PLAN

IDEA CELLULAR
ANNUAL MARKETING

2009

Abhishek Chandra (PGP13_002)

Biswa Bhusan (PGP13_012)
Premraj N (PGP13_032)
Sabith Salim (PGP13_042)
Subhash Pankaj (PGP13_052)
Vishnu Suresh (PGP13_062)
Contents
............................................................................................................................................7

Market Survey on Cellular service usage...............................................................................32

Executive Summary
IDEA Cellular is a part of the US $ 28 billion Aditya Birla Group, India’s first truly
multinational corporation. Customer Service and Innovation are the drivers of this
Cellular Brand. A frontrunner in introducing revolutionary tariff plans; IDEA Cellular
has the distinction of offering the most customer friendly and competitive Pre Paid
offerings, for the first time in India in an increasingly segmented market. IDEA has
seen phenomenal growth since its inception, the company's footprint Idea is to first
achieve critical mass, then drill deep instead of spreading thin, however, does not
increasing geographic footprint only, it also drills deep and successfully attempts to
provide excellent network coverage in all its circles of operations. Idea has received
international recognition for its path-breaking innovations when it won the GSM
Association Award for 'Best Billing and Customer Care Solution' for 2 consecutive
years.

Starting with a brief introduction of Aditya Birla Group and its recent history, we
have in our plan, talked about IDEA Cellular and its history. Then we carry out the
detailed analysis based on market demographics, products and services offered,
Indian Telecom industry, the competition faced, advertising and promotion etc. The
different types of taglines, target segments were analyzed.

SWOT analysis, Porters 5 force analysis, positioning of Idea cellular on BCG matrix

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 was done. In marketing strategies we did the STP analysis of Idea cellular, found the
Ansoffs matrix for it and also talked about the 4 Ps of marketing.

A market research was conducted to know about the consumer preferences - what
they looked in a service provider, whether they preferred prepaid or postpaid .The
results of the survey were studied .The profit of Idea for the current year has been
forecasted so has the advertising split up needed to capture more market shares.

About Aditya Birla group

Aditya Birla Group (Aditya Birla) is an industrial conglomerate engaged in

manufacturing and supplying of aluminum and copper products, cement, carbon black,
textiles, fertilizers, chemicals, insulators, fatty alcohol and fatty acids. The company also
engages in software, business process outsourcing (BPO), finance and insurance, telecom
and retail businesses. Aditya Birla primarily operates in Asia, the Americas and Europe.
It is headquartered in Mumbai, India, and employs 130,000 people.

History

The Birla Group of companies was founded by Mr. Seth Shiv Narayan Birla in 1857.
The origins of Aditya Birla Group can be traced back to the 19th century when Seth
Shiv Narayan Birla started trading in cotton in the town of Pilani, Rajasthan. In the
early part of the 20th century, Group's founding father, Ghanshyamdas Birla,
expanded the group and set up industries in critical sectors such as textiles and
fibre, aluminium, cement and chemicals. In 1969, Aditya Birla, the then Chairman of
the Group, put the group on the global map. He set up 19 companies outside India,
in Thailand, Malaysia, Indonesia, the Philippines and Egypt. Under Aditya Birla's
leadership, the group attained new heights and it became world's largest producer
of viscose staple fibre, the largest refiner of palm oil, the third largest producer of
insulators and the sixth largest producer of carbon black. After Aditya Birla's demise
his son Kumar Mangalam Birla took over the charge of the group and under his
leadership the group has sustained the numero uno position in the sectors in which
it operates.

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Recent History

Idea Cellular

IDEA Cellular Limited, a part of the Aditya Birla Group and an India's leading
Global System for Mobile communication (GSM) Mobile Services operator was
began its journey in the year 1995 as in the name of Birla Communications Limited
for providing GSM-based services in the Gujarat and Maharashtra Circles. Later the
company has licenses to operate in all 22 Service Areas. Presently, operations exist
in 14 Service Areas covering Delhi, Maharashtra, Goa, Gujarat, Bihar, Tamil Nadu,
Orissa, Andhra Pradesh, Madhya Pradesh, Chhattisgarh, Uttaranchal, Haryana, UP-
West, Himachal Pradesh, UP-East, Rajasthan and Kerala. With a customer base of
over 24 million, IDEA Cellular's footprint currently covers approximately 60% of
India's telecom population.

