ufone

Impact of Competitor on Brand Equity in Telecommunication

PREFACE

This report reviews the marketing of Ufone, the second largest telecom company

in Pakistan. We give a brief history of the company and tell about the

achievements and growths of Ufone. It put light on the whole organization

specifically its marketing department and the activities ongoing in its marketing

department. These activities include two of its major components i.e. Sales

Promotion and Advertising. These two are the main topics of this report which we

have discussed in the depths of the company’s strategies and functioning. Further

we review Ufone’s strengths, weaknesses, Opportunities and Threats (SWOT

Analysis). In the end we give the future plans of Ufone and conclude with our

views and suggestions for Ufone.

　　　　　　

EXECUTIVE SUMMARY

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This project has been undertaken in order to highlight the Human Resource Practices of Ufone

´.Its all about YOU its all about Ufone a company very highly spoken of these days. A company

paying more attention to its customer’s delights rather then the customer’s satisfaction. Ufone is

accompany starting from scratch and has shown utmost performance in the last four years. Ufone

owes its success to its employees believing that providing employees with job satisfaction,

motivates them to work hard and provide better results. Proper planning is Ufone’s strongest

point; all the products that they have launched so far are backed by wise strategies with proper

market research and massive advertisement campaigns. Decisions are taken at top level with

some participation from the lower levels showing that they do comprehend the worth of Group

decision-making. However goal setting is a procedure dedicated to only the top management.

Working on newer technologies is a specialty of ufone.

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INTRODUCTION

The company commenced its operations under the brand name of Ufone from Islamabad on

January 29 2001. Ufone expanded its coverage and has added new cities and highways to its

coverage network. After the privatization of PTCL, Ufone is now owned by Etisalat. During the

year, as a consequence of PTCL’s privatization, 26% of its shares were acquired by Emirates

Telecommunication Corporation (Etisalat). Being part of PTCL, the management of Ufone has

also been handed over to Etisalat. During the years, Ufone continued on the path to success. The

Company further expanded its coverage and has added new cities and highways. Ufone has

network coverage in more than 5885 locations and across all major highways of the country.

During the year Ufone adopted the policy of simplified tariffs with no hidden charges, which

resulted in positive impacts on the usage trends of subscribers as well as total subscriber base,

which has increased to 19.4 million. Ufone currently caters for International Roaming to more

than 230 live operators in more than 130 countries and introduced International roaming facility

for Prepaid subscribers in Saudi Arabia, United Kingdom, United Arab Emirates, Singapore,

Portugal, Thailand, Cyprus, Bangladesh, Uzbekistan, Tunisia, Sri Lanka, Belgium and Kuwait

with lowest rates, featuring no security deposit and activation charges. GPRS Roaming facility is

available with more than 115 Live Operators across 85 countries. The company has also been

awarded a new License for providing cellular services in Azad Jammu & Kashmir and Northern

Areas.

BRIEF HISTORY

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　 In 1990, Pakistan introduced its first mobile phone service called “Paktel”. After eleven years

in January 2001, a new cellular company with GSM technology came into the market and they

named it Ufone. The government of Pakistan granted them the license of Pak Telecom mobile

limited to operate GSM 9000 all Around Pakistan. Ufone succeeded to establish itself in the

market by providing quality service at low rates. After it’s opening, initially they started their

service in major cities like Rawalpindi, Islamabad, Karachi and Lahore and on major highways.

Later the service expanded to other major cities like Peshawar, Quetta and different towns.

Ufone invested around $ 65 million to setup its modern technical infrastructure to provide high

quality crystal clear voice and fast data transmission. Ufone targeted the middle class, by

introducing low rates and different packages with Urdu names like Jazba etc to attracted lower

and middle class people. Ufone has expanded its customer support in a very organized manner

with a planned network of dealers, outlets for people convenient. Ufone not only focused on the

technical capabilities, but to provide subscribers a convenient to get connections and services.

Ufone recently started GPRS through which users can connect themselves to the global village

via Internet, also introduced multimedia messaging services and worldwide SMS at flat rates.

Not only SMS but also provides Ufone Info service through which user can get latest

information about news, sports, religion, horoscope, stock exchange etc even live sports updates.

