Chapter 1

INTRODUCTION

Communication is among the vital aspects of human life. In olden time, pictures were drawn by humans to express themselves
to one another. But as the time moved, the ways to communicate also changed. The telecom industry came into existence in
1876 when Alexander Graham Bell introduced voice transmission, an easy design made for single side voice communication.
Shortly, two way speech transmissions took over the one way voice transmission project. Here both speakers could
communicate. Now, processing and telecom industries are both efficient service suppliers which are making an effort to
change the outdated PSTN telephony with the IP networks, a regional web connecting the computers and the internet that
grids all of them together.

Telecom can be considered as the world’s largest messed up machine with complicated networks. Phones and transistors are
connected through transmission of networks, while, wires, mobiles and computers connect through internet. Each one of us
some way or the other come in contact with these universal systems which simplifies the exchange of emotions and makes
work easy irrespective of the location in the world. The overhead mentioned amenities can all be easily attained with the help
of telecom service operators. There has been a great progress in the telecommunication industries cause of the new innovative
ideas coming up rapidly. Many of the monopolies of the government are being privatized as the result telecom service
providers now face excess of competition. Industries have started facing a large amount of competition due to the use of old
fashion telecommunication products. Many service providers have moved towards the latest technology and innovative
income producing services. The problems that are being faced by the telecom industry now days is changing the very base of
their business. More modified content rich and merged lifestyle multimedia is being demanded by both enterprises and
consumer. This emergence of latest services and applications seem to be a worthwhile opportunity for better growth. On one
side, there are consumer dominated telecom market presents that gives opportunities to the service providers whereas on the
other side, provides devastating challenges (Alcatel-Lucent, 2007).

Telecommunication service suppliers should move from the old fashion services and provide the new technology networks
which provide tailored, elaborated applications and systems that support professional actions. These measures help in getting
new chances of earning profit, organizing, functioning and upholding the new era networks. However, the issues that restrict
the development of these networks must be addressed. Telecom service providers are rapidly being asked to provide support to
networks but it is getting difficult due to scanty resources. Other than these there are supplementary issues that these servicers
have to face, such as selling of the product, sales force capabilities etc. As the outcome this, company faces problem in
maintaining equilibrium between invention and providing the least number of old products based services with minimum
diversity. The network complexity, time spent on network support and the time spent on network innovation relation is shown
in Figure 1.

Network
Network Complexity Complexity
Resource Allocation

Time spent on
Network Support

Time spent on
Network Innovation

Figure 1 Network complexity, Resource allocation and Innovation

(Source: Alcatel-Lucent, 2007)

We can conclude that, to survive in the telecommunication industry, services suppliers should not only consider network
transformation as a technical issue but also as a business issue.
1.1 Background and Research Context
Recently the telecom industry has faced many drastic changes and seen unbeatable competitiveness. Such variations
attract several writers and researches, as the casual accessibility and largely spread choice of high-tech telecom
technologies which are usually connected with the lucrative value for the societies (Fransman, 2002). According to
Allee and Taug (2006) knowledge and information are the source of competitive advantage. “Now is a golden
opportunity for innovation. But what we, the Telco’s, are doing is re-arranging the deck chairs on the Titanic while the
innovation landscape is changing!"

In recent time strategy is widely used in business world such as marketing strategy, corporate strategy, advertising strategy,
online strategy , product strategy and so on. Basically the word strategy is derived from Greek word “strategos” which means
talent of the general, and first time it was used for business context by William Newman in his book published in 1951. For the
purpose of this study, researcher is mainly focusing on marketing strategy and how it important it is for an organization to
reach new height in business world. “Marketing strategy is a process by which the organization aligns with the market that it
has decided to serve” by Paul Fifield. Marketing strategy means different for different organizations. Good market strategy
helps organizations to earn more profit in business world and it mainly depends the organization management team what
decisions will taken according to the market condition and environment.

If anyone did not know their destination then any way will take them there. A good planned strategy always helps a manager
analyze his action and propose action against strategy. Moreover business goals always ensure the consistency which is
necessary to continued success .If the manger has not planned his strategy he will always agonizing over the decision which
he could make .He will be regretful over the time and money spent. Marketing strategy connects with the public who uses
services of an organization, its supplier and the people connected to the marketer by the source of information. And this
information is used to innovate, improve and promote marketing actions and improve to gain better knowledge of marketing as
a process. The role of marketing strategy is to make a suitable plan to choose one or more available options and then to achieve
the goals by finding the expenditure and making a schedule. A planned marketing strategy helps manger to think over it and
make decision for better control by which it takes the organization in right direction.
1.2 Significance of the research

The direct investments by the foreign investors and the deregulation of the telecom industry resulted in the development in the
nation’s telecom industry. Indian telecom market has fascinated workers from countries as far as Scandinavia, Eastern Europe,
United Arab Emirates and Asia. Billions of dollars have been invested by these telecommunication companies in the country
with an effort to make profit. Everyone has been forced to reduce their prices due to strong competition. Every
telecommunication company finds ways to increase its number of consumers to improve their revenues. The research tries to
look at the marketing strategy of Airtel, examine the effectiveness of marketing strategy and identify the gap in the marketing
strategy of the company.

1.3 Aims and Objectives of Research

The overall aim of the research is to investigate the marketing strategy, which is really an important tool for any telecom
company like Airtel in the volatile telecommunication sector of India. The main research topic is ‘Marketing strategy of Airtel
mobile company’. Based on the topic selected, the researcher has designed a couple of question with their related objectives
that need to be verified at the end of research. The key aims and objectives in this study are as under stated:

• Critical analysis of existing literature on marketing strategy.

