Airtel launched its prepaid cellular service called Magic in January 1999 in India to target infrequent mobile users. Magic was made easily accessible by making SIM cards available in various stores. This led to rapid growth in Airtel's subscriber base. To sustain its position as market leader, Airtel revamped Magic by rebranding it as Airtel Magic, introducing regional roaming and other value-added services. It also implemented aggressive celebrity endorsement campaigns. These strategic changes helped Airtel transform the Indian cellular market and achieve a subscriber base of over 65 million by 2008, making it the largest cellular provider in India.

1. AIRTEL MAGIC
Roll Nos:8201 to 8212
Div B

2. Background Note
 Cellular telephony was introduced in India in early 1990’s.
 Only two major players- Bharti (Airtel) & Essar.
 Only post paid services available and very high tariff rates
about Rs.16/min for outgoing calls.
 Monopoly prevailed and tariff rates as well as handsets were
very expensive.
 Hence phone services regarded as luxury and target customers
were elite segment of society.

3. Why limited growth?
 High Tariff rates
 Services restricted only to Metros.
 Lack of awareness among people.
 Low standard of Living.
 Government regulations.

4. Launch of PRE-PAID Services
 Major cellular services providers launched pre-paid services in
late 1990’s.
 The main aim was to target customers from all sections.
 Prepaid cellular cards gained quick popularity.
 Tariff rates declined 75% between 1990-2000.
 By October 02 ,out of the 8.5 million users , 65% belonged to
prepaid segment.
 An estimated 80% of new add-ons were prepaid subscribers.

5. The Magic of magic……
 Bharati launched its own prepaid cellular service under magic
brand in Jan 99.
 First launched in Delhi and later in other circles in India.
 Magic targeted at infrequent mobile users.
 Acquiring a magic connection was made very easy.
 Made more accessible with magic made available at
Departmental stores, gifts shop, telephone booths, Kirana
stores etc.
 It offered instant connectivity , STD/ISD facility, voice-mail
and sms facility.
 Made available in various denominations (300-3000).

6. Radical transformation in cellular market
 The subscriber base increased to 6.4 million in March 2002 as
compared to 3.5 million in March 2001.
 Growth rate in subscribers
Rajastan 179%
Harayana 151%
Kerala 151%
 Analysts estimated that the number of subscribers in 2004
would reach 25 million as compared to 4.5 million in 2002.
 The immense potential lured all major players and hence
Bharati also felt the need to revamp its strategies to retain its
position.

7. Revamping the marketing strategies
 Newer areas, changes in pricing, positioning and advertising.
 New value additions and better services.
 Magic brought under Airtel and renamed AIRTEL MAGIC.
 Magic positioned as friendly, mass-market brand.
 Magic targeted at youth and stood for simplicity and attitude
“Anything is possible”
 Logo was changed which now reflected energy, simplicity and
friendliness.

8.  Introduced special features .
 It also introduced doorstep delivery of Magic cards.
 In mid 2002,Bharati launched regional roaming network in
Asia for magic subscribers.
 Also regional roaming facility was offered to customers within
the country as well.
 It also waived intra-operator call charges in some parts of the
country.

9. Celebrity Endorsements
 In 2002, Saurav Ganguly and Leading movie stars Madhavan
and Kareena Kapoor were signed as the endorsers of Airtel
Magic.
 Objective was to cash upon the two biggest passions of Indian
masses-Movies & Cricket.
 In October 2002, a TVC was launched featuring Shah rukh
khan and Kareena Kapoor.
 This TVC was developed by Percept Advertising, India’s
leading advertising agency.

11. THE MAGICAL TAGLINES
YOU CAN DO MAGIC
MAGIC HAI TOH MUMKIN HAI
KABHI BHI KAHIN BHI
LIFE BANAO AB AUR BHI AASAN

12. Market Leader
 Airtel comes to you from Bharti Airtel Limited
 The businesses at Bharti Airtel have been structured into three
strategic business units (SBU's) - Mobile services, Broadband
& Telephone services (B&T) & Enterprise services.
 First private telecom service provider to connect all states of
India .
 Covers 23 telecom circles of the country, has 21 million
customers
 Highly successful brand in India

13. Mission
 We will meet the mobile communication needs of our
customers
Vision
 ‘To be the most admired brand in India by 2010’
Values
 We will always put our customers first. We will always trust
and respect each other. We will respect our associates as we
respect each other. We will work together through a process of
continuous improvement.

14. Competitive environment
 Market challengers
2. Hutch
3. BSNL
 Followers
5. Idea
• Nichers
1.Aircel
2.Spice

15. MARKETING MIX

16. Product
 Airtel Pre-paid
 Airtel Post-paid
 Blackberry Wireless Handheld
 Value Added Services (VAS)
The different value added services provided by Airtel are-
 Instant Balance Enquiry
 24Hr recharge Facility
 Caller line identification
 Call divert, Call wait & Call Hold
 Multimedia messaging service (MMS)
 Airtel Live Portal
 SMS based Information Service

17. ..Contd
 Hello Tunes & Ring Tones
 Voice Mail Service
 Easy Post-paid bill collection
 Gifting of Ring Tones & Hello Tunes
 GPRS
 Business Solutions

18. Price
 Customer based pricing strategies.
 Flexible pricing mechanism
 Controlled by TRAI.

19. Place
 It has wide and extensive presence even in the remotest areas
 Airtel Customer Care Touch Points
 Distributors like
E.g. Paan shops, grocery stores, chemists, outlet etc.

