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Telecom Industry & Reasons for

Switching Operators in the Industry
(Business Statistics)

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TABLE OF CONTENTS:

Executive Summary..3
Introduction..3
Aim & Objectives of Research..4
Scope & Significance of Research..5
Literature Review..5
Methodology..5
Questionnaire.6
Data Analysis..8
Conclusion.20

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EXECUTIVE SUMMARY
The research has been conducted in order to examine the factors
influencing brand switching in telecommunication industry of India and to
access the problems generally faced by the service users and their
satisfaction towards the different cell phone service providers. Qualitative
and quantitative methods have been used in this research. Literature
review includes all important factors that can influence brand switching in
telecommunication sector. Primary data for research has been collected
through a questionnaire survey from a sample of 42 mobile subscribers.
The results of research have been presented in systematic manner. The
findings have been discussed descriptively and graphically.
INTRODUCTION
Telecom industry in India has changed drastically over the years. India
with a subscriber base of nearly 898 million has the second largest
telecom network in the world. There are around 15 telecom companies
operating in India. But the telecom space is ruled by 5 major players
which include Idea, Airtel, Vodafone, Reliance Communication and BSNL.
Due to intense competition, India has the lowest tariffs in the world. The
telecom space is divided into 22 circles classified in 4 categories that are
metros, A, B & C based on economic parameters and revenue potential.
Each circle has a unique license and only four operators per circle are
allowed. The Department of telecommunication (Gov. of India) is the
governing body for the telecom industry.
The Indian Telecom space can be broadly classified into
-

Fixed Line Telephony

Mobile Telephony

The major players in the Fixed Line telephone include BSNL, MTNL, VSNL
and the major players in the mobile telephony include Idea, Vodafone,
and Airtel etc.

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Bharti Airtel It is the biggest telecom operator in India. It was the first
in the telecom sector to connect all the states of India.
BSNL(Bharat Sanchar Nigam Limited)- It is the oldest telecom sector
in India and they are the first telecom operator to connect rural
households with their telephone services.
Vodafone Essar It started its operation in India in the year 1994 and
has been growing since then. The company has its operations all over
India with a customer base of more than a 100 million customers.
Reliance Communication- It has more than 135 Million Subscribers. It
is the Flagship Company of ADAG group and its headquarters are located
in Navi Mumbai. It offers Wired, Wireless, GSM, CDMA, 3G Services in
India.
Idea- Idea offers both prepaid and post-paid services. Idea was the first
service provider to launch GSM and EDGE services in India.
Customer is the most important player of market. All the efforts of
companies are directed towards customers. Customer can either remain
loyal with a particular brand or switch to another one. This particular
study evaluates the factors influencing customers to switch telecom
operators.
AIM & OBJECTIVES OF RESEARCH
The aim of the research is as follows:
To examine the factors influencing brand switching in the telecom
industry.

The aim of the research has been expanded through following objectives:

To examine the factors that influence brand switching in telecom

industry

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To examine the factors that prevent brand switching in telecom

industry

To study the customer preferences of mobile service providers in

telecommunication industry of India

To propose recommendations to the mobile service providers for

increasing customer loyalty

SCOPE & SIGNIFICANCE OF RESEARCH

Telecommunication industry has becoming very competitive day by day
and customers are being exposed to a number of choices. This research
evaluates the factors that influence customers to switch over other mobile
service

providers.

Factors

specific

to

brand

switching

in

telecommunication market are evaluated.

LITERATURE REVIEW
All industries have experience brand switching but telecommunication
industry is more exposed to it. There are many factors that influence
brand switching. Price of the services such as calls and has been found
most influential factor in brand switching in telecom sector. Besides price
there have been many factors that enhance brand switching like quality
service, coverage area, trust, advertisement, and brand image. All these
factors have been critically analysed in the literature review in the light of
work of previous researchers.
METHODOLOGY
The main objective behind the research is identifying the factors
influencing brand switching in telecom industry of India. Here analysis of
various factors is done and evaluated using various statistical measures.
Research Design: A research design is a basically a study that links the
factual and empirical findings of the research to the research question and
its objectives and also to the conclusion that is arrived at the end of

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research.

