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CASE STUDY : XYZ TELECOM ORGANIZATION ENTERING INTO UAE<br />SUBMITTED BY:<br />PRATEEK SIGH DHILLON<br />prateekdhillon@g...
AGENDA<br />Three objectives :<br />1. Secondary research for the XYZ organization.<br />2. Create a Methodology for succe...
GCCCOUNTRIES<br />
GCC COMPANY COMPARISON<br />
Mobile Penetration Rates in Middle East<br />
Major Operators in GCC<br />
Assumption<br />XYZ is an Indian organization with a good financial for the development of infrastructure.<br />Is looking...
U.A.E<br />
UAE (Major City)<br />
Telecom revenues breakdown in 1H09 (rounded figures)<br /><ul><li> The telecommunications sector in the UAE experienced dr...
 Even in 1H09, amidst a global economic slowdown, telecom revenues rose by 12%, reaching AED14.5bn. 59% of these revenues ...
Subscriber 4-year CAGR by segment (2004-2008)<br />
UAE mobile subscribers and YoY growth<br />
Operators net additions and market share (quarterly)<br />
MARKET OVERVIEW<br />
Market <br />Positives<br />Negatives<br />Mobile<br />Fixed-line<br />
Positives<br />Negatives<br />Internet<br />
Porter analysis :<br />
Pest Analysis<br />
Competitive Analysis of Rivals<br />
Market Share <br />
SPACE Matrix Strategic Management Method <br />
SPACE MATRIX<br />Y Axis<br />Suggested<br />Strategy Type<br />2.75<br />3<br />25<br />X Axis<br />
S T P Analysis<br />Segment : <br />Age Structure:<br />   0-14 years: 20.4% (male 500,928/female 478,388)<br />   15-64 y...
Desire for personalization.
Love for Music.
Dynamic change of taste.
“They are the household chief technology officers” (enjoys figuring out new feature)
Impressed by viral application and use messaging to keep in touch.</li></li></ul><li><ul><li> How to position
Access to branded accessories andphones like Iphone, Google and BlackBerry and Brand accessories like MTV which represent ...
Text messaging: this should be free between XYZ Customers.
Rescue Ring : A fake call at any time the customer wants with what ever massage the customer want to hear from us.
Online Real-time Billing
Wake up Call : Alarm for customer.</li></li></ul><li><ul><li>Ring tones : latest ring tones for various nationality.
The Hit List.
Fun Clips : Cartoon clips, youtube clips, Uploading clip to youtube.
Social networking Site features for the customer like facebook any myspace.
Music Messenger .
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Analysis

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XYZ communication as a mobile operator wants to enter one of the countries in the GCC

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  • Gulf Cooperation Council
  • 16.5% Emirati, 83.5%South Asian, Indian,Pakistani, Bangladeshi,Chinese, Filipino, Thai,Iranian, (Westerners) 
  • Compound annual growth rate
  • 1. Market development2. Market penetration3. Product development4. Forward integration5. Backward integration6. Horizontal integration7. Concentric diversification
  • Transcript of "Analysis"

    1. 1. CASE STUDY : XYZ TELECOM ORGANIZATION ENTERING INTO UAE<br />SUBMITTED BY:<br />PRATEEK SIGH DHILLON<br />prateekdhillon@gmail.com<br />
    2. 2. AGENDA<br />Three objectives :<br />1. Secondary research for the XYZ organization.<br />2. Create a Methodology for successful entry. <br />3. Provide a sustainable solution for business. <br />
    3. 3. GCCCOUNTRIES<br />
    4. 4. GCC COMPANY COMPARISON<br />
    5. 5. Mobile Penetration Rates in Middle East<br />
    6. 6. Major Operators in GCC<br />
    7. 7. Assumption<br />XYZ is an Indian organization with a good financial for the development of infrastructure.<br />Is looking to invest in UAE.<br />Has considered all the legal consequences that are applicable in UAE.<br />Company is looking for quick launch within 3 to 6 months time span.<br />Research methodology used for the firm would be according to current scenario and it can have secondary data research.<br />Company is having Approx $ 70 million for marketing Budget<br />Company has a brand name that consumers perceive as value for money, quality, innovation and an aspiring degree of fun and competitive challenges.<br />
    8. 8. U.A.E<br />
    9. 9. UAE (Major City)<br />
    10. 10. Telecom revenues breakdown in 1H09 (rounded figures)<br /><ul><li> The telecommunications sector in the UAE experienced dramatic growth between 2003 and 2008. Revenues tripled, reaching AED 27.72bn in 2008 vs. AED 9.2bn in 2003, whilst the telecoms sector contribution to UAE’s total GDP increased from 3.1% to an estimated share of 5.2%.
