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EXECUTIVE SUMMARY
The purpose of this report is to provide an analysis and evaluation of the current marketing strategies of Reliance Communications. The analysis is to know the perspective of the customers of RCom regarding various aspects in order to know where the company stands in the industry. Methods of analysis include surveys and interviews with a selected number of people. The statistics and frequency counts are represented graphically. Results of data analyzed show that the performance of the company is fairly good. In particular, comparative performance is average in the areas of customer base despite launching new products and services similar to that of the competitors. The report finds the prospects of the company in its current position are not excellent and that there is a need for some caution. The major areas of weakness require further investigation and remedial action by management. Recommendations discussed include: o Introducing new schemes for youngsters as well as for older people. o Should provide more offers to post-paid customers in order to increase the number of post-paid customers. o Providing new schemes for loyal customers.
OBJECTIVES
The study aims to 1) Investigate the implementation of Marketing Strategies in Reliance Communications in India and examine its effects on the customers. 2) 3) 4) Understand the various Marketing activities carried out by RCom. Study the services provided by the company. Assess the satisfaction and expectations of the customers of RCom.
I believe that the conduction of the study might provide valuable information to the development of some of the strategies carried out in this company. For educational institutions and researchers, it is hoped that the study also contributes to the better understanding of the different strategies undertaken in RCom.
By analyzing this information, the company would be able to better design schemes & services & target right prospects needs & wants.
This study helps to identify the behavior of consumerwhen there are no offers & schemes from Reliance communications.
Limitations Carrying the survey was a general learning experience but the company under study being a very large organization, with a huge size of customer base, the questionnaires could only be distributed to a limited number of people.
RESEARCH METHODOLOGY
Introduction Marketing research means the systematic gathering, recording, analyzing of data about problems relating to the marketing of goods and services Marketing research has proved an essential tool to make all the need of marketing management. Marketing research therefore is the scientific process of gathering and analyzing of marketing information to meet the needs of marketing management. But gathering of observation is must be systematic. The systematic conduct of research requires: Orderliness, in which the measurements are accurate. Impartiality in analysis and interpretation.
All of research can be categorized into basic and applied. BASIC RESEARCH:Basic Research is that intended to expand the body of knowledge for the use of others.
APPLIED RESEARCH: Applied Research is one which is carried out to find the
solution for a particular problem or for guiding a specific decision. It is usually private in nature. My research on Reliance communications is carried on for guiding specific decisions and its results are useful only to Reliance communications for taking particular decision regarding product quality, staff and security. Hence the nature of my research study is APPLIED RESEARCH .
The marketing research is done in systematic process. I have pursued the below process of marketing for my study at Reliance Communications:
Problem Identification
Research Design
Data Collection
Problem Identification
The first and the most important step of marketing research is properly defining the problem. Here the companys problems are A number of customers are not satisfied with services, new schemes and offers. A number of customers are not satisfied with the network coverage. A number of customers are not satisfied with the current call rates of Reliance communications. A number of customers are not satisfied with the Free SMS schemes.
A number of customers are not satisfied with the service of customer care of Reliance communications.
Research Design
Research design indicates the methods and procedure of conducting research study. Research design can be done in following three types:-
1 Exploratory Research:Exploratory research focuses on the discovery of new ideas and is generally based on secondary data.
2 Descriptive Research:Descriptive research is undertaken when the researcher want to know the characteristics of certain groups.
3 Causal or Experimental Researches:An experimental research is undertaken to identify causes and effect relationship between two variables. The Research Design is: Descriptive Research Design
1 Observation Method
It contains Causal observation, Systematic observation, direct observation and contrived observation.
2 Survey Method
It contains Personal Interview, Telephone Interview and Mail Interview.
1 Internal Source
Various internal sources like employee, books, sales activity, stock availability, product cost, etc.
2 External Sources
Libraries, trade publications, literatures, etc are some important sources of external data. The Researcher has used primary data for the core purpose of the project and this primary data has been gathered by survey method. The researcher has also used secondary data
Sampling Plan: The researcher has design a sampling plan that is consist of five
decisions.
Sampling unit
Who is to be surveyed?
