Samir Anand Marketing Telecom

04/12/23 copyright www.brainybetty.com 2006

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MS Marketing (Session 2007-2009)

Telecom Industry – Mobile HandsetsTelecom Industry – Mobile Handsets

Submitted To: Prof. Jagan Mohan

Submitted by:Samir Anand (0911)


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CELL PHONES

CELL PHONES


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Marketing MixMarketing Mix

4 P’s4 P’s....• Product-> Cell Phones• Price-> Lower End segment to Super Premium End.

• Place-> Exclusive Showroom, Shopping Mall, Chain Store (Next, Hotspot, The Mobile Store, Big C), Local Venders.

• Promotion-> Print Media, Mass Media & Electronic Media.


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Product StrategyProduct Strategy

• Product is anything that Product is anything that satisfies human needs and satisfies human needs and wants.wants.

• Cell phones today have become basic requirement of human (just like food, shelter and cloth).

• So many companies are going through various factors to be salable among consumers.


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What I write

What I hear

Where I am

What we say

USES AND NEED FOR MOBILE PHONESMobile device – Recording everything


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Product classificationProduct classification• Product classification is based Product classification is based on ...on ...

• Tangibility->Yes, cell phones are tangible.

• Seperability->Yes, cell phones are easily separable.

• Ownership->Of course, we get the ownership when we purchase the cell phones.


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Contd...Contd... Purpose of use..Purpose of use..

• Purpose->Consumed basically for communication and connectivity.

• Type->Consumer Good.• User->Almost people of all age groups even including children.


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Contd..Contd..• Based on functional life Based on functional life cycle of product..cycle of product..

• Type-> Durable• Nature of use-> It changes with time, technology, trends. But one can use it for life time also.

• Functional life period-> For long period.


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Contd..Contd..• Based on shopping habits..Based on shopping habits..

• Cell phones basically are type of SHOPPING and up to an extent SPECIALITY GOODS.


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Contd..Contd..• Based on the Price and Quality..Based on the Price and Quality..• Cell Phones are.. • ECONOMY PRODUCTS. Ex.. Nokia 1100,1110,1208, Reliance (Classic handsets), Motorola C-180,Samsung C-130, etc.

• As well as PREMIUM PRODUCTS. Ex.. Nokia Communicator, E-series, N-series, Sony Ericssion W & P-series, HTC phones, I-mate phones, Apple I-phones, Blackberry, Virtue fashioned jewelry phones, etc.


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Contd..Contd..• Based on product development..Based on product development..• Innovations-> Cell phones world is being more n more innovative day by day. Whether its urban or rural market no one is untouched by it.

• Imitations-> Many Chinese cell phones have come in the market which are indeed affecting the main market whereas Gray Market is gaining more profit.


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Contd..Contd..• Based on Brand Hierarchy Based on Brand Hierarchy Level..Level..

• In context with our country cell phones present here are all GLOBAL BRANDS (such as Nokia, Sony Ericssion, Motorola, Samsung, etc.) and up to some extent UNBRADED BRANDS (basically Chinese mobiles) are present in the market.


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Product MixProduct Mix

• Length Extension-> There are several phone models present in a product line. Ex.. Nokia-1110,1208,N-series; Sony Ericssion-J230i,Walky-series; Motorola-C180,Razor,Crazor;etc.

• Depth Extension-> Addition of many attributes and features to cell phones. Ex.. Cell phones with Radio, Mp3 & Media players, video conferencing facility, Internet & windows enabled, different mega pixels of cameras such as 1.3 to 5 mega pixel of cameras, etc.


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Line StretchingLine StretchingCell phone companies pay a lot of attention towards Cell phone companies pay a lot of attention towards

line stretching..line stretching..

As for low end usage customers it goes for DOWNWARD stretching by adding low end items. Ex.. Lower priced mobile phones with only basic features and facilities such as Reliance phones range starting from rs.777, Nokia’s 1208 model priced at rs999 only, etc;

For high end customers it goes for UPWARD stretching by adding high end items and whereas for customers of middle level it goes for both ways stretching of their product line. Ex.. Higher priced cell phones such as I-mate,

Apple I-phone, Htc, Nokia communicator, Sony Ericssion P-series price ranging from rs.20000 onwards.

For customer of middle level it goes for BOTHWAYS of stretching of the line. Targeting at potential customers whose market constitutes of the biggest market for any cell phone manufacturer. Here at this stage mobile

phones are ranged between rs.5000 – rs.20000.A company has the largest collection of various models in this

range.


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Line PruningLine Pruning

• Traffic Builders->Some higher end and attractive cell phones such as Nokia N-80&81,Virtue,Sony Ericssion P-series, etc.

• Bread Winners->Models of middle level (in price & features, etc) such as Nokia 3110,5300,6300; SonyEricssion W200,W550; Motorola Motorazar, L7i, etc.


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New Product New Product DevelopmentDevelopment

It is important ...• Easy to Use.• Are aesthetic and provide value for money.

• Use the R&D, Physical, Financial, Human Resource.

• To Compete with Competitors and differentiating from their products.