• To investigate the marketing strategy which used by Airtel.
• To critically evaluate the effectiveness of marketing strategy use by Airtel.
• Improving market strategies by making recommendations.

1.4 Research Questions

The preferred goals or ideas can be achieved by answering a research questionnaire given as follows:
• What does existing literature say about the marketing strategy?
• What marketing strategy use by Airtel?
 • What are the factor affect the market strategy of Airtel
• How will the marketing strategy of Airtel improve?

1.5 Background of the study: A brief history about the telecom sector in India

In the early 1990s, A new economic policy was taken up by the Indian government which directed towards improving India's
competitiveness in the worldwide markets. It also aimed at increasing growth of exports. A world-class telecom infrastructure
was the only way to achieve these goals.

The telecommunication sector in India is categorized on basis of the four Indian metropolitan cities - New Delhi, Mumbai,
Chennai and Kolkatta . There are around 20 circles which cater to each Indian State. These circles are further categorized
under "A," "B" and "C," where the "A" circle is the most alluring and "C" being the least attractive. Two cellular licenses for
each metro and circle were allotted by the directing body — the Department of Telecommunications (DOT). In 1995, there
was an auction of Thirty-four licenses for GSM900 cellular services to 22 firms. The foremost mobile service company in
India was Modi Telstra, which was launched in August 1995. No firms were allowed to attain more than one metro and three
circles or both in the auction. There are only one bidders for West Bengal and Assam while circle of Jammu and Kashmir and
Andaman and Nicobar have no bidders.

In 1996, a bill was passed by the Lok Sabha by the Telecom Regulatory Authority of India (TRAI), where the president
formally stated the TRAI ordinance on 25 January 1997. TRAI was established by the government of India to distinguish
regulatory operations from functions that dealt with policy formulation, licensing and telecom operations. DOT was purely
responsible for these functions before the formation of TRAI.

It resulted in a gigantic financial pressure on the operators because of huge license charges and huge tenders for the cellular
licenses that moved funds away from network growth and improvement. A large number of suppliers were not able to pay the
huge fees so a many of them withdrew their licenses. A new telecom policy was found in March 1999, (New Telecom Policy
[NTP] 1999), under this policy, the old fixed-licensing system had to be replaced with an income sharing plan. According the
plan, the government had to be paid 8-12 percent of the cellular income.
1.6 Bharti Airtel Company

Bharti Airtel is also famous by the name of Bharti Televenture Ltd. It is one of the biggest mobile companies in India more
than 110 million customers in 2009 by annual report of the company. Telecom services are being provided by it, under the
brand name Airtel, and it is managed and controlled by their head, Mr. Sunil Mittal.

Company Profile

"As we spread wings to expand our capabilities and explore new horizons, the fundamental focus remains unchanged: seek out
the best technology in the world and put it at the service of our ultimate user: our customer."

The entire plan of action of Bharti Enterprises has been based on these grounds. Bharti Enterprises is ahead of competition as
far as its technology is concerned and has played a major role in reformation of telecommunications sector in India with its top
of the line products and services. It has numerous accolades to its credit and has been the first in introducing a range of
revolutionary services. It provided the first mobile service in Delhi, it was the country’s first private basic telephonic service
supplier , it was the first Indian company to provide complete telecommunication \ services in Seychelles and the first private
sector service supplier to find National Long Distance Services in India. Bharti provides its services to approximately 3.21
million total customers out of which nearly 2.88 million are mobile customers while about are 334,000 fixed line customers.

Andhra Pradesh, Chennai, Delhi, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Kolkata, Madhya Pradesh circle,
Maharashtra circle, Mumbai, Punjab, Tamil Nadu and Uttar Pradesh (West) circle are the main parts of its service sector
business. In addition to that, the states of Madhya Pradesh and Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu have a
fixed line operation plus a nationwide broadband and long distance network.

Some time back, Bharti started country wide long distance services. It now provides data and voice transmission services for
calls that originate and terminate on majority of Indian mobile networks. To provide international bandwidth, a submarine
cable project is being executed, joining Chennai-Singapore by the company.
Bharti Enterprises is the largest producer of telephone sets and sells overseas telephone terminals and cordless phones to USA.

Bharti Tele-Ventures' strategic objective is “to capitalise on the growth opportunities that the Company believes are available
in the Indian telecommunications market and consolidate its position to be the leading integrated telecommunications services
provider in key markets in India, with a focus on providing mobile services”.

Business structure

Bharti Airtel was divided into three alter strategic business units (SBU's):

• Mobile Services: It offer mobile and landline services with help of GSM technology in telecom circle of 23.
• Airtel Tele media Services: It provides broadband and telephones services in 95 cities and newly launches DTH
services and Airtel digit.
• Enterprise Services. It offers services to corporate user by national wide fiber optic, fixed line and mobile with
international bandwidth.

Airtel brand ambassador

• Shahruk Khan is the brand ambassador for mobile company

• Karenna Kapoor and Saif Ali Khan - Bollywood couple is used for advertising DTH services.
• Sachin Tendulkar and A.R Rehaman are also brand ambassadors for Airtel company . They are used to advertise their
products and services, especially Rehaman who has composed the Airtel tunes which is world wide famous.
Global Status

Bharti Airtel is the third bigger mobile companies in home country on the bases of their costumers follow by China Mobile and
China Unicom and at international level it place sixth integrated with essar.

In Indian mobile market Airtel has a 24.9% share of the cellular services, followed by Reliance communication consisting of
17.1% share and then Vodafone Essar share 18.4%. Manoj Kohili is the MD and CEO for Indian and South Asian operations
since January 2010

Airtel products and it services

Airtel offer multinational services amongst India, Bangladesh and Sri Lanka manage by Bharti Airtel under the level of Airtel:
cellular Services, internet, fixed line Services; Leased Line and Long Distance Services and Enterprise Services.