The Researcher has selected youngsters, businessmen, and housewives, employees to conduct survey and to measure satisfaction level.
Sampling types
There are two types of sampling i.e. Probability Sampling and Non probability Sampling.
Probability Sampling
Probability sampling means each unit of the universe has equal chance of getting selected. The most frequently used probability sampling methods are as below a) Simple Random Sampling. b) Stratified Random Sampling. c) Multi-stage Random Sampling. d) Cluster Sampling. e) Multi phase Sampling. f) Replicated Sampling.
Sample Size
Sample size means limited numbers of respondents covered under the research study from a population and the researcher has taken a survey of 100 respondents to know the satisfaction level of customer.
Sampling Area
The area which is selected for conducting the survey is called Sampling Area. In this research, the sampling area was Hyderabad & Secunderabad Clusters.
Sampling Unit
Here the researcher has randomly selected the respondents of the Hyderabad & Secunderabad cities.
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The cost for the companies can come down if the revenue share imposed on them as a condition of license is abolished or drastically reduced. Today every telephone company is bound to pay a share out of its revenue to the exchequer. These costs are, however, not to be scheduled to take a step further in the development of the telecom. In addition when we go through the telephone bill there is a 5 to 8% service charge. This amount also does not go for the telecom development. If these external cost are removed there can be seen a spurt in demand of not less than 40% as expected. While taking the side of suppliers a lot of new companies are coming into the battlefield resulting in reduction of prices and hence a little less burdensome on to the customer. The cost of interconnection with the incumbent is proving to be contributory to the high cost of services provided by the competitors. The delay in the interconnection disregards the quality of service and high cost will detract from affordability. This is an area in which no consumer body can knowledgeably contribute unless it has the assistant of experts or economists who alone can discover all the relevant fact of all the contesting companies. It indicates the pre-eminent domain of TRAI (Telecom Regulatory Authority of India).As the driven down of the prices for long distance including international services reduces the amount available for subsidizing the local service, the rental for local services are being increased. Considering that about 90% of the long distance calls are made by less than 20% of customers, 80% of customers have to pay higher rental this depresses the demand for telephones and affordability. The urban businesssubscribers will be bearing the bond of the subsidies to be given to the rural private consumers.
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Industry Profile
The telecom network in India is the fifth largest network in the world meeting up with global standards. Presently, the Indian telecom industry is currently slated to an estimated contribution of nearly 1% to Indias GDP. The Indian Telecommunications network with 110.01 million connections is the fifth largest in the world and the second largest among the emerging economies of Asia. Today, it is the fastest growing market in the world and represents unique opportunities for U.S. companies in the stagnant global scenario. The total subscriber base, which has grown by 40% in 2005, is expected to reach 250 million in 2007. According to Broadband Policy 2004, Government of India aims at 9 million broadband connections and 18 million internet connections by 2007. The wireless subscriber base has jumped from 33.69 million in 2004 to 62.57 million in FY2004- 2005. In the last 3 years, two out of every three new telephone subscribers were wireless subscribers. Consequently, wireless now accounts for 54.6% of the total telephone subscriber base, as compared to only 40% in 2003. Wireless subscriber growth is expected to bypass 2.5 million new subscribers per month by 2007. The wireless technologies currently in use are Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA). There are primarily 9 GSM and 5 CDMA operators providing mobile services in 19 telecom circles and 4 metro cities, covering 2000 towns across the country.
Evolution of the Industry - Important Milestones: Year 1851 Description First operational land lines were laid by the govt. near Calcutta(seat of British Power) 1881 1883 1923 1932 Telephone Service introduced in India Merger with the postal system Formation of Indian Radio Telegraph Company (IRT) Merger of ETC and IRT into the Indian Radio and Communication Company(IRCC) 1947 Nationalization of all foreign telecommunication companies to form
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the Posts, Telephone and Telegraph(PTT), a monopoly run by the governments Ministry of Communication 1985 Department of Telecommunications (DOT) established, an exclusive provider of domestic and long-distance service that would be its own regulator (separate from the postal system) 1986 Conversion of DOT into two wholly government-owned companies: the Videsh Sanchar Nigam Limited (VSNL) for international telecommunications and Mahanagar Telephone Nigam Limited (MTNL) for service in metropolitan areas. 1997 1999 Telecom Regulatory Authority of India created Cellular Services are launched in India. New National Telecom Policy is adopted. 2000 DoT becomes a corporation, BSNL
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obsolescent technologies / standards. Although cellular licenses were made technology neutral in September 1999, all the private operators are presently offering only GSM based mobile services. The new licensees for the 4th cellular licenses that were awarded in July 2001 too, have opted for GSM technology to offer their mobile services.