The tariff packages have been designed keeping in mind the requirements of every segment of

the society may that be a housewife, a taxi driver, a trader or a student. Ufone started its

operation from Islamabad on 29th January 2001. Cellular industry performance in Pakistan

before the launch of Ufone was quite dismal, with one of the lowest population penetration rates

in the Whole region. Ufone’s strategy from the day one was to change this scenario and ensure

that mobile phones are turned into an everyday business and personal communication tools for

all. This approach brought about a revolution in the market; increasing its size five fold in a mere

two years.Ufone’s own performance in these two years has been exemplary, as it surpassed all

financial and marketing goals. Despite Ufone’s strategy to provide a high standard of service

rather than increasing subscriber base without capacity, it has achieved a substantial market share

in a market ten years older than itself.

MISSION

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"Ufone, it's all about U! We are where you want to be… …At Ufone we aim to provide you

with wider coverage, superior connectivity, clear signals & voice quality. Wherever you are,

Ufone keeps you connected.

VISION

“To be the leading telecommunication service provider in Pakistan by offering innovate

communication solutions for our customers while exceeding shareholder value & employee

expectation.”

　

Brands:

While keeping its tradition of being the trend setter in the industry, Ufone changed the image of

mobile phones from a luxury only affordable by the elite, to a necessity affordable by the

common man. Since its inception, Ufone has positioned its brand for masses. In keeping with the

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upcoming competition and market dynamics, Ufone increased its focus on the youth segment

(which comprises 50% of the population), with the Prepay brand. By designing market focused

products, Ufone’s brand team launched aggressive campaigns, which further increased the brand

equity. The new brand image gained huge popularity amongst the targeted market. A recent

marketing survey conducted by a prominent marketing research company showed that Ufone has

considerably increased its brand visibility and image. Ufone’s Prepay brand is now considered to

be one of the most favored brands by the youth market and is followed by other mobile operators

launching their respective brands for the youth market.

UFONE’s ACHIEVEMENTS

►During 2006 Ufone successfully completed the network expansion of Phase 4 in existing as

well as in new cities and towns which amounted to more than US Dollar 170 million. As a result

the asset base of the Company has increased from Rs. 20 billion to Rs. 27 billion.

►Ufone adopted the policy of simplified tariffs with no hidden charges, which resulted in

positive impacts on total subscriber base, which has increased from 2,579k in June 2005 to

7,487k in June 2006.

►Ufone currently caters for international roaming to more than 195 live operators across 119

countries and introduced International roaming facility for Prepaid subscribers in Saudi Arabia,

United Kingdom, United Arab Emirates, Singapore, Portugal and Kuwait with lowest rates,

featuring no security deposit and activation charges. GPRS roaming facility is available with

more than 75 Live Operators across 59 countries.

►The Company has also been awarded a new License for providing cellular services in Azad

Jammu & Kashmir and the Northern Areas.

OPERATING PERFORMANCE

Ufone’s operational performance has been very encouraging. Despite the stiff competition in

Pakistan telecom market which has led to reduction of prices to bare minimum level, due to its

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aggressive policies and exercising strict control over expenses the Company managed to improve

its revenue and after-tax profit by 87% and 54% respectively, as compared to last year.

GROWTH RATE

As mobile users in the country have reached over 28 million at a very rapid pace, Ufone has

maintained itself as the 2nd largest cellular operator in Pakistan with a subscriber base of around

6.5 million and a market share of nearly 25%. Ufone has seen a subscriber growth rate of over

200% in the last year, and since the start of 2005 Ufone added nearly 5 million subscribers onto

its network. A remarkable achievement indeed, especially considering the fact that two new

international players also entered into the market in 2005. Subsequently the growth in subscriber

base caused a healthy trend in revenues which have doubled.

TECHNOLOGY

After Mobilink, Ufone is the second cellular service provider company that is based on GSM

technology. Basically they are using GSM 900 technology with version 2001. Apart from this

they are very strong in technological developments especially they have a well-established

research and development department that is working on new technological developments in

their products. Like they are the first company in Pakistan that is offering GPRS facility to their

subscribers

　　　

STRUCTURE OF THE ORGANIZATION

In Ufone the hierarchy is very lean, in general the whole setup is centralized, all the matters are to be reported to the main company and all the policies and targets are approved at the higher level. But at the department level the structure is decentralized.

