Monaco Telecom Case Customers, Value and Profitability Gabrielle PinchaudMarion DUCLAUX - Adrien DAMEZ - Jules CLEMENT - Laurent CHADIAN - Vincent DI LEONE
Strategy for national techies Customers, Value and Profitability Gabrielle PinchaudMarion DUCLAUX - Adrien DAMEZ - Jules CLEMENT - Laurent CHADIAN - Vincent DI LEONE
Executive summary t on tex l c rna r k E xte chma 1 - Ben 2 - SWO T 3 - e o nal ati an d r Mix y g a teg tin Str Ma rke ) 4 - 5 - ter k (af ch mar min g Ben - T i 6 - 7 s ion o lut e s x tiv ndi e rna ppe alt 9 - A s and isk8 - R
Page 1 1 - External contextPestel : Political • Main politic decision : The 4th mobile operator promotion – Allowing new entrants on the market Economical • Stricted rule in term of hygien and security / toxic material, energy and recycling Social • Strict governmental control on free competition Technological • Mobile operator privatization Environmental • Politic stability- Security Legal Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 2 1 - External contextPestel : Monaco : •Dynamic and diversified economy •Moderated fiscality Political •PIB 2009 : 4 002 694 k€ •Population : 35 881 Economical •Low purchasing power of our target (18-30y.) •MT has the monopoly of Internet, fixed phones and Social TV •Highest income per capita of the world Technological Market : Environmental •Stable market – Saturation of medium class purchasing power Legal •Penetration rate 99,1% in 2010 •4,7 billions of net revenues in 2009 (France) •+130% of smartphones sales Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 3 1 - External contextPestel : •Mobile phone are considered as a professional and distraction tool (Addiction). Political •The mobile phone will overtake the PC for internet conection + Fix/mobile convergence – Fix calls decrease, Mobile calls increase Economical •Smartphones has created a Trendy phenomenon - Social social identification Technological •Increase of interpersonal relations Environmental •Loyaltyless – The young people like to change their phones Legal •Mobile phone depersonalization - Increase of lost phones and exchange between people thanks to the phone unlocking Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 4 1 - External contextPestel : •3G technology – 4G is coming •Internet website are adapted to the mobile phone Political •New CFM services based on Wi-Fi, Wi-MAX, UMA technology in order to reduce the calls costs and Economical long term maintenance costs – Reduce the clients erosion Social •P e r f o r m a n c e i m p r o v e m e n t i n t e r m o f miniaturization, power and speed Technological •New technology :LTE and Wimax which correspond Environmental to the high debit mobile Legal •VoIP : Subscription increase •Smartphones development – increase of applications download - Chat (What’sapp...) Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 5 1 - External contextPestel : •Medecine studies has shown that the mobile phone vibes are bad for the health Political •Environment is infested by Radiofrequencies because of mobile phones – Controlled by the Economical National Frequency agency Social •Medecine studies recommend to send text more than calling Technological •Environmental norm – Energy consumption, product recycling, waste due to the fabrication Environmental •Creation of an operational commitee responsible Legal for conducting experiments on possible exposure (2009) Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 6 1 - External contextPestel : •The « Châtel » law : - does not prevent the calls surtax to the hotline and the mobile operator pressure favour the long term engagment Political - impose the free calls to the « green numbers » Economical - 24 month engagment are more flexible : The consumer can stop his subscription before, paying only 25% of the remaining sum Social •July, 30th 2007 : Roaming regulation by the Technological European Commission impose the Euro tarif to all the operators – 0,49€ maximum for all the foreign Environmental giving calls and 0,24€ for the foreign coming calls Legal •Sentences for anti-competitive agreements between mobile operators Sources : Telecom.sia-conseil.com, scribd.com, journaldunet.com and arcep.fr
Page 7 1 - External contextQuantitative research : Market share - all segments +6% 42% 48% 23% 20% -3% 18% 16% -2% 16% 15% -1% 2009 2011 MT is the mobile operator leader – The only operator which has increased their market share in 2 years (+6%)
Page 8 1 - External contextQuantitative research : Penetration rate 57% +7% 50% 38% +21% 17% 26% +1% 25% 18% 20% +2% 2009 2011 Monaco Telecom has the strongest penetration rate – With 60% of penetration MT still have some potential new clients
Page 9 1 - External contextQuantitative research : Market share per segment Under 30 30 - 44 45 - 59 Over 60 12% 14% 21% 21% 10% 13% 23% 26% 31% 23% 23% 41% 50% +5% 47% 30% 16% With 41% of MS, SFR is the leader on the under 30y where MT is the follower – opportunity to win some shares from SFR
Page 10 1 - External contextQualitative research : The focus group An interactive Lasted for 1 to 2 group hours discussion led by a moderator. between members who fit the profile Respondents are asked of the target about their Open and unstructured perceptions, (National techies < discussion where the opinions, beliefs and 30 y.o). moderator encourages attitudes towards a the free flow of ideas. mobile subscription.