The company offers Broadband (DSL) and telephone services (fixed line) in over 94 indian cities through 15 circles. On
March 31, 2008, the Company had 2,283,328 customers (a growth of 22%), of which 34.8% (~795,000) were using
broadband / internet services. The focus of the organization is on those cities that have a potential for growth in the telemedia
services. Supply with installation of fixed-line telephones which caters local, national and international long distance voice
connectivity and broadband Internet access through DSL is offered by the product in this segment.
 (source www.bhartiairtel.in)

It is apparent in the figure above that the telecommunications industry in India has experienced a colossal jump with a revenue
of $42 billon in 2008-2009 as compared to about $20 billion in the year 2005-06.
The above figure shows that the market share of wireless lines was only 14% as compared to the fixed lines of 86% in 2007-
08.

1.7 Outline of the dissertation

The dissertation consists five chapters; a short note on each chapter is described below:

Chapter 1. In this chapter the context of study is established, its purpose is defined, the contributions of this research are
discussed and its objectives are stated. Chapter begins with an appropriate title explaining the topic. It introduces the research
which then follows to a rational study of the topic, emphasizing on the goals and purpose of the research. This chapter also
forms a base for the rest of the dissertation

Chapter 2 provides an analytical outlook of the related literature on marketing schemes in general and the marketing schemes
of Airtel. The literature has been extracted from a number of bulletin articles, administrative books and specialized bodies
keeping the research purposes in notice. The theory and practice has been exhibited in a wider perspective. The literature
comprises of the classification and production of suitable ideas and theoretical outlines. This chapter will also try to identify
the gap between the marketing strategy identify corporate entrepreneurship as a option to effectively compete in the Indian
telecom market.

Chapter 3 gives an outline of the investigation system used in the study by giving examples of aptness and limitation of the
project. The selection of research method is explained and connected to research objects recognized in preceding chapters. The
research tools used in the research are also illuminated in detail using the suitable research language. The illustration size and
its rationalization are also talked about in the chapter taking into thought the instrument design, dependability and validity

Chapter 4 gives a clear demonstration of the conclusions and examinations directly associated to the research questions. This
chapter exhibits perfect skills of organization, association and synthesis of data according to each segment of the investigation.

Chapters 5 finally provide a conclusion and propose suitable references. This chapter delivers a perfect relation between
study purposes, literature and outcome of the research. Some execution issues are discussed in this chapter too. This chapter
also comprises of a sector which studies the research work and overall limitation.

1.8 Limitation of Study

In the conducted research, following are some of the limitation:

Sample: While judging the perception of consumers the link for the questionnaire was posted on the internet which means
that data was collected from individuals that had access to computers. In India most of the population lives in rural areas and
the research conducted failed to gather their opinion.

Method: The questionnaires were sent by email to various respondents which ignored the importance of body language and
environment of the respondents. Respondents might be manipulating and fabricating the answers rather than reporting the
ground realities.
Time and Resources: The research was conducted in a limited time period and researcher was also bound with word limit
which affected the analysis and accuracy of results.

Sample Size: Due to time constraints and nature of study only one mobile company was studied. Though these companies are
major mobile operators of the country but still they do not reflect the whole prospective of the industry.

Road Map for the dissertation

Introduction
Aims, Rational of study, Definition of problem, Objectives, Research Question, Research Methodology & Contribution of research

Literature Review

Marketing Strategy

Marketing Strategy of Airtel

Identification of Gap in literature and identifying corporate entrepreneurship as a way to success

in Indian competitive market
Research Methodology

Conclusion and Recommendations

Examine the effectiveness

Research ofrecommendations
marketing
Questions
Appropriate linkedstrategy
with of Airtel
and objectives
conclusions
 Chapter 2
Literature Review

The main aim of this dissertation is to focus on the branding schemes of the IT firms in
the developing companies. Under this chapter a collection of literature philosophies and
a skill required to identify information is presented. There is a mix of data and borrowed
philosophies is collected here is related to the study.

Rational flow of concepts, trustworthy and appropriate references with significant, use of
proper terms, and a fair and wide view of research on the topic are important. Following
are a few editorials and journal based on marketing policies of an item, telecom selling
plans, and telecommunications marketing strategy in the country:

2.1 Marketing Strategy

Kotler, Gregory and Rodgers. (1997), have explained marketing strategies as an idea
which helps a firm in concentrating on its present sources to increase its profit by
increasing its sale. Customer satisfaction should be its most important goal. “A
marketing strategy is compressive systematic independent and periodic examination of a
company or business units marketing environment objectives strategies and activities
with a view of determine problem areas and opportunities and recommending a plan
faction to improve company marketing performance.”

Marketing Strategies draws out various facts and helps in making decisions in the best
possible way, it enables to find supporters and find the worth of the produced goods or
service (manage the marketing mix variable). According to Henry mintzberg, “Marketing
strategy is that set of management decision which identify which customers will be
targeted and what value propositions will be made to them”

To say, it is map which enables an organization or a company to use their limited

resources to attain their best and to get maximum benefit. It is a planning done by the
company to get maximum profit in every field and protect its self from tough competitors
and also to strengthen itself.

An article on defensive marketing strategies in marketing science was written by Hauser

J. and Shugan S. (1983). In this an analysis has been shown on the adjustments done by
companies towards its selling cost and its rate to save its position in the markets form the
new competitive products. The main goal is to provide efficient expert recommendations
on the strategy of response. Especially, we show that representing the item in different
attributed area, a firm can increase its profit.