• To get more market share.• New Technology Innovation.


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New Products In New Products In MarketMarket

• Sony Ericssion->Newly launched CYBER SHOT (3.2 mega pixel) camera phone and also new Walkman Series (such as W-850i).

• Nokia->N- 81,93i,95i; and Music Edition of various models.

• Virtue->New fashioned phones with jewels embedded.

• Apple I-phones with I-tunes sound format.


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Stages InStages InNew Product New Product DevelopmentDevelopment

1. Idea Generation2. Idea Screening3. Concept Testing &

Analysis4. Product Development5. Test Marketing6. Commercialization


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BrandingBrandingBrand Brand

SponsoringName What

Name How

NOKIA Global Individual Brand

Easy to Use-Short, Simple, Easy to

Pronounce SONY ERICSSION

International

Individual Brand

Easy to Use-Short, Simple, Easy to Pronounce

MOTOROLA

Global Individual Brand

Easy to Distinguis

h

SAMSUNG International

Individual Brand

Easy to pronounce, Read and Remember


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Branding: Why It Is Branding: Why It Is NecessaryNecessary

1. Brand identity helps processing.

2. Brand image gives competitive advantage.

3. Brand personality convinces consumer.

4. Brand equity enhance value. Brand SponsoringBrand SponsoringManufacturer brand-> Nokia N-

series, Motorola Motorazar, Sony Ericssion Walky series , Samsung Metallic, Lg Chocolate.


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Brand ExtensionBrand ExtensionIn past some mobile phone companies In past some mobile phone companies has gone for Brand Extension such has gone for Brand Extension such as.as..

• Nokia->From Paper Stationary business – Cable Wires – Software Development – Cell Phones.

• Samsung->From Electronic Goods – Cell Phones.

• LG->From Electronic Goods – Cell Phones.

• Siemens->From Electrical & Electronic Goods – Cell Phones.


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Brand EquityBrand EquitySome companies have a good name in the market Some companies have a good name in the market

due to their certain aspects. For Ex..due to their certain aspects. For Ex..

• Nokia is basically known for its Nokia is basically known for its DURABILITY DURABILITY & EASY HANDLING& EASY HANDLING

• Sony Ericssion is known for its richness of Sony Ericssion is known for its richness of SOUND QUALITYSOUND QUALITY

• Blackberry & I-mate is known as Blackberry & I-mate is known as WINDOWSWINDOWS mobile.mobile.

Brand PersonalityBrand PersonalityBasically Youth is the brand personality of Basically Youth is the brand personality of

cell phones among which Sony Ericssion cell phones among which Sony Ericssion (Hrithik Roshan) & Motorola (Abhishek (Hrithik Roshan) & Motorola (Abhishek Bachhan) are at the top in targeting the Bachhan) are at the top in targeting the youth.youth.


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Pricing StrategyPricing Strategy

Concept Of PricingConcept Of Pricing....Determinants of consumption/uses(4A’s)

• Affordability• Availability• Awareness• Acceptability


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Recent TrendsRecent TrendsAs per today’s situation our income & As per today’s situation our income &

standard of living is increasing standard of living is increasing consistently and while talking about consistently and while talking about mobile phone no one is untouched with mobile phone no one is untouched with its presence.its presence.

1. Market Fragmentation->Mobile phone companies has fragmented the market on various aspects. For Ex.. Nokia came up with model 1100 basically for rural areas with torch in low price.

2. Market Saturation->For rural and low end market companies like Reliance & Nokia have come up lower priced models.


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Contd..Contd..3. Inter-Category Competition->

Companies like Reliance has come up with low price cell phone and air time (rs.777 onwards) with the validity of 1 or 2 year which have given a tough competition to Dot or Basic landline phones.

4.Value Conscious Consumption-> Today a consumer is getting the benefits in terms of money.


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Pricing ObjectivesPricing Objectives

It is important for ..

• Profit• Sales• Competition• Development


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Factors Influencing Factors Influencing Pricing Decisions Pricing Decisions

• Internal->Cost, Product Line, Marketing Strategy.

• External->Demand, Competition, Channel, Politico-Legal.

• Internal/External->Management Judgmental Factor.


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Right Approaches For Right Approaches For PricingPricing

Cost Based Approach-> Companies like Nokia and Sony Ericssion follow..

• Marginal Cost/Contribution & Pay Back Period->As at the time of the launch of any new model they are priced at their maximum cost to meet the profit on fixed cost and after a certain period of the price gets down.


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Contd..Contd.. Competition Based Approach->

Almost companies follow this approach. But Nokia is the Leader Pricing company with lowest range mobile phones in the market. Also other companies are reacting with each other with the Competitive Pricing Approach. For Ex.. Nokia’1208,1110i models are ranging from 999 – 1100 whereas Motorola’s C-180 model too is priced at 1100 with Airtel connection.


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Price In Other Price In Other Marketing MixMarketing Mix

1. Quality Conscious Consumers-> These consumers are quality and new and different features conscious. (For Ex.. I-mate, Blackberry, Nokia series 60 mobiles, Sony Ericssion Walkman & P-series, etc).

