“CONSUMER BEHAVIOUR OF AIRTEL”
FOR PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE
MASTER OF BUSINESS ADMINISTRATION
SUBMITTED TO: SUBMITTED BY:
U.P. TECHNICAL UNIVERSITY Shailendra Kumar
MBA III SEM.
KRISHNA INSTITUTE OF ENGINEERING &
(AFFILIATED TO U.P. TECHNICAL UNIVERSITY, LUCKNOW)
I am sincerely thankful to all those people who have been
giving me any kind of assistance in the making of this project
I express my gratitude to Mr. Chetan Kumar (Branch
Manager), who has through his vast experience and knowledge
has been able to guide me, both ably and successfully towards
the completion of the project. I express my gratitude, Krishna
Institute of Engineering & Technology. I would hereby, make
most of the opportunity by expressing my sincerest thanks to
Mrs. Mani Tyagi and all my faculties whose teachings gave me
conceptual understanding and clarity of comprehension, which
ultimately made my job more easy. Credit also goes to all my
friends whose encouragement kept me in good stead.
Their continuous support has given me the strength and
confidence to complete the project without any difficulty.
Last of all but not the least I would like to acknowledge my
gratitude to the respondents without whom this survey would
have been incomplete.
I am also thankful to authority of Airtel for providing me the
(SHAILENDRA KUMAR BHARADWAJ)
I, Shailendra Kumar Bharadwaj, being a student of MBA, of
The project title “Consumer Behaviour of Airtel” is the analysis
of the big scale sector of communication. This project involves
the big scale level provided by Airtel to its customers. The
survey was conducted so as to analyze the big scale sector
prevailing in the current industry and the improvement that can
be made upon it.
Market research study has been conducted in order to bring out
the picture of big scale sector that exists in this industry. The
differences in service quality that exists in the market. What the
customer’s preferences are provided by the Airtel?
The project is an extensive report on how the Airtel
company markets its strategies and how the company has been
able in tackling the present tough competition and how it is
cooping up by the allegations of the quality of its products. The
report begins with the history of the products and the
introduction of the Airtel company. This report also contains the
basic marketing strategies that are used by the Airtel company
of manufacturing process, technology, production policy,
advertising, collaboration, export scenario, future prospect and
government policies. The report includes some of the key salient
features of market trend issues.
In today’s world of cutthroat fierce competition, it is very
essential to not only exist but also to excel in the market.
Today’s market is enormously more complex. Hence forth, to
survive in the market, the company not only needs to maximize
its profit but also needs to satisfy its customers and should try to
build upon from there.
e of the
OBJECTIVE OF THE STUDY
1. To identify the difference in market performance of Airtel industry.
2. To study the market of Airtel Industry in big scale sector.
3. To compare various parameters of manufacturing process,
technology, production policy, advertising, collaboration,
export scenario, future prospect and government policies.
Achieving accuracy in any research requires in depth study
regarding the subject. As the prime objective of the project is to
compare Airtel with the existing competitors in the market and the
impact of WLL on Airtel, the research methodology adopted is
basically based on primary data via which the most recent and
accurate piece of first hand information could be collected.
Secondary data has been used to support primary data wherever
Primary data was collected using the following techniques
Direct Interview Method and
The main tool used was, the questionnaire method. Further direct
interview method, where a face-to-face formal interview was taken.
Lastly observation method has been continuous with the questionnaire
method, as one continuously observes the surrounding environment he
Procedure of research methodology
# To conduct this research the target population was the mobile users,
Who are using GSM technology.
# Target geographic area. Sample size of 100 was taken.
# To these 100 people a questionnaire was given, the questionnaire
was a combination of both open ended and closed ended questions.
# The date during which questionnaires were filled.
# Some dealers were also interviewed to know their prospective.
Interviews with the managers of GSM service providers were also
# Finally the collected data and information was analyzed and
compiled to arrive at the conclusion and recommendations given.
Sources of secondary data
Used to obtain information on, Bharti’s history, current issues, policies,
In the early 1990s, the Indian government adopted a new economic
policy aimed at improving India's competitiveness in the global markets
and the rapid growth of exports. Key to achieving these goals was a
world-class telecom infrastructure.
In India, the telecom service areas are divided into four metros (New
Delhi, Mumbai, Chennai and Kolkatta) and 20 circles, which roughly
correspond to the states in India. The circles are further classified
under "A," "B" and "C," with the "A" circle being the most attractive and
"C" being the least attractive. The regulatory body at that time — the
Department of Telecommunications (DOT) — allocated two cellular
licenses for each metro and circle. Thirty-four licenses for GSM900
cellular services were auctioned to 22 firms in 1995. The first cellular
service was provided by, Modi Telstra in Kolkatta in August 1995. For
the auction, it was stipulated that no firm can win in more than one
metro, three circles or both. The circles of Jammu and Kashmir and
Andaman and Nicobar had no bidders, while West Bengal and Assam
had only one bidder each.
In 1996, the Telecom Regulatory Authority of India (TRAI) bill was
introduced in the Lok Sabha, and the president officially announced the
TRAI ordinance on 25 January 1997. The government decided to set
up TRAI to separate regulatory functions from policy formulation,
licensing and telecom operations. Prior to the creation of TRAI, these
functions were the sole responsibility of the DOT.
High license fees and excessive bids for the cellular licenses put
tremendous financial burden on the operators, diverting funds away
from network development and enhancements. As a result, by 1999
many operators failed to pay their license fees and were in danger of
having their licenses withdrawn. In March 1999, a new telecom policy
was put in place (New Telecom Policy [NTP] 1999). Under this new
policy, the old fixed-licensing regime was to be replaced by a revenue-
sharing scheme whereby between 8-12 percent of cellular revenue
were to be paid to the government.
1.1 INDIAN CELLULAR MARKET - EARLIER ROADBLOCKS AND
Indian Cellular market immediately after the first round of licensing in
1994-96 was beset by several problems for 3 - 4 years till the New
Telecom Policy of 1999 was announced. Some of these roadblocks /
current position is tabulated below:
High license fees
Migration to revenue sharing mode in 1999 mitigates high initial fund
requirements for payment of license fees.