Changed its name to Birla AT&T Communications Limited followed by joint venture
between Grasim Industries and AT&T Corporation in the year 1996. After one year,
in 1997, it commenced its operations in the Gujarat and Maharashtra. Migrated to
revenues share license fee regime under New Telecommunications Policy ('NTP')
Circles in the year 1999. During the year 2000, the company merged with Tata
Cellular Limited, thereby acquired original license for the Andhra Pradesh Circle.
IDEA acquired RPG Cellular Limited and consequently the license for the Madhya
Pradesh (including Chhattisgarh) Circle in the year 2001, and in the same year
changed its name from Birla AT&T Communications Limited to Birla Tata AT&T
Limited. They obtained license for providing GSM-based services in the Delhi Circle.

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Again in year later, in 2002, the company altered its name to Idea Cellular Limited
and launched 'Idea' brand name and commenced its commercial operations in Delhi
Circle. During the year, the company reached one million subscriber figures and
consecutively in the year 2003, reached two million subscriber marks.

During the year 2004, the company acquired Escotel Mobile Communications
Limited (subsequently renamed as Idea Mobile Communications Limited), reached
the four million subscriber mark and became the first operator in India to
commercially launched EDGE services in 2005. Idea reached the five million
subscriber mark in the year 2005 and also won an Award for the 'Bill Flash' service
at GSM Association Awards in Barcelona, Spain. The Company became a part of the
Aditya Birla Group in the year 2006 after TATA Group transferred its entire
shareholding in the Company to the Aditya Birla Group. In the same year 2006, IDEA
acquired Escorts Telecommunications Limited (subsequently renamed as Idea
Telecommunications Limited). The Company reached the 10 million subscriber mark
and also launched New Circles in order to obtain more and more customers. IDEA
extended its reach to 500 towns in Andhra Pradesh in August of the year 2006. Also,
it received Letter of Intent from the DoT for a new UAS License for both Mumbai and
Bihar Circles. ABNL, the parent of Aditya Birla Telecom Limited, agreed to transfer
its entire shareholding in Aditya Birla Telecom Limited to the Company for the
consideration of Rs. 100 million. In 2007, the company won an award for the 'CARE'
service in the 'Best Billing or Customer Care Solution' at the GSM Association
Awards in Barcelona, Spain.

The Initial Public Offering aggregated to Rs. 28,187 million and the company got
listed on both Bombay Stock Exchange and the National Stock Exchange during the
year 2007. IDEA merged seven of its subsidiaries and reached the twenty million
subscriber mark in the same year 2007. As on February 2008, IDEA Cellular Ltd tied
up with Southern Biotechnologies Ltd to provide bio-diesel for operating IDEA's
gensets at all towers in the Andhra Pradesh region. The Company with Geodesic, an
innovator in communication, collaboration and entertainment applications on mobile
and Internet platforms jointly announced the launch of 'Idea Radio', a truly
differentiated mobile music service for IDEA customers in the same year 2008.

Customer Service and Innovation are the drivers of this Cellular Brand. A brand
known for their many firsts, IDEA is only the operator to launch General Packet
Radio Service (GPRS) and EDGE in the country. IDEA has seen phenomenal growth
since its inception, the company's footprint Idea is to first achieve critical mass, then
drill deep instead of spreading thin, however, does not increasing geographic
footprint only, it also drills deep and successfully attempts to provide excellent
network coverage in all its circles of operations.

Recent history

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Mission

“We delight our customers while meeting their individual

communication needs anytime anywhere”

Major products and services

Idea Cellular is a part of the Aditya Birla Group. The company provides Global
System for Mobile (GSM) services. The company's key services and brands include
the following:

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Overview of Telecom Industry
Indian Telecom sector, like any other industrial sector in the country, has gone
through many phases of growth and diversification. Starting from telegraphic and
telephonic systems in the 19th century, the field of telephonic communication has
now expanded to make use of advanced technologies like GSM, CDMA, and WLL to
the great 3G Technology in mobile phones. Day by day, both the Public Players and
the Private Players are putting in their resources and efforts to improve the
telecommunication technology so as to give the maximum to their customers.

