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PROJECT ON MARKETING STRATEGIES ADOPTED BY

AIRTEL IN INDIA.

SUBMITTED BY

SNEHA S. SINGH

ROLL NO. A-106

M.COM PART-I (Semester - II)

*2013-2014*

UNDER THE GUIDANCE OF

PROF. POONAM KAKKAD

SUBMITTED TO

UNIVERSITY OF MUMBAI

NIRMALA MEMORIAL FOUNDATION COLLEGE OF COMMERCE AND

SCIENCE, 90 FEET ROAD, ASHA NAGAR, THAKUR COMPLEX,

KANDIVALI (EAST), MUMBAI - 400 101.

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DECLARATION

I, Ms. SNEHA S. SINGH of M.COM Part-I (Semester-II) hereby declare that I

have completed the project on PROJECT ON MARKETING STRATEGIES

ADOPTED BY AIRTEL IN INDIA as a part of internal examination in the

Course of Strategic Management during the academic year 2013-2014.

The information submitted is true and original to the best of my knowledge.

Wherever the matter is taken from any published work, I have included that

details as reference.

... .....

Date of Submission Signature of Student

(SNEHA S. SINGH)

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CERTIFICATE

This is to certify that the project titled as PROJECT ON MARKETING

STRATEGIES ADOPTED BY AIRTEL IN INDIA has been completed by

Ms. SNEHA S. SINGH of M.COM Part-I (Semester-II) as a part of internal

examination during academic year 2013-2014.

. .......

(Dr. T. P. MADHU NAIR) (Dr. ALPA UPADHYAY)

Principal Programme Coordinator

.......... ..

(Prof. POONAM KAKKAD) External Examiner

Project Guide

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ACKNOWLEDGEMENT

I extend my gratitude to Prof. POONAM KAKKAD for providing guidance

and support during the course of project. She has been a great help through

the making of the project. I thank NIRMALA MEMORIAL FOUNDATION

COLLEGE for giving me the opportunity to work on such a relevant topic.

I also like to thank the Principal, faculty members and librarian for their help

and others who are indirectly responsible for the completion of this project. In

addition I would like to take this opportunity to thank our M.COM

Coordinator Dr. ALPA UPADHYAY for being there always to guide me and

for extending her full support.

Date: ...

Mumbai Signature of Student

(SNEHA S. SINGH)

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PROJECT ON MARKETING

STRATEGIES ADOPTED BY AIRTEL IN

INDIA

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INDEX

SR. NO. PARICULARS PAGE NO.

1. TELECOMMUNICATION MARKET IN INDIA 7-8

2. INDIAN CELLULAR MARKET 9-10

3. OVERVIEW OF AIRTEL 11-12

4. INTRODUCTION OF AIRTEL 13-17

5. HISTORY OF AIRTEL 18-22

6. MARKETING STRATEGY ADOPTED BY AIRTEL 23-32

7. SWOT ANALYSIS OF AIRTEL 33-37

8. CONCLUSION 38

9. WEBLIOGRAPHY 39

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TELECOMMUNICATION MARKET IN INDIA

The Indian telecommunications Network with 250m telephone connections

isthe fifth largestin the world and is the second largestamongemerging

economiesof Asia. Today it is the fastestgrowing market in the world and

represents unique opportunities for UK companies in the stagnant global

scenario. Tele-density, which was languishing at 2% in 1999, has shown an

impressive jump to 9.5% in 2006 and 10.5% in 2007 and is set to increaseto

20% in next five yearsbeating the Govt. target bythreeyears.A

ccordingly,

Indiarequires incremental investments of USD 20-25 bln for the next five

years.

Private operators have made.mobile.telephone the fastest growing (over

164% p.a.) in India.With more than 33 million users (both CDMA and

GSM), wireless is the principal growth engine of the Indian telecom

industry. Given the currentgrowth trends, cellular connections in India will

surpassfixed line by late. 2004 / early 2 0 0 5 . Intense competition between

the four main private groups - Bharti, Vodafone, Tata and Reliance and

with the State sector incumbents-BSNL and AIRCEL has brought about

asignificant drop in tariffs. Thereh as been almost7 4% in cell c

harg

es,

70% in ILD callsand 25% drop in NLD charges, resultingin aboom timefor

the consumers.