Inadequately funded businesses / weak and fragmented promoters
Businesses that have since been adequately funded growing at over
60% per annum, while businesses with weak promoters continuing to
languish - spate of acquisitions / mergers, with 4/5 major groups
emerging in the last one/two years.
Regulatory authority not in place
Telecom Regulatory Authority of India (TRAI) firmly in place, and its
role being accepted by all operators; Deptt of Telecommunications
(DOT) restructured, with operations and policy making roles vested in
Issues relating to unfavorable interconnect terms for private operators,
pass through income, intra circle long distance, spectrum availability
and allocation and the like remained unresolved for long periods.
Interconnect terms since rationalized, risks on pass through income to
DOT / BHARTI (Mahanagar Telecom Nigam Ltd.) resolved to the
satisfaction of all parties with changes in methodology / revenue
sharing, intra circle long distance allowed, spectrum availability cleared
with vacation of frequencies for usage by GSM operators.
Problems in Financial closures due to:
Licensing tenure of 10 years
Large up front cash requirements from promoters due to heavy
license fee burden in initial stages of deployment Asset based
financing approach by Indian Financial Institutions.
Licensing tenure increased from 10 to 20 years
Large up front cash requirements for license fee payments
mitigated with migration to revenue sharing mode allowing
promoters to deploy more capital for capital expenditure; project
financing being considered by most financial institutions.
Foreign ownership / change of partner limitations
Foreign ownership norms clarified, and change of partners allowed as
a matter of routine allowing ease of entry / exit - paves the way for full
control of businesses by foreign companies.
Inadequate growth of market / subscribers
Roadblocks spelt out earlier resulted in low market / subscriber growth,
but with corrective measures taken, market / subscriber base expected
1.2 DEVELOPMENTS IN THE CELLULAR INDUSTRY
The interconnection regime between cellular operators and fixed-line
operators is still biased against the former.
Despite the recent gains of the cellular industry, not everything is rosy.
The cellular penetration rate is still very low at 0.8 percent in a nation
of over one billion people.
In recent years, many foreign companies had pulled out from their
cellular joint ventures in India due to the difficult operating environment
and bureaucracy. In 1999 alone, Swisscom pulled out from Sterling
Cellular, Telstra from Modi Telstra and both the Telecom Organization
of Thailand and Jasmine International from JT Mobile. In 2000,
Telecom Malaysia sold its stake in Usha Martin Telecom, and both
Shinawatra of Thailand and Bezeq exited from Fascel. In June 2001,
British Telecom exited from Bharti Cellular. Bell South International has
also indicated its intention to pull out from Skycell Communications,
and Hong Kong-based Distacom is seeking to sell its stake in Spice
Communications. First Pacific's (based in Hong Kong) continued
commitment to Escotel is uncertain, and the former is reviewing
The string of sell-outs notwithstanding, there has been a merger and
acquisition wave sweeping across the Indian cellular industry in recent
years. Hong Kong-based Hutchison Whampoa, via Hutchison
Telecommunications (HK), acquired major stakes in Sterling Cellular
(December 1999), Usha Martin Telecom (mid-2000) and Fascel
(September 2000). Through a partnership with local company, Kotak
Mahindra Finance, Hutchison Whampoa practically controls Fascel
and Usha Martin Telecom, thus circumventing the 49 percent limit on
foreign ownership in Indian cellular operators. Hutchison Whampoa is
also the controlling shareholder of Hutchison Max Telecom. Not to be
outdone, Bharti Enterprises — another major cellular player —
acquired control of JT Telecom, which was later renamed Bharti Mobile
(December 1999), and Skycell Communications renamed Bharti
Mobinet (August 2000). Bharti also acquired the Punjab license of
Essar and started operations, giving competition to the lone operator
there, Spice Communications. Going forward, Bharti is likely to merge
all its cellular companies into one entity.
Five companies together bid Rs16.3 billion to bag the licenses for the
fourth operator slots in four metros and 13 circles. Bharti emerged as
the No. 1 bidder with eight new licenses, followed by Escotel with four,
Hutchison with three, and Reliance and Idea cellular with one each.
Bharti and Hutchison have already commenced operations in all the
circles while Idea is set to launch in Delhi. Escotel and Reliance have
not made any headway.
BHARTI, the third cellular operator for Delhi and Mumbai, started
services in March 2001. BSNL, as the third nationwide cellular
operator, launched services in Kolkatta and Bihar in January 2002.
This was followed by Tamil Nadu in July 2002. A nationwide launch
was scheduled for 2 October 2002. However, this has been postponed
until after mid October. Once BSNL rolls out its service, most telecom
circles will have four cellular operators. There will be tremendous
competitive pressure, which will result in lower tariffs. Future rate cuts
are expected, which will drive demand, together with falling handset
prices and the introduction of prepaid services.
In the midst of declining interest in technology stocks, Bharti came out
with its long-awaited initial public offering (IPO) in January 2002.
Leveraging on the success of its cellular service, the company got a
very good response from the primary market. The total size of the IPO
was 185 million shares at a floor price of Rs10. The issue was
oversubscribed by more than 2.5 times, netting Rs8.3 billion. This will
be used to fuel its investment in long-distance, basic and cellular
As of October 2002, only BPL Mobile has launched commercial
general packet radio service (GPRS) in Mumbai. However, large-scale
uptake remains elusive. While both Bharti and Idea have GPRS-
enabled networks, there is caution on their part to launch the service.
With hardly any applications, the success of GPRS remains a
Building visibility and awareness
Deviating from competing on the price platform, cellular operators are
actively promoting their brand and service portfolio through high-
visibility advertising and promotional campaigns. Cellular operators like
Bharti, Orange and BPL Mobile have been advertising aggressively on
hoardings and kiosks. Public transport like the city rail system and
cabs are used widely to carry the message of mobility.
Customer-focused activities are gaining traction among cellular
operators with the establishment of longstanding consumer benefit
programs. Orange in Mumbai offers "Orange Holidays" and "Orange
Monsoon Offers" at very attractive rates and added benefits like
discounts on airfare, food and beverages, among others. Others offer
special privileges in retail outlets, cinemas and music shops.
Enterprise mobile applications — promising revenue stream
All along, customer acquisition and the top line have been the focus.