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In profitable metros and circles, the competition is severe and the market is split between the two operators. In a price-cap regulated market, the operators use appropriate pricing strategy to win customers and win market share. In highly price-elastic markets, such as in India, as the service provider reduces the price, the subscriber base increases considerably, and so is the network traffic. The increased network traffic decreases the performance and the quality of service, inviting customers to switch. Being a new entrant in a metro area, the government operator reduced the airtime charges to such an extent that the subscriber base increased suddenly leading to poor network performance. The operator did not have enough network capacity to handle calls leading toblocking of calls, with frustrated customers switching over immediately to competitors. The operators also have to resort to non-pricing competition strategies to win customers. In India, CMSPs offer a variety of service plans as a means to attract new customers. Different service plans include: pre-paid calling card schemes, discounted airtime rates for evening and night time calls, discounted roaming charges, no or minimum activation fees, and reduced mobile to mobile long distance call rates. The service providers incur additional advertising and infrastructure cost for implementing these plans. Short Message Service (SMS) and Wireless Application Protocol (WAP) service are fast catching up. For example, in India, about 500,000 SMS messages are being carried by a service provider in one metro area alone. When the sector moves over to an oligopoly market, the operators have to provide improved quality of service and value added services in order to survive and gain market share. Larger operators who have experience and infrastructure may be able to provide a higher quality of service and other value-added service at a lower price. They also have access to larger project financing for enlarging their networks and services. For example, a single large operator now has license to operate in 14 service areas in the country with the largest footprint to cover most of the areas of the country. Mergers and acquisitions are commonplace as the operators are consolidating their revenues to survive in the market places. Cellular subscribers and those with a propensity to go mobile in Delhi have never had it so good. They now have four service providers to choose from, each offering an array of
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both pre- and post-paid schemes. More importantly, average tariffs across plans have, by some reckoning, dropped by at least 50 per cent in the last six months. The entry of Reliance communications saw a further drop in tariffs and the operators have come out with new schemes to retain their subscribers and attract fresh ones. What does this mean for subscribers and for the cellular industry in Delhi? All the four operators Essar Mobile Services Ltd., BhartiCelluar Ltd, MTNL and Idea Cellular services are convinced that the market will only expand and the subscribers will benefit even more. Their reasoning is that cellular penetration in Delhi, which traditionally occupies the third position in other areas, is less than fifty per cent. Therefore, entry of new players will only increase awareness about the facility, the companies say. Moreover, the state-owned MTNL has also been playing with its cellular service for quite some time. that, with the imminent launch of limited mobility using CDMA (code division multiple access) technology by companies like Tata Tele Services will only add to the subscriber base, probably result in further reduction of tariffs, and an even greater widening of the cellular market, according to officials in four cellular companies now servicing Delhi. However, the companies also sound a note of caution any further drop in tariffs will be harmful to the companies, points out one of the officials taking care of the Sales & Marketing division of the, Essar Mobile Services Ltd, average tariffs in Delhi across different plans have fallen by 30 per cent since December with launching of the CDMA services. Besides the fall in tariffs, what has really happened with the entry of CDMA is a heightened awareness in the market. Mobile penetration in Delhi and its suburbs is estimated to be less than twenty-five percent of the population and the cellular operators believe that this number should definitely go up. It is here that Reliance communications decided to target the customers with what it believes are unique products and features. Its emphasis has been on value proposition and brand building. Mobility is not only about carrying voice, as per the reports from the marketing department and adds that the unified messaging system for the post-paid customers of (now Reliance communications) is one such unique product.