• Advertising can be used to raise awareness about a product/service

• If the new product cannot be kept out of the market then decreasing the budget is
the most significant option.
• Increasing the price is most favourable option
• There may be a downfall in profit also under optimum plans due to
competitiveness of recent items.

Nevertheless, the quality of the product should be upgraded and the advertising should be
done in such a manner the product seems to be ideal for the consumer. The prices should
be lowered to guard the strength of the product.

A paper on selling plans was written by Robertson. T and Wind.Y (1983) in the journal
of marketing: new directions of theory and research which stated that new directions for
marketing strategy are made, which aim at overcoming the current limitations of
marketing theory. A pilot application of the process along with an integrated planned
marketing approach is being offered. A memo for research on marketing strategy
concludes the paper.

The marketing agendas of the companies can be in improved by the studying the
consumers and understanding issues like:

• The understating of a consumers mental set while selecting from different options
available (e.g., brands, products) ;
• By learning the role played by the environment of the consumer.(e.g., culture,
family, signs, media);
• How the customers behave while purchasing a product.
• The ability to decide and purchase products is decreased due to the lack of
information.
• The customer’s inspiration and decision schemes differentiate among the items
which differ in the level of significance or importance that are demanded only for
the consumer; and
• The improvement in the selling schemes to improve the research of customers.
• After taking the customers into attention comprehending these matters help us in
adopting our plans. Like, to get the most interest of our consumers, we get to
know that effectual, publicity should be done again and again. We also observe
that sometime logical reasons and rest times emotional and symbolic appeal
peruse more consumers. Therefore by understanding the consumer it makes it
 easier for us as to what scheme should be applied to make better and simpler
decisions.

2.2 Consumer Behavior

The "official" explanation of consumer behavior is "The study of individuals, groups, or

organizations and the processes they use to select, secure, use, and dispose of products,
services, experiences, or ideas to satisfy needs and the impacts that these processes have
on the consumer and society." Although it is not necessary to memorize this definition, it
brings up some useful points:

• Behavior occurs either for the individual, or in the context of a group (e.g., friends
influence what kinds of clothes a person wears) or an organization (people on the
job make decisions as to which products the firm should use).
• Consumer behavior study includes a close examination of how products for sale
are purchased, utilized and then discarded. Marketer’s generally have a great
interest in the use of products, because this may affect the position of the product
and encourage an increase in consumption Since, many environmental problems
are caused due to disposal of items (e.g., to save the reusing fee the motor oil is
dumped into sewage systems, or landfills being pilled with garbage) it is also
considered as an area of consideration.
• Study of consumer behavior consists of an in-depth look into products, services
and ideas
• There is a growing relevance of the study of consumer behavior in social setups.
For example, assertive marketing of high calorie food products, or aggressive
marketing of simple credit, might have serious consequence on the national health
and economy.

The study of consumer behavior is important for 2 key reasons, first being the marketing
strategy i.e., for making better marketing campaigns. For example, after knowing that
consumers are more alert towards food advertisement when they are hungry, it was
realize that arranging the snack advertisements late in the afternoon was a good idea. It
elucidates that products are initially accepted only by a limited set of population and only
gradually do they spread to the remaining majority. So, we understand that (1)
companies introducing new products should be financed thoroughly so that they can
sustain till the time their products become commercially successful and (2) to please few
initial target audience is important. Since few initial consumers will then influence many
other customers’ mindsets about choosing the brands.
The second application of the study of consumer behavior is in public policy In the
1980s, Acetone, a near miracle cure for acne, was introduced. Unfortunately, this cure
severely affected pregnant women. Even though doctors and physicians were instructed
to let the pregnant women know of the harms of acetone, a lot of them conceived while
taking the drug. Therefore, to make the consumers’ understand its adverse effect, the
Measures of showing the pictures of defected babies on the container was taken by the
Federal Drug Administration (FDA).

Social marketing is a way of getting ideas across to the consumers rather than selling
them. A marketing professor, Marty Fishbein, went on study leave to work for the
Disease Controlling centers, trying to reduce the transmission of diseases caused due to
the use of illegal drug. Clearly it is most appropriate to prevent the use of the illegal drug.
Since this did not seem to be a feasible choice, it was found that that needle sharing
practice was too deep-seated to be put an end to. Using the knowledge of consumer
attitude, a campaign was created by Dr. Fishbein to promote that the needles were
cleaned with bleach before they were shared, which was definitely a more realistic
option. The benefit of the study of consumer behavior was that it would make us better
consumers. It is common sense that you need to pay less amount for 64 ounce bottle of
liquid laundry detergent when compared with 32 ounce bottle as the rate reduces per
ounce. But in actual situations it is often more profitable to buy a larger bottle as the price
per once decreases when you buy more. In simpler terms, for this analogy, you need to
check the unit cost labels in order to know what bargain are you getting. Several units
available in the marketplace can be examined. In this strategy the focal point is the
customer.

