Promotion Strategies of Vodafone

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UNIVERSITY OF MUMBAI

PROJECT REPORT ON

PROMOTION STRATEGIES OF VODAFONE

MASTERS OF COMMERCE

(BUSINESS MANAGEMENT)

SEMESTER 1

2014-15

SUBMITTED BY

Mr. Mustafa Tarwala

ROLL NO. 12

PROJECT GUIDE

Ms. KHYATI VORA

K.P.B HINDUJA COLLEGE OF COMMERCE

315, NEW CHARNI ROAD, MUMBAI-400 004



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M.Com (Business Management)

1st SEMESTER

PROMOTION STRATEGIES OF VODAFONE

SUBMITTED BY

Mr. Mustafa Tarwala

ROLL NO: 12



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CERTIFICATE

This is to certify that Mr. MUSTAFA TARWALA of M.Com Business

Management Semester- 1 [2014-2015] has successfully completed the Project on

“Promotion strategies of Vodafone” under the guidance of Ms. Khyati Vora.

Project Guide ________________

Course Coordinator ________________

Internal Examiner ________________

External Examiner ________________

Principal ________________

Date: ______

Place: Mumbai.



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DECLARATION

I, Mr. MUSTAFA TARWALA, student of M.Com – Business Management,

semester - 1 (2014-2015), hereby declare that I have completed the project on

“Promotion strategies of Vodafone”.

The information submitted is true and original to the best of my knowledge.

MUSTAFA TARWALA



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ACKNOWLEDGEMENT

I owe my special thanks to the Principal Dr. Chitra Natrajan and the Co-

coordinator of M.com Dr. Minu Madlani for giving me an opportunity for this

project work. I would like to give my thanks to the Project Guide Ms. Khyati Vora

for her guidance and kind assessment that she has provided me and the inspiration

in valued guidance and ideas throughout the project. I am also thankful to the

library staff of K. P. B. Hinduja College of Commerce who co-operated with me

and even all those seen and unseen hands and heads which helped me in the

completion of this project.



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Question at hand

Is promotion affecting the sales of Vodafone?

Vodafone is known for its unique promotion campaign such as pug, happy to help service and

“Zoozoo” promotion campaign. As Vodafone was a new brand in India, it had a challenging task

to develop its own entity and it has done it in a splendid way. Vodafone had been benefitted

immensely by the zoozoo campaign and it has been proved as a great marketing story.

This project analyzes the promotion strategies used by Vodafone especially the promotion

campaign of Zoo Zoo‟s, which helped them in increasing their sales. Whether it caught the

attention and fancy of the consumers, aroused curiosity, told stories and made people retell the

story.

Hypotheses

For the purpose of this study, the hypotheses available are as follows;

Promotions act as a catalyst to spread awareness of the services provided by Vodafone

and improve their image in the market.

Promotions positively affect the sales of any product/service.



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Table of Contents

Sr No Topics Page No

1 Chapter No 1 – Introduction

1.1 Executive Summary

1.2 Objectives of the study

1.3 Significance of the study

1.4 Research methodology

2 Chapter No 2 – Conceptual Framework

3 Chapter No 3 –

Introduction to Promotion strategy

3.1 Meaning of promotion strategy

3.2 Importance of promotion

3.3 Purpose of promotion

3.4 Types of promotion

4 Chapter No 4 – Introduction to Vodafone

4.1 Vodafone (company profile)

4.2 History/evolution of Vodafone

4.3 SWOT analysis of Vodafone

5 Chapter No 5 - Promotion strategies of Vodafone

6 Chapter No 6 – Findings and conclusions

6.1 Findings

6.2 Conclusions

6.3 Recommendations

7 Bibliography



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Chapter No 1

Introduction



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Executive Summary

The major aim of this project was to demonstrate the impact of promotion on the sales of a

business organization taking Vodafone as a case.

Promotion refers to the entire set of activities, which communicate the product, brand or service

to the user. The idea is to make people aware, attract and induce to buy the product, in preference

over others.

There are several types of promotions. Above the line promotions include promotion, press

releases, consumer promotions (schemes, discounts, contests), while below the line include trade

discounts, freebies, incentive trips, awards and so on. Sales promotion is a part of the overall

promotion effort.

Good promotion requires competent personnel including a number of specialists to enable it to

thrive in the ever dynamic and competitive business environment.

In today‟s world of competition, firms are selling goods and services through a variety of dir ect

and indirect channels. In mass promotion, marketers are exploring new forms of communication,

such as experimental, entertainment, and viral marketing.



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Objectives of the Study

In a growing economy such as India, it is often very difficult to have a regular and consistent

increase in the sales volume of a product because of the political and socio-economic instability

in the country which directly affect the standard of living and the purchasing power of the

consumers.

