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Introduction

Vodafone

Vodafone is the worlds largest mobile telecommunications community, employing over 65,000

staff and with over 130 million customers. The business operates in 26 countries worldwide.

Vodafone is a public limited company with listings on the London and New York stock

exchanges. Global recognition of the Vodafone brand is growing as the company rolls out its

identity into new markets. However, it retains local names and imagery in markets where this is

essential to maintaining the trustof customers. To help promote its image worldwide, Vodafone

uses leading sports AND stars from high profile global sports, including David Beckham and

MichaelSchumacher.Vodafone Essar, usually referred to as Vodafone is the Indian subsidiary

of Vodafone Group with 67% stakes held by UK based Vodafone Group Plc. and 33% stakes

owned by Essar Group. It was formerly known as Hutchison Essar. In May2007, Vodafone

acquired the 67% stake held by Li Ka Shing in Hutchison-Essar,thereby making it Vodafone

Essar. The company won 3G licenses in 9 of the 22telecom zones for Rs. 11617.86 crore and

plans to launch its 3G services in Jan-March 2011. The company now has operations across the

country with over 118.04 million customers.

From Hutch to Vodafone

Vodafone essar was formed out of an acquisition deal of Vodafone and hutch essar,and hence

Hutch was successfully rebranded as Vodafone. This was an easy way toenter into India as hutch

essar already had a strong brand image in Indian telecommarket. As the rebranding campaign

begun they started by changing the taglines communicating the change from hutch to Vodafone.


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The taglines were change is good, hutch is now Vodafone. They changed from where u go

our network followsto Make The most of Now They also carried out a massive advertising

campaign torebrand themselves, and the main feature of their campaign was the Zoo Zoo

characters that were used to promote the value added services by Vodafone and became famous

as soon as they were launched.

Situational Analysis

Customers

Vodafone operates in 23 telecom circles in India in 2G segment and it is about to enter 9 telecom

circles in 3G segments. As per the report of Cellular Operators Association of India, in the month

of October it has 118.04 million subscribers allover India

Competitors

Vodafones market share is 23.20% and it faces stiff competition from several players in the

market like Airtel, Reliance, BSNL, Idea, Tata Indicom, Virgin Mobile and new entrants like

DOCOMO. Therefore, the level of competition that Vodafone hasto face is high.

Company

Vodafone Essar, formerly known as Hutchison Essar is a cellular operator in India that covers 23

telecom circles in India based in Mumbai. Vodafone Essar is the Indian subsidiary of Vodafone

Group 67% and Essar Group 33%. It is the second largest mobile phone operator in terms of

revenue behind Bharti Airtel, and third largest in terms of customers. Vodafone Essar provides

2.75G services based on 900MHz and 1800 MHz digital GSM technology, offering voice and

data services in 23of the country's 23 license areas. It is second largest telecom service provider

as per the market share.

Context

Tele-density in India has reached nearly 51% and the industry is growing at a CAGR with 22%.

The intense competition has led the players to target lowersegments and entry into rural areas.

The rural mobile penetration is just 19%compared to 103 percent in urban India (around 20% is

estimated to have dual Simcards).


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7Ps of Service Marketing in relation to Vodafone

1. Product

A product with many different features provides customers with opportunities tochat, play

games, send and receive pictures, change ring tones, receive information about travel and

sporting events, obtain billing information and soon view videoclips and send video messages.

Magic Hand boxes:Vodafone provides a range of magic boxes (mobile handsets) at the lowest possible rates as a

part of its offering to the markets. It should embark on the low cost so as to attract the lower

income segment.

Solar Powered Phones:Vodafone has already launched its solar poweredphones earlier this year. These new handsets are

to benefit users in areaswith adequate sunlight and unstable electricity supply.

Bonus cards:These are essentially prepaid cards that enable a largersection of the society to stay connected.

These can be easily purchased fromits stores and mini stores.

VAS:Vodafone offers a range of Value added services apart from its core offerings. These include

Tunes and Downloads, entertainment quotients likemusic and movie related activities, devotional

and sports quotients, regular news and updates and call management services. Apart from these,

special offers and services are also offered on important festive occasions like Diwaliin order to

provide maximum value to its customers. This would be a very important component of

differentiation considering the fact that almost allplayers in the market are on an even playing

field with respect to providingthe core products.