Page 11 1 - External contextQualitative research : detailed methodologyStep 1: Preparation Step 2 : Developing step 3 : Collecting step 4 : After the of the session leading questions the information. cession • Define the • Usage : When, • Review of goal of • Report generated Objective : where and how do the meeting from the answers Understand and you use you (note taker). analize the needs smartphone ? • Review of and usage of the (Global) ground rules target • What are the • Questions and • Define the strengths and answers (reflect target : National weaknesses of back) techies -30 y.o your offers / telco ? (Focus) • Recap • What are your needs that are not covered by your mobile operator ?
Page 12 1 - External contextQualitative research : « I often use all the «data» included in my subscribtion and don’t use all the time Jules CLEM ENT allowed to phonecalls » « The main 3 operators offer - 24 y.o er - iPhone own - Subscriptio n: almost the same s, Unlimited sm net + mms, and in ter subscriptions... Whatever the » 2h call : 39€ operator, it’s still expensive !
Page 13 1 - External contextQualitative research : « I use my smartphone from 7am to 12pm, I use it as my alarm clock, as my ipod... I send messages, check facebook Marion DUCLAUX and my mails all day long ! » - 23 y.o - Blackberry owner - Subscription : « I am about to go to Raleigh : I Unlimited sms, have to choose between keep on mms, and internet + 4h call : 49€ paying for my sibscription or loosing my phone number. »
Page 14 1 - External contextQualitative research : « I am more and more disappointed by Orange services : It’s expensive and the hotline is terrible ! As soon as my subscribtion ends, I will Laurent CHADIAN change my operator ! » - 23 y.o - Blackberry owner - Subscription : Unlimited sms, mms, and internet + 2h call : 39€
Page 15 1 - External contextQualitative research : « I think SFR forgot me in their loyalty program... It’s impossible to get attractive prices on new Adrien DAMEZ phones ! » - 23 y.o - iPhone owner - Subscription : « I have a 2 years commitment. The worst choice I ever did... It’s way too long ! » Unlimited sms, mms, and internet + 4h call : 49€
Page 16 1 - External contextQualitative research : « My subscription is awesome : 5h phonecalls, unlimited sms/mms and internet for only €14.99 at Virgin mobile. I have to keep this offer, even Vincent DI LEONE if I change my phone ! » - 23 y.o - iPhone owner « My first and only call to Virgin - Subscription : Mobile’s hotline was terrible ! I waited Unlimited sms, 1h15 and the operator at the call » mms, and internet + 5h call : 14,99€ center was not that competent !
Page 18 3 - SWOT Strenghts Weaknesses •Future launch of 4g technology (target 18-30 •No packages dedicated to under 30 y.o y.o). •Poor “one to many” communication •Monopoly on landlines, Internet and internet •Poor presence on France •Market leader in the Mobile industry •Strong CRM system •4Play offers •Good market insight Opportunities Threats •CRM Strategy (online support) •Market entrance of Free mobile •Unlimited Data •Pricing competition (change every •Enable VoIP quarter) •Unlimited numbers for call and text •Mature market •Unlimited number of contacts •Offers already available •Smartphone compatibility (Blackberry) •Brand awareness •Hot-Spot WiFi access •Offers without commitment •Enable smartphone as modem
Page 19 4 - Strategy and rationaleHow the market will react ? Strategy #1 Focus on price competition • Try to get as close as possible to FREE’s range of prices • Remain coherent within the global Monaco Telecom’s offers Strategy #2 Focus on services and differenciation • Data consumption • International mobility • Focus on CRM
Page 20 4 - Strategy and rationale Strategy #1 Focus on price competition 0% Scenario 1 : Pricing Strategy 1% 10% 16% 2% 21% 23% Free Mobile 18% MVNO 20% Monaco Telecom 16% Orange Bouygues Telecom 41% SFR 33% 2011 2012 According to market analysts Free Mobile will gain 10% of market share following the launch of its offers and MVNO will also gain few market shares.* Following the launch of our mobile offer based on a pricing strategy we hope to gain 5% of market share on national techies under 30 years old. *Source : Challenge Magazine 10/2011
Page 21 4 - Strategy and rationale Strategy #2 Focus on services and differenciation Scenario 2 : Pricing and Data Strategy 1% 0% 10% 16% 2% 26% 23% Free Mobile MVNO 17% 20% Monaco Telecom Orange 16% Bouygues Telecom SFR 41% 29% 2011 2012 Following the launch of our mobile offer based on a pricing, data and international strategy, we hope to gain 10% of market share on national techies under 30 years old. Therefore there will be a loss of market share for traditional mobile operators (SFR, Bouygues Telecom & Orange).