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► UFONE has following functional departments:-

§ Technical

§ Customer operations

§ Finance

§ Administration & Procurement

§ Human Resource

§ Co-ordination (Govt. relations)

Marketing　

Current CEO (Chief Executive Officer) &

President of UFONE is Mr.Mubashir Naqvi

Ufone’s Head Offices is in Islamabad

　

SERVICES

Both Post-Paid and Pre-Paid Ufone subscribers can enjoy any/all Ufone services including GPRS based services (MMS, Ufone Internet, Pocket Stocks), Global SMS, etc

Ufone is proving these all services to its consumers:-

• Internal Excess,

Online Billing Payment

• Power SIM

• WAP

• International Roaming

• Voice Mail

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• Call Management

• Messaging

　

MOBILE PRODUCTS

Ufone is offering the following Mobile Products:-

Utalk

Missed Call Notification

Phonebook Saver

Trivia Quiz

Ushare

Uloan

Voice Bucket

Utunes

Awaz SMS

Uchat

Ugames

Call Block

Self Service Kiosk

U kisaan

U health

Ufone prize bond

Ubazar

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Hajj Guide

BRAND EQUITY

“Brand equity is the unique set of real and/or perceived distinctions attached to a brand by

customers…. Brand equity lives only in the hearts and minds of customers.”

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　 REVIEW OF LITERATURE

Brand equity, a measure of the overall value of a brand (Keller, 1998), is a key concept in brand

management. Brand equity has been identified as a valuable source of competitive advantage for

many organizations (Aaker, 1991; Bharadwaj, Varadarajan and Fahy, 1993; Keller ,1998). Keller

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(1993) conceptualizes brand equity as “the differential effect of brand knowledge on consumer

response to the marketing of the brand”. Furthermore, Keller proposes brand knowledge as

central to the definition of brand equity and contends that high levels of brand knowledge

increase the probability of brand choice, and defines brand knowledge in terms of brand

awareness and image. Keller conceptualizes brand awareness as “the strength of the brand trace

in memory that is reflected by the consumer’s ability to identify the brand under different

conditions” and defines brand image as “perceptions about a brand as reflected by the brand

associations held in consumer memory”. The customer-based brand equity is a set of brand-

related associations held by the consumer in memory (e.g., Keller, 1993). Under this perspective,

brand equity is regarded as being largely attitudinal in nature, composed of beliefs, affect, and

other subjective experiences related to the brand (i.e., brand attitude, brand image, etc.) In

addition, existing research on brand equity is used to identify four cognitive “components” of

customer-based brand equity. These are labeled as global brand attitude, strength of preference,

brand knowledge, and brand heuristic (Girish and Clayton, 2004). Others have tried to further

extend brand equity by including constructs, such as brand loyalty, brand awareness, perceived

quality, in addition to brand associations (e.g., Aaker, 1991; Keller, 1993)

Brand equity is defined as a set of assets and liabilities linked to the brand, which add value to or

subtract value from a product in its relationship with customers (Aaker, 1991). Aaker believed

that the value of brand equity came from five brand equity assets(brand loyalty, brand awareness,

perceived quality, brand associations and other proprietary brand assets), in which perceived

quality and brand associations were two most important assets. All these brand equity assets

could bring value for the enterprise and customer. The brand loyalty based on client can defend

the attack of competitor’s marketing, and the effect of competitive manufacturer’s marketing

efforts to attract the loyal customer of other brand is always unsatisfactory. Brand awareness can

provide the familiarity to a brand and the signal of substantiality and promise if the customer

knows the brand; while it will influence the consideration of customer to brand and further

influence the selection of customer on brand when the brand is memorized. The perceived

quality can influence the purchase decision and brand loyalty directly, especially when the

customer has not been stimulated by inducement or can’t make detailed analysis. Brand

association can assist customer to deal with or memorize information and become the base of

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product difference and product extension, which will provide a purchase reason for customer and

arise positive feeling.

From the viewpoint of Aaker, the study can find that brand equity can bring value for both client

and manufacturer, and the client value from brand equity is the base to create manufacturer

value. In five assets of brand equity, brand loyalty may be influenced by other key dimensions

(brand awareness, perceived quality and brand associations) of brand equity; therefore brand

loyalty can be regarded as the primary base of brand equity and independent from other

dimensions.