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The Government hasplayed a key enabling role by deregulating and

liberalizing the industry,in competition and paving the way for growth.

While there were regulatory irregularities earlier, resulting in litigation,

these have all been addressed now. Customs duties on hardware andmobile

handsetshavebeen reduced from 14percent to 5percent.

TheIndian governmenthas emergedthe I.Tand Telecom Ministriesto speed up

reforms.and decisionon the Communication Convergence Bill to enable the

common regulationof the Internet,broadcastingand telecomswillbe taken

after the new Government assumes responsibilities in may this year. An

independent regulatorybody (TRAI) and dispute settlementbody (TDSAT)

is fully functional.

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INDIAN CELLULAR MARKET

The Bharti Group, which operates in 23 circles, continues to be the country's

largest cellular operator, with 50 lakh subscribers. BSNL, which operates in 22

circles, has a subscriber base of 37 lakh subscribers. Thus BSNL stands

second largest cellular operator in terms of subscriber base at the end of the

fiscal ending March 31, 2007, displacing Vodafone from the second

position.

Vodafone, which operates in only eighteen circles, is the third largest operator

with a base 32 lakh. Unlike fellow public sector undertaking, AIRCEL, which

operates in Mumbai and Delhi, BSNL has been a very aggressive player in the

market. "Cellular operators who expected BSNL to go the AIRCEL way,

were taken by surprise and did not take effective steps to counter it, till

it was too late in the day," said a telecom analyst.

Belying fears of a slowdown in cellular subscriber acquisitions, the cell club has

reported a 7.92% growth, the highest growth in any month so far, during March

2005. Year-on-year, the cellular subscriber base in the country has almost

doubled in March 2005, and is expanding at the rate of 25% per year thereafter.

The cellular subscriber club expanded by 21.31 lakh last month. This is much

higher than 5.9 lakh subscribers added in February 2005 and 2.13 lakh in

January 2005. Idea, which operates in Seven circles, is the fourth largest

operator with a subscriber base of 17.80 lakh, higher than BPL's 11.31

lakh subscribers across four circles. The subscriber numbers per operator drop

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with the sixth largest operator,Spice Communications, having a subscriber base

of 9.40 lakh, followed by Reliance Telecom's 8.9 lakh subscribers.

While the subscriber base jumped by 3.38% to 44.39 lakh in the metros,

subscriber base of category A circles of Maharashtra, Gujarat, Andhra

Pradesh, Karnataka and Tamil Nadu jumped by 10.18 % to reach 43.64

lakh. Category B circles of Kerala, Punjab, Haryana, Uttar Pradesh

(West), Uttar Pradesh (East), Rajasthan, Madhya Pradesh and West Bengal

recorded a jump of 10.69%, with a total base of 33.74 lakh subscribers. Circle

C has reported 12.74% growth with subscriber numbers jumping to 5.08 lakh.

Among the metros, while Mumbai added 1,63,180 subscribers, higher than

the 1,58,646 added by Delhi, the Capital's cellular subscriber base of over

80 lakh is still higher than Mumbai's 66.89 lakh. While the cellular industry

has been on roll for the first three quarters of the previous financial year with an

average of 16.75 lakh monthly additions in the third quarter, the first two

months of 2007 had seen the growth slowingdown.

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OVERVIEW OF AIRTEL

Incorporated on July 7, 1995, Bharti Airtel Ltd is a division of Bharti Enterprises. The businesses

of Bharti Airtel are structured into two main strategic groups Mobility and Infotel. The Mobility

business provides GSM mobile services in all23 telecommunications circles in India, while the

Infotel business group provides telephone services and Internet access over DSL in 15 circles. The

company complements its mobile, broadband, and telephone services with national and

international long-distance services. The company also has a submarine cable landing station at

Chennai, which connects the submarine cable connecting Chennai and Singapore. Bharti Tele-

Ventures provides end-to-end data and enterprise services to corporate customers by leveraging its

nationwide fibre-optic backbone, last mile connectivity in fixed-line and mobile circles, VSATs,

ISP and international bandwidth access through the gateways and landing station. All of Bharti

Tele-Ventures' services are provided under the Airtel brand. As of September 2005, Bharti Tele-

Ventures was the only company to provide mobile services in all 23 telecom circles in India. By

the end of October 2005, Bharti Tele-Ventures was serving more than 14.74 million GSM mobile

subscribers and 1.10 million broadband and telephone (fixed line) customers.