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Vodafone products, top up coupons, a satisfied Zoo Zoo.

2. Price

Vodafone wants to make its services accessible to as many people as possible:from the young,

high powered business executives, to the more mature users.

It offers various pricing structures to suit different customer groups. Monthly price plans are available as well as prepay options. Phone users can top up their

phone on line

A number of schemes are being introduced from time to time to match the customerneeds, like unlimited free msg card, 1paisa per second call rates.

The top ups are available from Rs. 10.

Its pricing strategies varies accordingly by offering features like Filmyrecharges andSMS value packs targeted at the youth segment to features like Apne minutes, bonus

cards and longer validity schemes at a similar pricing but targeted at the lower income

segment.

Magic hand boxes:Magic Hand boxes are products by which Vodafone canattract customers from a variety

of income groups and other demographic characteristics. In order to make it available to a very

wide section of the audience Magic hand boxes are made available from prices as low as Rs.999

to Rs.9999.


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3. Place

Vodafone promotes its offerings through a host of over 400000 stores located across allthe 23 telecom circles in the country. Stores have special offers, and various point of sale

posters in order to attract its customers.

4. Promotions

Unlike the other telecom majors which rely heavily on Film stars and cricketers to promote

their brands, Vodafone has focused on advertising campaigns like the Pug and Zoo Zoos and

now the Parrot to have connectwith the people and also as a part of its strategy to be cost

effective on the ad production front.

Above the line:Advertising on TV, on billboards, in magazines and inother mediaoutlets reaches large audiences

and spreads the brand image and themessage very effectively. This is known as above the line

promotion.

Below the line:Stores have special offers, promotions and point of saleposters to attract those inside the stores to

buy. Vodafones stores, its products and its staff all project the brand image.

5. People

Vodafone Essar India has an employee database of around 10,115 in thefinancial year 2010

which is considered as a dedicated and passionate workforce and one of the best customer

service support teams. Fun is incorporated in the work life of employees of Vodafone.

Empowerment and career development go simultaneously with all opportunities in Vodafone.

Itprovides a dynamic environment and challenging opportunities to itsemployees. Vodafone

Essar Limited has received many awards over the yearssuch as the Best Mobile Service in India,

Most Effective and Most CreativeAdvertiser of the Year, and Most Respected Telecom

Company. Moreover itaims to reach the maximum number of people.


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6. Process

Vodafone Essar India provides a wide variety of services in mobile communicationand other

value added services by adopting an easy-to-use customer friendlyapproach. All information

about its basic and other valued services and variouspromotional offers can be availed through a

unique customer care number 111which can be dialed from anywhere in India.

7. Physical Evidence

Physical Evidence is the element which allows the consumer again to makejudgments on the

organization.

The most important physical evidence of for the Vodafone is its existing customerbase.The Vodafone Essar subscriber bases in the cities of India are:

City No. of Customers

Kolkata 1,632,875

Mumbai 2989970

Delhi 3002442

Chennai 981996

Existence of the customer care centers across the country, Vodafone ministores that aresmall in size but big in service, Vodafone stores; Vodafone outlets are all a part of the

physical evidence that facilitate the customer judge the service.


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Service Marketing Triangle in relation to Vodafone

External Marketing: Setting the promise

It involves marketing to the end users and is performed to capture the attention of the market and

arouse intrest in the service.

The Vodafone way;

Tagline of Vodafone is Make the most of now which is uniform and consistent acrossthe world.

Positioned as a premium brand in telecommunication segment. The rebranding exercise was a huge success and the main credit goes to the Zoo Zoo ads

which were mainly used to promote the value added services of Vodafone, these value

added services now form a main part of the telecom industry.

With its robust nationwide and global network infrastructure, Vodafone has the data andvoice solutions to meet any connectivity needs, whatever they are.

It brings together voice and data, wireless and wireline to help the business harness thepower of total communications solutions.

Vodafone's powerful business voice solutions allow any company to control costs andimprove productivity and responsiveness.