Few operators have concentrated on offering differentiated services for
businesses. However, as operators realize that offering basic voice
and Short Message Service (SMS) will get them the numbers but not
the margins, some are now seriously looking at the enterprise segment
for provisioning superior services.
Cost-centered solutions like closed user group (CUG), value-adds like
unified messaging and instant alerts are being offered.
A variety of mobile applications are finding takers among the enterprise
segment. Bharti is in the process of introducing a facility to fleet
management companies so that they can improve the efficiency of
trucks or buses by tracking movement and ensuring higher-use,
accurate route planning. Premium automakers are also installing a
global system for mobile communications inside a vehicle to help trace
lost vehicles and track down stolen cars.
Corporations can choose enhanced services like user-defined call
routing to prevent misuse. Calls can be barred, limiting access to
select numbers and diverting calls to one single number. Broadcasting
services are also quite popular, especially among fast food centers that
have a central number. Group SMS is quite popular, especially among
enterprises both in the service as well as the fast-moving consumer
goods (FMCG) segment that have a large field force and need to
provide regular updates on inventory status, discount schemes and
movement of goods from warehouse to the retail outlet. Banks too find
bulk SMS service very useful to forward transactional alerts to their
1.3 FUTURE TRENDS AND DEVELOPMENT
There will be more competition, forcing operators to constantly focus
on differentiations to maintain their lead.
• The implementation of enhanced networks like 2.5G will enable
operators to offer data services. This is an opportunity to
customize and differentiate better.
• The entry of state-run operators like BSNL and BHARTI means
that prices will no longer be controlled, thus there is less chance
of a cartel being formed.
• Network coverage in terms of geographic spread and quality of
coverage is crucial especially for the business subscriber.
• The bigger the service provider's national presence, the better it
is for businesses. On the roaming front, signing up with a
national operator is advantageous.
• Limited mobility wireless in local-loop services (by fixed network
service providers) will be a disadvantage for cellular operators in
the short term. Consequently, operators need to streamline their
customer relation activities and adopt aggressive subscriber
acquisition and retention strategies.
1.4 REGULATORY ISSUES
The operations of this sector are determined as under the Indian
Telegraph Act of 1885. A document buried in the sands of time. The
next major policy document, which was produced, was the National
Telecom Policy of 1994, a consequence of the on going process of
1851 First telephones in India
1943 Nationalization of telephone companies
1985 DoT was created
1986 Creation of BHARTI and VSNL
1991 Telecom equipment liberalized
1994 Licenses for paging
1994 Telecom policy announced
September 1994 Guidelines for private sector participation in
November 1994 Cellular licenses issued for metros
December 1994 Tenders for cellular licenses in 19 cities apart
from 4 metros
January 1995 Tenders for 2nd operator in basic services
apart from DoT on circle basis.
August 1995 VSNL launches Internet services
January 1996 TRAI formed
November 1998 Internet policy announced
The National Telecom Policy of 1994 document, which laid out broad
policy guidelines rather than a series of action points. Like other
policies, it sought to achieve the impossible in finite time like improve
quality of service and its availability, wide coverage (a phone in every
village), at reasonable rates, etc. The targets in quantifiable terms were
installation of 9.5mn additional lines, telephone on demand by 1997,
and a PCO pop of 500. The Eighth Plan had also allowed private
operators in value added services. To facilitate licensing, the nation
was divided into 20 circles (akin to a state) for basic and 21 circles for
cellular telephony. Mumbai falls in Maharashtra circle and Delhi in itself
The basic premise on which competition has been introduced is that
every circle will have one private operator apart from DoT/ BHARTI for
basic and two operators for cellular. DoT/ BHARTI have the option to
become the third cellular operator in future.
Government did not achieve most of its stated targets. The basic
theme, which was broadening the reach of telephony in India, has not
been met. Even liberalization policies were not implemented properly.
The regulator TRAI was set up after delays and confusion and even
after its creation, DoT continued to fight with it in courts. It was also
affected by the resource crunch, and financing options like BOT,
BOOT and BOLT was not used at all. The major policy direction it
showed was to allow private sector entry in both basic and value
added services. The intention, though noble failed to achieve its goals
because of improper implementation, the economic costs are still
borne by the end user.
The telecom sector has witnessed some fundamental structural and
institutional reforms in the past decade. telecom equipment
manufacturing was completely deregulated in 1991. Value-added
services (including cellular services) were thrown open to private
sector participation in 1992. Basic services were opened to private
participation in 1994 by dividing the country into 21 telecom Circles
and allowing one private operator per Circle to compete with DoT. An
independent telecom regulatory Authority of India was set up in 1997.
A new Policy for Internet Service Policy Providers (ISPs) was
announced in 1998 allowing independent service providers to enter the
sector ending the earlier monopoly of VSNL. Reorganization of DoT,
separating policymaking function and service provision and
corporatization of DoT's operational network are two major institutional
reforms, which need to be implemented.
"As we spread wings to expand our capabilities and explore new
horizons, the fundamental focus remains unchanged: seek out
the best technology in the world and put it at the service of our
ultimate user: our customer."
These are the premise on which Bharti Enterprises has based its
entire plan of action.
Bharti Enterprises has been at the forefront of technology and has
revolutionized telecommunications with its world-class products and
Established in 1985, Bharti has been a pioneering force in the telecom
sector. With many firsts and innovations to its credit, ranging from
being the first mobile service in Delhi, first private basic telephone
service provider in the country, first Indian company to provide
comprehensive telecom services outside India in Seychelles and first
private sector service provider to launch National Long Distance
Services in India. Bharti had approximately 3.21 million total customers
– nearly 2.88 million mobile and 334,000 fixed line customers.
Its services sector businesses include mobile operations in Andhra
Pradesh, Chennai, Delhi, Gujarat, Haryana, Himachal Pradesh,
Karnataka, Kerala, Kolkata, Madhya Pradesh circle, Maharashtra
circle, Mumbai, Punjab, Tamil Nadu and Uttar Pradesh (West) circle. In
addition, it also has a fixed-line operations in the states of Madhya
Pradesh and Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu
and nationwide broadband and long distance networks.