In five assets, other proprietary brand assets (patent, trademark and distributors etc.) are harder to

measure the perspective of customer. In this case, this make perceived quality, brand loyalty,

brand awareness and brand associations as the measure variables of brand equity based on the

achievements of above scholars (e.g., Aaker, 1991; Keller, 1993).

Relationship between Advertising and Brand Equity

Advertising expenditure, as the main marketing communications tool in the consumer market,

should be considered when determining the effects of marketing communications on consumers,

and the perceptions that the messages are provoking among different target individuals (Angel

and Manuel, 2005). Keller (2003) notes that the firm’s marketing communications contribute to

brand equity. That is, effective communication enables the formations of brand awareness and a

positive brand image. When consumers perceive high spending on advertising, this contributes to

their perception of the level of confidence that marketing managers have in the product (Kirmani

and Wright, 1989). Perceived advertising spending has positive effects, not only on brand equity

as a whole, but also on each of the elements it is made up of: loyalty, awareness, perceived

quality and brand associations (Cobb-Walgren, Ruble and Donthu, 1995).

The relationship between perceived quality and spending on marketing communications was

justified by different studies (Milgrom and Roberts, 1986; Kirmani and Wright, 1989; Aaker and

Jacobson, 1994; Archibald, Haulman and Moody, 1983). The work shows the favorable

relationship between marketing communications spending and the firm’s investment in the

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brand, which involves a higher perception of quality. The relationship between the investment in

marketing communications and quality affects not only the perceived brand quality, but also

supports the purchase decision by increasing the product value, as shown by Archibald et al.

(1983) — i.e. the recipient of the advertising considers the perceived advertising spending on the

brand as reaffirming the purchase decision.

From the study of former scholars, we can find that scale variables of brand equity such as

“brand awareness” and “brand attitude” can use “exposure effect” to increase the evaluation of

customer to the brand. Zajonc and Markus (1982) pointed out that “exposure effect” mean the

effect when some marketing objective was exposed repeatedly. The masses will have more

positive attitude to the marketing objective if it is exposed regularly. Anand, Holbrook and

Stephens (1988) also proved that “exposure effect” was a key factor to alter the preference and

attitude in the later study. Laroche, Kim and Zhou (1996) also validated the influence of

“exposure effect” on “brand knowledge”, “brand attitude”, “brand familiarity” and purchase

willing and confidence. Archibald et al. (1983) pointed out the relationship between the

investment in marketing communications and quality affects not only the perceived brand

quality, but also supports the purchase decision by increasing the product value. Hence

advertising expenditures are likely to be positively related to brand equity. This research

proposes the

H1 hypothesis about advertising expenditures and brand equity as below.

H1: Advertising expenditures affects brand equity

H1a: Advertising expenditures is positively related to perceived quality.

H1b: Advertising expenditures is positively related to brand loyalty.

H1c: Advertising expenditures is positively related to brand awareness.

H1d: Advertising expenditures is positively related to brand associations.

Relationship between Price Promotion and Brand Equity

Research has traditionally posited that sales promotions erode brand equity. Usually, price

adapted by the manufacturer as a direct promotion method will increase the purchase willing of

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customer. Most of the effect of a price cut is seen in consumers' short-term brand choices.

Promotions increase the price sensitivity of non-loyal customers (Mela, Gupta and Lehman,

1997). But it does not hold when long-term effects are considered. In this regard, using price

promotions means deterioration in brand equity.

The use of price promotions has a negative effect on brand equity, since it is considered that the

consumer perceives a negative relationship between brand equity and the need to use incentives

for sales that affects the established level of prices(Aaker, 1991; Yoo, Donthu and Lee, 2000).

Sales promotions in general, and especially price promotions, have been considered to weaken

brand equity in spite of the short-term benefit that they provide to the consumer (Yoo, Donthu

and Lee, 2000). Overall, the long-term effects of price promotions on sales are negative.

Therefore, price promotion may have negative influence on customer perceptions making

differential consciousness of customer on perceived quality, and then influences the brand equity

of product and purchase willing of customer. Activities based on lowering prices can place

brands in danger by provoking consumer confusion, instability and variability leads to an image

of unstable quality (Winer, 1986). Hence, this research proposes the research hypothesis.