2.3. Relationship between Consumer behavior and Marketing Strategy

According to Richardson (2010), “understanding and managing stakeholders is an

essential part of strategic analysis and include customers, employees, shareholders,
regulators, suppliers, lobby groups, the general public, neighbors, family of customers,
family of employees, contractors, associations and local government”. Richardson (2010)
further argues that the actual list of stakeholders will depend on the type of business and
this analysis is every important during the current climate. Weatherston & Wilkinson
(2004) argue, the an analysis of a stakeholder involves the analysis of stakeholders itself:
“All, organizations whatever their size, have a number of stakeholders. A person
,institute, company , interest group or other body that has a ‘stake’ in the corporation is
called the stakeholder. “In addition to having an interest in the activities of the
organization, some stakeholders have power to influence those activities.” Brooks, I.,
Weatherston, J. & Wilkinson, G. (2004)
Further Weatherston & Wilkinson (2004) steps involved in conducting a stakeholder
analysis are as follows:

1. Identification of stakeholders
2. Identify your stakeholder’s power, influence and interest and what set of
stakeholders are most likely to be affected by your decisions as an organization
and focus on them.
3. Stakeholder Mapping
4. Identify how to best engage your stakeholders and gain their support

Banala (2008) in her paper “stake holder analysis of Airtel” has identified internal and
external stakeholders of Airtel. The list of stakeholders for Airtel is shown in the diagram
below.

List of stakeholders of Airtel (Banala,2010)

Banala (2010) has identified customers as important external stakeholders and

emphasizes that to achieve strategic competitive advantage it is essential to be able to
identify, engage and retain their consumers or customers. Consumers are not only the
paying public that avails of your goods and services but your employees, suppliers and
communities are also part of your consumer list. So it is essential that customers should
be well taken care off when devising marketing strategies.

2.4 Market Coverage Strategy

The status of the brand in respect to the customers has to be decided by the firm which
can be done by subdivisions. Kotler et al. (2002) mentions three different market-
coverage schemes which can be used. A company overlooks market division and seeks
the full market in the standardized marketing. This focuses on the common aspect rather
than the different aspect. When it comes to publicity, it is a cost saving scheme,
according to Kotler et al. (2002), Since, it is impossible to make a brand which fulfills all
the needs of the consumers, most of the developers have high hesitation about the
schemes. Different plans can also be implemented by the firm, which is when a company
decides to look over the necessities of most of the market sections and come up with
different offers for each. According to Kotler et al. (2002) this plan is generally more
effective than the plan of taking everyone into consideration. At times firms requires a
scheme which focus on smaller sections. In this scenario organizations can use niche
marketing as an effective strategy. Dimmick (2003) tells that the use of niche as a plan
effects the firms relation to its environment.

As Iansiti & Levien (2004) further added, that when a firm choses to niche a market, it
suggests that the firm sinks in a market sector when they are associated to other lager and
more influential organizations. ”What is typical for a company is that it focuses on
specialisation where it can satisfy specific enquires and provide customers with solutions
to complex problems” (Iansiti & Levien, 2004). Hence, by the use of an integrated
marketing scheme, where the firm aims at smaller sub-markets can be more effective
rather than only getting a little portion of a comparatively huger section, (Kotler et al.,
2002). Another definition of niche scheme has been given by Cassill, Perish & Oxenham
(2006). They say that as a bottom-up method where the firm looks for a need in a lesser
part other than a hike in the consumer’s base. This is more attractive for the firms with
less sources, according to Kotler et al. (2002), In this way, since the firm has a huge
information of itself and has an important position, the firm niches the brand and achieve
powerful market segment of that part. However, the risk with this plan is that a large
amount of danger is involved in the styles of the society that makes a part sour or
increases the involvement of bigger competition.
Porter (1980) explains marketing strategy by dividing into three step strategies. These are
name as cost leadership, differentiation, and market segmentation other name is focus.
Market segmentation is small scope as compare to cost leadership and differentiation is
relatively wide scope in market

Cost Leadership Strategy

This strategy is based on efficiency. The firm produces high number of standard product
in low cost that available to large number of costumers. To maintain this strategy firm
always search for cost reduction in all aspect of business. This strategy concentrates on
market share, raw material, labors, or other important input like:

• process engineering skills

• products designed easy to manufacture
• tight checkup of labour
• strong grip control over cost
• Bonus based on targets.

Always try to put the costs at low possible level. According to researcher the Bharat
Sanchar Nigam Limited (B.S.N.L.) mobile company in India used this strategy very
intelligently. BSNL is the main rival of Airtel in India. Bsnl provide many services
slightly low difference then Airtel services like:

1) New sim cards only in 100Rs plus three month validity and hundreds rupee talk
time.
 2) Call rates 45p/min any networks mobile and landline without any additional
charges that have only 5p difference then Airtel tariff
3) Two BSNL no (one mobile and one landline) call 1p/min.without any extra
charges weather Airtel is charged for these services
4) Provide cheaper roaming services in India.

Hence these are the main factor by which BSNL attract thousands costumers in few
month and become main telecom industry.

Differentiation Strategy

In differentiation strategy the firm always tries to create, introduce new things and
services that make the firm unique from their competitor. Companies may charge more
due to this differentiation. It also leads to a loyal customer following.

According to researcher virgin mobile founded in 2005 use differentiation strategy and
reach at new height in telecom industry only small period of time especially in uk where
the market is mature. They provide new services that cannot provide by any telecom
industry in past in uk and rest Europe like

1) Virgin was the first operator in uk to abolish peak rate

2) The first to offer free voicemail services
3) Virgin Mobiles started pay as you go tariff and flex never expired
4) Other offers included theft insurance, colorful packing recharge or pay bill by
credit or debit cards.

There are many more services by which it becomes popular among the people without
fear of cost because these people want best services which are reliable.

Focus Strategy

It is most reliable for small companies but at times it is also profitable to big companies.
A focus strategy should target market segments where competition is low or weakest to
earn average investments and gain competitive advantage by launching their services and
established their business

By researcher point of view, Airtel - new private telecom industry in India has made its
marketing strategy based on focus strategy which focuses on market segment, and
launched its services in those region where geographical condition are hard like J&K,
Assam Arunachal Pradesh and some part of Himachal Pradesh etc where people are not
so aware to look of specific advantages. This has helped airtel to become popular in these
regions because no telecom industry provider offers their best services in these region.
Airtel has also comes in news several times by choosing Indian cricket captain Mahendra
Singh Dhoni as it mobile ambassador and by offering ready sponsorships for IPL games
in India.