Bharti has recently launched national long distance services by offering
data transmission services and voice transmission services for calls
originating and terminating on most of India's mobile networks.
The Company is also implementing a submarine cable project
connecting Chennai-Singapore for providing international bandwidth.
Bharti Enterprises also manufactures and exports telephone terminals
and cordless phones. Apart from being the largest manufacturer of
telephone instruments, it is also the first telecom company to export its
products to the USA.
Bharti Tele-Ventures' strategic objective is
“to capitalise on the growth opportunities that the Company believes
are available in the Indian telecommunications market and consolidate
its position to be the leading integrated telecommunications services
provider in key markets in India, with a focus on providing mobile
The Company has developed the following strategies to achieve its
• Focus on maximizing revenues and margins;
• Capture maximum telecommunications revenue potential with
minimum geographical coverage;
• Offer multiple telecommunications services to provide customers
with a "one-stop shop" solution;
• Position itself to tap data transmission opportunities and offer
advanced mobile data services;
• Focus on satisfying and retaining customers by ensuring high
level of customer satisfaction;
• Leverage strengths of its strategic and financial partners; and
• Emphasize on human resource development to achieve
Bharti Tele-Ventures current businesses include -
• Mobile services
• National and international long distance services
• VSAT, Internet services and network solutions
Bharti Tele-Ventures believes that the following elements will
contribute to the Company's success as an integrated
telecommunication services provider in India and will provide the
Company with a solid foundation to execute its business strategy:
• Nationwide Footprint - approximately 92% of India's total mobile
subscribers resided in the Company's fifteen mobile circles.
These 15 circles collectively accounted for approximately 56% of
India's land mass;
• Focus on telecommunications to enable the Company to better
anticipate industry trends and capitalize on new
telecommunications-related business opportunities;
• The strong brand name recognition and a reputation for offering
high quality service to its customers;
• Quality management team with vision and proven execution
• The Company's strong relationships with international strategic
and financial investors such as SingTel, Warburg Pincus,
International Finance Corporation, Asian Infrastructure Fund
Group and New York Life Insurance.
Bharti is working on a complex three-layered branding
architecture — to:
•Create specific brands for each service,
•Build sub-brands within each of these services and
•Use Bharti as the mother brand providing the group its
corporate identity as well as defining its goal to become a
national builder of telecoms infrastructure.
Error: Reference source not found
AirTel - The flagship brand for cellular operations all across the
Touchtel - The brand earmarked for basic service operations.
India One - The brand for national long distance (NLD)
Though the costs of creating new brands are heavy but the group
wants to create “distinct independent brands to address
different customers and profiles”.
To understand the brand strategy, let’s first look at the brand building
exercise associated with AirTel — a brand that had to be repositioned
recently to address new needs in the market.
When the brand was launched seven years ago, cellular telephony
wasn’t a mass market by any means. For the average consumer,
owning a cellular phone was expensive as tariff rates (at Rs 8 a
minute) as well as instrument prices were steep — sometimes as
much as buying a second-hand car.
Bharti could have addressed the customer by rationally explaining to
him the economic advantage of using a mobile phone. But Sachdev
says that such a strategy would not have worked for the simple reason
that the value from using the phone at the time was not commensurate
with the cost.
“Instead of the value-proposition model, we decided to address the
sensory benefit it gave to the customer as the main selling tack. The
idea was to become a badge value brand,” he explains.
So the AirTel “leadership series” campaign was launched showing
successful men with their laptops and in their deluxe cars using the
mobile phone. In simple terms, it meant AirTel was positioned as an
aspirational brand that was meant for leaders, for customers who stood
out in a crowd.
Did it work? Repeated surveys following the launch showed that there
were three core benefits that were clearly associated with the brand —
leadership, dynamism and performance.
These were valuable qualities, but they only took AirTel far enough to
establish its presence in the market. As tariffs started dropping, it
became necessary for AirTel to appeal to a wider audience. And the
various brand-tracking exercises showed that despite all these good
things, there was no emotional dimension to the brand — it was
perceived as cold, distant and efficient.
Sachdev and his team realized that in a business in which customer
relationships were the core this could be a major weakness. The
reason? With tariffs identical to competitor Essar and roughly the
same level of service and schemes, it had now become important for
Bharti to “humanize” AirTel and use that relationship as a major
The brand had become something like Lufthansa — cold and efficient.
What they needed was to become Singapore Airlines, efficient but also
human. A change in tack was important because this was a time when
the cellular market was changing.
The leadership series was okay when you were wooing the crème de
la crème of society. Once you reached them you had to expand the
market so there was need to address to new customers.
By that time, Bharti was already the leading cellular subscriber in Delhi
with a base of 3.77 lakh (it now has 1.2 million customers). And with
tariffs becoming more affordable — as cell companies started cutting
prices — it was time to expand the market.
How could Bharti leverage this leadership position down the value
chain? Surveys showed that the concept of leadership in the
customer’s minds was also changing. Leadership did not mean
directing subordinates to execute orders but to work along with a team
to achieve common objectives — it was, again, a relationship game
that needed to be reflected in the AirTel brand.
Also, a survey showed that 50 per cent of the new customers choose a
mobile phone brand mostly through word-of-mouth endorsements from
friends, family or colleagues. Thus, existing customers were an
important tool for market expansion and Bharti now focused on
building closer relationships with them.
That is precisely what the brand tried to achieve through its new
positioning under the AirTel “Touch Tomorrow” brand campaign.
This set of campaigns portrayed mobile users surrounded by caring
family members. Says Sachdev: “The new campaign and positioning
was designed to highlight the relationship angle and make the brand
softer and more sensitive.”
As it looks to expand its cellular services nationwide —to eight new
circles apart from the seven in which it already operates — Bharti is
now realizing that there are new compulsions to rework the AirTel
brand, and a new exercise is being launched to this effect. Right now,
the company is unwilling to discuss the new positioning in detail. But
broadly, the focus is on positioning AirTel as a power brand with
numerous regional sub-brands reflecting customer needs in various
parts of the country.
If AirTel is becoming more humane and more sensitive as a brand,
Bharti has also understood that one common brand for all cellular
operations might not always work in urban markets that are now
getting increasingly saturated.
