This is our 2nd term presentation on Reliance's marketing /management strategies that changed the landscape of the Indian mobile industry.

1. Abhishek Prasad (08) Dipti Navaney (31)Madhavi Shetty (25)
Neha Mehta (15)Pankaj Dedhia (18)

2. I nt r oduct i on
• Reliance Communication formerly Reliance Infocomm, setup by
Shri. Dhirubhai Ambani in 2000
– 1999 change in policy by Govt. for telecom industry
– To make an India where the common man in urban as well as rural
area would have access to affordable means of information
technology and communication.
– Target to setup 60,000 kms. Of Fiber optics
backbone covering nearly 450,000 villages and
77 Mn. Subscribers
– Serving 147 Mn. Customer base as on Sept 2011

3. The Vi si on
“My vision is to provide the latest telecommunication facilities to every
Indian at the price of a post card”
– Dhirubhai Ambani

4. Pr i ci ng St r at egy
• Challenged conventional cost structures in the telecommunications
industry
• Broke the mould with a tariff that can be described as the most
ambitious ever listed by a telecom company in India.

5. Pr i ci ng St r at egy Cont ..
• Other operators aimed for the higher value market.
• Reliance realized that there is a market in driving volumes and created a
completely new market.

6. Dhi r ubhai Ambani Pi oneer Of f er
• Consumers were given
– free digital mobile phone
– unlimited free incoming calls
– billing at 15-seconds pulse rate, for a one-time fee of Rs 3000

7. • Value added services like
– voice mail
– call waiting
– call hold
– call divert
– call identification
– call conferencing
– dynamic locking and text messaging were offered for free.
Val ue Added Ser vi ces

8. Fr ee I nt er net !
• Internet access through the phones was also offered “free” initially.

9. Li vi ng The Dr eam
“The pricing system is in line with Dhirubhai Ambani's dream and directive of
making phone calls affordable for every Indian. It has been made possible
due to the significant capital productivity achieved”
- Mukesh Ambani

10. Advant ages over exi st i ng compet i t i on
• Biggest entry barrier : Handset prices
• Minimum handset cost – Rs 7500
• This meant dealing with two suppliers:
– one for the service
– another for the handset.

11. But Wi t h RI M..
• Access to a fancy handset without the initial price barrier
• And dealing with just one supplier

12. How RI M managed t he “FREE”
handset

13. • Built-in contract of three years for every customer
–guaranteed cash flows
• Exclusive agreements with handset vendors like LG and Samsung.
–High volumes : Rock bottom costs
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14. • Reduced the choice available to the customer to just two models per
brand
– ensuring mass production : further reduction in prices.
Rs 10500 = Rs 800 !
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15. Pat h br eaki ng st r at egi es
• “No charge” for incoming calls
• Other competitors charged incoming calls at almost half the rates of
outgoing calls
• No implementation of CPP(Calling party pays)

16. How t hey managed such l ow cal l
cost s?

17. • High rental of Rs 600
– But 400 mins. Talktime
• Low pulse rate
– 15 secs. Compared to existing 1 min.
• RIM to RIM
– 40 paise / min
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18. Shi f t i n St r at egy
• Post-Paid to Pre-Paid.
– Cash is collected beforehand
– Cost of collecting bills - which is 1 to 3 per cent of revenue –
vanished
• Pay Rs. 3,500 = Handset + Free Reliance Prepaid connection + Recharge
vouchers worth Rs. 3,240
• Automatic Roaming – No Extra Cost

19. Cost Management - The I nsi de St or y
• Cost Saving – Working through other group company offices
– Capital Cost
– Personnel Cost
– Technology & Engineering
• Centralized Operations
• “80 per cent of our administration and operation is centralised. Compared
to the best telecom networks in the world we have deployed only half the
number of people per 1,000 lines making our human resources the highest
productive resource.”

20. Economi es of Scope
• Optimum Utilization of Network
– Reliance landline
– Broadband Internet
– Leased Line
– VPN (Virtual Private Network)
– IPLC (International Private Leased Circuit)
– IDC (Internet Data Centre) services
– Centrex

21. Sal es And Mar ket i ng St r at egy

22. Tappi ng I nt er nal Resour ces
• 10 connections at a discounted rate per employee
• Share Holders encouraged to promote the service
– Overall discount of Rs. 4100 for two connections

23. Dhi r ubhai Ambani Ent r epr eneur shi p
Pr ogr amme – A New Way t o Mar ket :
• Began with an aim of enrolling 200,000 individuals
• Trained these entrepreneurs in basic skill sets, so that they are able to
deliver value to customers at their doorsteps.
• Contributing to society and gaining goodwill and enhancing networks
• Retailers like FabMall, PlanetM, HP, Music World and Timex started to
bundle their products along with RIM.

24. Adver t i si ng – Educat i ng Masses and
Evoki ng Passi ons:

25. RWor l d – Wor l d i n your hands
• Mixing of data applications
• Live News from TV channels like
– NDTV, CNBC, Aaj Tak
• Specific festival services for the Durga Puja and Dusshera festivals.
• Heavily promoted Reliance mobile ShowTime
– the first of its kind concerted movie promotion through Reliance
mobile RWorld and Reliance WebWorlds.

26. Pr oduct I nnovat i ons – Connect i ng
wi t h Ever y Sect i on of Soci et y:
• Leveraged its product innovation skills, applications development skills
– managing queues in temples
– connecting all police stations, to delivering egovernance solutions
to citizens.
• Connect with the huge farmer and trader community of India
– Mandi (market) onto mobile handsets
– tied up with National Commodity & Derivatives Exchange Limited
(NCDEX) to disseminate its spot and future commodity prices on
RWorld Mobile App.

27. Mor e I nnovat i ons
• Tap into the retailer community
– deployed India's first Wireless Point of Sale (POS) Terminal for
processing credit card transactions in association with HDFC
• Rconnect
– India's only nationwide wireless Internet connectivity
– helped it to connect to the growing community of Internet users,
– Enabling it to gain over 300,000 subscribers in less than seven
months

28. Cust omer Ser vi ce – I ci ng on t he
Mar ket i ng Cake
• A 24 by 7, 365 days a year customer service was set up in a central
location in Mumbai
• Service was offered in 10 languages
• Other mobile operators took more than two days, RIM provided fully
provisioned mobile phone within 15 minutes.

29. Moul di ng t he r egul at i ons
• (TRAI) regulations : Mobility range of about 20-25 km with no roaming.
• RIM overcame the policy shackles by enabling the customer to use the
same handset in areas other than where it was registered.
• RIM ‘s political influence helped them gain the Unified License

30. What ot her s coul d not see
• While others saw weaknesses of India as a market – widespread
poverty and low levels of telecommunication penetration –RIM realized
that these actually were strengths which it could tap into.

31. Cont i nui ng t he l egacy
• RIM managers saw that telecommunications would be much valued by
the poorer sections of society if it could be used to create opportunities
and offered at affordable prices.

32. Thank you