Airtel distribution expansion in rural areasDocument Transcript
DISTRIBUTION EXPANSION AND MARKET
(IN RURAL AREAS OF AMBAH & PORSA)
FOR THE PARTIAL FULFILLMENT OF THE AWARD OF
MASTER OF BUSINESS ADMINISTRATION
Submitted to: Submitted by-
HEAD OF THE DEPARTMENT M.B.A.-III SEM.
IPS College of Technology & Management
Bela Ki Babadi Shivpuri Link Road Gwalior (M P)
A successful research could not be done without any
inspiration, guidance and help from different person in the
society of modern corporate world.
This project report is the result of collective efforts made
by me and my senior staff who give me their full support
and valuable time.
First I would like to thank mr. Sudhir Bhadoriya sir, who
give us an opportunity to work in the Asian world largest
I will also like to thank mr. Jitendra sir who share his
valuable experience with us &. also mr. Prakash sir (RSO)
under who’s guidance i completed my summer training.
The complition of the project is impossible without the help
of these experienced persons
By working under these experienced persons I got an
opportunity to learn more and more.
In last I will also like to thanks my friends Ranjit & Achal
who support me during my summer training .& also to FOS
of the company.
I ………….student of M.B.A. III sem from IPS Group of
college of TECHNOLOGY & MANAGEMET , Gwalior
(M.P.) declare that all the information, facts and figures
represented in this report are actually inside on my
experience and in the market research in analyzing the
“Distribution expansion and market services” with special
reference to Bharti Airtel, GWALIOR.
Date: / /
• About Sunil bharti mittal ( CEO & Chairman)
• Bharati Tele Ventures
• Airtel’s Enterprise Services
• Airtel reach 100 million customer
• Location of low revenue site
• Marketing Strategy in Rural Areas
• List of new outlets
ABOUT SUNIL BHARATI MITTAL
Chairman and Managing Director of Bharti Group, India's
largest GSM-based mobile phone service provider.
Sunil Mittal can be called as originator of cellular phone
revolution in India. He is the founder, Chairman and
Managing Director of Bharti Group and runs India's largest
GSM-based mobile phone service.
Sunil Bharti Mittal's father was an M.P. Sunil did not
followed his father's footsteps. After graduating from
Punjab University in 1970s, he set up a small bicycle
business in Ludhiana in partnership with his friend. By
1979, Sunil Mittal realized that his ambitions could not be
fulfilled in Ludhiana, so he moved out to Mumbai from
He spent a few years in Mumbai and in 1982, Sunil Mittal
started a full-fledged business selling portable generators
imported from Japan. This gave him a chance to acquaint
himself with the nitty-gritty's of marketing and advertising.
His business was running smoothly but later on the
government banned the import of generators as two Indian
companies were awarded licenses to manufacture
In 1986, Sunil Bharti Mittal incorporated Bharti Telecom
Limited (BTL) and entered into a technical tie up with
Siemens AG of Germany for manufacture of electronic
push button phones. Gradually he expanded his business
and by early 1990s, Sunil Mittal was making fax machines,
cordless phones and other telecom gear.
In 1992, when the Indian government was awarding
licenses for mobile phone services for the first time, Sunil
Mittal clinched Delhi cellular license in collaboration with
French telecom group Vivendi. In 1995, Sunil Mittal
founded Bharti Cellular Limited (BCL) to offer cellular
services under the brand name AirTel. Soon, Bharti became
the first telecom company to cross the 2-million mobile
subscriber mark. Bharti Cellular Limited also rolled out
India's first private national as well as international long-
distance service under the brand name IndiaOne. In 2001,
BCL entered into a joint venture with Singapore Telecom
International for a $650-million submarine cable project,
India's first ever undersea cable link connecting Chennai in
India and Singapore.
Today, Sunil Mittal runs a successful empire with a market
capitalization of approximately $ 2 billion and employing
over 5,000 people. He has been honored with several
awards. Sunil Bharti Mittal was chosen as one of the top
entrepreneurs in the world for the year 2000 and amongst
'Stars Of Asia', by 'Business Week'. He also received IT
Man of the Year Award 2002 from Dataquest and CEO Of
the Year, 2002 Award (World HRD Congress).