The equity shares of Bharti Tele-Ventures are currently listed on the National Stock Exchange of

India Ltd (NSE) and the Stock Exchange, Mumbai (BSE). As of September 30, 2005, the main

shareholders of Bharti Tele-Ventures were: Bharti Telecom Ltd (45.65%), a subsidiary of Bharti

Enterprises; Singapore Telecom (15.69%), through its investment division Pastel Ltd; and,

Warburg Pincus (5.65%), through its investment company Brentwood Investment Holdings Ltd).

Other shareholders with more than a 1% stake were: Citi Group Global Markets Mauritius Pvt Ltd

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(2.99%); Euro pacific Growth Fund (2.04%); Morgan Stanley & Co International Ltd (1.93%);

CLSA Merchant Bankers Ltd A/C Calyon (1.33%); Life Insurance Corporation of India (1.34%);

and, The Growth Fund of America Inc. (1.11%). Sunil Bharti Mittal, the founder-chairman of

Bharti Enterprises (which owns Airtel), is today, the most celebrated face of the telecom sector in

India. He symbolizes the adage that success comes to those who dream big and then work

assiduously to deliver it. Sunil Bharti Mittal began his journey manufacturing spare parts for

bicycles in the late 1970s. His strong entrepreneurial instincts gave him a unique flair for sensing

new business opportunities. In the early years, Bharti established itself as a supplier of basic

telecom equipment. His true calling came in the mid 1990s when the government opened up the

sector and allowed private players to provide telecom services. Bharti Enterprises accepted every

opportunity provided by this new policy to evolve into India's largest telecommunications

company and one of India's most respected brands. Airtel was launched in 1995 in Delhi. In the

ensuing years, as the Airtel network expanded to several parts of India, the brand came to

symbolize the very essence of mobile services.

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INTRODUCTION OF AIRTEL

Bharti Airtel Limited was incorporated on July 7, 1995 for promoting investments in

telecommunications services. Its subsidiaries operate telecom services across India. Bharti Airtel

is India's leading private sector provider of telecommunications services based on a strong

customer base consisting of 50 million total customers, which constitute, 44.6 million mobile and

5.4 million fixed line customers, as of March 31, 2007.

Airtel comes to us from Bharti Airtel Limited - a part of the biggest private integrated telecom

conglomerate, Bharti Enterprises. Bharti provides a range of telecom services, which include

Cellular, Basic, Internet and recently introduced National Long Distance. Bharti also

manufactures and exports telephone terminals and cordless phones. Apart from being the largest

manufacturer of telephone instruments in India, it is also the first company to export its products

to the USA. Bharti has also put its footsteps into Insurance and Retail segment in collaboration

with Multi- National giants. Bharti is the leading cellular service provider, with a footprint in 23

states covering all four metros and more than 50 million satisfied customers.

CMDs (Founder) Profile:-

Sunil Bharti Mittal

He started his career at a young age of 18 after graduating from Punjab University in India and

then he founded Bharti.

Chairman & Managing Director since October 2001

Age: 49 years

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Today, at 49, he heads a successful enterprise, amongst the top 5 in India, with a market

capitalization of over US$ 40 billion and employing over 30,000 people.

He is an alumnus of Harvard Business School, USA.

He has been conferred one of the highest civilian awardPadma Bhushan.

He has been conferred the degree of Doctor of Science by the G B Pant University of

Agriculture & Technology.

FIGURES & FACTS

Total Wireless subscribers in India In June 09 & July 09 are 102,367,881&

1,05,177,635 respectively.

Total Wire line subscribers in India In June 09 & July 09 are 2,827,882 & 2,861,822

respectively.