The Indian telecom sector can be broadly classified into Fixed Line Telephony and
mobile telephony. The major players of the telecom sector are experiencing a fierce
competition in both the segments. The major players like BSNL, MTNL, VSNL in the
fixed line and Airtel, Hutch, Idea, Tata, Reliance in the mobile segment are coming
up with new tariffs and discount schemes to gain the competitive advantage. The
Public Players and the Private Players share the fixed line and the mobile segments.
Currently the Public Players have more than 60% of the market share.

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Market shares of public and Private
Players

Both fixed line and mobile segments serve the basic needs of local calls, long
distance calls and the international calls with the provision of broadband services in
the fixed line segment and GPRS in the mobile arena. Traditional telephones have
been replaced by the cordless and the wireless instruments. Mobile phone providers
have also come up with GPRS-enabled multimedia messaging, internet surfing, and
mobile-commerce. The much-awaited 3G mobile technology is soon going to enter
the Indian telecom market. The GSM, CDMA, WLL service providers are all upgrading
their technologies to provide 3G mobile services.

Along with improvement in telecom services, there is also an improvement in

manufacturing of telecom equipments. In the beginning, there were only the
Siemens handsets in India but now a whole series of new handsets such as Nokia's
latest N-series, Sony Ericsson's W-series, Motorola's PDA phones etc. have come up.
Touch screen and advanced technological handsets are gaining popularity. Radio
services have also been incorporated in the mobile handsets, along with other
applications like high storage memory, multimedia applications, multimedia games,
MP3 Players, video generators, Cameras etc. The value added services provided by
the mobile service operators contribute more than 10% of their total revenue.

Top competitors

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 Bharat Sanchar Nigam Limited (BSNL)
Bharat Sanchar Nigam Ltd. is the World's 7th largest
Telecommunications Company. BSNL is one of the largest public
sector units in India. It has a wide network and serves its customers
with its wide bouquet of telecom services across India except Delhi and Mumbai. In
all, it has about 47.3 million line basic telephone capacity, 4 million WLL capacity,
20.1 Million GSM Capacity, more than 37,382 fixed exchanges and 287 Satellite
Stations, OFC Cable and Microwave Network connecting 602 Districts, 7330 cities
and 550,000 villages across India. BSNL is the pioneer of rural telephony in India.

Today, BSNL offers total telecom solutions to Corporate Customers, big business
houses and individuals. Their executives in the Business Development Cell act as
single window point for Corporate Customers. They’ve recently slashed the rates for
mobile services in order to compete with other private players who offer reduced
charges. With a view to improve their network coverage and to improve
performance, they are also in the process of expanding their GSM Network.

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The company offers vide ranging and most transparent tariff schemes designed to
suite every customer. Services are more expensive compared to other alternatives,
but BSNL towers are better spread across the country and therefore offer better
connectivity. Continuous innovation in product and delivery of services with the
appropriate pricing and promotion is the key strategy of BSNL for developing their
customer’s brand loyalty.

BSNL being a legacy operator earns a lot of criticism for its poor customer service.
Efficiency of the company has drastically improved over the past few years and one
can now get a connection in a matter of hours. Despite this growing concern for
customer satisfaction, it is still below Industry’s expectations.

Bharti Airtel (Airtel):

Airtel is an offering of Bharti Airtel Limited, India’s largest
integrated and incidentally, the first private telecom services provider with a
footprint in all of the country’s 23 telecom circles. Airtel has largest customer base
in India. Its market share is 101,114,971 i.e. 24.2% of the total 375,742,592 GSM
and CDMA mobile connections in India till Feb’2009. Globally, Bharti Airtel is the 3rd
largest in-country mobile operator by subscriber base, behind China Mobile and
China Unicom. In Dec’2008, Bharti Airtel rolled out third generation services in Sri
Lanka in association with SingTel.

The ranges of products offered by Bharti Airtel are Airtel Prepaid, Airtel Postpaid,
Calling cards, and BlackBerry. Airtel offers several unique services like having no
minimum or fixed amount for recharge for their prepaid customers. This convenient
recharge scheme was well received by their customers.