This research is based on the drive to know the effect of promotion on the sales volume of a

product in a company.

Outline of Objectives

To access the extent to which a promotion program reflects on the sales volume of a

product.

To identify the major merits and the purpose of promotion.

To get to know the concepts of promotion and its various forms.



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Significance of the Study

The research offers an opportunity to learn about the various forms of promotion

strategies adopted by Vodafone

It also allows the reader to understand the effects of appropriate promotion techniques on

the sales volume of a company



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Research Methodology

1. Restatement of hypotheses

-Promotions act as a catalyst to spread awareness of the services provided by Vodafone and

improve their image in the market.

-Promotions positively affect the sales of any product/service.

2. Sources of data collection

Secondary data

To undertake the research for the current study i.e. The Promotion Strategy of Vodafone,

secondary data was collected through reference books, journals, published and unpublished

reports, newspaper articles and websites.

3. Limitations of the research method

Similar to any research, this study has several characteristics that limit the generalization of its

findings. There were some problems in collecting and collating the information on time due to

time constraints and presence of a single researcher.



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Chapter No 2

Conceptual Framework



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Marketing Strategy

An organization's strategy that combines all of its marketing goals into one comprehensive plan.

A good marketing strategy should be drawn from market research and focus on the right product

mix in order to achieve the maximum profit potential and sustain the business. The marketing

strategy is the foundation of a marketing plan.

Promotion

Promotion is one of the market mix elements or features, and a term used frequently in

marketing. The marketing mix includes the four P's: price, product, promotion, and place.

Promotion refers to raising customer awareness of a product or brand, generating sales, and

creating brand loyalty. Promotion is also found in the specification of five promotional mix or

promotional plan. These elements are personal selling, advertising, sales promotion, direct

marketing, and publicity. A promotional mix specifies how much attention to pay to each of the

five subcategories, and how much money to budget for each.



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Chapter No 3

Introduction to Promotion



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Promotion Strategy

Promotion is one of the market mix elements or features, and a term used frequently in

marketing. The marketing mix includes the four P's: price, product, promotion, and place.

Promotion refers to raising customer awareness of a product or brand, generating sales, and

creating brand loyalty. Promotion is also found in the specification of five promotional mix or

promotional plan. These elements are personal selling, promotion, sales promotion, direct

marketing, and publicity.

A promotional mix specifies how much attention to pay to each of the five subcategories, and

how much money to budget for each. A promotional plan can have a wide range of objectives,

including: sales increases, new product acceptance, creation of brand equity, positioning,

competitive retaliations, or creation of a corporate image.

Fundamentally, there are three basic objectives of promotion. These are:

To present information to consumers as well as others.

To increase demand.

To differentiate a product.

There are different ways to promote a product in different areas of media. Promoters use internet

advertisements, special events, endorsements, and newspapers to advertise their product. Many

times with the purchase of a product there is an incentive like discounts (i.e., coupons), free

items, or a contest. This method is used to increase the sales of a given product.



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Promotions are also held in physical environments at special events such as concerts, festivals,

trade shows, and in the field such as in grocery or department stores. Interactions in the field

(i.e., grocery and department stores), allow customers to purchase the brand or product

immediately. The interactions among the brand and the customer are performed by brand

ambassadors or promotional models that represent the products and brands in physical

environments.

Brand ambassadors or promotional models are hired by marketing companies that are hired by

the brand to represent the product and/or service. Person-to-person interaction, as opposed to

media-to-person involvement, establishes connections that add another dimension to promotion.

Building a community through promoting goods and services can lead to brand loyalty.

Promotional activities to push a brand enabling social media channels to spread content making

something viral such as the promotion by Coke using the release of a new Bond film creating a

huge amount of attention which then gets promoted across all social channels by people

spreading the information due to excitement.

Social media, as a modern marketing tool, offers opportunities to reach larger audiences in an

interactive way. These interactions allow for conversation rather than simply educating the

customer.

Facebook, Twitter, LinkedIn, Pinterest, Google Plus, Tumblr and Instagram are rated as some of

the most popular social networking sites. As a participatory media cultures, social media

platforms or social networking sites are forms of mass communication that through media

technologies allow large amounts of product and distribution of content to reach the largest

audience possible.



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However, there are downsides to virtual promotions as servers, systems, and websites may crash,

fail, or become overloaded. With promotion through participatory media, there is an opportunity

to gain social capital.

Promotion can be done by different media, namely print media which includes Newspaper and

magazines, Electronic media which includes radio and television, Digital media which includes

internet, social networking and social media sites and lastly outdoor media which includes

banner ads, OOH (out of home). Digital media is a modern way of brands interacting with

consumers as it releases news, information and promotion from the technological limits of print

and broadcast infrastructures.