H2: Price promotion affects brand equity

H2a: Price promotion is negatively related to perceived quality.

H2b: Price promotion is negatively related to brand loyalty.

H2c: Price promotion is negatively related to brand awareness.

H2d: Price promotion is negatively related to brand associations.

POSITIONING

Positioning is basically to implement an image into the consumer’s minds, by using Positive

traits of the product.

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1. Positioning concept of Ufone:

The slogan of Ufone is “Its all about you”. By this slogan, Ufone is positioning itself as a

Company, which moulds itself according to their customers. Ufone is also implying that, it is a

very flexible, adaptable and user friendly. So the image of Ufone in the minds of people is that, it

is inexpensive, well performing & customer oriented.

2. Characteristics of present Positioning:

How can we conclude the positioning status mentioned above? We can do it, by looking at the

following facts:

• International roaming across 125 countries.

• Provides wide coverage, with clear signals & voice quality.

• User friendly Customer services & Sales

• Accurate Billing

• It is using latest technological facilities (e-g online phone-book,

Transferring balance, WAP etc)

By taking a look at these features of Ufone, we can state that Ufone’s positioning is Mainly, “It

has made packages and Services, according to target market’s needs.”

3. Positioning strategy:

The primary positioning strategy of Ufone is “Positioning by Price, Quality &

Competitors”.

The secondary positioning strategy is an extension of the primary strategy. And that is to

Position according to Product’s class & attributes. (In this case, attributes mean Services).

PROMOTION

Ufone believes in Integrated Marketing Communication which is a carefully blended mix of

promotion tools. Ufone employ different marketing activities and channels to communicate and

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deliver value to customer. These activities are coordinated to provide maximum communication

output. These communication channels includes:-

Advertising, Sales promotion, Public relations, Direct marketing, Personal selling.

Ufone strategize to carry out promotion in order to increase its market share.

Promotion Strategy:

v Advertising (discussed later)

v Sales Promotion (discussed later)

v Public Relations : Ufone is less conscious of developing its general public relations. But

recently it has launched its “Hajj Guide” service on Ufone. It avoids getting in news stories and

controversies but sometimes it proves inevitable.

v Direct Marketing : Ufone employ on-road umbrella franchises where the directly market and

sell their connections and Sims.

v Personal Selling : Ufone administer personal selling facility to sell their PostPay connections

targeting well to do people and businessmen

› It won’t be an exaggeration to say that Ufone has placed itself where it is now through brilliant

promotions.

　

SALES PROMOTION

“Sales promotions are short term incentives to encourage the purchase or sale of a product or

service”

Ufone uses following sales promotion tools

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Contests:

Ufone carried out contest for cricket talent hunt in the year 200_______. Our renowned Pakistani

cricketer Shoaib Akhtar was used as patron for this contest. However this contest didn’t do much

good to Ufone’s image or sales. But Ufone holds future plans to carry out such activities in more

effective and profitable ways.

Games:

Ufone is currently running its game show on ATV prime time. This game show rewards the

winning participants. Ufone updates its customers every now and then to participate in this game

show. The problem we see in this activity is that Ufone is not properly advertising it.

Premiums:

All the cellular services are now offering premiums for their customers. This premium is offered,

when a customer don’t use his/her sim for more than 3-6 months, in the form of extra credit

balance delivered to their numbers for free

Free tickets:

Ufone recently offered free trip to Dubai. It was Ufone’s first Eid offer. Every time you make

any international call of 5 minutes or longer than 5 minutes, you enter the lucky draw to win a

return ticket to Dubai. The more calls you make, more is your chance to win.

COMPETITORS

There is a hard core competition among the cellular service providers in Pakistan. Ufone is a

market challenger in its competitive position, where MOBILINK is the market leader. Warid,

Telenor and newly introduced ZONG are also strong contenders in market challenger category.

Ufone has the following four direct competitors:-

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Mobilink, Telenor, Warid.

Ufone also considers the following as its competitors:-

ZONG (former PAKTEL), PTCL WIRELESS, Wateen, WorldCall

Competitive strategy:

Ufone’s competitive strategies are Customer intimacy and Differentiation. Ufone aims at fore

passing Mobilink in its competitive race.