    11. 11. Even in 1H09, amidst a global economic slowdown, telecom revenues rose by 12%, reaching AED14.5bn. 59% of these revenues were generated from mobile services, whilst data services and fixed-line generated 14% and 13% respectively.</li></li></ul><li>Market Structure<br />Telecom market<br />Mobile Segment<br />Internet Segment<br />•Introduction of competition<br />•Inflow of expatriate<br />•High GDP per capita<br />•Dual SIM card usage<br />•Intensification of<br /> competition<br />•Network upgrade by<br /> operators<br />Skilled citizens<br />• Advanced IT <br /> infrastructure<br />• Expanding <br /> broadband<br /> connectivity<br />Fixed-line Segment<br />• Real-estate roll-out in<br /> New Dubai<br />• Competition on the<br /> international calling <br /> front<br />• Spread of FTTH network<br />• Provision of triple-play<br /> service<br />
    12. 12. Subscriber 4-year CAGR by segment (2004-2008)<br />
    13. 13. UAE mobile subscribers and YoY growth<br />
    14. 14. Operators net additions and market share (quarterly)<br />
    15. 15. MARKET OVERVIEW<br />
    16. 16. Market <br />Positives<br />Negatives<br />Mobile<br />Fixed-line<br />
    17. 17. Positives<br />Negatives<br />Internet<br />
    18. 18.
    19. 19.
    20. 20. Porter analysis :<br />
    21. 21. Pest Analysis<br />
    22. 22. Competitive Analysis of Rivals<br />
    23. 23. Market Share <br />
    24. 24. SPACE Matrix Strategic Management Method <br />
    25. 25. SPACE MATRIX<br />Y Axis<br />Suggested<br />Strategy Type<br />2.75<br />3<br />25<br />X Axis<br />
    26. 26. S T P Analysis<br />Segment : <br />Age Structure:<br /> 0-14 years: 20.4% (male 500,928/female 478,388)<br /> 15-64 years: 78.7% (male 2,768,030/female 1,008,404)<br /> 65 years and over: 0.9% (male 27,601/female 15,140)<br />note: 73.9% of the population in the 15-64 age group is non-national (2009 est.)<br />Target : Youth (12-29) 35% approx.<br />Positioning :<br /><ul><li>Youth and Mobile:
    27. 27. Desire for personalization.
    28. 28. Love for Music.
    29. 29. Dynamic change of taste.
    30. 30. “They are the household chief technology officers” (enjoys figuring out new feature)
    31. 31. Impressed by viral application and use messaging to keep in touch.</li></li></ul><li><ul><li> How to position
    32. 32. Access to branded accessories andphones like Iphone, Google and BlackBerry and Brand accessories like MTV which represent hip-hop and youth culture.
    33. 33. Text messaging: this should be free between XYZ Customers.
    34. 34. Rescue Ring : A fake call at any time the customer wants with what ever massage the customer want to hear from us.
    35. 35. Online Real-time Billing
    36. 36. Wake up Call : Alarm for customer.</li></li></ul><li><ul><li>Ring tones : latest ring tones for various nationality.
    37. 37. The Hit List.
    38. 38. Fun Clips : Cartoon clips, youtube clips, Uploading clip to youtube.
    39. 39. Social networking Site features for the customer like facebook any myspace.
    40. 40. Music Messenger .
    41. 41. Movies : Online movie viewing on their Mobile set.