The Ansoff Growth matrix is other formula in businesses to know their product and
growth of market strategy. This tool has been developed by Igor Ansoff and was first
published under heading of “Strategies for Diversification” in Harvard Business Review
in 1957. It provides knowledge to an organisation on how to maintain or grow their
business by means of existing and new product in existing or new market. This tool offers
benefits to the companies by telling what decision should be taken to improve current
performance. This tool has four key segments as shown in figure

These are
described
below:

Market Penetration: The businesses focus on selling existing products into existing
markets. The three main objectives that businesses want to achieve include, to either
outgrow or stabilize the current market share for the product; the target market to be out
grown into should be a secure market, and bringing up faithful strategies to improve the
quantity of consumers.
Market Development: The main focus of the business is to bring the presiding products
into the new market. The scheme includes:

• Locating a new geological market; like export of new items to another country.
• Giving more emphasis to the latest item and its promotion.
• Supply of new channels
• New pricing schemes to get more customers.

Product Development: It is one of the prime aims of businesses to bring and introduce
new products in the marketplace. This strategy based on development and modification
of products can get new dimension into the existing markets.

Diversification: In diversification the firm cans business in new markets with new
products. The strategy implied is risk oriented as the business is being launched into a
new markets where the firm lies inexperienced. The firm, which plans to adopt a
diversification strategy, must have a clear vision about it target and a good idea of the
risks involved.

According to researcher, Airtel company uses Ansoff growth matrix as a tool for its their
marketing strategy in India because in India the competition in telecom industry has
become hard as there are many telecom industry introducing their services. Hence Airtel
concentrates on market penetration and development by introducing new services like
Airtel broadband, 3g services, air T.V, and national and low international roaming
services and many loyalty schemes in their services which attract more costumers under
one brand. It also focus on product and diversification by launching new product like
Blackberry Iphone and apple mobile under his brand name and it also shift in new market
like Bangladesh, Pakistan, Sri Lanka and etc to become multinational brand and provide
different services like broadband, air TV etc under one brand Airtel.

2.5 Market Competitiveness

The “five force” model by M.P. Poter (1980) (Morden, 1999) is the most widely spread
way for finding the market competition. Which is also known as porter five force model
and Figure shows five forces model into action in competitive market of
telecommunication.
 Porter’s five force model on Indian Telecommunication industry (Ahmed, 2008)

Threat from substitute products: According to Porter (1980) there is a constant

threat from substitute products in telecom industry. It depends upon factors like
superficial level of item for consumption differentiation, and buyer knobbing power.

The threat of the entry of new competitors in telecom industry: The telecom
business is a lucrative business with lofty return and evidently attracts firms, which
result in many new entrants and successfully decline effectiveness. Till the time the
entry of new firms can be infertile by incumbents, the profit rate will depreciate
towards a competitive level. It depends upon following

The survival of fence to entry

Trademark impartiality
Capital necessity
Access to circulation
Wisdom curve advantage
Government policy
Intensity of the competitive rivalry: For the telecommunications industry in India
it is the major determining factor of the competitiveness of the industry. Sometime
rival forceful and sometimes non price aspect such as advance, promotion, etc.
depend on following factor:

Quantity of competitor.
Rate of growth of the development of Industry
Variety of competitors
In rank of density and unevenness
Altitude of advertising expense

The bargaining power of customers: In telecom industry the bargaining power of

customers is also described as market of outputs. It is the capability of buyer to put
pressure on firm and it also affects the customer’s feeling to price modifications.
There are following factor involved:

Buyer size
Amount of reliance upon existing channels of allotment
Bargain hunter price understanding
Benefit of industry product

The bargaining power of supplier: This in the telecom industry described as

market input. In telecom industry suppliers of unrefined materials, mechanism,
labor, and services to the firm is source of power to other firm

Supplier switching costs comparative to firm switching costs

Degree of segregation of inputs.
Existence of replacement inputs
Employee unity
Cost of inputs virtual to selling price of the item for consumption.
According to the researcher the managing committee of Airtel mobile company has
taken sufficient knowledge from porter five force model to make their marketing
strategy. Airtel mobile company innovates its range of products at regular basis and
tries to keep price according to the market level and also puts pressure on
government to make new policies which is not suitable for substitute products.
Airtel always tries doing new things in their advertisement campaign to make better
strategies for tackling new competitor. In hard competitive atmosphere this telecom
company expands its product and services range according to demands of different
section of society and is always enthusiastic to enter new markets as well as new
geographical area. Airtel has made its marketing strategy to handle the bargaining
power of customers and supplier by providing best customer services, up to date
technology and provides best prizes according to market level and make contact
with four to five suppliers at same time so they get psychological advantage and
provide messages of so many option. Airtel is always in news or in media about
their future projects and new requirements so that more and more supplier come in
contacts and offer their services by which they can easily bargain with supplier.

2.6 New Product Development

Barczak. G (2003) wrote a paper on New Product action plan, Edifice, Process, and
Accomplishment in the Telecommunications Industry that states that a regular flow
of new products is the lifeblood for firms that hope to remain zealous in high-
technology industries such as telecommunications. Faced with regular depreciating
product life cycles, the voyage for more beneficial new product development (NPD)
should be combatively perused by these firms. Choosing an appropriate combination
of new product tactics, executive constitution, and NPD practices showcase the
factors for success for these companies.