To bring in new customers, the company decided that it needed to
segment the market. One such experiment, launched last year, is
Youtopia, a brand aimed at the youth in the 14 to 19 age bracket and
for those who are “young at heart”. With its earlier positioning, AirTel
was perceived as a brand for the well-heeled older customer; there
was nothing for younger people. With Youtopia, AirTel hoped to
In order to deliver the concept, AirTel offered rock bottom tariff rates
(25 paise for 30 seconds) at night to Youtopia customers — a time
when they make the maximum number of calls. It also set up
merchandising exercises around the scheme — like a special portal for
young people to buy things or bid for goods.
The company is now looking at offering other services at affordable
prices to this segment which include music downloads on the mobile
and bundling SMS rates with normal calls to make it cheaper for young
people to use.
The other experiment that Bharti has worked on is to go in for product
segmentation through the Tango brand name. The brand was created
to offer mobile users Internet-interface services or what is known as
WAP (Wireless Application Protocol).
The idea was to bring Internet and mobile in perfect harmony. “The
name was chosen from the popular movie title It Takes Two To
Tango: basically, you need the two services to tango to offer
customers a new choice”, says Sachdev.
This, however, had less to do with the branding exercise as with
inefficiency of service (accusingly slow download speeds) and the
limited utility of WAP services.
Subsequently, the ads were withdrawn, but the company re-iterated
that the branding exercise could be revived because Tango will be the
brand to offer GPRS services — or permanent Internet connectivity on
the mobile phone — which AirTel is expected to launch soon.
Perhaps the more ambitious experiment has been with Magic — the
pre-paid card. The idea was to make the brand affordable, accessible
and, most importantly, feasible as a means of expanding the market
PHASE I –
Magic was aimed at bringing in infrequent users of a mobile phone into
the market and assure him that he would have to pay only if he made a
call. Such a customer used the phone sparingly — mostly for
emergencies — and was not willing to pick up a normal mobile
connection with its relatively high rentals (pre-paid cards do not include
To achieve its objectives Bharti did three things.
• One, the product was made available at prices ranging from Rs
300 to Rs 3,000 with no strings attached and was simple to
• Two, the product was made accessible and distributed through
small stores, telephone booths and even kirana shops so that the
offering was well within arm’s reach.
• Third, to make the product more “approachable” to the customer,
the company came with vernacular ad campaigns like “Magic
Daalo Se Hello” which appealed to local sensibilities.
This apart, the company roped in Karisma Kapoor and Shah Rukh
Khan for a major ad campaign all across Delhi, a ruse that saw the
number of subscribers go up from 5.47 lakh to 12 lakh today,
overtaking Essar’s branded pre-paid card Speed, which was launched
much ahead of Magic. The company is now re-working its Magic
strategy even further.
Earlier, the branding strategy was aimed at roping in only interested
customers — that is, customers who were already inclined to opt for
mobile services. But now, with basic service providers having been
allowed limited mobility at far cheaper rates, mobile service providers
could find themselves under threat again.
That is why the new exercise is aimed at co-opting non-adopters.
While the exact strategy is under wraps, insiders say the new branding
strategy would be aimed at offering them value which they had not
perceived would be available from using a pre-paid card.
PHASE II -
Bharti used AirTel Magic to build a strong value proposition and
accelerate market expansion through India’s first national pre-paid card
TV brand campaign
• First time ever in India - any pre-paid card brand goes on TV
• A combination of the film genre exposed through the TV medium
designed to connect with the masses of India
• Youth based - romance driven strategy platform makes the value
proposition of AirTel Magic - ‘Mumkin Hai’ come alive
• All elements - user imagery, context, tone & language created to
connect the category to the lives of the SEC B & SEC C segment –
the middle class non-mobile user.
• AirTel Magic positions itself on the platform of being excellent for
emergency situations - increasing productivity as a part of everyday
• Sharukh Khan makes ‘everything in life possible’ while romancing
pretty Kareena Kapoor with AirTel Magic, India’s leading pre-paid
AirTel today unveiled its strategy for market expansion with the launch
of it’s new AirTel Magic pre-paid card brand campaign – ‘Magic hai to
Mumkin hai’. The strategy is targeted at the non-user segment defined
as young adults, 15-30 years of age; in the Sec B & C segment is
aimed at accelerating market expansion. The value proposition is
centered around a person’s desire to make all his / her dreams,
ambitions & aspirations instantly possible. The new campaign for
AirTel Magic is all about empowering millions of Indians to be on top of
The brand is positioned to be relevant to the mass-market who want to
make all their dreams, hopes & desires come alive… instantly. (At just
Rs.300/- per month AirTel Magic is so easy to buy.) Improving
productivity, letting you befriend the world and opening up new
horizons. It gives you the freedom to control your life in a way never
possible before. Indeed, anything that you think is possible is possible
with AirTel Magic. The new brand slogan ‘Magic hai to Mumkin hai’
has been specially created to capture this effectively.
This strategy is designed to help us talk to this segment directly in the
tone, manner & language of the masses. The “Mumkin hai” value
proposition will help us expand the market and gain a higher
percentage of market share in the process.
The brand ambassadors Sharukh Khan and Kareena Kapoor embody
this ‘can do’ or “Mumkin Hai” spirit (infact that is the reason they were
selected as brand ambassadors). Sharukh rose from a TV actor to
become India’s top film star and national heartthrob. Kareena’s
success is due to her ‘attitude’, talent, hard work and the sheer ability
to make a mark in such a short time. Both these stars have said
‘Mumkin hai’ and made it happen for themselves.
The genre of this new strategy & campaign is Hindi cinema led. This
genre connects millions across India. The spirit of romance, dancing…
the Indian cinema, well known to most as Bollywood, holds millions of
Indians together as one.
The new TV campaign of AirTel Magic crafted in the Hindi film idiom,
magnifies the empowering optimism of “Mumkin Hai”, in the endearing
situation of a boy-girl romance. Where Sharukh Khan, sets his eyes
on Kareena Kapoor and wins her love with the help of AirTel Magic.
(Poignantly conveying that special feeling we all get when a dream is
made possible and a victory of the heart is won).