20. Outlets

21. Promotion
• Large scale print and video advertising.
• Big celebrities like SRK and Sachin are roped in to endorse
the product.
• In 2002 Airtel got its Signature tune from A.R. Rehman, this
signature tune is perhaps the most downloaded tune in India.
• Provides innovations such as Bollywood movie premiers,
music services such as ring back tones & many more.

22. ..Contd
 "Friendz" pre-paid connection for youth," Ladies Special"
plan, Seniors plan.
 Executives corporate plan (First to give prepaid in this
category).
 Special discounts in calling rates & sms services.
 Providing wallpapers and screensavers on website.

23. Financials

24. Net Sales Year End 2008
Company Net Sales
Last Price Change % Change
Name (Rs. cr)
Bharti Airtel 722.30 -20.00 -2.69 25,761.11
Reliance
249.20 10.00 4.18 14,792.05
Comm
Idea Cellular 53.50 0.05 0.09 6,719.99
MTNL 74.85 -1.95 -2.54 4,722.52
Tata Comm 495.15 2.60 0.53 3,283.30
TataTeleser
20.15 0.40 2.03 1,707.19
vice
Tulip
501.20 67.85 15.66 1,216.44
Telecom
Spice Comm 36.00 3.40 10.43 957.85
HFCL Infotel 7.45 0.44 6.28 248.88

25. Net Sales(Rs. Cr)

26. For the current year

27. Net Profit (Rs. Cr)

28. SWOT

29. STRENGTHS
 Bharti Airtel has more than 65 million customers (July 2008).
 It is the largest cellular provider in India, and also supplies
broadband and telephone services - as well as many other
telecommunications services to both domestic and corporate
customers.
 Other stakeholders include Sony-Ericsson, Nokia - and Sing
Tel, with whom they hold a strategic alliance. This means that
the business has access to knowledge and technology from
other parts of the telecommunications world.
 The company has covered the entire Indian nation with its
network. This has underpinned its large and rising customer
base.

30. WEAKNESS
 Price Competition from BSNL and MTNL
 Losing lead on technical expertise.
 Until recently Airtel did not own its own towers, which
was a particular strength of some of its competitors such as
Hutchison Essar.
 When started initially,the business had little knowledge and
experience of how a cellular telephone system actually
worked. So the start-up business had to outsource to
industry experts in the field. .

31. OPPORTUNITIES
– The fast extending IPLC market.
– Latest technology and low-cost advantage.
– Growth of mobile phone users.
– Untapped Rural Market.
– Bharti Airtel is embarking on another joint venture with
Vodafone Essar and Idea Cellular to create a new
independent tower company called Indus Towers. This new
business will control more than 60% of India's network
towers.

32. THREATS
 Airtel and Vodafone seem to be having an on/off relationship
 Bharti Airtel could also be the target for the takeover vision of
other global telecommunications players that wish to move
into the Indian market.

33. Porter’s 5 forces

34. 1) THREAT FROM COMPETITORS- HIGH

35. 2) CUSTOMER BARGAINING POWER - HIGH
 Lack of differentiation among Service Providers
 Cut throat Competition
 Low Switching Costs
 Attractive Schemes for new connection
 Availability of all operators everywhere
 Difficulty to differentiate Brand
 Number Portability will have –Ve Impact
 Businesses & Consumers

36. 3) THREAT OF SUBSTITUES- HIGH
 Cellular Services address the communication needs and
staying connected.
 Hence a necessity, but there are substitutes
Landline
CDMA

37. 4)THREAT OF NEW ENTRANTS – Previously LOW
Now HIGH.
Previously Low because
 Huge License Fees to be paid upfront & High gestation period
 Spectrum Availability & Regulatory Issues
 Infrastructure Setup Cost - High
 Rapidly changing technology
Now High because
 New Entrants are ready to enter with Huge Capital Considering the
attractiveness of the market
 Increase Of FDI to 76% bringing competiton from Foreign players
 New Entrants from Non telecom companies with the ease of
Outsourcing

38. Recommendations

39. Future strategies
 Translate its expertise in Indian markets to other emerging
economies.
 This could call for acquisitions globally.
 Indian market inspite of being the worlds largest is still not
matured. Opportunities abound in the hinterland which must
be exploited

40. Future Strategies to retain its market share
 New tariff plans.
 More value added services.
 Increase in visibility and coverage
 The AirTel - AirTel advantage
 New innovative packages
 More of the e-factor

41. Technical Front
 Widening the network coverage area.
 Increasing quality of service and interconnectivity.
 Innovative VAS such as e-recharge or recharge using sms.
 Advanced technology introduction such as M-commerce
e.g. m-check, ATM recharge.

42. Airtel – Strategy
MANTRA :
Focus on Core Competencies and Outsource the rest!

43. THANK YOU