BHARATI TELE- VENTURES
Bharti Airtel formerly known as Bharti Tele-Ventures LTD
(BTVL) is the largest cellular service provider in India,
with more than 124 million subscribtions as of February
2010. With this, Bharti is now the world's third-largest,
single-country mobile operator and sixth-largest integrated
telecom operator. It also offers fixed line services and
broadband services. It offers its TELECOM services under
the Airtel brand and is headed by Sunil Bharti Mittal. The
company also provides telephone services and broadband
Internet access (DSL) in top 95 cities in India. It also acts
as a carrier for national and international long distance
communication services. The company has a submarine
cable landing station at Chennai, which connects the
submarine cable connecting Chennai and Singapore.
It is known for being the first mobile phone company in the
world to outsource everything except marketing and sales.
Its network operations are provided by Ericsson, business
support by IBM and transmission towers by another
company. Ericsson agreed for the first time, to be paid by
the minute for installation and maintenance of their
equipment rather than being paid up front. This enables the
company to provide pan-India phone call rates of Rs.
The businesses at Bharti Airtel have always been structured
into three individual strategic business units (SBU's) -
Mobile Services, Airtel Telemedia Services & Enterprise
Services. The mobile business provides mobile & fixed
wireless services using GSM technology across 23 telecom
circles while the Airtel Telemedia Services business offers
broadband & telephone services in 95 cities and has
recently launched a Direct-to-Home (DTH) service, Airtel
Digital TV. Shahrukh Khan is the brand embassador of the
mobile company and Kareena Kapoor and Saif Ali Khan
are the brand embassadors of the DTH company. The
company provides end-to-end data and enterprise services
to the corporate customers through its nationwide fiber
optic backbone, last mile connectivity in fixed-line and
mobile circles, VSATs, ISP and international bandwidth
access through the gateways and landing station.
• BY 2010 AIRTEL WILL BE THE MOST ADMIRED
BRAND IN INDIA
• LOVED BY MORE CUSTOMERS.
• TARGETED BY TOP TALENT.
• BENCHMARKED BY MORE BUSINESS.
Airtel comes to you from Bharti Tele-Ventures Limited - a
part of the biggest private integrated telecom conglomerate,
Bharti Enterprises. A consortium of giants in the
telecommunication business. In it's six years of pursuit of
greater customer satisfaction, AirTel has redefined the
business through marketing innovations, continuous
technological up gradation of the network, introduction of
new generation value added services and the highest
standard of customer care.
Bharti is the leading cellular service provider, with an all
India footprint covering all 23 telecom circles of the
country. It has over 12 million satisfied customers.
Cellular telephony was introduced in India during the early
1990s. At that time, there were only two major private
players, Bharti (Airtel) and Essar (Essar) and both these
companies offered only post-paid services. Initially, the
cellular services market registered limited growth.
Moreover, these services were mostly restricted to the
metros. Other factors such as lack of awareness among
people, lack of infrastructural facilities, low standard of
living, and government regulations were also responsible
for the slow growth of cellular phone services in India.
Although the cellular services market in India grew during
the late 1990s (as the number of players increased and
tariffs and handset prices came down significantly) the
growth was rather marginal. This was because the cellular
service providers offered only post-paid cellular services,
which were still perceived to be very costly as compared to
Following this realization, the major cellular service
providers in India, launched pre-paid cellular services in
the late 1990s. The main purpose of these services was to
target customers from all sections of society (unlike post-
paid services, which were targeted only at the premium
Airtel is a brand of telecommunication services in India,
Bangladesh and in Sri Lanka owned and operated by Bharti
Airtel. It is the largest cellular service provider in India in
terms of number of subscribers. Services are offered under
the brand name Airtel: Mobile Services (using GSM
Technology), Broadband & Telephone Services (Fixed line,
Internet Connectivity(DSL) and Leased Line), Long
Distance Services and Enterprise Services
(Telecommunications Consulting for corporates). It has
presence in all 23 circles of the country and covers 71% of
the current population (as of Financial Year 2007). Airtel
has also launched 16Mb/s broadband plans in India,
making it the first ISP to do so.