STRATEGIC BUSINESS UNIT OF AIRTEL

Mobile services

Mobile and fixed

wireless services

Airtel telemedia

Broadband,

Telephone services& DTH

Enterprise services

End-to-end data and

enterprise servicesto the corporatecustomers throughits nationwide fiberoptic backbone

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MARKET SHARE

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Distribution Model:

The company whose operations are concentrated in and around Delhi, it has 27 Franchisees and

15 Distributors. They also have 8 'instant access cash card counters. Each franchises or distributor

can have any number of dealers under him as long as the person is approved by the Airtel

authority. Each franchises has to invest Rupees Ten Lakhs to obtain a franchise and should

employ an officer recruited by Airtel. This person acts as an liaison between the company and the

franchises. The franchises can it any number of dealers as long as their territories do not overlap.

But unfortunately Airtel has not been very successful in controlling territorial overlaps of dealers.

The franchises can carry out his or her own promotional strategy. For this the. company

contributes 75% of the money and the franchises contributes 25% of the money. The dealers

under the franchisee receive the same commission. The franchises and the dealer obtain the

feedback from the customers and they are sent through the liaison officer on a day-to-day basis to

COMPANY

Customer

Dealer

Franchise Distributor

Customer

Dealer

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Airtel. The dealer has to invest Rs. One Lakh as an initial investment. The dealer of Airtel are not

allowed to provide any other operators' service.

Target set for distributors and the dealers is 100 -150 activations per month. Hence the

dealers can also go for their own promotions like banners and discounts on festivals etc.

The dealer provides service promptly. The consumer on providing the bill of purchase for

the handset and proof of residence has only to wait an hour before getting connected. The

staff of the dealers and the franchisees are provided training by the Airtel personnel.

The complaints encountered by the franchisees and dealers are either handset being non-

functional or the SIM Card not getting activated. Anything more complicated is referred to

the main Airtel office in Delhi.

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HISTORY OF AIRTEL

Bharti Cellular launched cellular services 'AIRTEL in Delhi in 1995,Himachal Pradesh in

1997, Karnataka and Andhra Pradesh circles in 1999

In 1998, Bharti Telenet obtained a license for providing fixed-line services in Madhya Pradesh

circle and in the same year, Bharti Telecom and British Telecom formed a 51% : 49% joint

venture

In 1999, New York Life Insurance Fund acquired a 3% equity interest in Bharti Cellular.

In 2001, Bharti Cellular entered into a joint venture, Bharti Aqua net, with SingTel for

establishing a submarine cable landing station at Chennai.

In 2002, Bharti Cellular entered into license agreements to provide cellular services in eight

new circles.

In 2002, Bharti Cellular Ties up with Secondary School Certification Board, Hyderabad,

where Bharti will announce SSC results to its customers on their mobile phones.

In the same year, 2002, ICICI Bank ties up with Bharti for pre-paid mobile cards via ATMs.

In 2003, Bharti Group's cellular brand Airtel has unveiled free multimedia messaging services

(MMS) for its customers. The company has also rolled out pan-India GPRS (General Packet

Radio Services) for its corporate subscribers.

Launches its `IndiaOne MeetXpress' audio-conferencing service(2003)

Airtel provides SMS facilities to hearing impaired in Chennai(2003)

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In 2003, Airtel Subscribers exceed 3 million mark.

In 2004, Bharti Cellular entered into license agreements to provide cellular services in 6 new

circles including Uttar Pradesh (East), West Bengal & Andaman Nicobar, Orissa, Bihar and

Jammu & Kashmir.

Same year Airtel launches GPRS services for pre-paid customers.

Brand Logo

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TAGLINES OF BRAND

'Power to keep in Touch (1995)

'Touch tomorrow (1999)

'Live Every Moment' (2002)

'Express yourself

(2003)

Following are the reasons for change in Tagline of Airtel:

'Power to keep in Touch

YEAR- 1995-1998

SIGNIFICANCE-

-- The tag line 'Power to keep in Touch' used in the brand promise was designed to make the user

feel 'in controlpowerful'.

-- Positioned in premium category aimed at elite class of society.

-- Perception of aspiration and lifestyle brand.