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Accordingly, Reliance communications signed in its subscribers in lakhs from the year onwards it has been launched in Delhi. Industry analysts say that a majority of them will be pre-paid customers, whose loyalty to a particular brand is always in doubt. However, pre-paid for the cellular is nothing but the engine for growth and there is always a possibility that most of them will shift to post-paid once they are convinced of the quality of service provided. On the other hand the entry of a new operator lends more visibility to the service and there is also increased trade activity that is the number of dealers will increase and more people will be on the road trying to sell the service and product. There is also greater consumer awareness of what cellular service can deliver and expectations go up in terms of pricing or service standards or network availability.
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really caught on, but operators like Bharti are bringing in services like music messaging and concierge facility for its subscribers.
Figure 1 Market Share of both mobile and wire line Service Providers in Indi
GSM Subscribers
The cumulative All India GSM subscriber base rose to 72.12 million in April 2006 from 69.19 million in March 2006 which is a growth of 4.23% for a month under review [4]. Table I shows the subscribers growth rate for one month along with market share of each provider with coverage
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Table I. GSM Subscribers growth rate Company No of Subscribers (in million) March 2009 Bharti BSNL Reliance communications IDEA Aircel Vodafone Spice MTNL BPL Total 7.37 20.61 1.90 1.93 1.94 1.34 69.19 7.64 2.83 2.01 1.98 2.02 1.31 72.12 10.6% 3.9% 2.8% 2.7% 2.8% 1.8% 100% 11 7 8 2. 2 1 19.57 17.16 15.36 April 2009 20.68 17.59 16.06 Percentage Market Share 28.7% 24.4% 22.3% 23 21 16 Service Areas
India has an urban population ofabout 26.8% and rural population isabout73.2%. And there are over 600,000 villages in India. But a vast section of the rural sector is still cut off from the benefits of telecom services. The rural population of around 700 million is
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waiting for its share of economic growth. Initially the big telephone companies focused only on urban centres, which they felt were more profitable. However, this mindset is gradually changing with the realisation that there is equal, if not bigger money in rural areas.
Table II. CDMA Subscribers growth rate Company (No.of Subscribers-per million) March 2009 April 2009
(% Market Share) in Service Areas
It is estimated that a one per cent increase in rural connectivity can generate 0.5 per cent economic growth. Thus a well-planned 10 per cent increase in rural connectivity can propel India into double-digit growth and unprecedented prosperity. Rural India possesses enormous potential in terms of economy and human resources. Recent experiments have confirmed that ICT (information and communication technology) helps improve the timeliness and efficiency of rural farm operations and enhance income through producer-oriented markets. Hence the communication ministry has requested the finance ministry for higher allocations from the USO Fund for executing rural telephony network. The finance ministry has made a budgetary allocation of 15 billion from the USO Fund. The rural telephony targets include, providing 50 million telephones by 2009(i.e. one phone per three rural households) and 80 million by 2012 (i.e. one phone per two rural households) and provisioning mobile access to all villages with population more than 5,000 by 2009 and more than 1,000 by 2010.The Government is confident that the Bharat NirmanProgramme target of providing coverage
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to remaining 41,000 villages would be met by March 2010 which will be much earlier than a schedule of November 2010. India plans to establish 0.25 million, village knowledge centres. The ICT industry can establish rural call centresmodeled on the Kisan Call Centre established by the Ministry of Agriculture to provide domain knowledge in the services, agriculture and manufacturing sectors. This spread will increase the volume of users and automatically bring down bandwidth cost, with a spiraling effect on efficiency and economy. Advanced telecom services are no longer considered a luxury but a necessity for all. Thus, providing telecom services to every individual in a country like India is a huge challenge, and at the same time holds immense opportunities for those in the telecom industry.
Major Players
There are three types of players in telecom services: State owned companies (BSNL and MTNL) Private Indian owned companies (Reliance Infocomm, Tata Teleservices) Foreign invested companies (Reliance communications-Essar, Bharti Tele-Ventures, Escotel, Idea Cellular, BPL Mobile, Spice Communications) India's mobile telecom sector is one of the fastest growing sectors. Unlike in the 1990s when the mobile phone was an elitist product, mobile operators now tap a mass market with mass marketing techniques. "Unified licensing" rules allow basic and mobile operators into each others territory, and have ushered in perhaps the final phase of industry consolidation.