Vodafone Essar (Vodafone)

Vodafone Essar is a subsidiary of Vodafone Group PLC. It
commenced operations in 1994 when its predecessor Hutchison
Telecom acquired a license for providing cellular services in Mumbai. Despite the
official name being Vodafone Essar, its products are simply branded Vodafone. Over
the years, under the names of both Hutchison Essar (Hutch) and Vodafone, it has
garnered a reputation of a respected, creative, and one of the best mobile services
in the country. Vodafone provides services based on GSM technology, and offers
both voice and data services. Like others, it offers both prepaid and postpaid
coverage across India and is especially strong in the metros.

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The Hutch to Vodafone transitions in September 2007 was one of the biggest brand
transition exercises of recent times. Vodafone Essar spent around Rs 2.50 billion
(US$ 175.23 million) on this high profile transition and has been fairly successful so
far. Hutch was often praised for its clean and simple advertisements. Their ad
campaigns since 2003 featured a friendly dog named ‘Cheeka’ following a boy
everywhere, with the tagline – ‘Wherever you go, our network follows’. As this
powerful advertisement was widely admired, Vodafone is still using similar
advertisements for its ad campaign. The latest ad by Vodafone during IPL 2009
where a new character namely ‘Zoozoo’ was created was very well accepted by the
viewers.

Owing to the aforementioned reasons, Vodafone has over 49.1 million customers
currently. Most of their customers are still from their initial playing field:
metropolitan cities Mumbai, Delhi and Kolkata.

Tata Teleservices (Tata Indicom)

Tata Teleservices Limited is a part of the US$29 billion (Rs 1.4 trillion)
Tata group. Tata Teleservices Maharashtra Limited (TTML) spearheads
the Tata Group's presence in the Indian telecom sector, licensed to provide services
in Maharashtra (including Mumbai) and Goa. Incorporated in 1996, Tata
Teleservices was the first to launch CDMA mobile services in India, starting with the
Andhra Pradesh circle. Tata Teleservices has all its services grouped under the Tata
Indicom brand. Having pioneered the CDMA 3G 1 x technology platforms in India,
Tata Teleservices boasts of a reliable telecom infrastructure that ensures quality in
its services.

Like others, it offers both prepaid and postpaid coverage across India. Tata Indicom
has been credited with path breaking schemes like their offering – Tata Indicom Non
Stop Mobile, which allowed customers to receive free incoming calls for a period of
two years without any recharge. They were amongst the first to offer full talk time
on their recharge vouchers. As a brand, Tata Indicom stands out amongst other
brands due to the trustworthiness and dynamic nature of the Tata trademark, as
well as the consumer connect that it has successfully established over the years.

Reliance Communications
(RelCom)
Reliance Communications Ltd. founded by the late
Shri Dhirubhai H Ambani is the flagship company of

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Reliance Anil Dhirubhai Ambani Group. RelCom’s corporate clientele includes 2,100
Indian and multinational corporations, and over 800 global, regional and domestic
carriers.

When mobile telephony first began in India, a local call cost Rs 16 (US$ 0.37) per
min., an STD Rs 50 (US$ 1.17) per min., and a call to the US Rs 100 (US$ 2.34) per
min. With Reliance Communications’ pioneering the price initiative as a part of their
aggressive marketing strategy, a local call now costs a mere 15 paisa (less than
US$ 0.01) per min., STD 40 paisa (less than US$ 0.01) per min., and a call to the US
costs less than Rs 2 (US$ 0.05) per min. The presence of Reliance Communications
is making competition in India panicky. Be it their distinctive branding activities,
bold marketing campaigns or strong below the line activities, RelCom has
constantly stormed the Indian telecom market with its aggressive streak.

MTNL (Mahanagar Telephone Nigam

Limited)
It is a state owned telephone service provider in the cities of Mumbai,
Navi Mumbai, Thane and New Delhi. With a subscriber base close to 6 million, MTNL
has more than 500 exchanges in its name. It offers a wide array of services
including basic landline, CDMA fixed and mobile, GSM mobile, Internet, Broadband,
PCO and ISD. It is the largest landline service provider in India, along with BSNL. It
has recently taken bold initiatives to retain and recapture its market share lost to
growing mobile services.

Advertising and promotion

"Stay Connected" is a brand promise that looks at the key purpose of mobile
telephony. It converges with the tangible requirement of 'network depth' & at the
same time, reflects the eternal human need for bonding, kinsmanship, and
relationship forming. This campaign enables Idea to own the biggest category
benefit of "keeping people connected", through a simple, unique and likeable
expression of connectivity. And it makes consumers aware that "no one connects
better than Idea".