Page 22 4 - Strategy and rationale After this analysis, how Monaco Telecom is going to differentiate into this market? Focus on the content instead of an aggressive pricing policy. Each new entrant is going to offer an all unlimited offer (calls, sms, data). Our strategy : Highlight the 4 mains differentiation characteristics
Page 23 4 - Strategy and rationale #1 An International strategy • With more and more internships, gap year, exchange programs, VIE etc.. the experience abroad is an essential step in the techies life and because of their smartphone addiction, the mobility need really worth to be taken in account by mobile operators. • 2 options : - The possibility to momentarily suspend your mobile subscription and to get back the same number, the same mobile subscription when you come back. (Maximum 12 months). - Negociation and implementation of partnerships with foreign mobile operators in the main destinations (Europe, USA, Australia, China, India). e.g. Discount on mobile subscription.
Page 24 4 - Strategy and rationale #2 Data unlimited (Fair-use) : Others mobile operators are promoting an “unlimited data” actually limited to 2Gb. In a way to differentiate our offer on a content basis, Monaco Telecom has to plan a superior data offer (5Gb?). #3 No commitment Psychological paradoxism : Being aware that they can leave the mobile operator whenever they want, the techies will be loyal to Monaco Telecom thanks to this liberty feeling. #4 No commitment Psychological paradoxism : Capitalize on the techies knowlege, give value to the fact that the new technologies mastery is a real asset. The implementation of a 100% online support make the techies to stay in their own world. They have to feel that the offer is a personalized one, created just to answer their particular needs.
Page 26 5 - Marketing Mix Voice Unlimited phonecall (+ VoIP) Mobility Sms/Mms 2 options * Unlimited texting Our Product : Commitment by Data No commitment, no Unlimited (No 1gb mobile handset limitation) Support International 100% online 3h international option support (5€/month)
Page 27 5 - Marketing MixAdditional benefits face to the Techies needs : Liberty : • Data Unlimited : No worrying about credit time. • No comitment International mobility : A sole solution adapted to your way of life. • Suspention of your mobile subscription : Stop paying for something totally unadapted abroad ! • Partnership : An adjusted mobile subscription wich will allow to communicate within your exchange country and to keep in touch with your family and friends. Autonomy : 100% online means self-management, no intermediary Time saving • Personalization with options : International calls, Deezer Premium…
Page 28 5 - Marketing Mix Pricing policy : 59,90€ Psychological barrier The techies are ready to spend 50€ for an current all unlimited mobile subscription 59,90€ with the international dimension and no commitment seems to be an appropriate price. ( NB: price must not pass over 60€) Coherence Coherence with the Monaco Telecom premium pricing strategy : The mobile subscriptions price is globally more expensive than in France. NB : The price is not the most important factor in the techies choice decision for a mobile subscription. They are looking for the best deal, not necessarily the cheapest one.
Page 29 5 - Marketing MixDistribution : 100% Online 100% online support : Direct access to all information (Time efficiency for techies) Community To pass over the after-sale weakness : Create a community Mutual aid between experienced members (forum, questions/answer)
Page 30 5 - Marketing MixPromotion : Nouveau ! Events Create an event : « The Party » To 100% Online create a community (e.g : BBM community). Voix illimitée The target use to belong to a group with the Data illimitée same needs, same way of life… Sms/Mms illimités Buzz Buzz Marketing on youtube (e.g : Tippex International inclus web experience) and social medias ! 59,90€ Local advertisement TELLEMENT MONAC O Advertising on local channels.