Airtel is facing a lot of flack from its customers, as people
have become dissatisfied with its customer care services.
(www.consumercomplaints.in - Indian Consumer
Airtel Sri Lanka
In December 2008, Bharti Airtel rolled out third generation
services in Sri Lanka in association with Singapore
Telecommunications. SingTel is a major player in the 3G
space in Asia. It operates third generation networks in
several markets across Asia.
Airtel's operation in Sri Lanka, known as Airtel Lanka,
commenced operations on the 12th of January 2009.
Airtel in Bangladesh
In January 2010, it was announced that the Bangladesh
Telecommuncations Regulatrory Commission (BTRC) of
The People's Republic of Bangladesh had given Bharti
Airtel the go ahead to acquire a 70% stake in the
Bangladesh business of Abu Dhabi based Warid Telcom.
The latter had till date invested a total of $600 million, with
plans to bring their Bangladesh investments to the $1
billion mark. Airtel's 70% stake in the company is said to
be at a cost of an initial $300 million.
Until September 18, 2004, Bharti provided fixed-line
telephony and broadband services under the Touchtel
brand. Bharti now provides all telecom services including
fixed-line services under a common brand "Airtel".
On 19 October 2004 Airtel announced the launch of a
BlackBerry Wireless Solution in India. The launch is a
result of a tie-up between Bharti Tele-Ventures Limited and
Research In Motion (RIM).
On 9 October 2008, Airtel joined the DTH bandwagon in
India with Airtel Digital TV, a Direct-to-Home Television
The Apple iPhone 3G was rolled out in India on 22 August
2008 via Airtel & Vodafone.
In May 2008, it emerged that Bharti Airtel was exploring
the possibility of buying the MTN Group, a South Africa-
based telecommunications company with coverage in 21
countries in Africa and the Middle East. The Financial
Times reported that Bharti was considering offering US$45
billion for a 100% stake in MTN, which would be the
largest overseas acquisition ever by an Indian firm.
However, both sides emphasize the tentative nature of the
talks, while The Economist magazine noted, "If anything,
Bharti would be marrying up," as MTN has more
subscribers, higher revenues and broader geographic
coverage. However, the talks fell apart as MTN group tried
to reverse the negotiations by making Bharti almost a
subsidiary of the new company.
In May 2009, Bharti Airtel again confirmed that it is in
Talks with MTN and companies have now agreed discuss
the potential transaction exclusively by July 31, 2009.
Bharti Airtel said in a statement “Bharti Airtel Ltd is
pleased to announce that it has renewed its effort for a
significant partnership with MTN Group".
Talks eventually ended without agreement, some sources
stating that due to the South African government
On 14, February 2010 a statement issued exclusively to the
Ghana News Agency by Zain Ghana, said "the Board of
Directors of Kuwait's Zain Group, after its meeting on
February 14, 2010, issued a resolution to accept a proposal
received from Bharti Airtel Limited (Bharti) to enter into
exclusive discussions until 25 March 2010, regarding the
sale of its African unit, Zain Africa BV." The offer was for
“This potential transaction does not include Zain’s
operations in Morocco and Sudan and remains subject to
due diligence, customary regulatory approvals and signing
of final transaction documentation,” Bharti said. The deal
would provide Bharti access to 15 more countries in the
region, adding around 40.1 million subscribers to its
already 125 million-plus user base. With Bharti already
having presence in five overseas markets,after the deal, it
would increase its global presence across 20 regions. The
combined revenue of the two entities would be around $12
Recently a shareholder of Zain Nigeria, Broad
Communications, secured an injunction against the
company from managing its subsidiary in that country
because Zain was destroying shareholder value. Experts
have said the developments in Nigeria could have
implications for the Bharti acquisition.
Bharti Airtel signed a five-year deal with ESPN Star Sports
to become the title sponsor of the Champions League
Twenty20 cricket tournament. The tournament itself is
named "Airtel Champions League Twenty20."