'Government of the People, For the People, and By the People' media campaign of
IDEA Cellular, gives the Idea of 'Participative Management' for Governance where
two-way communication is encouraged between government and public.

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The brand tagline "What an Idea Sirji!" is the message given by Brand Ambassador,
Abhishek Bachchan, which is echoed by the public at large in the story, and even
viewers of the new imaginative ad. The ad explores the Idea of Government(s) using
mobile service as an efficient tool to gather public opinion and support, while taking
vital decisions impacting people's lives.

Idea Cellular has launched WalkWhenYouTalk.co.in as a part of its ‘Walk When You
Talk’ campaign where the company encourages mobile phone users to walk while
they talk on their mobile phone. The website invites visitors to enter their friends’
mobile phone numbers and triggers a reminder call on those numbers asking the
receivers to walk as they talk.

WalkWhenYouTalk.co.in also hosts a walk-n-talk meter, which helps the user to

calculate the amount of calories he or she might lose by walking while talking for a
particular amount of time on mobile phone. Users can also upload or check out
interesting 'walking while talking' videos on the site.

Situation analysis

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SWOT ANALYSIS

BCG MATRIX

BCG Matrix of IDEA Cellular with respect to Airtel ( Market Leader)

Analysis:

• Idea Cellular falls in the first quadrant i.e. “question mark” in

BCG matrix

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 • Airtel being the “Market Leader” in the telecom sector has a
strong influence in the market
• Prober strategies has to be devised for IDEA
• IDEA has 12% market share

PORTER’S 5 FORCES ANALYSIS

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Idea recorded the highest revenue growth rate in last 4 quarters across all
major players

Highest subscriber growth rate in last 2 years across all major

players

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TRENDS THAT REVOLUTIONIZED THE
TELECOM INDUSTRY
• Technologies of mobile telecommunications and Internet are going to set the
contours of further technological progress in the current decade and the next

• The most recent initiative aims at convergence of voice and data received
from multiple sources, both web based and real time video streams, in mobile
handheld devices. Global satellite systems, mobile handsets and calling cards
have made virtual presence possible almost everywhere and anywhere
overcoming the barriers of distance, topography and remoteness.

• A techno-economic alternative is helping in improving telecom penetration

bypassing shortages of fixed lines. Consequently, it is bringing along with it
all concomitant economic benefits of enhanced telecom accessibility.

• A shift in investment burden from state to private sector and the consumers

• Growth in Internet usage

• Faster expansion and consolidation of technologies ushering in Internet

revolution. Broadband access technologies, which include Digital Subscriber
Lines (DSL) and cable modem, permit faster download and graphic-intensive
Internet applications.

• Increase in Voip and 3G usages

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Marketing Objectives
The marketing objectives of Idea cellular are:

• To expand the market to other states where Idea has not yet been introduced
.

• To increase the market share in existing states

• To maintain its existing customers

• To introduce new technologies and services

• To continue to develop the Idea brand

Marketing Strategies

Segmentation Scheme
• Geographic variables

o Region: Different schemes need to be provided to different states

as consumer preferences and purchase habits are different in
different states..

o Category: Metro, Tier I/II cities

• Demographic variables

o Age: 18-25, 25-35, >35 are the targeted age groups. The usage
patterns and requirements are different for different age groups

o Income: Medium Income and High Income. The type of income

determines the duration for which they use their mobiles.

o Generation: Younger generation, older generation require different

needs.

o Occupation: Students, Executives, Professionals. All these category

of people make use of mobile phones. Different offers should be
there to cater to different groups’ needs.