Page 31 5 - Marketing MixCRM : Improve processes that affect the customer : Implementation of a hotline dedicated to techies support (To reinforce the subscription online and capitalise on Monaco Telecom after-sale service’s excellence) ➡ Increase customer satisfaction. ➡ Use a 100% online support to collect and analyse data. Recognize the customer A member login / password will be attributed to the « AllPlay community » members to exchange (experiences, tools, apps…) on the online community. Reward loyalty e.g : 1 mobile for free / 2year Personalise the offer e.g : International option, Spotify
Page 32 5 - Marketing Mix The main goals ➡ to Strengthen the Monaco telecom brand awareness through offer (events, buzz..) ➡ Through a multi-channels campaign
Page 33 6 - Benchmark (after)Free mobile leaks : Subscribtion "All included" 5H Subscribtion Commitment None None Calls (France) Unlimited all operator 24/24 - 7/7 5H + unlimited towards Free Mobile and landlines Unlimited towards US and Canadian mobiles + towards Unlimited towards US and Canadian mobiles + towards Calls (International) landlines over 100 destinations landlines over 100 destinations SMS / MMS unlimited unlimited Data unlimited 3G ("fair use") + unlimited FreeWifi + Modem unlimited 3G ("fair use") + unlimited FreeWifi Price 29,90 euros 19,90 euros No handset Terms of payment on 6, 12, 18 or 24 months) 2H Subscribtion «Mini» Subscribtion Commitment None None Calls (France) 2H + unlimited towards Free Mobile and landlines 2H + unlimited towards Free Mobile and landlines Unlimited towards US and Canadian mobiles + towards Unlimited towards US and Canadian mobiles + towards Calls (International) landlines over 100 destinations landlines over 100 destinations SMS / MMS unlimited unlimited Data unlimited 3G ("fair use") + unlimited FreeWifi 1ct / Mo 3G + unlimited FreeWifi Price 14,90 euros 9,90 euros No handset Terms of payment on 6, 12, 18 or 24 months) Nobody knows exactly what will be the content of the offers launch by Free. This board is a synthesis of the main rumors and expectations from experts. Source : Journal du Geek
Page 34 6 - Benchmark (after)Mapping after the launch of :Data 12 10 8 6 4 2 0 0 10 20 30 40 50 60 70 The size of the circles corresponds to the market share of each operator -2 Price Other MVNO
Page 35 7 - Timing November December January Technical feasability 14 25 Definition of technical costs Technology 25 31 Deeper Market Study 14 25 25 31 Adjustments 31 05 Marketing & Test Final proposition creation sales 28 20 Market watch & possible adjustments Final Mobile Offer 02 03 28 Branding, Creation of 02 communication tools Monitoring of campaigns Creation of a dedicated website 10 10 Multichannel com. 12communication 06 Branding, Creation of Launch Party communication tools 02 15 Buzz media Creation of low-cost offers by the main Free enters the mobile market French operators (Red, Sosh, B&You) External Presence of MVNO We assume it’s impossible to launch an offer before Free (less than 2 months available)
Page 36 8 - Risks and alternative solutions Risk : Probability Impact Recommendations Differenciation strategy : Free entrance - Keep the «premium» on the mobile 100% Market Share positionning of MT market - Don’t compete on the price Use the «premium» brand image market prices to justify higher prices and drop 90% Margin communicate on the high quality of CRM Be sure that we guarantee the best after sale service, even if Customer CRM problem 50% experience it’s 100% online. Problems may occur with other new entrants on CRM (e.g : Sosh...)
Page 37 8 - Risks and alternative solutions Alternative solutions Impacts - Customers won’t be lost - They feel more secure about this 100% online offer - The customer can count on Monaco Invest on CRM : Develop a CRM Telecom in case of any problem campaign (Which is not necessary the case with other «new entrants» : e.g with the topics on SOSH’s forum where many users complain about poor service.)
Page 38 8 - Risks and alternative solutions Alternative solutions Impacts - Sense of belonging to a specific community : Monaco - Unique offer : Specific name and logotype Work on the brand image - Focus on the brand image of Monaco ; A premium brand +
Page 39 9 - AppendixAbout the product’s name : • The use of English make it modern and dynamic. Moreover the Techies are totally familiar with this language, especially in the brand universe. (e.g : Facebook, Youtube, B&You…) NB : All the competitors are using an English name. • Because we evolve primarily on the French Market, we decided to create a descriptive name (VS a neologism like ‘Sosh’) with 2 strong understandable roots « All » and « Play ». • The binary rythm and the short lengh make it easily memorisable. • The name highlights the specific positioning and the product differentiation of the MT offer : All unlimited all over the world. • ‘AllPlay ’ means ‘And suddenly the world becomes your playground’. • Plus, the name can be available on INPI’s 38th class (telecom) with an appropriate legal strategy (e.g : a semi-figurative name such as «AllPlay by Monaco Telecom»).
Page 40 9 - AppendixGeneration mobileHow smartphones shape the lives of Techies ?
Page 41 9 - AppendixGeneration mobileHow smartphones shape the lives of Techies ?
Page 42 9 - AppendixGeneration mobileHow smartphones shape the lives of Techies ?
Page 43 9 - AppendixGeneration mobileHow smartphones shape the lives of Techies ?
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