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REASON FOR CHANGE-

-- Now, cellular service operators could drop their prices and target new customer segments.

-- As the category developed with prices going down sharply, Airtel began talking to a wider

spectrum of potential users. This gives the birth to the new Tagline.

'Touch tomorrow

YEAR- 1999-2001

SIGNIFICANCE

-- Airtel started talking to new segments by positively positioning and establishing itself as a

brand that improved the quality of life.

-- New look and the feel of the brand tagline indicated the core values of the brand i.e. leadership,

performance and dynamism.

REASON FOR CHANGE-

-- Airtel started to look from a regional level to pan India position.

-- Rediffussion DY&R, which is the ad agency that took charge of revamping Airtel's brand image

thought, to become an Indian leader, Airtel need to change its tagline.

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'Live Every Moment'

YEAR2002-2003

SIGNIFICANCE

-- This was the first time A R Rehman had agreed to work for any brand, anywhere in the world.

The music from the commercial became the most downloaded ring tone in the history of

telecommunications.

-- Tagline denotes that each and every person in India live every moment (emotions, feelings etc.)

of the life with Airtel.

REASONS FOR CHANGE

-- Rediffussion DY & R, which is the ad agency that took charge of revamping Airtel's brand

image again changed the tagline to give better tagline to Airtel which catches some emotional

appeal.

'Express yourself

YEAR- 2003-2008

SIGNIFICANCE

-- Express yourself' was successfully launched taking the ownership of the entire space of

communication and strengthening the emotional bond Airtel enjoys with its customers.

-- The masterminds behind the 'Express Yourself' campaign are the joint vice-presidents: Mr.

Prashant Godbole and Zarwan Patel.

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MARKETI NG STRATEGY A D O P T E D B Y B H A R T I A I R T E L

Bharti has spent a considerable amount on advertising its mobile phone service, Airtel. Besides

print advertising, the company had put up large no of hoardings and kiosks in and around Delhi.

The objective behind designing a promotion campaign for the Airtel services is to promote the

brand awareness and to build brand preferences.

It is trying to set up a thematic campaign to build a stronger brand equity for Airtel. Since the

cellular phone category itself is too restricted, also the fact that a Cellular phone is a high

involvement product, price doesn't qualify as an effective differentiator. The image of the

service provider counts a great deal. Given the Cell phone category, it is the network efficiency

and the quality of service that becomes important. What now the buyer is looking at is to get

the optimum price-performance package. This also serves as an effective differentiator

Brand awareness isspread through the' campaigns and brand preference through brand stature.

Airtel's campaign in the capital began with a series of'teaser' hoardings across the city,' bearing

just the company's name and without explaining what Airtel was. In the next phase the

campaign associated Airtel with Cellular only thereafter was the Bharti Cellular connection

brought up. Vans with Airtel logos roamed the city, handing out brochures about the company

and its services to all consumers. About 50,000 direct callers were sent out. When the name

was well entrenched in the Delhiitess mind, the Airtel campaign began to focus on the utility of

Cellphone. In the first four months alone Airtel's advertisement spend exceeded Rs. 4 crores.

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As of today the awareness level Is 60% unaided. This implies that if potential or knowledgeable

consumers are asked to name a Cellular phone service provider that is on the top of his/her mind

60% of them would name Airtel. As for aided, it is 100% (by giving clues and hints etc.).

Brand strength of a product or the health of a brand is measured by the percentage score of the

brand on the above aided and the unaided tests. The figures show that Airtel is a healthy and a

thriving brand.

Every company has a goal, which might comprise a sales target and a game plan with due regard

to its competitor. Airtel 's campaign strategy is designed keeping in mind its marketing strategy.

The tone, tenor and the stance of the visual ads are designed to convey the image of a market

leader in terms of its market share. It tries to portray the image of being a "first mover every

time" and that of a "market leader".

The status of the product in terms of its life cycle has just reached the maturity stage in India. It

is still on the rising part of the product life cycle curve in the maturity stage.

The diagram on the left hand side shows the percentage of the users classified into heavy,

medium and low categories. The right hand side shows the revenue share earned from the three

types of users.