Survey

research

method

is

chosen

for

collecting

the

information for the conducting the quantitative analysis in the same.

Population and Sample: Sampling method that is used in the research to
collect the data is random sampling technique. In random sampling
approach every unit or element from the sample population has equal
likely chances to be selected as subject of consideration.
Data Collection Procedure: There are two major techniques to collect
data, when gathering data to tackle and approach the underlying
objectives of the study. Data that is collected from any source which is
already been published in some form is known as the secondary data.
Secondary Data is that data that already exists; it is gathered with a prior
set objective. Primary data is the first hand collection of data that is
usually undertaken after some insights are gained in the area of research.
In this project report Primary data is collected through a questionnaire. A
self-administered questionnaire was used to collect the relevant data. The
questionnaire was then posted on social networking sites like Facebook as
well as Google Docs.
Questionnaire
A close ended questionnaire was circulated through Google forms; link
and screenshots are attached below.
https://docs.google.com/a/associates.sibm.edu/forms/d/1jApJdFRg9X58V
bSXPfuYrQ_GwFoGX3-kmZ8mgp_6170/viewform?c=0&w=1

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DATA ANALYSIS
Inferential statistical methods used are ANOVA, correlation and regression.
Reasons:

To know that the satisfaction of the particular customer depends on which

factors and knowing which factor plays the most important role
To know which how two things are related to each other positively and

negatively
To understand how would the dependent variable/s change on changing
one of the independent variables and to what extent

Following are the graphical outputs received on surveying 42 mobile customers

(questionnaire screen shot attached above):

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The outcomes of the survey through the graphs are selfexplanatory. However, for the readers better understanding we
would like to explain the outcomes in brief. These results are
based on the sample taken which can be extrapolated at
population level (here its just a simulation not real life outcome
as our survey was mostly done with MBA students).

The majority of mobile users are in age group 22 25 years with more
female users than male users. The daily usage of phone in terms of calls

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& data services are more or less evenly distributed between user using
phone for 1-2 hours, 2-3hours, 3-5hours and >5hours (maximum being
3-5 hours). Out of all the surveyed customers 35.7% customer
experience call drop & network jam related issues every 3-4 days.
Out of all the surveyed customers 60% customers rank better network
coverage as number 1 reason which would motivate them to switch to
another telecom service provider, 47.1% customers rank 2g/3g data
services as number 2 reason which would motivate them to switch to
another telecom service provider, 32.4% & 37.5% customers rank better
value added services & customer service helpline respectively as number
3 reason which would motivate them to switch to another telecom service
provider, 34.4% customers rank customer helpline as number 4 reason
which would motivate them to switch to another telecom service provider
and finally 35.3% customers rank flexibility of switching plan as number 5
reason which would motivate them to switch to another telecom service
provider.
Out of all the surveyed customers 48.5% customers rank acceptance of
problem by customer care as number 2 on scale for the grievance
redressal mechanism of customer service center both online & offline
(with 1 being most satisfied & 5 being extremely dissatisfied), 38.2%
customers rank listening to your problem by customer care as number 1
on scale for the grievance redressal mechanism of customer service
centre both online & offline (), 38.2% customers rank grievance
resolution by customer care as number 3 on scale for the grievance
redressal mechanism of customer service center both online & offline ()
and finally 38.2% customers rank future preventive action by customer
care as number 4 on scale for the grievance redressal mechanism of
customer service centre both online ().
57.1% of surveyed customers responded that they sometimes face the
problem of certain services which are automatically activated and deduct