Mass communication has led to modern marketing strategies to continue focusing on brand

awareness, large distributions and heavy promotions. The fast-paced environment of digital

media presents new methods for promotion to utilize new tools now available through

technology.

With the rise of technological advances, promotions can be done outside of local contexts and

across geographic borders to reach a greater number of potential consumers. The goal of a

promotion is then to reach the most people possible in a time efficient and a cost efficient

manner.



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Importance of Promotion

Communication plays an important role in marketing. Communication perform the function of

informing the target customer about the nature and type of the firm's product and services, their

unique benefits, uses and features as well as the price and place at which these products can be

purchased. The nature of marketing communication is persuasive since it aims at influencing the

consumer behavior in favor of the firm's offering. These persuasive communications are

commonly called "Promotion". In the context of marketing promotion refers to the applied

communication used by marketers to exchange persuasive messages and information between

the firm and its various prospective customers and general public.

Marketing communication is the essential element of the promotion function of marketing.

Effective marketing depends on effective management of its promotion function. Effective

promotion comes through effective communication. Success of products like hot-shot camera,

Maggie 2 minute noodles, Khaitan fans, and UTI's ULIP scheme are purely depend on the

promotion function played by the respective marketing firms. There are products which are

failed due to the lack of effective promotion.

With the growing competition in the market place as well as the customers becoming better

informed and more choosy, it is important now that marketing communications of the right kind

only are made to the right group of target buyers.



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Given below are the importance of Promotion:

1. Communicating information

The job of marketing is to identify consumer wants and then satisfy these wants with the

right kind of products, at the right place and at the right price. The purpose of promotion

in the marketing function is to convey to customers about the features of the product and

how it will satisfy consumer wants or any other relevant information needed by

consumers to affect sales. It is essential to communicate to potential customers about the

extent of discount, period during which discount is available, name of the stores where it

is available etc.

2. Promotion is persuasive Communication:

In any free enterprise system where firms develop and offer a wide range of new and

better products, there are messages and distractions of all sorts. Consumer often have to

select the products from among a wide range of competing products. As consumers do

not have time and energy to compare the competing products physically, they turn to

advertisements for product information. The present business environment being highly

competitive, each firm wants the customers to buy its brand.

3. Promotion serves as a reminder:

Even the most loyal customers must be reminded that t product has served them well over

the years and about the features that make the product attractive. This is more so in an

environment where competitors consistently attempt to attract the customers of

competing brands with their own informative and persuasive message.



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Purpose of promotion

The partnership between producers and consumers through promotion is solely aimed at

achieving certain mutually beneficial objectives. There are;

To introduce new products: One of the roles of promotion is to inform consumers about

the existence of a new product in the market i.e. creation of awareness.

Persuade customers to buy: Promotion helps in arousing the customer‟s interest and by

so doing persuades them to buy the product.

Creation of demand: Promotion stimulates demand by constantly reminding potential

consumers about the availability of the product in the market.

To create brand loyalty: The demand of the consumers can be maintained by constantly

arousing their interest on a particular product and this will ultimately create brand loyalty.

Develop large market: Promotion creates large market segment which leads to the

development of larger market.

To promote the image of the firm: Promotion builds a corporate image for a company.



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Types of Promotion

The promotional mix involves different forms of promotions. These are:

A.

Personal selling

It is a form of promotion which involves direct contact between the sales representatives and

prospective customers. Normally it can be seen on the street or in centers.

Advantages

It is easier to persuade customers to buy the product

The selling person may know what the feeling/reaction of the customers is

It is clear to let customers know everything about the product

Disadvantages

If the selling person is not adroit in the conservation, customers may be unhappy and go away

Customers may not have time to listen to the selling person's introduction of the product

B. Public Relations

Public relations is all about publicizing and promoting a positive image of the organization‟s

achievements with a view to influencing customers to buy products. Major retailers spend a great

deal on public relations to promote a responsible, caring and high-quality image.

Other companies carry out public relations to:



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Increase an understanding of the company, its scope and products

Bring the company and its products to the attention of a wider audience

Generate more business and profits

C. Sales promotion

A sales promotion is an attempt to communicate with our customers and encourage them to

purchase or stock the product as well as to recommend it to other people. Consumer promotions

are used to encourage potential consumers to try a product and, hopefully, to purchase it again.

These may involve free samples of the product, discount coupons or voucher, free gifts, buy one

get one free, etc.

Advantages

It is easy to make more profits than other promotions

Usually this is a good way to attract people to buy the products

The expenditure on this promotion is not very much

Disadvantages

Sometimes the sales promotion cannot attract customers to buy because customers may not think

that is necessary

It does not work on the new product because customers may know nothing about the product

because it is new.



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D. Direct marketing

The place component of the marketing mix does not just comprise decisions about location and

distribution. There are a range of techniques that would allow Lancôme to approach potential

customers directly. By using different styles of communication like the telephone, post and the

internet, the company can target potential customers anywhere.