Rather than taking into the account, the interrelationships among these result-
oriented factors, however, the most previous studies of NPD have looked at these
issues independently. The fact that the past studies of NPD have commonly cut
across industry lines result in developing this deficiency. Gloria Barczak addresses
these issues by stating that a firm's selection of new product strategy, structure, and
process are related to each other, as are the outcomes of that selection on NPD
performance. Because these selections and their outcomes also may be contingent on
the sole essential quality of the industry in which a firm wrangles, her study focuses
fashionably on firms in a specific, high-technology industry, telecommunications.

The study clearly brings forth that for the telecommunications industry there is no stand
alone NPD strategy, that can be singled out as being superior to any other strategy.
Instead, it emerges that a company's center of attention should be on confirming the best
possible fit between its chosen NPD strategy and its corporate goals and abilities.

In keeping with the main focus on cross-functional teams, the study outcomes signifies
that the project teams and the R&D teams are the most result oriented means for
organizing NPD efforts in the telecommunications industry. Not to anyone’s surprise,
R&D teams essentially vital for first-to-market organizations when compared to the fast
followers and late tenderfoots. An R&D team comes up with the technical skills, which
are necessary for playing the role of pioneer. Nonetheless of the firm's NPD strategy and
structure, the existence of a product champion is a major element in the success of new
product efforts.

2.8 Service Positioning Decisions

In a research paper on the topic Strategies for ensuing at the Bottom of Pyramid (BOP)
market in Telecom Services Sector by Rao. U. S and Sangeet. S. (2007) wrote that of late,
there has been regard in marketing to the Bottom of the Pyramid (BOP) market, and
several successful measures have shown that the poor can be served equitably and
profitably by enhancing their income generation prospective. BOP (Bottom of the
Pyramid) is a term that was coined by C.K. Prahalad and Allen L. Hammond (2002), it
alludes to around 4 billion people at the bottom of the economic pyramid with an
obtaining potential of USD 1500 per year or less. Is it practical to serve to the needs and
wants of this section of people? This paper discusses affairs such as the business
prospective of the BOP market, the cartogram of options for income generation for the
poor, pricing, promotion, low cost delivery mechanisms and effective communication in
this segment, in the Telecom services sector.

The World Economic Pyramid, Source: Prahalad (2005)

Faisal. N (2007), in an article on Service Positioning Decisions: Understanding strategy

in a journal of Indian Management that in the last five years Indian services sector has
shown tremendous growth particularly in the areas like telecommunications,
entertainment and air travel. With the expulsion of governmental shackles, the country
has seen a massive growth in these sectors with the benefit sooner or later reaching to the
final consumer. Who would have dreamt of mobile phones advancing from luxury to
commodity items, air tickets to be sold for as less as Rs.500 or the luxury of watching
more than 100 channels now accessible to common man. Though the vying has resulted
in a lot of alternatives for the consumers, the service providers are finding it arduous to
maintain their zealous position in the marketplace. One of the major reasons is lack of
clear understanding about the positioning strategies of services.

Mobile service operators: on the whole these services can be graded in two categories
namely the CDMA service providers like Reliance or TATA Indicom and GSM service
providers like, Airtel, MTNL, Hutch, BSNL, and Idea. For an average customer the most
important selection criteria for the service are the “cost.” This has led these operators to
offer a host of schemes and the prices have seen a downward trend. CDMA service
providers like Reliance or TATA Indicom are late arrivals in the telecommunication
arena, but it seems they were not able to situate their services in the best manner and are
now simply keeping up with on the basis of cost. Though Idea at the establishment of
their service used the caption “An Idea can change your life” but it was not able to
differentiate itself from the other operators. One of the harsh facts that these operators
have to accept is that mobile services are now commodity services. Gone are the days
when the customers used to pay five to ten times of a landline call and even for an
incoming call. Now the customers need value added services like entertainment, banking
etc to be provided by their mobile service operator in addition to the regular service of
communicating. The commoditization of mobile services has taken very fast and thus
operators now need specific strategies to differentiate their services form their
competitors.

2.9 Corporate Entrepreneurship

It is widely renowned that the corporate entrepreneurship is a tread of entrepreneurship

theory. In very early stages the corporate entrepreneurship was a means to re-energize
large organizations. The term “rejuvenation” was used by Stopford and Baden-Fuller
(1990) for it. McGinnis and Verney (1987) argue that the purpose of corporate
entrepreneurship is “to harness the entrepreneurship spirit of the small organization and
blend it into the culture of the larger, more established firm”. Carrier (1996) suggests that
the small organizations can also reap benefits out of corporate entrepreneurship. Words
like “corporate entrepreneurship”, “entrepreneurship” and “corporate venturing” are often
used interchangeably and frequently seen as a strand in the entrepreneurship theory
(Cunningham & Lischeron, 1991). According to Maes (2003) there exists a definitional
gap as there is no generally acceptable definition on important concepts like corporate
entrepreneurship.
So one can establish a fact that if an organization shows creativity in its design processes
to generate innovative products internally then it could be said that the organization has
corporate entrepreneurial traits. The research adopts a divide and conquer rule by
breaking the main objective into sub components and looking individually at each of the
sub objective. Following section will try to identify the sub objectives of objective
number one from appropriate literature review.
Rixon (2003) argue that if organizations want to innovate then they must be committing
to a creative process. The author further argues that strategic commitment is vital for
innovation to be achieved as without strategic focus and commitment creativity may
surface naturally but innovation will not be delivered. Moris et al. (2008) contends “when
the action is taken in large firms to form competitive advantage and to exploit it through a
strategy based on entrepreneurial actions, then the firm is employing an entrepreneurial
strategy”. While establishing direction and preferences for the product ahead, service and
process innovation efforts of the firm, the company is laying down its strategy for
entrepreneurship.