    42. 42. AirTime Earning Scheme : Call your friend on XYZ network and earn some air time.</li></li></ul><li>Options for price structure<br />Clone Industry Prices: contracts<br />Set prices below competition: contracts<br />A whole new plan: prepaid pricing<br />
    43. 43. #1 Clone Industry Prices<br /><ul><li>Cons
    44. 44. May drive margins down if additional features are costly
    45. 45. Reduces competitive advantage
    46. 46. Difficult to penetrate saturated market with similar offer as competitors
    47. 47. Competitive with other cell phone providers and packages; does not support strong market differentiation
    48. 48. Pros
    49. 49. Give customers more features for the same price
    50. 50. Easy to promote, use current models
    51. 51. Limited spending power on promotion may be a justifiable factor
    52. 52. Viable with Virgin Mobile’s limited advertising budget</li></li></ul><li>#2 Price Below Competition<br /><ul><li>Pros
    53. 53. Drive sales and market share
    54. 54. Accounts for limited spending power of target market
    55. 55. Cons
    56. 56. Margins and profitability will be driven down
    57. 57. Inconsistent with company goal of profitability
    58. 58. Cannot compete in price wars
    59. 59. Not a long term solution</li></li></ul><li>#3 A Whole New Plan: Prepaid Pricing<br /><ul><li>Pros
    60. 60. Differentiate from competition
    61. 61. Cater to the needs of target market
    62. 62. Flexibility is attractive to target market
    63. 63. Profitability is key
    64. 64. Eliminates risk of missed payments
    65. 65. Cons
    66. 66. Risk of limited returns and loyalty
    67. 67. Churn rate may increase</li></li></ul><li>MARKETING PENETRATION<br /><ul><li>Pricing Strategy : Option 3 from the above Strategies
    68. 68. Pricing Objective:
    69. 69. Sales Maximization
    70. 70. Demand Estimate:
    71. 71. Current market penetration of target market.
    72. 72. Create Demand amongst remaining.
    73. 73. Capitalize on Highly Elastic Demand of Target Market.
    74. 74. Cost Estimates:
    75. 75. Monthly Cost to Serve per Customer
    76. 76. Networking Cost
    77. 77. Customer Service Cost</li></li></ul><li><ul><li>Pricing Method :
    78. 78. Penetration Pricing
    79. 79. Costs per Unit is inversely related to Number of Subscribers
    80. 80. Reduce CCPU by increase in Number of Subscribers
    81. 81. Increase in Margin will follow</li></ul>LTV=Life Time Value.<br />ARPU= Average Revenue Per Unit.<br />CCPU=Cash Cost Per Unit= 45% of ARPU.<br />M=Monthly margin =ARPU-CCPU.<br />AC=Acquisition cost.<br />r=Retention rate= 1- churn rate.<br />i=interest rate.<br />
    82. 82. Advertisement<br />Marketing budget $70 million.<br />Quirky and offbeat advertising, different from the competitors.<br />Street marketing.<br />Teens to be used for marketing.<br />Youth magazines like The Complex, Vibe,…etc are to be used to publish “advertorials.”<br />
    83. 83. CONT. Advertisement Example<br />
    84. 84.
    85. 85. References<br />http://www.citc.gov.sa/NR/rdonlyres/ECC196FF-D3C1-4C88-B793-685C96CA0309/0/ICTSectorinKSA2009English.pdf<br />http://www.tra.ae/annual_ICT_industry.php<br />http://www.reportlinker.com/p0131813/Saudi-Arabia-Telecoms-Mobile-and-Broadband.html?request=news<br />http://www.tra.gov.om/newsite1/Portal/Upload/Documents/398_Q4-2009.pdf<br />http://www.tra.gov.om/newsite1/Portal/Upload/Documents/337_08AnnualReportEn.pdf<br />
    86. 86. http://www.globalinv.net/research/GCCTelecom-112009.pdf<br />http://www.zawya.com/printstory.cfm?storyid=ZAWYA20091228053738&l=053700091228<br />http://www.tra.org.bh/en/pdf/TelecommunicationsmarketsindicatorsintheKingdomofBahrain.pdf<br />http://www.tra.org.bh/en/marketstatistics.asp<br />http://www.gulfbase.com<br />http://www.mckinseyquarterly.com<br />http://www.escwa.un.org/popin/members/uae.pdf<br />https://www.cia.gov/library/publications/the-world-factbook/region/region_mde.html<br />http://www.zawya.com<br />http://www.ptc.com.sa<br />
    87. 87. http://www.ft.com/home/middleeast<br />http://www.gulfbase.com/site/interface/SpecialReport/Qtel_15102009.pdf<br />http://www.reportlinker.com/p0189736/Saudi-Arabia-Telecommunications-Report-Q2-2010.html<br />http://www.reportbuyer.com/telecoms/country_overviews_telecommunications/kuwait_telecommunications_report_q2_2010.html<br />http://www.nbkcapital.com/BR/Research/MER/Telecom%20Sector/Kuwait/Wataniya%20Telecom/NBK%20Capital-Wataniya%20Telecom%20Initiation-02July2009.pdf<br />http://www.itu.int/ITU-D/ict/newslog/Qtel+Subscriber+Base+Exceeds+Countrys+Total+Population+Qatar.aspx<br />
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