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balance without your consent. 52.5 % of surveyed customers responded

that their telecom service expenditure per month is between Rupees 400
700. 57.1% of surveyed customer felt that their telecom service plan
was more expensive than the competition in the market. 95.1% of the
surveyed customers were aware of the mobile portability availability in
India. 58.5% of surveyed customers were somewhat satisfied with their
current telecom services provider. 83.3% of surveyed customers would
like to try plan of competitor (telecom services), if there is availability of
better/competition plan in the market (than the one customer currently
has).
Attractive internet service pricing and network ranks as number 1 reason
for motivating customer to switch to competitors telecom services, cheap
calling plans rank as number 2 reason for motivating customer to switch
to competitors telecom services, influence of family & friends rank as
number 3 reason for motivating customer to switch to competitors
telecom services, highly satisfactory customer services rank as number 4
reason for motivating customer to switch to competitors telecom services
and finally phone network rank as number 5 reason for motivating
customer to switch to competitors telecom services.
Following are the outputs received from SPSS software:

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Descriptive Statistics
Mean

Std. Deviation

Analysis N

PhoneNetwork

2.659

1.4935

41

Dataservices2G3G

2.634

1.2601

41

Valueaddedservices

3.488

1.1645

41

Customerservicehelpline

3.341

.9902

41

Flexibilityofswitchingplans

3.683

1.2736

41

Acceptanceofproblem

2.415

.9994

41

Listeningtoyourproblem

2.098

1.0910

41

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Grievanceresolution

3.024

.9871

41

Futurepreventiveactions

3.293

.9809

41

Valueaddedbonusforproblem 3.610

1.3206

41

Ranktheparameterswhichwo 1.659

1.1749

41

2.244

1.0904

41

Attractiveinternetservicespric 2.293

1.4360

41

1.1884

41

1.2610

41

uldmotivateyouforswitchingto
an
Cheapercallingplans
ingampnetwork
Influencedbyfriendsampfamil 3.293
ies
Highcustomersatisfactoryser 2.902
vices

KMO and Bartlett's Testa

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

Bartlett's Test of Sphericity

.581

Approx. Chi-Square

324.636

df

105

Sig.

.000

a. Based on correlations

Communalities
Raw

Rescaled

Initial

Extraction

Initial

Extraction

PhoneNetwork

2.230

2.132

1.000

.956

Dataservices2G3G

1.588

1.072

1.000

.675

Valueaddedservices

1.356

.772

1.000

.569

Customerservicehelpline

.980

.550

1.000

.561

Flexibilityofswitchingplans

1.622

1.521

1.000

.938

Acceptanceofproblem

.999

.832

1.000

.833

Listeningtoyourproblem

1.190

.924

1.000

.776

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Grievanceresolution

.974

.746

1.000

.766

Futurepreventiveactions

.962

.669

1.000

.696

Valueaddedbonusforproblem 1.744

1.466

1.000

.841

Ranktheparameterswhichwo 1.380

1.045

1.000

.757

.734

1.000

.617

1.637

1.000

.794

1.074

1.000

.761

1.345

1.000

.846

uldmotivateyouforswitchingto
an
Cheapercallingplans

1.189

Attractiveinternetservicespric 2.062
ingampnetwork
Influencedbyfriendsampfamil 1.412
ies
Highcustomersatisfactoryser 1.590
vices

Extraction Method: Principal Component Analysis.

Component Transformation Matrix

Component

.305

.617

.298

-.081

.657

.729

-.593

.102

-.297

.135

.575

.283

-.435

.575

-.265

.030

-.148

.793

.566

-.166

.211

.408

.287

-.504

-.673

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

CONCLUSION
Based on above outcomes it can be seen that major factors which
influence brand/operator switching are bad reception (network), poor
customer care service, poor 2g/3g data service, not useful value added
services and difficulty in switching plans. Brand/operator switching can be
tackled if operators pay more attention to their current customer
preferences. Operators should provide proper and steady network and
data services in most of the circles where they operate, should provide

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with humble and caring customer care services, should allow or provide
options to change plans according to individual needs and should give
better value added services which would help customer in his/her life. To
increase brand loyalty operators should judiciously utilize the big data
analytics based on which they should offer new plans to customers,
should give them discounts, should see to it that customer receives
proper call & data services where ever they travel within the country and
should prevent automatic activation of services & deduction based on
those services without customers consent.