Advantages

This is a direct way to tell customers about the information of the company or a new product and

develop a relationship with existing customers/potential customers

This is a cheaper and less time-consuming way to promote

Disadvantages

Customers may throw the mail away or deleting the text message when they receive it because

they think that is 'Junk Mail'

This is more difficult to increase sales and make profits because this is not a good way to attract

people to buy the products.

E. Trade fair and Exhibitions

It is an organized gathering of companies from different organizations for the display and

promotion of their goods and services. By doing this the organization would attract prospective

customers.



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Advantages

This is a good way for all companies to promote their goods or services, especially new ones,

background of the companies, their products and services through the trade fairs.

For customers, it is an excellent chance to have 'general shopping'. They can find out more

updated products and services.

Disadvantages

There are too many competitors because trade fairs are for all companies

This is not a promotion by individual organization.

F. Sponsorship

It is the material support of an event, activity or organization by an unrelated donor. Lancôme

can reinforce awareness among its target market by sponsoring an event which attracts a similar

target market.

Advantages

This is a good way to increasing the image of the sponsor and promotes the virtues of a specific

of products.

After raising the image of the organization, it will help to make it more popular, or even increase

the sales and make more profits

After this promotion is done, the benefits are more than other promotions



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Disadvantages

This is not easy for the small businesses to be sponsors or spondees

If the sponsor can't make sure the event will be successful, they may have risk of losing lots of

money as well as the image of the organization

G. Advertising

Advertising is an important part of an organization‟s promotional activities. It's the most

effective tool and is used to inform, persuade and publicize to remind customers about Lancôme

products and activities. Advertising is a means of increasing sales.

There are several places in which businesses would want to advertise their product. They could

advertise in the newspaper, magazines, television, radio, transports, etc.

Advantages

Advertising can be seen or used anywhere.

A good advertising can let customers have a good impression, especially new products.

Disadvantages

A poor advertising can't let the customers have a good impression, sometimes could be even

worse

The expenditure on advertising is too much. It is not guaranteed to make profits if the company

can't provide a good advertising



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Chapter No 4

Company Profile



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Vodafone

Vodafone Group plc. is a British multinational telecommunications company headquartered in

London and with its registered office in Newbury, Berkshire. It is the world's 2nd-largest mobile

telecommunications company measured by both subscribers and 2013 revenues (in each case

behind China Mobile), and had 434 million subscribers as of 31 March 2014.

Vodafone owns and operates networks in 21 countries and has partner networks in over 40

additional countries. Its Vodafone Global Enterprise division provides telecommunications and

IT services to corporate clients in over 65 countries.

Vodafone has a primary listing on the London Stock Exchange and is a constituent of the FTSE

100 Index. It had a market capitalization of approximately £89.1 billion as of 6 July 2012, the

third-largest of any company listed on the London Stock Exchange. It has a secondary listing on

NASDAQ.

Name

The name Vodafone comes from voice data fone, chosen by the company to "reflect the

provision of voice and data services over mobile phones".



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History/Evolution of Vodafone

The evolution of 'Vodafone' brand started in 1982 with the establishment of 'Racal Strategic

Radio Ltd' subsidiary of Racal Electronics plc. – UK's largest maker of military radio

technology. By initiative of Jan Stenbeck, Racal Strategic Radio Ltd formed a joint venture with

Millicom called 'Racal Vodafone', which would later evolve into the present day Vodafone.

Evolution as a Racal Telecom brand: 1980 to 1991[edit]

Vodafone's original logo, used until the introduction of the speechmark logo in 1997

In 1980, Sir Ernest Harrison OBE, the then chairman of Racal Electronics plc. took a deal with

Lord Weinstock of General Electric Company plc. to allow Racal to access some of GEC's

tactical battle field radio technology. The head of Racal's military radio division – Gerry Whent

was briefed by Ernest Harrison to drive the company into commercial mobile radio. Whent

visited GE‟s mobile radio factory in Virginia, USA the same year to understand the commercial

use of military radio technology.

Previously in 1979, Jan Stenbeck, a head of a growing Swedish conglomerate, set up an

American company, Millicom, Inc., to pursue mobile communications by applying for licenses

in the United States.

In the summer of 1982, Stenbeck approached Racal‟s Whent about bidding jointly for the UK‟s

second cellular radio license, soon to be awarded, the first going by prior arrangement to British

Telecom. The two struck a deal giving Racal 60% of the new company, Racal-Millicom, Ltd,

and Millicom 40%. Due to UK concerns about foreign ownership, the terms were revised, and in



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December 1982, the Racal-Milicom partnership was awarded the second UK mobile phone

network license.[12] Final ownership of Racal-Millicom, Ltd was 80% Racal, with Millicom

holding 15% plus royalties and venture firm Hambros Technology Trust holding 5%. According

to the UK Secretary of State for Industry, "the bid submitted by Racal-Millicom Ltd… provided

the best prospect for early national coverage by cellular radio."