The strategy & new brand campaign is targeted at the large untapped
base of intending mobile customers from Sec A, B & C. The estimated
addressable market of such customers in the next two years is around
25 million in AirTel’s 16 states. The new strategy aims at correcting
the perception that the mobile category is useful mainly for ‘business’
or ‘work’ related scenarios.
The new strategy, brand positioning & brand slogan is an outcome of
an extensive nationwide research and is an integral part of AirTel
Magic’s new multi-media campaign. The campaign has been created
by Percept Advertising.
PHASE III -
Bharti used AirTel Magic to build a strong value proposition and
accelerate market expansion through India’s first national pre-paid card
TV brand campaign
• First time ever in India - any pre-paid card brand gives such
freedom to recharge any value
• A combination of the film genre exposed through the TV medium
designed to connect with the masses of India
• Youth based - romance driven strategy platform makes the value
proposition of AirTel Magic - ‘Aisi azaadi aur kahan?” come alive
• Sharukh Khan makes ‘everything in life possible’ AirTel today
unveiled its strategy for market expansion with the launch of it’s new
AirTel Magic pre-paid card brand campaign – ‘Magic hai to Mumkin
hai’. . The value proposition is centered around a person’s desire
to make all his / her dreams, ambitions & aspirations instantly
possible. The new campaign for AirTel Magic is all about
empowering millions of Indians to be on top of their lives.
The brand is positioned to be relevant to the mass-market who want to
make all their dreams, hopes & desires come alive… instantly .At a
amount of your choice you can recharge your account with available
validity time .Improving productivity, letting you befriend the world and
opening up new horizons. It gives you the freedom to control your life
in a way never possible before. Indeed, anything that you think is
possible is possible with AirTel Magic. The new brand slogan ‘Aisi
azadi aur kahanhas been specially created to capture this effectively.
Servi Processin Talk Validi
Amount ce g Time ty
(Rs.) Tax Fees(Rs. (Rs.) (Day
900 66.67 150 683.33 60
1000 74.07 150 775.93 60
1080 80 150 850 60
1200 88.89 150 961.11 60
1300 96.3 150 1053.7 60
1400 103.7 150 1146.3 60
1500 111.11 150 1238.89 60
1800 133.33 150 1516.67 60
2000 148.15 150 1701.85 60
2160 160 150 1850 60
3000 222.22 150 2627.78 60
5000 370.37 300 4329.63 366
6000 444.44 300 5255.56 366
7000 518.52 300 6181.48 366
8000 592.59 300 7107.41 366
9000 666.67 300 8033.33 366
9999 740.67 300 8958.33 366
YOUR TALK TIME = MRP - PROCESSING FEE -
Other Brand Building Initiatives:-
The main idea is to stay ahead of competition for at least six months.
Working on the above game plan Bharti is constantly coming up with
newer product offerings for the customers.
The focus, of course, is to offer better quality of service.
• To make the service simpler for customers using roaming
facilities, Airtel has devised common numbers for subscribers
across the country for services like customer care, food services
and cinema amongst others.
• It will also launch a unified billing system across circles so,
customers moving from one place to another do not have to
close and then again open new accounts at another place.
• To assist customer care personnel to deal with subscriber
queries, a storehouse of 40,000 frequently asked questions and
their answers have been stored on the computers.
• Bharti expects that most of its new customers (one estimate is
that it would be 60 to 70 per cent of the total new subscriber
base) would come from the pre-paid card segment. So, they
must be given value-added products and services which
competitors don’t provide.
• Bharti, for the first time for a cellular operator, has decided to
offer roaming services even to its pre-paid customers, but the
facility would be limited to the region in which they buy the card.
To ensure that customers don’t migrate to other competing
services (which is known as churn and ranges from 10 to 15 per
cent of the customer base every month), the company is also
working on a loyalty program. This will offer subscribers tangible
cash benefits depending upon their usage of the phone.
• The loyalty program will not be only for a ‘badge value’, it will
provide real benefits to customers. The idea is to create an Airtel
• Another key area which Bharti is concentrating its attention upon
is a new roaming service launched in Delhi under which calls of a
roaming subscriber who is visiting the city will be routed directly
to his mobile instead of traveling via his home network.
• The company also offers multi-media messaging systems under
which customers having a specialized phone with a in-built
camera can take pictures and e-mail it to friends or store it in the
phone. The cost per picture is between Rs 5 to Rs 7.
• Bharti is also aware that it has to make owning a ready-to-use
cellular service much easier than it is today. A key area is to
increase the number of activation centers. Earlier Bharti had 250
Airtel Connect stores which were exclusive outlets (for its
services) and about 250 Airtel Points which were kiosks in larger
shops. Now activation can be done by all of them, and not only
by Connect outlets, all within 15 to 20 minutes. In comparison,
the competition takes two to four hours.
• Pre- paid cards are really catching up with the mobile phone
users and it is actually helping the market to increase. First, they
are easier to obtain and convenient to use. Unlike post-paid, one
need not pay security deposits for picking up a pre-paid card. It is
often available even with paanwalas. As befits a fast-moving
consumer service, the game is now moving beyond price to
expanding distribution reach and servicing a well-spread-out
clientele with technology and strategic alliances. Bharti is
focusing on two factors to make pre-paid cards more attractive.
Keeping the entry cost low for consumers and making recharging
• Bharti is in the process of launching a new system in alliance
with Mumbai-based company Venture Infotech which will enable
a pre-paid card user to renew his subscription by just swiping a
card. The system will not only save users the hassle of going out
and buying a card every time it expires but also enable mobile
companies to reduce the cost of printing and distributing cards.
• Bharti Televentures has tied up with 'Waiter on wheels,' a
company delivering food at home, to reach its Magic pre-paid
cards to subscribers' doorsteps. The company is also joining
hands with local grocery shops which will enable users to
recharge their cards by just making a phone call to the shop.