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Competitors’ Analysis:

1. Mobilink

• Pioneer cellular 100% GSM company in Pakistan

• It is the first one to introduce the concept of FRANCHISE in cellular industry

• ISO 9002 quality management system certification for the billing, engineering department

and customer service contact center

• Big market share

• Loyal customer base

• Branded product

• Broad coverage area

• Mobilink benefits from broad coverage, with the widest network of easily accessible GSM

centers, and Connect Point of Sales Express Shops. Customer service too is friendly, with an

automated phone mechanism that directs

• Customers to particular departments, providing a choice of Urdu- or English-speaking

operators.

• Easy load facility is another advantage.

• Greater number of postpaid corporate customers.

Following are problems with Mobilink

• Lack of quality service.

• Connectivity problems.

• High call charges to other networks and high SMS charges.

2. Warid

• New and innovative post paid packages.

• Friends and family packages.

• Free minutes are given for post paid users depending upon connection.

• 30 seconds billing and 1 second billing in Zahi postpaid connection.

• Huge investment.

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• Heavy advertisement.

• 4 million users in just one year after introduction.

• Coverage area is less and network is expanding slowly.

3. Telenor

• Friends and Family packages e.g. (PERSONA). Call charges are different for first minute and

following minutes.

• Heavy advertisement.

• Huge investment.

• Easy Load facility.

• Voice quality is very good.

• No connectivity problems.

• Coverage area is increasing rapidly.

4. Zong

• Huge investment

• Rapid growth of market share

• Simple and clear marketing strategy

• Controlled by the worlds largest telecommunication company (subscriptions vise)

• Claiming to have the lowest call rates

COMPETITIVE ADVANTAGES

It’s an advantage over competitors gained by offering consumers greater value than competitor’s

offer. Ufone strategizes to gain more and more competitive advantages. It also uses these

competitive advantages well enough for its promotion. Currently Ufone is enjoying the following

competitive advantages:-

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v Lowest overall call rates

v Value added Services (VAS)

v Call block service

v Corporate color

CHALLENGES

Ufone face many challenges with the ever growing needs of telecommunication. It must remain

profitable with the decreasing economical situation of Pakistan. It must grow as well in these

dark times if it has to remain IN the market. Ufone face very strong competition from its

competitors. It must offer lowest rates with better quality service. New features and services

should be introduced to make its customers loyal, happy and satisfied.

FUTURE PLANS

►Keeping in view the growth potential of the cellular industry there is no option but to be

aggressive in order to remain a potent force in the cellular industry.

►A strong focus will be on maintaining high quality of service, which is always a benchmark of

Ufone, increasing usage and exploring new revenue streams on value added services, market

visibility through various market initiatives to fulfill subscribers’ satisfaction and demand and

above all to increase the value of investment for the shareholders.

　　　　　　　　　　　　　　　　　　　　　　　MATERIALS AND METHODS

RESEARCH METHOD

Figure 1 exhibits the research framework of this study. It demonstrates the effects of advertising expenditure and price promotion on brand equity and shift the spot light on the moderating role of product category.

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Brand equity

Perceived qualityBrand loyaltyBrand awarenessBrand associations

Search productExperience product

Price promotion

Advertising

Product category


Figure 1: Conceptual Framework

Definition and Measurement

This research contains three constructs including advertising, price promotion and brand equity.

Advertising expenditure, as the main marketing communications tool in the consumer market,

should be considered when determining the effects of marketing communications on consumers,

and the perceptions that the messages are provoking among different target individuals.

Therefore, advertising in this study is defined as the consumer’s subjective perception of

advertising expenditures for the brand.

The measurement scale is developed with reference to Yoo et al.(2000) and Martin (2000). Price

promotions mean short-term price reduction such as special sales. It is measured as consumer’s

subjective perception of frequency of the price promotions used for the brand. The measurement

scale is developed with reference to Yoo et al.(2000) and Martin (2000). The scale of brand

equity measures four core dimensions: perceived quality, brand loyalty, brand awareness and

brand associations. Perceived quality is defined as a subjective judgment made by the consumer

regarding the excellence or superiority of a product (Zeithaml, 1988). The measurement scale is

developed with reference to Aaker and A´ lvarez del Blanco(1995), Lassar et al.(1995) and Yoo

et al.(2000). Brand loyalty plays an outstanding role in generating brand equity, not only because

of its capacity to keep customers loyal (Aaker, 1991; Grover and Srinivasan, 1992), but also

because that customer loyalty extends to other brands in the company’s portfolio (Cebollada,