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 • Psychographic variables

o Personality: Ambitious, Authoritarian, Free spirited

o Value: Value for money, Strong product differentiation

o Attitude: Up-market; college/office going youth with aspirations;

status seekers

• Behavioral variables

o Occasions: Daily usage in offices, college/universities. Most

importantly we can talk to anyone anytime, so convenience factor

o User status: Regular users, potential users and first time users

o Usage rate: Heavy user rate. Hence service providers come up with
different packages and offers

o Loyalty status: Hardcore loyalist who stick to the brand they

brought initially and would not change their service providers even
if they provide better services, shifting loyal who switch to
another service provider if they provide better services and
switchers who keep changing their service providers to get
maximum benefits

Targeting
Nowadays mobiles are most commonly found with the younger generation than with
the older generation .Hence this segment should be targeted .For this Idea cellular
has adopted a new strategy. Previously the taglines were “no one connects better
than IDEA”, “what an Idea sirji”. These taglines were meant to add the Indian value
to the brand .It was mainly targeted at the rural section of the people as they
constituted a large number. But now Idea cellular has targeted the urban young
people with the introduction of the virtual character “Zac”. He is young, cool, smart
& stylish, forever on his mobile phone just like any other youngster of his age;
health conscious, he loves to walk when he talks on the phone. Idea is trying to
target the youth entirely by introducing this character .Games and contests are
made based on this character to attract more customers.

Positioning
Idea cellular is trying to position itself entirely as Indian brand, more
specifically stress is given on rural markets in India. Rural markets are perceived to
be not-so-lucrative in India and are very much neglected by other telecom service

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companies. Idea was the first cellular company to target rural India market
effectively. This positioning is advantageous because urban markets are getting
saturated exponentially. With rising incomes in rural India, it promises to be good
market for cellular services. Idea already has extensive network coverage in rural
areas to substantiate claims made in the promotion. Recently they have also
started campaigns targeted at youth.

On the whole side, Idea is trying to be common people’s cellular service as

they continue to bring common people’s problem in the promotional ads like
decision of building malls on agricultural land, problem of outsiders in city of
Mumbai, Caste related clashes, struggle to get quality education.

Ansoff Matrix:

The Ansoff Matrix focuses on the firm’s present and potential products and markets/
customers. The company should follow all four strategies depending on the demand
and product as indicated in the matrix. The company perhaps needs to focus more
on the comparatively neglected area of diversification.

Marketing action programs

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Product
Idea currently offers various services like Prepaid, Postpaid services and Idea Net
Setter for its GPRS customers. The Prepaid and Postpaid services are priced
differently as different plans in various circles where Idea operates. In many metros
like Mumbai, New Delhi, Pune and Bangalore in order to lure young working
professions, Idea comes up with innovatively competitive schemes as a part of its
corporate plan. Also, it offers various other voice services like Call Conference,
Fixed Cellular Terminals etc. The different value added and other voice services
provide cost effective access to the GSM telecommunications Network for incoming
and outgoing calls to the subscribers.

IDEA 'Women's Card' caters to the special needs of women on the move, and 'Youth
Card' covers the emerging youth segment. IDEA 'My Gang' is the product widely
popular among community user group.

One of the recent innovations is their online recharge facility. Pre-paid customers
can now recharge their Idea prepaid without physically going to a retail outlet. The
same can be done through their website itself.

According to our market survey results, customers have shown an inclination to use
few utility-based services like Mobile Banking and Mobile Ticketing and are willing to
pay extra for it. Our recommendation is that Idea should offer these value added
services by charging the customers extra.

Price
Idea cellular right now is competitively coming up with new pricing plans for people
It had recently launched new tariff vouchers where only 50 paisa will be charged for
all the local calls. It has also launched an STD and local combo pack where for Rs.
128 you can get all local calls for 50 paisa for and STD for Re. 1. In many states Idea
has reduced STD rates to 75 paisa.

Cellular companies mainly have to deal with the customers that use local calls. The
new pricing plans many of which are state specific will give Idea greater penetration
in the local customer market. Though there are good pricing techniques in
communication but in internet GPRS Idea’s Net Setter is highly priced at Rs. 749 per
month and the promised speed of 236.8 Kbps is overstated while one of its
competitors Airtel offers the fastest broadband for only Rs. 500.

Place

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With acquiring of Spice Idea operated in 15 circles. Now with the launching of
operations in Orissa, Tamil Nadu and Chennai in April’09, May’09 and July’09
respectively Idea now covers 90% of the subscriber base. Idea is soon to expand its
operations to West Bengal and Kolkata so as to cover 97% of total subscriber base.
With that and further expansions to other areas, Idea is going to be a pan-India
operator in 2009 itself.