Airtel, keeping in mind the importance of the customer retention, values its heavy users the

most and constantly indulges in service innovation. But, since heavy users comprise only 15 -

20% of the population the other segment cannot be neglected.

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The population which has just realized the importance of cellular phones has to be roped in. It is

for this reason that the service provider offers a plethora of incentives and discounts. Concerts

like the "Freedom concert" are being organized by Airtel in order to promote sales. The media

channel is chosen with economy in mind. The target segment is not very concrete but, there is

an attempt to focus on those who can afford. The print advertisements and hoarding are placed

in those strategic areas which most likely to catch the attention of those who need a cellular

phone. The product promise (which might cost different 1 higher) is an important variable in

determining the target audience.

Besides this, other promotional strategies that Airtel has adopted are:

People who have booked Airtel services have been treated to exclusive

premiers blockbuster movies. Airtel has tie-up with Lufthansa to offer customer bonus

miles on the German airlines frequent flier's programs.

There have been educational campaigns, image campaigns, prelaunch

advertisements, launch advertisements, congratulatory advertisements, promotional

advertisements, attacking advertisements and tactical advertisements.

And nowadays airtel is targeting the young generations by providing special packs to

young generations as there requirement. And they promoting their product by campaign or

advertisement carrying slogan HER EK FRIEND JARURI HOTA HAI.

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BCG MATRIX

BCG Matrix is used to find out the relative growth prospects of the product line. Within

the Airtel product line leased, private, circuit are among star.

Airtel is going to have a submarine cable between Singapore and Chennai with the

collaboration of SingTel. This wills Airtel to maintain its position in IPLC market. Right

in India only VSNL have such cables.

HIGH

GROWTH %

LOW

Leased

Private

Circuit

Stars

Basic Telephone

(Fixed Line)

Cows

ISP

Cellular

Do s

HIGH LOW

Relative Market Share

uestionmarks

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ANSOFF MATRIX

To portray alternative corporate growth strategies, Igor Ansoff conceptualized a matrix that

focused on the firmspresent and potential products and markets / customers. He called the

four product-market strategic alternatives

market penetration [existing market + existing product],

market development [existing product + new market],

product development [existing market + new product], and

Diversification [new product + new market].

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.

MARKET

PENETRATION

ENTERED IN BROADBAND

AND FIXED LINE MARKET

PRODUCT

DEVELOPMENT

IPLC PRODUCTS

MARKET

DEVELOPMENT

LOOKING FOR OVERSEAS

MARKET

DIVERSIFICATION

OUTSOURCING

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MARKET PENETRATION: Airtel entered in broadband and fixed phone line market.

PRODUCT DEVELOPMENT: IPLC products.

MARKET DEVELOPMENT: Airtel is now looking for overseas market.

DIVERSIFICATION: Airtel has now outsourcing sum of its services like

customer services with IBM.

INDUSTRY STRUCTURE PORTER'S MODEL

Supplier Power

Low

Supplier

Power is

Entry

Barriers

Entry

Barriers

Threats of

Substitutes Low

Threats of

Substitutes

BPC LowBPC Getting

Higher

Industry Attractiveness

High Earlier

Low Now

Prior to Competition Post Competition

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The earlier pattern used to be that the national telecom company used to own every segment

of the value chain till the international gateway. With liberalization there was competition in

virtually every segment. There are companies that provide local connectivity, those that

function as long distance carriers, and those that provide only gateway links. Some integrated

players operate in all segments. The intensity of competitive pressures across the chain is

reflected in the downward spiral being witnessed in tariffs and prices to customer.

The value chain for cellular mobile service and Internet Service Providers (other than cable

based net connections) are similar in as much as the calls reach the destination through similar

local loop, long distance and international gateway.

ENVIRONMENTAL ANALYSIS

It is a systematic examination of all 3 levels of the environment with at least three purposes:

Detecting important economic, social, cultural, environmental, health, technological,

and political trends, situations, and events

Identifying the potential opportunities and threats for the institution implied by these

trends, situations, and events

Gaining an accurate understanding of your organizations strengths and limitations

STEEP refers to changes in the social, technological, economic, environmental, and political

sectors that affect organizations directly and indirectly.