Apart from improving the convenience of recharging, mobile
operators are beefing up their distribution channels. The
company is constantly innovating to enhance the value
proposition for its pre-paid service. They are leveraging
technology to expand their distribution network and deliver
round-the-clock recharge options to its MOTS (Mobile On the
• Bharti Cellular has also launched a special service, CareTouch,
for high-value, corporate customers, providing them with instant,
single-point access for any assistance they require. Customers
can dial 777 and enjoy a slew of services, which includes easier
payment of bills, service on priority basis, and value-added
services without any additional paper work. Bharti Cellular is
offering a range of services without going through an interactive
voice recorder ensuring that they save time. Dedicated
‘CareTouch’ executives are expected to assist customers with
any service on priority basis. Besides the regular proactive
reminder calls for bill payment, customers can also call
CareTouch for bill payments at free of cost.
• AirTel presented MTV Inbox; the first ‘on-air’ SMS based
interactive music dedication show exclusively for AirTel and
AirTel Magic customers. Highly interactive VJ based show with
real-time feedback mechanism. Both brands joined hands to
target the high growth youth segment.
Bharti’s View on its Branding strategy:-
First, brand building efforts in today’s context have to be seen in a
more holistic manner. Delivering value on a sustained basis is perhaps
the most potent key to build a brand that lasts.
Unflinching orientation to customer needs is the second key success
factor. Customers (be it for industrial products or consumer goods and
services) across the world are more informed and, at the same time,
becoming more individualistic in their needs and far more demanding
with the passage of time.
Pro-active tracking of shifts in consumer behavior, anticipating
redefined or emerging customer needs, and then reacting in “real-time”
are essential to attract and retain customer loyalty — a key element of
creating brand equity in the present situation.
Customizing the product (and communication of its benefit) to meet the
specific needs of various consumer/customer sub-segments is the third
element in creating brand appreciation.
As far as allocation of time and financial resources are concerned, too
many companies mistakenly allocate a disproportionate amount on
mere advertising and promotion. This is not to say that advertising and
promotion are less relevant. On the contrary, with more choices and
higher media clutter, businesses need to budget for an increasingly
higher spend on their brand promotion but this has to be undertaken in
tandem with enterprise-wide “reengineering” of the business
philosophy and core design, production, and delivery operations for the
The positive spin to this argument is that by first addressing the
fundamentals, the enterprise itself becomes more competitive. This
can be the beginning of a virtuous cycle wherein brand equity
continues to increase as the enterprise sustains delivery of an
appropriate product or service at an ever increasing value.
It is, however, crucial to note that in the years to come, not only will the
cost of building a regional or a national (or an international) brand will
continue to rise but also the time taken to do so will be longer and will
need sustained and focused efforts.
20% 28-35 15-21
FINDINGS AND ANALYSIS
Age Group Graph
As we can see from the above graph, the people who are in the age
STUDENTS of 21-28 years are the ones who are the maximum users of
group EXECUTIVES HOUSEHOLDS OTHERS
mobile phones. This segment is the one which gives maximum
business to the mobile operators. This segment constitutes the young
executives and other office going people. They are 65% of the total
people who were interviewed. The next age group are the people who
are 28-35 years old. They are 20% of the total. They are those who
are at home or have small business units etc. And the next age group
is the youngest generation who are 15-21 years old. They are school
and college going students and carry mobile phones to flaunt. They are
15% of the total interviewed people.
As the above graph shows that 55% of the total people interviewed are
working. So, these people are the ones who are the maximum users of
mobile phones. They are the young executives, managers, Tele -
callers etc. who require mobile for their official purposes. The next
category is the households, who are either housewives, small units
CUSTOMER SATISFACTION LEVEL
which operate from their homes etc. They are 20% of the whole . The
next segment is the students. They are 15% of the whole. And 10% of
the whole is a category who are the professionals.
DISSATISFIED FULLY DISSATISFIED
Service Provider Graph
IDEA AIRTEL HUTCH OTHERS
The above graph shows a slice of 50%. These are the total no. of
people who are using Airtel. It seems that people are more aware of
Airtel than any other brand. The next popular brand is Hutch. 305 of
the people interviewed had Hutch connections. The next popular brand
was Idea. 15% people had Idea connections. As it came very late in
the market when Airtel had established it self very well. So, that could
be one of the reasons of such a low percentage. The remaining 5%
had trump connections.
Customer Service At Airtel Graph
As the above graph clearly shows that customer services at Airtel
seems poor. 60% of the people are dissatisfied with the customer
services provided by Airtel. They are the ones who have the maximum
share in the market but they are lagging behind in the customer
services. 10% of the people were fully dissatisfied with the customer
services of Airtel. This could leave an impact on the mind of the
consumer. He can even switch over his brand. 20% of the people
TYPES OF CARDS
satisfied with the customer services and only 10%
seem to be fully satisfied with 12%
Airtel’s customer services, which is a
very small amount.
Type Of Card Graph Rs 450
85% Rs 200
Cash cards seemed quite popular among the people interviewed. 85%
of the total mobile users were having cash card connections. This
means that the cash cards should be easily and readily available in the
local markets. Airtel should make sure that Magic is available in each
and every nook and corner of the market. 15% of the people were
having sim connections which is the regular bill.
Monthly expense graph
People on an average spend RS 500 per month as their mobile phone
expense. 64% people spend this amount. 24% people spend RS 300
per month as their monthly mobile expense. And the remaining 12%
had an expense more than RS 1000, they could the ones having sim
connections or having cash cards and having a lot of business calls on
AWARENESS OF WLL WLL
AWARENESS ABOUT PLAYERS
their mobiles. INDICOM
Awareness About WLL Graph
WLL seemed to be a new word for many of the people. 45% of the
people were not at all aware of such a technology. So, in order to get
the answer for this question they were first explained the concept.
Only, 55% people knew what WLL is all about.
Awareness of WLL Players Graph
Reliance was the brand which was popular amongst the interviewed
people. As Reliance had done so much advertising and has it banners
and hoarding spread all over Delhi. So, this could be one the reasons
of its popularity. Tata was hardly a known brand in this new field.
Possibly, because of less promotions done by them as compared to
On the basis of analysis of the questionnaire I have found that the
maximum no. of people who use mobile phones are in the age group
of 20 to 28. who are the young executives and other office goers.
They spend a maximum of RS. 500 as their mobile expense.
There are more no. of prepared cards than post paid cards. The
mobile users want to spend money side by side than to spend money
at the end of the month on a big bill.