Promotion
From the survey results it is clear that the main mode of promotion among youth is
through friends’ recommendations. To make use of it, currently Idea has started
promotion via social networking sites like facebook through ‘Zac’, and is providing
real-time games. Since the customers top priorities are still call and messaging
should come out with attractive special tariffs. Also internet facilities should also be
promoted well since that is the value added service in which, largest number of
survey respondents showed interest.

Recommendations

Online promotion via social networking sites: Currently ‘Zac’ has presence in
facebook and twitter. They can continue the move by further by establishing Idea
widgets in more social networking sites like ‘orkut’ which are more popular in India.
As prizes for the games present, gift which introduces Idea products could be given.
Also providing more online games which don’t require money to be spent to keep
visitors involved more online will be a better
option.

Advertisements on Print and Electronic

media: Has to make a strong presence in print
and electronic media. Along with the ads aimed
at rural India, New ads focusing on youth and
vibrancy should be introduced along with the
theme of “Walk while you Talk”.

Channel and organization associations:

associations with various Television-programs
that attract youth or channels itself like MTV.

Street promotions, Campus promotions:

Apart from the above two mediums, Street
promotions also has got a considerable

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influence among target customers. Hence street
promotions and Sponsoring campus events along with
involving activities and games should be made.

Market Research
Market research was based on online surveys and
individual customer interviews. Data such as market-
share was obtained from secondary sources. Survey
was conducted via the link:
http://spreadsheets.google.com/ viewform? Majority of the
formkey=dGRzajZuSjI5Z1E0dVFiSHh1djI2RlE6MA.. respondents
belonged to the age
Online Survey group 20-24 years,
ie college going or
Which age group do you belong to? just entered their
jobs. So the survey
results will be
indicative of this
target group

More than half of

people depend on
friend’s
recommendation or
word of mouth
publicity.
Advertisements and
Street promotions
too where
significantly
influential in
consumer choice

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 How did you get information about the current
service provider?

Majority of
respondents (more
than 75%) have
never switched or
using the same
service for more
than two years.
Focus should be on
converting them into
loyal customers of
Idea.
How frequently do you switch between service
providers?

70% of the
respondents are
willing to switch if
better services are
offered than their
current service. That
shows a good
potential for
converting them

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If Idea Cellular offers a better service than your current service provider,
will you switch to it?

Which of the following paid services would you like to have?

25 Indian Institute of Management Kozhikode

What are you top three priorities in choosing a
particular service provider? People primarily
prefer value added
services like
Internet, mobile-
banking, Mobile
ticketing etc which
are more utility
based rather than
for entertainment
purpose.

The top priorities are

still remaining as call
rates, SMS and
coverage. So gaining
market by providing
better offers on this
strategy and making
more profit on value
added services,
roaming facilities etc
can be a good
strategy.

26 Indian Institute of Management Kozhikode

Brand awareness
has increased very
much, but the
basic question of
‘why one should
choose Idea’
remains
unanswered

Consumer Interview
To get the preferences of other age groups, consumer
surveys conducted on such target groups. The results were
similar to survey results obtained in higher age groups. The
customer was reluctant towards switching. The top
preference for choosing the provider was again Call rates
and coverage. Roaming rates also were important. The
customers from the lower age group preferred content
download and internet services along with call rates.

Idea should either They were also interviewed about the effectiveness of
expand to more advertisements. The campaigns ‘What an Idea’ and ‘Walk
operating circles while you Talk’ has caught the attention and the brand
or focus on awareness has increased a lot over the previous times, but
improving the present advertisements are not answering the basic
question, ‘why should people choose Idea’.
situation in
present circles to
improve total Market share
market share

27 Indian Institute of Management Kozhikode

Currently, Idea’s market share is lowest among the top-five players. That is
primarily because Idea operates in lesser no. of circles as compared to its
competitors. So Idea can either enter more circles to increase its total market share
or concentrate more on circles in which they are operating presently and become
top players there.

Financial Projections

Using the existing data for profit from 2005 to 2008 we can estimate the profits for
next four years from 2009.This is done using “Straight line fit method “.the formulas
required to make the estimation are shown below.

Y=a+bX

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 ∑XY=a∑X+b∑Y2

∑Y2=a∑Y+b∑XY
where Y is the profit and X is the last digit of the year.