A STEEP analysis of the macro environment indicates that economic (a phone call being a

cheaper way to stay in touch than outstation travel for example) and social factors (working

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outside the home town) have forced the pace of utilization of technology (Public Call Offices,

mobile phones, networked companies). Increasing customer awareness has raised expectations

and vocal demands are being articulated for consumer rights; such political factors have in turn

impacted the competitive environment by way of entry of private players, independent

regulation, and a policy framework tilted towards a level playing field for new entrants. A

near environment analysis indicates that the competitors are becoming active resource

rivals (political and financial) apart from applying pressures as customer rivals. The

customer has, needless to say, benefited from increased choice from within the communications

services basket itself.

CORE COMPETENCE

Airtel core competencies are sales & promotions and as of now Airtel is leading brand in

mobile services in India. Airtel have three big personality Viz. Sachin Tendulkar , Shahrukh

Khan and music maestro A. R. Rahman for endorsing there product and services currently

Airtel is outsourcing there no competence function and try to fully concentrate on his core

competency that is sales promotion.

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5-FORCE MODEL

Threat from Competition:

Reliance (CDMA + GSM)

Tata (CDMA)

Vodafone (GSM + BPL)

Idea (GSM)

Others (CDMA + GSM)

Customer Bargaining Power:

Lack of differentiation among service providers.

Cut throat competition.

Low switching costs.

Threat fromCompetition

CustomerBargaining

Power

Threat ofSubstitutes

SupplierBargaining

Power

Threat ofNew

Entrants

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Number portability will have negative impact.

Businesses and consumers.

Supplier Bargaining Power:

Outsourcing deals.

Network outsourcing and maintenance.

Information Technology.

Passive Infrastructure.

Call center outsourcing.

Threat of Substitutes:

Landline

CDMA

Videoconferencing

VOIPSkype, Gtalk, Yahoo Messenger

E-Mail and Social Networking Websites

Threat of New Entrant:

Huge license fees to be paid upfront and High gestation period.

Entry of WiMAX operators.

Spectrum Availability and Regulatory Issues.

Infrastructure setup cost - High.

Rapidly changing technology

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SWOT ANALYSIS OF AIRTEL

STRENGTHS

Cost advantage

Current leaders in quality service

Largest distribution network

Ability to constantly innovate

Highly skilled workforce

Entrepreneurial zeal

Airtels increased equity and market

cap.

WEAKNESSES

To prove credibility

Price pressures

Need for Government support

Awareness

Sales and Marketing

OPPORTUNITIES

To sustain passion and commitment

Airtels market share increasing at other

service provider expense. Thus

opportunity to wipe it out.

Attain higher value services

Collaborative business needs to be

explored

Vertical repeatable solutions.

Low penetration level in rural markets.

THREATS

Foreign investment

Global trends moving from GPS to

WLL.

Lack of global parity in telecom tariff

Other competition

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STRENGTH

1) Very Focused On Telecom: Bharti Airtel is largely focused on the telecom, around 93% of the

total revenue comes from telecom (Total telecom revenue Rs 3,326).

2) Leadership In Fast Growing Cellular Segment: Airtel is holding leadership position in

cellular market. Bharti Airtel is one of India's leading private sector providers of

telecommunications services based on an aggregate of 27,239,757 customers as on August 31,

2006, consisting of 25,648,686 GSM mobile and 1,591,071 broadband & telephone customers.

3) Pan India Footprint: Airtel offers the most expansive roaming network. Letting you roam

anywhere in India with its Pan-India presence, and trot across the globe with International

Roaming spread in over 240 networks. The mobile services group provides GSM mobile services

across India in 23 telecom circles, while the B&T business group provides broadband & telephone

services in 92 cities.

4) The Only Operator In India Other than VSNL Having International Submarine Cables:

Airtel, the monopoly breaker shattered the Telecom monopoly in the International Long Distance

space with the launch of International Submarine cable Network i2i jointly with Singapore

Telecommunications Ltd. in the year 2002. This has brought a huge value to the IPLC customers,

delivering them an option besides the incumbent carrier, to connect to the outside world.