A commitment to continuously explore the marketplace for emerging opportunities is

majorly required for Corporate entrepreneurship. It involves probing what your present
customers and non-customers may need in the future, developing innovative products that
make existing products (even your own) obsolete, exploring your market's fringe for
customers who have problems that are begging for breakthrough solutions, and scanning
the horizon for clues for markets and even industries that do not exist today.

According to Varma, Gopinathan, Gopal (2008) both external business environment and
the internal business environment drive corporate entrepreneurship. So it is worthwhile to
see from the customers’ prospective as well; that are they ready for new service offerings
from the telecom operators and how do they contribute towards building the pressure on
the service providers to engage in corporate entrepreneurial activities.

It can be deduced that corporate entrepreneurship is all about creating a new value in the
organization, exploiting the latent energy of the firm, re-energizing and enhancing the
ability of a firm to acquire innovative skills and capabilities.

Marketing strategy and Entrepreneurship

According to Shaaw (2010) Bharti Airtel Ltd. shares lost 7.8 percent last year. The author
further argues that India may have as many as 15 mobile-phone operators this year,
compared with 10 at the start of 2009, based on data on the regulator’s Web site. The
Indian Telecommunications companies are cutting down prices to get a larger share of
the world’s second- largest wireless market, which will shot up 63 percent to 771 million
users by 2013, research firm Stamford, Connecticut-based Gartner Inc. predicted in June.
The above emphasis shows that Airtel need to explore new markets and adopt a path of
product and service innovation and entrepreneurship.

Bygrave & Hofer (1991) quoted - good science always gets off the ground with good
definitions. Maes (2003) argues that no definition is good in itself. Kirby (2003) despite
of the importance of entrepreneurship, there is lack of agreement on the subject. Chell et
al (1991) argue that the problem in pinpointing of an entrepreneur can be related to the
fact that there is no standard universally accepted definition of entrepreneurship. Gibb
(1996) argues that the word entrepreneurship is often linked to “novel venture creation”
and “small business management”. Table 1 illustrates the work done by some of the
authors on the subject of entrepreneurship, list of authors and publication is also listed.

It is worthwhile to mention here that Kirby (2003) argues that innovation is a vital part of
the entrepreneurial process. According to Drucker (1997) “innovation is the specific tool
of entrepreneurship, the means by which they exploit change as an opportunity for a
different business or different service”. Many authors relate entrepreneurship with new
value creation instead of innovation (Zahra, 1993c, Stopford & Baden-Fuller, 1994,
Carrier, 1996, Covin & Miles, 1999, Shane & Venkataraman, 2000). However, renowned
authors Aldrich and Martinez (2001) and Ucbasaran et al. (2001) had the view that
entrepreneurship is possible without innovation, “leading to ‘innovators’ on the one hand
and ‘reproducer organizations’ on the other hand” (Aldrich & Martinez, 2001; Maes
2003). Gartner (1989) warns not to associate entrepreneurship with innovation.
“correlating both constructs would lead to the almost unsolvable problem of identifying
which firms in an industry are innovative and which are not, increasing the ambiguity in a
field already confronted with a definitional dilemma” – Gartner (1989).
 Source Definition of Entrepreneurship
Low (2001) “The creation of a new enterprise”
Shane & Venkataraman (2000) “The discovery, creation and exploitation (including by whom
and with what consequences) of opportunities to bring into
existence future goods and services”
Kouriloff (2000) “The process of creating a new venture”
Wickham (1998) “Creating and managing vision and communicating that vision
to other people. It is about demonstrating leadership,
motivating people and being effective in getting people to
accept change”
Krueger & Brazeal (1994) ‘The pursuit of an opportunity irrespective of existing
resources”
Jones & Butler (1992) “The process by which firms notice opportunities and act to
creatively organize transactions between factors of production
so as to create surplus value”
Stevenson & Jarillo(1990) “The process by which individuals – either on their own or
inside organizations – pursue opportunities without regard to
the resources they currently control”
Timmons (1989) “… the ability to create and build something from practically
nothing. It is initiating doing, achieving, and building an
enterprise or organization, rather than just watching, analyzing
or describing one. It is the knack for sensing an opportunity
where others see chaos, contradiction and confusion…”
Schuler (1986) “The practice of creating or innovating new products or
services within existing businesses or within newly forming
businesses”
Gartner (1985; 1989) “The process of new venture creation; the process by which
new organizations come into existence”
Kanter (1985) “The creation of new combinations”
Miller (1983) “A firm’s actions relating to product-market and technological
innovation”
Table 1: Definition of entrepreneurship with respect to various authors
(Adapted from: Maes, 2003)

Technology and Entrepreneurship

Fredric and Zolin (2005) argue that technology firms are often known as technological
entrepreneurs that play an important role in the development and commercialization of
technologies all over the world. Zahra (1996) points out that these firms are essential to
may industries like software, biotechnology and telecommunications. Clarysse and
Moray (2004) suggest that “as technology adopters these firms use new technologies for
the product and process innovation”. According to Kelley and Rice (2002) “technology is
the key strategic resource that can be used to develop a competitive advantage through
innovation”. These firms heavily rely on the technology as most of the decision made by
the firm on technologies to develop and exploit can impact probabilities of success or
failure (Zahra and Chandler 1999). Zahra (1996) argues that a logical and consistent
technology strategy is one of the most important components for successful performance.
Deeds et al (1999) adds on to this by saying that the technology strategy is shaped by the
organization’s scientific, managerial and technological capabilities.