By making use of the above table and the formula we arrived at the
following results.

The Marketing budget

29 Indian Institute of Management Kozhikode

The advertising costs of 2009 -10 were projected using the data available
for previous years advertising costs.

Based on previous year’s advertising expenses we projected this year’s advertising

expense to be around 5676 million. This was allocated according to the above break
ups.

TV ads: amount to be spend equals 0.356*5676=2020.65million

Major portion of the advertising is done through television ads as they help to target
both the youth and the older people.

Magazine ads: amount to be spend equals 0.071*5676 = 402.996 million

Internet ads: amount to be spend equals 0 .051*5676 =289.476 million

Newspaper ads: amount to be spend equals 0.119*5676=675.444 million

Retailer awards: amount to be spend equals 0.047*5676= 266.772 million

Distributor awards: amount to be spend equals 0.032 *5676= 181.632 million

Sponsorship amount: to be allocated equals 0.147 *5676=834.372 million

Retail chain amount: to be spend equals 0.059 *5676 =334.825 million

Road side banners: amount to be spend equals 0.051*5676=289.4 million

Multiplex ads: amount to be spend equals 0.068 *5676=385.968 million

30 Indian Institute of Management Kozhikode

REFERENCES
1. www.indiastat.com

2. www.Ideacellular.com

3. www.adityabirla.com

4. http://ieeexplore.ieee.org/Xplore/dynhome.jsp

5. Marketing Management ,Kotler

6. Financial report of Idea Cellular

7. Quarterly report of Idea cellular

31 Indian Institute of Management Kozhikode

 8. Investor Presentation Q1FY10

9. www.capitaline.com

10.http://titania.sourceoecd.org/vl=1591291/cl=15/nw=1/rpsv/home.htm

11.http://site.securities.com/ch.html?pc=IN

12.www.warc.com

13.Cygnus business consulting and research data

14.The Indian telecom industry ,by marketing club of IIM Calcutta

15.Comparative study of Telecom Service Providers in India (IEEE paper)

Annexure
Market Survey on Cellular service usage
Market survey conducted as a part of academic project at IIM Kozhikode

32 Indian Institute of Management Kozhikode

* Required

Which age group do you belong to? *

• Below 15 years

• 15- 19 years

• 20-24 years

• 25-34 years

• 35 years and above

Which age group do you belong to? *

• Below 15 years

• 15- 19 years

• 20-24 years

• 25-34 years

• 35 years and above

What is your average monthly income (in Rupees) ? *

• less than 7,500

• 7,500-15,000

• 15,000-25,000

• Above 25,000

What is your average monthly mobile bill (in rupees)?

• less than 200

• 200-400

• 400-1000

• Above 1000

33 Indian Institute of Management Kozhikode

Which mobile service do you use? *

• Aircel

• Airtel

• BSNL

• Idea/Spice

• Tata Indicom

• Vodafone

• No cell phone

• Other:

How did you get information about the above service provider? (or how do you
usually get info. about different mobile operators)

• Friend's reccomendation

• Advertisements in news paper, media etc

• Sales promotional calls

• Internet browsing

• Street promotion, pamphlets, Hoardings etc

• Other:

How frequently do you switch between service providers? *

• less than three months

• 3 months to one year

• 1 to 2 years

• more than two years

• never switched

34 Indian Institute of Management Kozhikode

If Idea Cellular offers a better service than your current service provider, will you
switch to it ?

• Yes

• No

• Will think about it

What do you like to use, pre-paid or post-paid?

• Pre-paid

• Post-paid

How much is your approximate weekly mobile usage?

• less than one hour

• 1 to 3 hours

• more than 3 hours

Which of the following paid services would you like to have? (choose maximum
THREE most important uses only

• Mobile Banking

• Mobile ticketing services

• Content download (wallpapers, ringtones)

• Daily tips (news,horoscopes, jokes etc)

• Mobile radio

• Internet

• Other:

What are you top three priorities in Choosing a particular service provider Please
choose maximum three options only

35 Indian Institute of Management Kozhikode

 • Local and STD call rates

• Free SMS services

• subsidised calls to closed user groups/with in same networ

• Area coverage

• Roaming facilities

• Value added services

• Customer care service

• Style and Brand

• Other:

Submit

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