Vodafone was launched on 1 January 1985 under the new name, Racal-Vodafone (Holdings)

Ltd, with its first office based in the Courtyard in Newbury, Berkshire, and shortly thereafter

Racal Strategic Radio was renamed Racal Telecommunications Group Limited. On 29 December

1986, Racal Electronics bought out the minority shareholders of Vodafone for GB£110 million;

and Vodafone became a fully owned brand of Racal.

In September 1988, the company was again renamed Racal Telecom. On 26 October 1988, Racal

Telecom, majority held by Racal Electronics; went public on the London Stock Exchange with

20% of its stock floated. The successful flotation led to a situation where the Racal's stake in

Racal Telecom was valued more than the whole of Racal Electronics. Under stock market

pressure to realize full value for shareholders of Racal, Harrison decides in 1991 to demerge

Racal Telecom.

Vodafone Group, then Vodafone Airtouch plc. 1991 to 2000

On 16 September 1991, Racal Telecom was demerged from Racal Electronics as Vodafone

Group, with Gerry Whent as its CEO.

In July 1996, Vodafone acquired the two thirds of Talk land it did not already own for £30.6

million. On 19 November 1996, in a defensive move, Vodafone purchased Peoples Phone for

£77 million, a 181 store chain whose customers were overwhelmingly using Vodafone's



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network. In a similar move the company acquired the 80% of Astec Communications that it did

not own, a service provider with 21 stores.

In January 1997, Gerald Whent retired and Christopher Gent took over as the CEO. The same

year, Vodafone introduced its Speechmark logo, composed of a quotation mark in a circle, with

the O's in the Vodafone logotype representing opening and closing quotation marks and

suggesting conversation.

On 29 June 1999, Vodafone completed its purchase of AirTouch Communications, Inc. and

changed its name to Vodafone Airtouch plc. The merged company commenced trading on 30

June 1999. In order to gain anti-trust approval for the merger, Vodafone sold its 17.2% stake in

E-Plus Mobilfunk. The acquisition gave Vodafone a 35% share of Mannesmann, owner of the

largest German mobile network.

On 21 September 1999, Vodafone agreed to merge its U.S. wireless assets with those of Bell

Atlantic Corp to form Verizon Wireless. The merger was completed on 4 April 2000, just a few

months prior to Bell Atlantic's merger with GTE to form Verizon Communications, Inc.

In November 1999, Vodafone made an unsolicited bid for Mannesmann, which was rejected.

Vodafone's interest in Mannesmann had been increased by the latter purchase of Orange, the UK

mobile operator. Chris Gent would later say Mannesmann's move into the UK broke a

"gentleman's agreement" not to compete in each other's home territory. The hostile takeover

provoked strong protest in Germany, and a "titanic struggle" which saw Mannesmann resist

Vodafone's efforts. However, on 3 February 2000, the Mannesmann board agreed to an increased

offer of £112 billion, then the largest corporate merger ever. The EU approved the merger in

April 2000 when Vodafone agreed to divest the 'Orange' brand, which was acquired in May 2000



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by France Télécom. The conglomerate was subsequently broken up and all manufacturing

related operations sold off.

Vodafone Group plc. 2000 to present

The headquarters of Vodafone Romania in Bucharest

On 28 July 2000, the Company reverted to its former name, Vodafone Group plc.

In 2001, the Company acquired Eircell, the largest wireless communications company in Ireland,

from eircom. Eircell was subsequently rebranded as Vodafone Ireland. Vodafone then went on to

acquire Japan's third-largest mobile operator J-Phone, which had introduced camera phones first

in Japan.

On 17 December 2001, Vodafone introduced the concept of "Partner Networks", by signing

TDC Mobil of Denmark. The new concept involved the introduction of Vodafone international

services to the local market, without the need of investment by Vodafone. The concept would be

used to extend the Vodafone brand and services into markets where it does not have stakes in

local operators. Vodafone services would be marketed under the dual-brand scheme, where the

Vodafone brand is added at the end of the local brand. (i.e., TDC Mobil-Vodafone etc.)

In 2007, Vodafone entered into a title sponsorship deal with the McLaren Formula One team,

which traded as "Vodafone McLaren Mercedes" until the sponsorship ended at the end of the

2013 season.

In May 2011, Vodafone Group Plc. bought the remaining shares of Vodafone Essar from Essar

Group Ltd for $5 billion.



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On 1 December 2011, it acquired the Reading based Bluefish Communications Ltd – an ICT

consultancy company. The acquired operations formed the nucleus of a new Unified

Communications and Collaboration practice within its subsidiary – Vodafone Global Enterprise,

which will focus on implementing strategies and solutions in cloud computing, and strengthen its

professional services offering.