Airtel plans to launch the nationwide 3G services in India
in the second quarter of 2010.
To be globally admired for telecom services that delight
customers.We will meet global standards for telecom
services that delight customers through:
• Customer Service Focus
• Empowered Employees
• Cost Efficiency
• Unified Messaging Solutions
• Innovative products and services
• Error- free service delivery
AIRTEL`S ENTERPRISE SERVICES
The company is structured into four strategic business units
- Mobile, Telemedia, Enterprise and Digital TV. The
mobile business offers services in India, Sri Lanka and
Bangladesh. The Telemedia business provides broadband,
IPTV and telephone services in 94 Indian cities. The
Digital TV business provides Direct-to-Home TV services
across India. The Enterprise business provides end-to-end
telecom solutions to corporate customers and national and
international long distance services to telcos.
Bharti Airtel offers GSM mobile services in all the 23-
telecom circles of India and is the largest mobile service
provider in the country, based on the number of customers.
The group offers high speed broadband internet with a best
in class network. With Landline services in 94 cities we
help you stay in touch with your friends & family and the
world. Get world class entertainment with India’s best
direct to home (DTH) service digital TV in more than
Enterprise Services provides a broad portfolio of services to
large Enterprise and Carrier customers. This division
comprises of the Carrier and Corporate business unit.
Enterprise Services is regarded as the trusted
communications partner to India's leading organizations,
helping them to meet the challenges of growth.
Discover the magical experience of digital enterainment
with Airtel. From DVD quality picture and sound,the best
and widest variety of channels and programmes to the
best on-demand content on Airtel Live, your tv viewing
experience change forever with digital TV from Airtel!
Bharti Airtel crosses 100 million customers
New Delhi, May 15, 2009: Bharti Airtel, Asia’s leading
Integrated Telecom services provider, today announced that
it has crossed the 100 million customers mark. This
milestone makes the company the 3rd largest single
country mobile services operator and sixth largest in-
country integrated telecom operator in the world.
Bharti Airtel is structured into three strategic business units
- Mobile services, Telemedia services and Enterprise
services. The mobile business offers services in India and
Sri Lanka. The Telemedia business provides broadband and
telephone services in 95 cities, DTH services and has
recently forayed into the IPTV services. The Enterprise
business provides end-to-end telecom solutions to corporate
customers and national and international long distance
services to carriers. All these services are provided under
the Airtel brand. Airtel’s high-speed optic fibre network
currently spans over 101,337 Rkms covering all the major
cities in the country. The company has two international
landing stations in Chennai that connects two submarine
cable systems - i2i to Singapore and SEA-ME-WE-4 to
The objective of my project report is to study the reasons of
distribution gap in rural areas and effectiveness of
distribution channel in rural areas of Ambah & Porsa.under
this project following points are covered.
• Find out the reasons of less number of outlet in rural
• Convince the people about airtel schemes and
• To open new outlets where number of outlets are less
• Study the problems of rural retailers.
• Convince the rural retailers to provide airtel services
who does not provide airtel services.
LOCATION OF LOW REVENUE SITE:
Following are the low revenue areas. In these areas number
of retailers are less than five. This is the main reason of low
revenue from these site.list of low revenue areas are
SITE TEHSIL VILLAGE DISTRIBUTER
mp5951 Porsa Shyampur Prakrati telecom thara
Mp5952 Porsa Dharamgarh Shyam oil mill porsa
Mp4726 Ambah Thara Prakrati telecom thara
Mp5941 Ambah Bareh Sunil enterprises
Mp5948 Ambah Kirranch Shyam oil mill porsa
Mp5953 Porsa Raipur Parmar kirana rajudha
Mp2234 Porsa Mahua Prakrati telecom thara
Mp2238 Ambah Esah Tomar telecom dimni
Mp2253 Ambah Roophati Prakrati telecom thara
Mp2250 Porsa Kontharkalan Parmar kirana
Mp2233 Porsa Useth Prakrati telecom thara
Mp2423 Porsa Kichol Parmar kirana
Mp3582 Porsa Harahar ka Shyam oil mill porsa
Mp1444 Porsa Kasmada Prakrati telecom thara
• People in rural areas are not aware about new schemes
launched by distributor and company.