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1995). In this study, brand loyalty refers to the overall commitment of being loyal to a specific

brand. The measurement scale is developed with reference to Aaker and A´ lvarez del

Blanco(1995) and Yoo et al.(2000). Brand awareness measured as the consumer’s subjective

perception-level of the brand. High levels of brand-name recognition are those that present the

brand with a high degree of brand awareness. The measurement scale is developed with

reference to Yoo et al.(2000). Brand associations are related to a series of tangible and intangible

attributes associated with the brand, which conditions a favorable attitude to choosing the brand.

The measurement scale is developed with reference to Aaker and A´ lvarez del Blanco (1995),

Lassar et al.(1995) and Yoo et al.(2000). All the items of construct are measured with the Likert

5-point scale.

Research Methodology:

We adopt the following method to collect the data

o Primary Data

o Secondary Data

o Internet

o Broachers

o Questionnaire

o Interview

Research Design

I selected a topic for conducting the research on Impact of Competitor on Brand Equity in

telecommunication industry. I used the methodological approach of interviews from different

Businessmen, Students and teachers, for it first I develop a questionnaire and I will try to find out

the accurate results.

Accumulations and Sample

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I took sample size of 25 people for this research about Impact of Competitor on Brand Equity in

telecommunication industry which includes businessman, students, bankers and I conduct

research in Faisalabad.

Assumptions

We are taking sample size of 25 people for this research which includes businessman, students,

bankers and govt. officials and I conduct research in Faisalabad.

Delimitation of the Study

While making this project I faced numerous of problems are load shedding which always break

the continuity and concentration while making project. Secondly this research related to my topic

were not easily available on internet.

Population sample

Population Sample size

1- Students 11

2- Job person 4

3- Businessman 10

Samples and Sample Method

In this research, I took the sample size of 25 people and I have chosen almost all categories’

people which are related to telecommunication industry directly or indirectly.

Research Instruments

I prepared 3 close ended questions and 9 questions are four intervals and there are few three

intervals questions in this research’s questionnaire.

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Procedures and Data Collection

In this research project mostly all the data is primary data which I will conduct research myself

like I will personally go to the students, job person, businessman and I gathered the information

through questionnaire and secondary data is also used in literature review.

　　　　　　　　　　　　　　　　　　　　

　　　　　　　　　　　　　　　　　　　RESULTS AND DISCUSSION

CONCLUSION

Telecom industry is most growing industry of Pakistan still huge investment required for

coverage. The market also has strong competition after the entrance of China Mobile Company

as player. Competitors are hiring professionals to entertain the consumer which is resulting

technological implementation and value added services. People are worried about call rates they

don’t prefer any particular company. Consumer searches good service with lowest call rates,

although companies are minimizing call rates this will result more growth in the market. Ufone

bring amazing packages to attract the customers. Ufone promote their product through TV

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commercial, Newspaper, Radio, Internet etc. The choice of people is Ufone because Ufone price

level is low and affordable that every one can say “it’s all about U”

This research investigates advertising across search and experience product categories. Across

both categories, the brand with the higher advertising budget yielded substantially higher levels

of brand equity. This study notes that the firm’s advertising contributes to brand equity and

increases loyalty. Perceived advertising spending showed a favorable causal relationship for

three of the four dimensions of brand equity. The higher the spending on advertising for the

brand, the better the quality of the product as perceived by the consumer, the higher the level of

brand awareness and the more associations linked to the product, forming its brand loyalty. That

is, effective advertising activities enable the formations of brand awareness and a positive

perceived quality, brand loyalty and brand associations. To summarize, advertising has a positive

effect on brand equity. Hence, hypothesis H1a, H1b, H1c and H1d are supported. The research

question that concerns this study is whether price promotions can contribute to building brand

equity. Price promotions have a negative effect on brand equity in the long term. Price

promotions as incentives to increase sales have been shown to have a negative effect on brand

equity. Although they can cause a short-term benefit to the consumer, from a strategic

perspective they showed negative effects. These effects can affect the perceived quality of the

product adversely, since benefits gained through price promotion are not enduring, and do not

transmit the security or the confidence that a brand should inspire with regard to its expected

utility. However, adopting a consumer-based brand knowledge perspective of brand equity, this

study shows that price promotions of bank are useful to create brand equity because of their

positive effect on perceived quality, brand loyalty and brand associations. Nevertheless, the

statistics of the search product proves that price promotion has significant negative impact on

brand awareness and brand association. Hence, H2 is partially supported.