It seems that only companies with deep pockets can effectively compete as primary operators mobile markets. Economies of scale, scope, and end-to-end presence in longdistance as well as local telecom, are desirable.
There are, besides, new challenges. Operators have to find new growth drivers for the wire line business. There are problems of getting broadband to take off, of technology choice, of when to introduce new technologies, and of developing a viable business model in an era of convergence.
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Although mobile telephones followed the New Telecom Policy 1994, growth was tardy in the early years because of the high price of handsets as well as the high tariff structure of mobile telephones. The New Telecom Policy in 1999, the industry heralded several pro consumer initiatives. Mobile subscriber additions started picking up. The number of mobile phones added throughout the country in 2003 was 16 million, followed by 22 millions in 2004, 32 million in 2005 and 65 million in 2006. The only countries with more mobile phones than India with 156.31 million mobile phones are China 408 million and USA 170 million.
India has opted for the use of both the GSM (global system for mobile communications) and CDMA (code-division multiple access) technologies in the mobile sector.
The mobile tariffs in India have also become lowest in the world. A new mobile connection can be activated with a monthly commitment of US$ 5 only. In 2005 alone 32 million handsets were sold in India. The data reveals the real potential for growth of the Indian mobile market.
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video and voice solutions, to introduce world's first wireless, high-resolution video and CD-quality audio, conferencing service along with simple-to-use content sharing capabilities - at a bandwidth speed of 256 kbps at any place. They own and operate the world's largest next generation IP enabled connectivity infrastructure, comprising over 2,77,000 kilometers of fibre optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region. Reliance Communications Ltd was incorporated on July 15, 2004 as a private limited company with the name of Reliance Infrastructure Developers Pvt Ltd. In July 25, 2005, the company was converted into public limited company and the name was changed to Reliance Infrastructure Developers Ltd. During the year, the company altered the objects clause of the memorandum of association to carry on the business of telecommunication, infrastructure, telecommunication system,
telecommunication network and telecommunication services. In August 3, 2005, they further changed their name to Reliance Communication Ventures Ltd. In August 11, 2005, the equity shares of the company were acquired by Reliance Industries Ltd and thus the company became the wholly owned subsidiary of Reliance Industries Ltd. As per the scheme of arrangement, all the properties, investments, assets and liabilities related to Telecommunication Undertaking of Reliance Industries Ltd was transferred and vested in the company on a going concern basis with effect from December 21, 2005. In March 6, 2006, the equity shares of the company were listed on the Bombay Stock Exchange Ltd and the National Stock Exchange of India Ltd. In June 7, 2006, the name of the company was changed from Reliance Communication Ventures Ltd to Reliance Communications Ltd. As a result of a Scheme of arrangement with Reliance Industries Limited, the company became the holding company of minority interests in the telecommunications companies formerly controlled by Reliance Industries Ltd. The company restructured the telecom businesses by realigning the economic ownership of various businesses into the company. Under a Scheme of Amalgamation and Arrangement which became effective from September 12, 2006, inter alia, Reliance Infocomm Ltd, Ambani Enterprises Pvt Ltd, Reliance Business Management Pvt Ltd, Formax Commercial Pvt Ltd, Reliance Communications Technologies Ltd, Reliance Software Solutions Pvt Ltd, Reliance Communications Solutions Pvt Ltd and Panther Consultants Pvt Ltd were amalgamated with the company and the and Network division