• Numbers of retailers are very less in these villages.
• Rural distributor set target to retailers.if retailer
doesnot sell five sim in a month then distributor does
not provide balance on lapoo sim.
• Rural distributor doesnot go regularly in villages to
provide balance and other services.
• Rural distributor does not provide less than 500 Rs
recharge on lapoo sim.
• People buy small recharge voucher card in villages
rather than e recharge. so shopkeeper in villages sell
recharge card while these shopkeepers arenot retailer
• Shopkeepers sell the recharge voucher of Rs.10,25,50
for Rs 11,26,52 respectively .it means they earn more
than 10% on each card sell.while in e recharge they
earn only 2.5%. so shokeepers arenot interested to
• Retailers in rural areas donot submit sim document in
time. So company stop services on sim so people do
not buy sim from rural retailers.
• Retailers in villages not provide latest scheme to
• Retailers and customers are not satisfied with network
• We can hardly found posters and glow signboard of
airtel at rural retailer’s shop in rural areas.
• Due to less advertisement of schemes in villages the
retailers and customers’ do not get aware of the new
scheme of airtel on time.
• Distributors of airtel donot provide any discount to the
retailers on purchase.
• Two or more rural distributors are working in same
• Mostly retailers of rural areas are not well educated so
they find difficulty in e recharge.
• There are more demands of “life time plan” but due to
congestion in the network, customers of rural areas do
not want to buy it.
• Retailers do not get the claim on time.
• Retailers donot receive posters,pemplets,signboard
and other accessories related with new schemes on
• Rural distributor does not collect documents and other
papers on time from retailers.
• Distributors provide the balance and recharge voucher
to retailers only on cash payment while distributor of
urban areas provide credit facility to retailers.
• Another relevation was that customer seemed very
peeved with the amounts they had to pay for local and
One of the biggest problem in rural areas is low
ARPU.people are not investing money on mobile
Marketing strategy in Rural area:
In the rural area we face mainly 3 types of
• Customers who don’t know anything about
These are the customers who are willing to buy
product or services but they are unknown to them.
Although there is a less percentage of this kind. To
attract these customers the role of outlet store or R.D.
is crucial because they will buy what they get from
• Aware customers….
This category holds the huge percentage. They are
not bised with product and firstly gather knowledge
about all available products and services and then
• Customers showing extra knowledge.....
This is the most difficult category to face. These
peoples have their own perception and they are bised
towards the product or services. It is difficult to
change there mentality some times.
So in case of rural customer the role
and responsibilities of the outlets is different. Some
times old relations and the popularity of the seller also
plays role. The point is this ‘Outlets are the
businessmen they want to earn money, so they will
sell which give them more income. In rural areas the
customer is almost neutral and depend to the outlet,
so providing extra benefit to them will work in
increasing subscriber base.’ The second category
which interfere during selling product or service
is old customers. These are the free advertiser of the
company, Before selling the product or service their
opinion is taken by the seller so satisfaction of old
customers is essential.
• First of all Airtel must improve the efficiency of the
network to cater the customer base in rural areas.
• Airtel and its Distributors should advertise the running
schemes in villages.
• Airtel should properly provide the promotional
material and other accessories to the retailers on time.
• Airtel should focus on providing the attractive and
competitive tariff plans.
• Retailers’ helpline no. should be improved more so
that retailers can take the advantage of it.
• Distributors should provide discount and to the
retailers on the bulk purchase so that retailers can be
motivated to sell.
There should not be area conflict among the
• Enhance the relationship between Retailers &
Distributor in area to gain the retailers confidence.
• Distributors should take care that the field boys cover
all shops (including newshops) in the market.