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Winning growth strategies of Vodafone are:y Excellent network and technology platformsy Data focused pricing strategies, IT and customer carey Leading position in mobile enterprise: MNC, SoHo- SMEy Attractive emerging markets assets now performingy Early investor in M2M and payments, with an active prensce in several markets

Making premium brand available at affordable price. Products promoted by the Group include Vodafone live!, Vodafone Mobile Connect USB

Modem, Vodafone Connect to Friends, Vodafone Passport, Vodafone Freedom Packs,

Vodafone at Home, Vodafone 710 and Amobee Media Systems.

Vodafone also runs an AppStore for Android, called AppSelect.

Internal Marketing: Enabiling the promise

Its all about marketing to internal employess of the company. It is carried out to enable

employees to perform the service effectively and keep up the promise made to the customers.

The Vodafone way;

They have feedback services for their employees which is provided by the customers sothe promotion, increment and productivity is based on the performance of the employees.

Effective internet and telecommunication techonologies installed for effectivefunctioning at all outlets.

Internal call centre for free home delivery service. Taining is provided to the employees for period of one month on customer relationship

and servicing.


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Interactive Marketing: Delivering the promise

This step is of very important because if the employee makes any faults at this level, all prior

efforts made towards establishing a relationship with the customer, would be wasted. This refers

to the decisive moment of interaction between the front-office employees and customers, i.e.

delivery service.

The Vodafone way;

They offer mobile solutions to help your company stay connected 24/7. Vodafones products and services are available directly via Vodafone stores and country

specific Vodafone websites, and indirectly via third party service providers, independent

dealers, distributors and retailers, to both consumer and business customers in the

majority of markets under the Vodafone brand.

All the service centres are situated at a distance of around about 7 kms away fromeachother.

Vodafone endeavours to ensure that customer needs are at the centre of all of the Groupsactions. The Group seeks to use its understanding to deliver relevance and value to each

customer and communicate to them on an individual, household, community or business

level, with the ultimate aim of encouraging customers to stay with Vodafone for longer

and use and promote the Groups services more.


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Gap Analysis of Vodafone

A service firm may win by delivering consistently higher quality service than competitors and

exceeding customers experience. These expectations are formed by their past experiences, wordof mouth and advertising. After receiving the service, customers compare the perceived service

with the expected service. If the perceived service falls below the expected service, customers

lose interest in the provider and vice versa. Thus Exceeding Customers Highest Hopes is what

a firm should constantly focus on to achieve success.


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Gaps that caused unsuccessful delivery at Vodafone

1. Gap between customer expectation and management perception:Gap 1Vodafone system has made a glitch of not accurately showing the users data usage so the

company will very soon rectify that which will result in higher bills. The customers suddenlywill face higher bills as a result of the changes made. These changes will impact both mobile

data usage as well as tethering which is where a user connects their phone to their computer anduses their mobile phones for an internet connection.

Three key areas namely peer-to-peer connections, VoIP and internet services which require a

personal log-in (Vodafone gives the examples of Hotmail and Internet banking) have not been

counting towards or have not been accurately shown in a users data usage as a result of a glitchwith Vodafones system. So this gap has to be filled gradually by making the customers aware.

So in an effort to reduce the chances of customers whove been using these services falling

victim to the bill shock phenomena Vodafone should start undertaking needful steps.

2. Gap between service delivery and external communication: Gap 4Potentially thousands of its customers are facing poor network performance. Vodafone

initially blamed software bugs and argued that there were no serious problems with its network.

The customers then took to social media and sites like Vodafail.com forcing the telco to admit to someremaining issues. But customers calling its customer care line have been placed on hold for hours on end

and then forced to fill out lengthy forms.

Some customers who complained the loudest and contacted the Telecommunications IndustryOmbudsman (TIO) have been able to get out of their contracts and received compensation but

others have given up long before this stage.

Calls dropping out, reception issues, poor data performance, poor network this is not whatVodafone customers signed up for. "Vodafone, however, has continued to charge customers on

its mobile plans, without providing the service it promised."

Vodafone must now do something to improve their network.

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