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WEAKNESS

1) Price Competition from BSNL and MTNL: Airtel is tough competition from the operators

like BSNL and MTNL as these two operators are offering services at a low rate.

2) Untapped Rural market: Although Airtel have strong Presence Throughout the country but

still they are far away from the Indian rural part and generally this part is covered by BSNL so

indirectly Airtel is loosing revenue from the rural sector.

OPPORTUNITIES

1) The Fast Extending IPLC Market: An IPLC (international private leased circuit) is a point-

to-point private line used by an organization to communicate between offices that are

geographically dispersed throughout the world. An IPLC can be used for Internet access, business

data exchange, video conferencing, and any other form of telecommunication. Airtel Enterprise

Services and SingTel jointly provide IPLCs on the Network i2i. The Landing Station in Singapore

is managed by SingTel and by Airtel in Chennai (India). Each Landing Station has Power Feeding

Equipment, Submarine Line Terminating Equipment and SDH system to power the cable, add

wavelengths and convert the STM-64 output to STM-1 data streams respectively.

2) LATEST Technology & Low Cost Advantage: the costs of introducing cellular services for

Airtel are marginal in nature, as it needs Only to augment its cellular switch/equipment capacity

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and increase the number of base stations. The number of cities, towns and villages it has Covered

already works to its advantage as putting more base stations for cellular coverage in these areas

comes with negligible marginal cost. Besides such cost advantages, it has also other cost

advantages for the latest cellular technology. As a late entrant into the cellular market, it has dual

advantage of latest technology with modern features, unlike other private cellular operators who

started their service more than 4-5 years back and low capital cost due to advantages of large scale

buying of cellular switch/equipment.

3) Huge market: The cellular telephony market is presently expanding at a phenomenal /

whopping rate every year and there is still vast scope for Airtel to enter /expand in this market.

Besidesthere is a vast rural segment where the cellular services have not made much headway and

many customers are looking towards Airtelfor providing the service to them. With its wide and

extensive presence even in the remotest areas, Airtel poised to gain a big market share in this

segment when it expands cellular services into the rural areas.

THREATS

1) Competition from other cellular: It is time for BSNL to improve/expand its cellular services.

Fierce and cut-throat competition is already in place with the markets ever abuzz with several

tariff reductions and announcement of attractive packages, trying to grab most of the mind share

of the king -the consumer, whose benefits are increasing with passing of everyday. If BSNL is

not innovative and agile, its cellular service will be a flop. It needs to be proactive with attractive

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packaging, pricing and marketing policies lest its presence in the market be treated with disdain by

the private cellular companies. The launch of WLL services by Reliance Infocomm has

aggravated the situation.

2) Market Maturity In Basic Telephony Segment: Although Airtel entered in the basic

telephony market its a biggest there for the company as the basic telephony market has reached.

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CONCLUSION

Bharti is one of the largest single foreign investments made in the Indian telecom sector. The

companys mobile network equipment partners include Ericsson and Nokia. In the case of the

broadband and telephone services and enterprise services (carriers), equipment suppliers include

Siemens, Nortel, Corning, among others. The Company also has an information Technology

alliance with IBM for its group-wide information technology requirements and with Nortel for

call center technology requirements.

Outsourcing the call center operations for the mobile services have been outsourced to IBM

Daksh, Hinduja TMT, Teletech & Mphasis. Airtel is looking for overseas market and already

started operation in Nigeria and Seychelles. Airtel is facing strong completion from MTNL and

BSNL in spite of the fact they are far away from airtel technologically but these two have an

inside reach in rural and urban area and have low tariff Rates. Airtel is holding a position of

Market Leader by having 21 percent of the total market share.

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WEBLIOGRAPHY

www.airtelworld.com

www.airtel-broadband.com

www.trai.gov.in

www.hindustantimes.com

www.Wikipedia.org

http://www.airtelworld.com/http://www.airtel-broadband.com/http://www.trai.gov.in/http://www.hindustantimes.com/http://www.wikipedia.org/http://www.wikipedia.org/http://www.hindustantimes.com/http://www.trai.gov.in/http://www.airtel-broadband.com/http://www.airtelworld.com/