This paper seeks to systematically examine the possible drivers of differences across product

categories and the implications of our preliminary findings. The result proves that the product

category does have moderate effect in between price promotion and brand equity. The result

shows that product categories moderated the relationship between advertising, price promotion

and brand equity. The influence of advertising and price promotion on brand equity is different

from search goods/services and non-search (experience and credence) goods/services. Compare

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to non-search goods/services, search goods/services is positively more effective in advertising on

brand equity. The impact direction and dimension of price promotion on brand equity in various

product categories are different. In search products (UFONE), it has significant negative impact

on brand awareness and brand association. In non-search products (bank), it has significant

positive impact on perceived quality and brand loyalty. The product category exerts a moderator

effect on the relationship between brand equity and advertising or price promotion. Hypotheses

H3 and H4 are supported.

APPENDIX

Research Questionnaires

Dear Sir/Madam,

I am the student of MBA at University of Agriculture Faisalabad

The following questionnaires are about my research project “Impact of Competitor on Brand

Equity in telecommunication industry” Kindly provide impartial opinion about each

statement. I request you please provide me information to complete my research. I also undertake

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that all the information provided by you is solely for academic purpose only. The information

obtained from you will be kept confidential I shall be very oblige to you.

Yours truly,

Raees Ahmad Zafar.

Questionnaire:

Name: _____________________ Mob: ________________

Gender:

(i) Male (ii) Female

Age Group (please tick the appropriate one):

(i) 0-18 (ii) 19-24 (iii) 25-35 (iv) 36-50 (v) 50+

Which area do you belong to?

(i) Urban (ii) Rural

As there are many Cellular Companies in the Telecom Industry, do you think because of

the competition, the services are being improved? (Please tick appropriate one.)

(i) Yes (ii) No

Are you currently using any of the following service connections?

a) Mobilink b) Telenor c) Ufone d) Zong e) Warid

Which one of the following service connections has the best voice clarity?


Which one of the following service connections has the best coverage?


Which one of the following service connections gives you more better service?


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Which one of the following service connections has the best promotional strategies?


Which one of the following is the main competitor of UFONE?


Would you recommend Ufone to a friend?

• Yes • No

What recommendations you offer for improving Ufone service?

• Better sales promotions

• Improved network coverage

• Include more features in SIM services (Power tools)

• Better Call Rates

Contact list

Names Occupation Contact numbersAhmad Ali Businessman 03467747467Ahsan Awan Job person 03219666649 Ali Raza Job person 03006627927Aslam Student 03218665737 Athar Businessman 03457730072 Awais Businessman 03237693163 Ayesha Malik Student 03217820507Azam butt Student 03457939493

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Danish Awan Businessman 03008664682 Faisal Ikram Businessman 03218598888Fareed Attah Job person 03006601926Hamid Mehmood Businessman 03006519500 Hamza Aataf Student 03226224524 Hina Arshad Job person 03426939277M. Bilal Student ------ M.Rehman Student ------Rameez Ahmad Student 03216660306Umer Raiz Student 03216660092Usman Iqbal Businessman 03338393537

Waqas Javaid Student 03007651768Wasim Job person 03437433388Yasir Latif Businessman 03018210239Yousaf Student 03009656716Zaib Businessman 03216687904Zubair Sathie Job person 03236654255

REFERENCE

www.google.com

www.ufone.com

www.nation.com

www.telecompk.net

www.pta.geo.com

Aaker, D. A. (1991) ‘Managing Brand Equity. Capitalizing on the Value of Brand Name’, The Free Press, New York, NY.

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http://www.pta.geo.com/

http://www.telecompk.net/

http://www.nation.com/

http://www.google.com/


Angel F. Villarejo-Ramos, Manuel J. Sa´nchez-Franco (2005, 8), ‘The impact of marketing communication and price promotion on brand equity’, Brand Management, vol.12, No.6, 431-444

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ufone

Documents

Transcript of ufone