1.As every company is eying towards the rural subscribers
competition is increasing constantly. The only way to cross
this is to ensure more reliability and faith in company
brand. This can be done by several ways -
• To make the brand more reliable and to raise faith on
brand company can go for CSR (Corporate Social
Responsibility). As building Bus Stops, by supplying water
tanks (Water is the biggest problem in rural areas in
summers), by opening Pyaus, give signboard near the
• Plantation is a good idea as this will help protecting
environment and a level on tree guard is the effective
advertisement of the company. This type of plantation
can also be done in villages connecting roads.
2. Low awareness about new product and service is the
most difficult problem in rural areas. People have no
knowledge about the new schemes. To make it known to
every one some steps can be taken –
• Make sure that the R.D.s are trying to show the
information on the display boards. (A display board can be
given to every R.D. and big outlets so that they can write
“AAJ KA OFFER”. Company is doing work in this
direction but in ground level idea is not working because
they are not made aware about the benefits of it.)
• There is a mentality of rural subscriber that the person
who can repair there mobile phones is the best for getting
recharges. Company can invite this kind of mechanics for
training sessions. This will help to increase customers in
• Any scheme given to the retailers is made available to
them in no time so some times they are unable to be
beneficial. If they will make known one day before they
3. This is bigger problem in the rural area because due to
shortage of electricity rural population can not attracted by
electronic advertisement, so to attract the rural population
strong advertisement is strongly needed.
• Advertising is strongly needed in rural areas because in
rural area “Jo Dikhta Hai Wo Bikta Hai” mentality is still
working. (This thing is come in front of me in case of
FMCG products. Shopkeepers told me that several time
they face the problem as ‘Mughe Amitabh Bachchan wala
tel chahia’, ‘mughe Salman ki undergarments chahia’ etc.)
• Electronic advertising will not work here because of
electricity problem, so advertising via Banners, Posters,
CSR, Advertisement on buses,walls will work here because
they are appear to them every time.
• Advertisement through buses will work. Company can
paint it’s logo on buses and In other traveling means.
4. To attract the customers for landline connections
following points can be useful
• Make it cheaper to the customers ( For a P.C.O.
connection customer has to invest a minimum of 1700 Rs.,
Company can provide different plans to make it cheaper
and can also expend it’s business to personal connections.)
• Attract customer by internet connections (Now a days
computers are available everywhere it will be a good idea
to provide the high speed internet connections, this is useful
in cities and tehseel places.)
• Good networking facilities are essential
• Company can offer free or low cost internet facility to the
5. One of the biggest problem in the rural area is Low
ARPU (Low Average Revenue Per User) . People are not
investing money on mobile. Here some points are lighten
towards the problem –
• Low call rates can be offered.
• Different value vouchers can be used.
• SMS packs can be given to the customers as per
LIST OF NEW RETAILERS
Opening of New Outlets
ar ka pura,Kasmada,Rached,Samsukh ka pura,Rajaudha
NAME VILLAGE MOBILE
Pappu telecom Mahua 9993369314
Suresh kirana Mahua 9993368946
Radhe telecom Mahua 9630778776
Brajmohan Mahua 9630315973
Sonu telecom Thara 9993369586
Manoj telecom Thara 9752823440
Kuldeep telecom Thara 9630778886
Bhagwati telecom Useth 9981757348
Ramlal kirana Useth 9981757194
Mukesh telecom Useth 9752850235
Prashant telecom Kasmada 9981757180
Ajay kirana Kasmada 9993369162
Ravi telecom Kasmada 9977124847
Gaurav telecom Roophati 9981757144
Bhadoriya kirana Bareh 9993275005
Bhanu telecom Bareh 9993273302
Bhadoriya telecom rached 9981704131
Tomar telecom Rached 9893077791
s.r. telecom Samsukh ka pura 9981704127
Arabi singh Samsukh ka pura 9893012964
Sunil enterprises Esah 9752408042
Over two thirds of India's population live in rural
surroundings and in these telecoms have not really made
their presence felt to any real extent.
Airtel is targeting the rural areas. Companies driving
technology into this sector of the market the effect is likely
to be a boom in telecoms demand.
It is probable in these rural areas that cheap call rates will
link with state-of-the-art technology to boost teledensity
and offer more freedom.