In April 2012, Vodafone announced an agreement to acquire Cable & Wireless Worldwide

(CWW) for £1.04 billion. Vodafone was advised by UBS AG, while Barclays and Rothschild

advised Cable & Wireless. The acquisition will give Vodafone access to CWW's fiber network

for businesses, enabling it to take unified communications solutions to large enterprises in UK

and globally; and expand its enterprise service offerings in emerging markets. On 18 June 2012,

Cable & Wireless' shareholders voted in favor of the Vodafone offer, exceeding the 75% of

shares necessary for the deal to go ahead.

On 24 June 2013, Vodafone announced it would be buying German cable company Kabel

Deutschland. The takeover is valued at €7.7 billion, and was recommended over the bid of rival

Liberty Global.

On 2 September 2013, Vodafone announced it would be selling its 45% stake in Verizon

Wireless to Verizon Communications for $130 billion, in one of the biggest deals in corporate

history.

In October 2013, Vodafone began its rollout of 4G to provincial New Zealand, with the launch of

the system in holiday hotspots around Coromandel.

In February 2014, Vodafone made an offer to acquire Spain‟s largest c able operator, ONO, in a

deal rumored to be around €7 billion.



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SWOT Analysis of Vodafone

• Strengths

-Campaign penetrated both media as well as in social networking site

- Zoozoo is a representation of a common man depicted as a cartoon

-wide media coverage, more precisely through video

-easy and cheap animation leading to low production cost

-no celebrity endorsers

• Weaknesses

-had an undermining effect on the brand Vodafone

-difficulty in understanding faced by rural population

• Opportunities

-revolution in the conventional way of promotion

-low promotion cost leading to provision of cheaper service

-zoozoo took over ads of IPL Season 2.

• Threats

-A major intimidation to the brand Vodafone.

-other networks are following up.



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Chapter No 5

Promotion Strategy of

Vodafone



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Promotion and its effect on sales (Vodafone)

Vodafone is known for its unique promotion campaign such as pug, happy to help service and

“Zoozoo” promotion campaign. As Vodafone was a new brand in India, it had a challenging task

to develop its own entity. The previous name of this Indian company was associated with a pug.

Vodafone decided to come with a new persona for itself, so the people of the country can

associate it with the company. The company came with a brilliant persona for itself, which was

very apt for it, The “Zoozoos”.

Zoozoos are promotion characters promoted by Vodafone during the Indian Premier League

Season 2 (IPL). Zoozoos are white creatures with ballooned bodies and egg heads who are used

to promote various value added services of Vodafone. Each ad used a story which was enacted

by the Zoozoos. These ads though look animated are actually real humans in the Zoozoo

costumes.

The Zoozoo promotions were created in South Africa by Ogilvy & Mather, an international

promotion, marketing, and public relations agency and Nirvana Films (Bangalore base company)

used some animated characters to make these promotions. Ogilvy & Mather, were asked by

Vodafone to create a series of 3D promotions which could be aired each day during the IPL

Season 2. The ZooZoos became very famous and popular in little time. They spent near Rs. 30

million to make these promotions.

Nowadays it is one of the most admirable promotions in India. The campaign created the buzz

both in the traditional media as well as in social networking sites like Facebook and Twitter and

video sharing website, YouTube, for example, it has 2 million members on Face book page

which is increasing rapidly.



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According to Neo@Ogilvy, who is responsible for managing ZooZoo‟s Facebook brand ZooZoo

fan page has received around 2.6 million page views in comparison to only 0.5 million of

IPLT20.com.

This ad campaign has several implications from the economic perspective. Vodafone operates in

what is known as “oligopoly”. An oligopoly is a market structure that has unique features

because it is characterized by a few sellers and mutual interdependence. It is a market where

each seller tries to outdo the other through what is known as “price wars” (cutting down prices)

and “non- price” wars.

Advertisement is part of “non- price war” where a firm tries to outdo its competitors through

marketing and/or promotion strategies to generate mass appeal. Zoozoos are part of a unique and

innovative promotion strategy aimed at outdoing the strategies of Vodafone s competitors. By

the means of ZooZoo Vodafone has tried to represent an image of the urban common man who is

the main drive force behind the increased usage of telecom & VAS services in the tele-

communication industry. Through ZooZoo character they have tried to showcase how the

various offered by Vodafone can be useful for an urban common man.

What Vodafone did was they projected the usage of their VAS services through various

promotions based on different themes as per the product (VAS) that they were offering. The

various services offered by Vodafone such as chota recharge, group SMS service, busy alert

service, fashion tips, recharge anywhere, bhakti songs, stock alert, voice SMS etc. were shown to

the viewer‟s not by normal promotion ways but through some funny & catchy ZooZoo ads which

were successful in immediately drawing the attention of urban population including all age

groups.