2. Value Conscious Consumers-> These consumers look the quality and features of the cell phones and give value to money. (For Ex.. Nokia 6283,3110,5610; Samsung Metal series, etc)

3. Price Conscious consumers-> These type of consumers look for basic utility function of mobile phone. (For Ex.. Reliance low end mobile-Classic ZTE, Nokia 1600,1110i,1208, Sony Ericssion J230i, Motorola C180, etc).


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Price WarPrice WarWhy it is Important?Why it is Important?• To capture the customers (due to it companies are gaining customers, ex.. Nokia and reliance are gaining customers in their respective handsets).

• To fight against competition & competitors (basically Nokia, Sony Ericssion and Motorola are fighting with each other to get an edge) .

• To gain the market share.


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Basically in price war Nokia and Basically in price war Nokia and Sony Ericssion are fighting with Sony Ericssion are fighting with each other as both the companies each other as both the companies are trying to give their best are trying to give their best quality at the offered price. In quality at the offered price. In CDMA handsets ZTE is giving CDMA handsets ZTE is giving competition to all of its category competition to all of its category (by providing colour screen (by providing colour screen handsets at a price of rs.999 handsets at a price of rs.999 only).only).

Motorola, Samsung and LG too are Motorola, Samsung and LG too are pacing their speed to be in the pacing their speed to be in the real rat race.real rat race.


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Marketing ChannelsMarketing Channels

Distribution or Trade-TrendsDistribution or Trade-TrendsTime->No specific time or Occasion to buy.

Place->Excusive Showrooms, Retail Outlets, Local venders.

Selling Who?->Companies, Consumers.


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Nature Of Marketing Nature Of Marketing ChannelsChannels

• Geographic Distribution-> No such specific geographic area instead of, it is nationwide.

• Channel Size-> Cell Phone companies uses all type of channel sizes (short, long and intermediary).

• Characteristics of Intermediary -> Retail Outlets, Malls, Hyper Markets like Big Bazar & Subhikhsha.


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Benefits From Channel Benefits From Channel Intermediaries..Intermediaries..

Channel intermediaries like Big Bazar, Subhiksha, etc give their own discounts on price and even more they provide several gifts also. These channels for purchasing the mobile phones have become more popular among customers and also they promote the phones on their own expenses.

So these all indeed help companies to sell and earn more profit.


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Marketing LogisticsMarketing Logistics(Physical Distribution)(Physical Distribution)

Getting Right Goods to Right Getting Right Goods to Right Place at Right Time..Place at Right Time..

• Physical Distribution• Efficient Delivery• JIT


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Communication/Communication/Promotion Mix In Promotion Mix In

Marketing…Marketing…• Nature of Product-> Tangible, Emotional & Rational (up to an extent), Durable.

• No of Buyers-> Large.• Nature of Buying->Basically Cognitive and up to some extent Impulsive also sometimes (due to the presence of plastic money).


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Uses Of Uses Of Communication Mix..Communication Mix..• To Create Awareness->Companies create

awareness, a desire , need among consumers through various sources.

• Enhance Company’s Reputation-> Companies improve their position among consumers and win their faith. For Ex.. Nokia replaced the batteries.

• Publicize Information on Products-> By good and various packaging and advertisements companies do provide certain information about the product. For Ex.. On the box of mobile phones the contents inside the box are mentioned and as well the attributes & features of them.


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To develop Communication, cell To develop Communication, cell phone companies target phone companies target basically the basically the Youth Audience. Youth Audience.

They take the help of media They take the help of media for this. for this.

Print mediaPrint media->Ex.. Magazine ->Ex.. Magazine called Mobile World, called Mobile World, Newspapers, Billboards, etc.Newspapers, Billboards, etc.

Electronic MediaElectronic Media->Ex.. ->Ex.. Internet.Internet.

Mass Media-Mass Media->Ex.. Television.>Ex.. Television.


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As Promotion & Advertising are As Promotion & Advertising are the most important aspect of the most important aspect of marketing, companies strongly marketing, companies strongly pay attention on it.pay attention on it.

For Ex.. Hrithik Roshan is the For Ex.. Hrithik Roshan is the Brand Ambassador of Sony Brand Ambassador of Sony Ericssion India whereas for Ericssion India whereas for Motorola Abhishek Bachhan is Motorola Abhishek Bachhan is there.there.

So these two youth icons drags So these two youth icons drags the attention of the people the attention of the people which of course helps in which of course helps in selling of the mobiles.selling of the mobiles.


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The Selling Process…The Selling Process…• Companies try to see the demand of the product. For Ex.. Earlier there were only basic featured mobile phones but now with lots of features they are trying to find prospects with their everyday improving or new product.

• For selling a mobile phone a salesman should be well trained with all the features so that he can give a satisfied demonstration.

• There should be a good facility of POST SALES SERVICE. Nokia in this regard is ahead of other companies as there are ample of service centers present in nation.


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THANK THANK YOU… YOU…

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Samir Anand Marketing Telecom