Now when I compared Airtel with its competitor from the point of view
of the consumer I found that on the basis of Tariff plan, value added
services and billing accuracy Airtel is at par or ahead of its competitor
but in the case of customer care and availability they lag behind there
competitors. As, Airtel has a hold in the market because it has the
maximum no. of connections, so it must improve upon it customer
services. As far as WLL is concerned people are aware about it but
not many people are aware about Tata. They only Know more about
Reliance. People at this point of time are not interested to switch over
from GSM to WLL.
Following are the few suggestions to AIRTEL for improving
the market share and image of the products concerned.
*Modification must be brought about in AIRTEL, in terms
of quality. Its demand should be increased.
* The brands must be made available easily in, PCO &
*Company must undertake extensive promotional
activities like advertisements must be released in
different Medias to create brand awareness.
*Free samples should be distributed among the
prospects. Sales promotion tools like gifts, contests and
coupons must be given to retailers as well as customers
* Catalogues should be distributed among
• Being one of the largest companies in India the company has
achieved a degree of focus in its core business of its
• It has a strong brand name, superior quality products and an
enviable distribution network.
• It has a clear and well-defined organization structure and
limits of financial authority.
• Increase in advertisement spends affect the company’s
• The company‘s bottom line falls victim to the bloated and
highly paid workforce, which affects its margins.
• Little efforts over the Advertising of products.
• Distribution channel is not accurately categorized.
• Premium priced products, hence can’t compete in low price
• No separate strategy for rural market.
• The company's financial performance can receive a major
boost from its cost reduction efforts.
• There is a lot of scope of product and market diversification.
• Exports of products will also have huge chances in the coming
• Airtel’s business has ample scope for gaining market share
from the unorganized sector. Rural penetration too holds vast
potential to bring about growth.
• The slowdown in the economy has restricted topline growth of
most FMCG majors and for Airtel also it will be difficult to
maintain historical growth rates in such a depressed scenario.
• Company’s major raw materials are influenced by government
policies / controls as well as vagaries of the monsoons.
Fluctuations in the prices of raw materials would have
significant impact on costs and margins of the company.
Moreover, inordinate hike in Broad Band Internet products would
also increases company’s production and distribution cost.
I have made following recommendation to the company after
doing the summer training there:
• The company should modify its credit policy as they only
target the cash paying customers who are not easy to
• The company should emphasis more on the quality of
Pharmaceuticals Products it was mostly claimed by the
exporters that their receipts from company doesn’t
matches with the sample’s quality shown before giving
• The company should makes its marketing strategy
flexible enough in order to face competition.
• The company should keep an eye on the proper delivery
of the goods to exporter on time, as it has been
recommended by exporters to make the delivery on time.
• The company rate policy must be flexible enough to
catch new customers because if company offers lower
price to a new customer then he may continue buy the
goods and can be a permanent customer for the
• The company should offers such rate in the market so
that it may able to catch a biger market share and it
should be able to compete with the local traders and
commission agents while having a brand name.
The company should take the opinion of exporters from time
to time to know what problems they are facing from the
company’s side? And if any change they require in present
No project is without limitations and it becomes essential to
figure out the various constraints that we underwent during
the study. The following points in this direction would add to
our total deliberations:-
1. During the study, on many occasions the respondent
groups gave us a cold shoulder.
2. The respondents from whom primary data was gathered
any times displayed complete ignorance about the complete
branded range, which was being studied.
3. Lack of time is the basic limitation in the project.
4. Some retailers/wholesellers refuses to cooperate with the
5. Some retailers/wholesellers gave biased or incomplete
information regarding the study.
6. Money played a vital factor in the whole project duration.
7. Lack of proper information and experience also because
hurdle for me.
8. Some retailers did not answer all the questions or do not
have time to answer.
After analyzing the findings of the research, I can conclude that Airtel
lagged behind its competitors as far as customer service and
availability is concerned. The maximum no. of people who use the
mobile are in the age group of 20 to 28. Cash cards are the most
popular type of mobile connections, as they are consumer friendly and
recharging the connection is not a problem.
Maximum no. of people spend RS 500 on their connections. As Airtel
is the only company having the maximum no of mobile connections so
it must seriously look into the loop holes of the existing customer
As we know that now airtel has already launched its product with logo
“’ Aisi azaadi aur kahan”’ has already became popular in market. So
we can say that inspite of so many competitor in the market Airtel is
having a good position just because every time, it tries its best to
understand the need of its important customer.
In this project report, while finalizing and for analyzing quality problem
in details the following Books, Magazines/Journals and Web Sites
have been referred. All the material detailed below provides effective
help and a guiding layout while designing this text report.
Airtel (2 July to 10 July 2004)
Airtel India page of HT paper (Thursday 1December 2004)
Cowards India (26 December to 4 Jan. 2004)
I am a student of MBA of Krishna Institute of Engineering &
Technology, Ghaziabad, doing my summer training project on
consumer behavior from Airtel. Please give your precious time for
filling these details.
Q.1 For how long you have been using Airtel Product?
More than 10 years
Q.2 Are you using other product instead of Airtel?
Q.3 Among them, which Brand you, prefer most?
Q. 4 How would you rate the experience with Brand?
Excellent Good Average Below
Q.5 Do you collect any information search before making purchase?
Q.6 If yes, which sources are used?
Pamphlets and catalogue
Reference from friends and relatives
Q.7 What are the features you look for in a product before making
purchase decision? Give preferences (1-Highest, 6- least)
Price and Discount
After sales services and parts, network
Value for money
Add on features or ergonomics of design
Q.8. Which of these marketing / sales schemes attracts you while
purchasing any connection?
Q.9 If you have to purchase a new connection or product in near
future, which Brand will you go for and why?
Q.10 Are you aware of various promotional activities being run by
Airtel, if yes then how? Are you satisfied with these promotional
Very Satisfied Somewhat Not
Satisfied Satisfied satisfied
By Ad Films
24 hrs call center services
Q.11 How would you rate Airtel performance as your expectation
on 5 points scale (5 Highest)
1 2 3 45
After Sale service
Product as per expectation
Q.12 What are you suggestions for improving the product quality,
service availability and parts availability?