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As far as the reach of the promotion is concerned, this promotion campaign could have been

made more effective by taking into account the rural population of our country. In all these

ZooZoo ads, since Vodafone tried to promote all the Value Added Services offered by them,

clearly the targeted customers were the people who would use these Value Added Services.

Hence in their ads Vodafone tried to showcase all the VAS services that they have to offer to the

customers through different theme specific promotions. Each of the promotion was specific to

one particular VAS service & attractiveness of these ZooZoos, Vodafone was able to draw the

attention of the audiences quickly towards these ads & these ads became soon very popular &

thus the VAS offered by Vodafone.

Vodafone was welcomed in India in 2007 with the “ Hutch is now Vodafone” campaign and the

promotion agency, Ogilvy & Mather (O&M), had a two-fold task on their hands: promulgate the

entry of Vodafone in India and propagate the metamorphosis of Hutch into Vodafone.

The Hutch pug, which O&M had been using for about five years, would have been too costly a

proposition to be junked. Having survived the $19-billion buyout, it was consequently used in

putting forth the propaganda: “Change is good. Hutch is now Vodafone”.

One of the frequently used avenues for rebranding is promotion, as it is fairly easy and flexible.

It is a powerful mechanism for signalling a change in positioning of the company or reaching out

to a broad or targeted audience promptly.



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Time for “Make the Most of Now”

The next few months saw campaigns coming out from the Vodafone stable such as Happy to

Help, Friend circle, Cheaper SMS, „Amar Chitra Katha‟ Alerts, but it was also at this juncture

that the telecom industry woke up to the potential of Value Added Services (VAS) and Vodafone

realized that the burden of VAS would be too much for the pug!

It was an opportunity for tapping the lucrative Indian mobile VAS industry valued at more than

Rs. 70,000 million.

Cometh the hour, cometh the ZooZoos and what better occasion to launch the promotion

campaign than during the IPL in a cricket-crazy nation

Zoo zoos storm the promotion world

The ZooZoo promotions were indeed clutter-breaking and they reinforced the following:

Low cost promotions can make good impact

Concept and content are most important

Expensive brand ambassadors are not a necessity

The promotions should relate to the common man

The message conveyed should be kept simple

A well-crafted campaign can be accentuated through massive viral marketing.



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The success of the campaign could be gauged from the fact that:

Zoo Zoos were dominating social networking sites such as Facebook

Wallpapers, emoticons, ringtones, videos, contests, pictures, stories were being

downloaded frequently

Videos had approximately 3 million hits within the first 3 weeks

Huge number of downloads on YouTube

Winner of PETA, India‟s first Glitter Box awards

The ZooZoo campaign had considerable impact on the financials of the company when

compared to its competitors during a period which saw a slump in sales revenue in the industry.

This was due to price-wars among the existing players and the entry of new competitors in the

fray. At end of Q1, FY10.

Vodafone India added 7.68 million more subscribers

Its customer base increased by 3.8%

It reported an increase of 23% in revenue at constant exchange rates

Year on year Vodafone Group PLC's net income fell 31.21% from 7.97bn to 5.48bn despite

relatively flat revenues. A contributing factor (zoozoo‟s) has been an increase in the percentage

of sales devoted to the cost of goods sold from 67.16% to 67.96%.



41

Chapter No 6

Findings and conclusions



42

Findings

According to a survey done by the students of KC College, SYBMS (2012-13), through a

questionnaire, the following are the findings:

1. Out of the 20 respondents 84 % of the respondents are male and 16% of the respondents

are female.

2. Out of the 20 respondents 54 % are graduates, 32 % are post graduates, and 14% are

intermediate while there are no respondents who are only matriculate.

3. Out of 20 respondents 54 % are currents using Vodafone, 20 % are BSNL subscribers, 12

% are Airtel subscribers while 14 % are using other services.

4. 42 % of the respondents have been using their current service for more than 4 years.

From this it can be said that majority of the respondents who are Vodafone subscribers have

been using Vodafone for more than 4 years.

5. 72 % of the respondents have said that promotions do a play a role in deciding their

service providers while 28 % are not influenced by promotions. From this it is concluded

that promotion is one of the key marketing strategy that is essential for any company or firm

to capture a good market position and compete with its competitors in order to maintain its

position.



43

6. 32.43 % of the respondents said that promotions helps them in knowing the attributes of

the service while 21.62 % said that promotions helps them to compare services with other

providers. 40.54 % of the respondents said that promotions help them in all the above.

7. 90 % of the respondents have said that the promotions of Vodafone attract them the most

than any other service provider.

