bill?

(a) By Cash (b) By Cheque

(c) By Credit card (d) By Internet Banking

6. Where do you mostly pay your bill?

(a) Airtel Relationship Center (b) E-seva

(c) Drop Box

7. Which type of problem you are facing in postpaid connection?

(a) Bill payment (b) Never get bill on time

(c) Wrongly charged (d) never get bill

8. Are you satisfied with Airtel call center executives?

(a) Excellent (b) Good

(c) Satisfied (d) Unsatisfied

56


57/57

BIBLIOGRAPHY

1. Books:

a. Marketing management: analysis, planning, implementation, and

control by

Philip Kotler - Business & Economics - 1988

2. Internet Sites:

a. www.airtel.in

3. Other sources

a. Marketing Manual of Bharti Airtel Limited
http://books.google.co.in/books?id=Kn1u8akZtjcC&q=marketing+management&dq=marketing+managementhttp://books.google.co.in/books?id=Kn1u8akZtjcC&q=marketing+management&dq=marketing+managementhttp://books.google.co.in/books?q=+subject:%22Business+%26+Economics%22http://www.airtel.in/http://books.google.co.in/books?id=Kn1u8akZtjcC&q=marketing+management&dq=marketing+managementhttp://books.google.co.in/books?id=Kn1u8akZtjcC&q=marketing+management&dq=marketing+managementhttp://books.google.co.in/books?q=+subject:%22Business+%26+Economics%22http://www.airtel.in/

Marketing Strategies of Bharti Airtel Limited 2010

Documents

Transcript of Marketing Strategies of Bharti Airtel Limited 2010