8. 74 % of the respondents have said that the promotions of Vodafone attract them very well

while 24 % said that the ads attract them somewhat well. Only 2% of the respondents are

not at all attracted by the promotions of Vodafone. Hence it can be said that the promotions

of Vodafone attract the majority of the people very well.

9. 98 % of the respondents have recognized the cartoon character named ZooZoo the mascot

of Vodafone. From this it can be said that presently people are quite updated on the

promotions.

10. 64 % of the respondents said that the creativity in Vodafone promotions appeals most

while 16 % say that all the mentioned factors appeal to them. From this it can be said that in

this modern era creativity in Vodafone ads is the most important factor in Vodafone‟s

promotion campaigns.

11. 90 % of the respondents have been able to associate with Vodafone‟s mascot ZooZoo

while only 10 % have not been able to associate.



44

12. 54 % of the respondents like Vodafone promotions which are related to discount

schemes, 26 % looks for good network ads while only 20 % of the respondents like value

added services promotions. This shows us the increasing competition in the telecom sector

as people go for those services which costs less to them & hence service providers has to

constantly provide new discount schemes in order to attract the customers.

13. 72 % of the respondents like ZooZoo as the Vodafone mascot while 24 % like previous

mascot i.e. the pug as the Vodafone mascot. This shows that people like the creativity

shown through the ZooZoo in the Vodafone promotion campaigns.

14. Although 72 % of the respondents like the ZooZoo more than the pug, but still 78 % of

the respondents miss the pug who was the previous mascot. It shows that Vodafone

promotion campaigns have not only attracted the people with the concept of ZooZoo but has

done the same with the concept of pug as the mascot over the years.

15. 64 % of the respondents are attracted more towards the services of Vodafone just

because of the promotions. This shows the positive impact of Vodafone promotion

campaign on people.



45

16. 56% of the respondents feel that with the launch of mobile number portability

Vodafone will be able to attract more customers while 44 % of the respondents do not feel

the opposite. But with the introduction of mobile number portability service which allows a

customer to change over to a new service without changing their present number 56 % of

the respondents feel that Vodafone customer will increase.

17. 88 % of the respondents do not want Vodafone to change its mascot while 12 % want

Vodafone to change its mascot and go for movie stars or sports person as its mascot. From

this it can be concluded that in this modern era people prefer a 3D creation of ZooZoo

more than any famous movie stars or sports person as the Vodafone mascot. In spite of

Abhishek Bachan endorsing IDEA and Ranbir Kapoor endorsing TATA DO CO MO

Vodafone has made a bigger impact on people with ZooZoo as its mascot and hence it can

be said that expensive brand ambassadors can be avoided.



46

Conclusions

There is no doubt that the Vodafone‟s ad campaign is a big hit and has become popular with

everyone from kids to adult. The promotion campaigns have given Vodafone a new look that

will go a long way in further improving its brand image. The commercials have hit the Indian

market like storm and will now probably go into history as one of the most brilliant promotion

idea for the industry. The response by Indian audience is phenomenal. Although experts claim

that the ads did not achieve the target of increasing VAS usage. ZooZoos have become a brand in

themselves with ZooZoo T-shirts and other accessories being sold at retail chains apart from

thousands of visits to their YouTube promotions and over 2 million fans on Facebook pages.

ZooZoo is a great marketing story. Vodafone has benefitted immensely by this campaign. It

caught the attention and fancy of the consumers, aroused curiosity, told stories and made people

retell the story. Over the years, promotion campaign of Vodafone had a positive effect on the

sales of Vodafone.



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Recommendations

Due to the competitive nature of the industry the marketing manager of Vodafone must develop

and formulate marketing programs that will satisfy the needs of the consumers. Since other

service providers have similar promotion messages, it is recommended that for a more

distinguished and effective response from the customer, other forms of advert should be used.

Regular and consistent up-to-date training on product information should be given to the

promotion agency so that they will have the current knowledge and skills to handle the adverts

and also to ensure that product information is being emphasized so as to enlighten the customers.



Reference/Bibliography

- ZENITH International Journal of Business Economics & Management Research

Vol.2 Issue 1, January 2012, ISSN 2249 8826

www.zenithresearch.org.in 151

-http://www.preservearticles.com/2012011821132/short-essay-on-the-development-of-

promotion-in-india.html

- http://varinderkaur.instablogs.com/entry/vodafone-zoozoo-a-successful-marketing-strategy/

-http://marketingpractice.blogspot.com/2009/05/best-marketing-practice-zoozoo.html

-http://www.domainofhope.com/2011/03/vodafone-zoozoo-3g-campaign-integrated.html -----

http://www.medianama.com/2011/05/223-fy11-vodafone-india-data-voip-net-neutrality/

-http://en.wikipedia.org/wiki/ZooZoo

-www.classof1.com

-www.vodafone.com

Documents

Promotion Strategies of Vodafone