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of Reliance Communications Infrastructure Ltd was de-merged to the company. Upon the scheme of amalgamation and arrangement, all the subsidiaries of erstwhile Reliance Infocomm Ltd, Reliance Infocomm Infrastructure Pvt Ltd, Reliable Internet Services Ltd and Campion Properties Pvt Ltd including the subsidiaries of Reliance Communications Infrastructure Ltd, Reliance Telecom Ltd and Flag Telecom Group Ltd became the subsidiaries of the company. During the period 2006-07, Paradox Studios Ltd, Reliance Digital World Ltd and NIS Sparta Ltd ceased to be subsidiaries of the company and Gateway Net Trading Pte Ltd, Reliance Communications (Singapore) Pte Ltd, Reliance Communications (Hong Kong) Ltd, Reliance Communications (New Zealand) Pte Ltd, Reliance Communication (Australia) Pty Ltd. RCOM Malaysia SDN BHD, Synergy Entrepreneur Solutions Pvt Ltd and Reliance Next Generation Technology Pvt Ltd became subsidiaries of the company. During the year 2007-08, Reliance Tech Services Pvt Ltd, Reliance Big TV Ltd, Yipes Holdings Inc, Reliance Globalcom Services Inc, Yipes Systems Inc, YTV Inc, AnupamGlobalsoft (U) Ltd, Lagerwood Investments Ltd and Reliance Telecom Infrastructure (Cyprus) Holdings Ltd became the subsidiaries of the company. While, Flag Projects Pte Ltd, Alsign Holdings Pte Ltd, Actaram Capital Pte Ltd, Reliance Telephones Ltd and Gateway Net Trading Pte Ltd ceased to be subsidiaries of the company. As per the scheme of arrangement amongst the company, Reliance Telecom Limited (RTL) and Reliance Infratel Limited (RITL), the passive infrastructure of the Company and RTL was demerged and vested into RITL, with effect from April 10, 2007. The group structure involving various subsidiaries of the company was reorganized during the year. Consequently, Reliance Infoinvestments Ltd and Synergy Entrepreneur Solutions Pvt Ltd amalgamated with Reliance Communications Infrastructure Ltd with effect from July 23, 2007 and September 1, 2007 respectively and Reliable Internet Services Ltd amalgamated with Reliance Telecom Ltd with effect from September 29, 2007. FLAG Telecom USA Ltd was merged with Yipes Holdings Inc. with effect from December 17, 2007. During the year, the company acquired Uganda-based company
AnupamGlobalsoft (U) Ltd, holding Public Infrastructure Provider License and Public Service Provider License to offer Mobile, Fixed Line, Internet, National and International Long Distance services, in addition to WiMax and Wifi services, marking
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their entry in Uganda In April 2008, they also acquired controlling stake in Reliance WiMax World Limited (formerly eWave World Limited), a UK headquartered company focused on the rapidly developing market for wireless telephony services using the WiMAX technology standard. During the year 2008-09, the company launched GSM services in 14 service areas and commenced commercial operations. They received start-up spectrum to launch GSM services from Department of Telecommunications (DoT) under their existing Unified Access Service License (UASL) in 14 service areas. Reliance Big TV Ltd, a wholly owned subsidiary of the company launched fully Digital Home Entertainment direct to home (DTH) Service on the most advanced MPEG 4 DTH Platform. During the year, Reliance Vanco Group Ltd and their subsidiaries, Reliance WiMax World Ltd and Gateway Net Trading Pte Ltd became the subsidiaries of the company. While, FLAG Telecom France Network SAS, FLAG Telecom France Services EURL, FLAG Telecom Korea Ltd and FLAG Telecom Espana SA ceased to be subsidiaries of the company. The company rolled out their fastest Wireless Internet service, 'Reliance Netconnect Broadband Plus', with a downlink speed of up to 3.1 Mbps. This makes Netconnect Broadband Plus best suited for video streaming, video surveillance, rich media content and superior Internet browsing. The company through their wholly owned subsidiary, Reliance Communications Infrastructure Ltd, formed a joint venture with KrishakBharati Cooperative Ltd (Kribhco), a premier co-operative society with an unparalleled marketing network in rural India. The company made a tie up with Flytxt, a leading technology provider, for the implementation of an integrated carrier-class mobile marketing software platform called Neon on the RCOM Network. Also, they made a tie up with SAS for better business intelligence and analytics and AMDOCS for Customer Self Service systems. During the year 2009-10, Global Innovative Solutions Pvt Ltd, Reliance WiMax D.R.C. B.V, Reliance WiMax Gambia B.V. Reliance WiMax Mauritius B.V., Reliance WiMax Mozambique B.V, Reliance WiMax Niger B.V., Reliance WiMax Zambia B.V., Access Bissau LDA became the subsidiaries of the company. While, Reliance Mobile Ltd and Vanco (India) Pvt Ltd ceased to be subsidiaries of the company. As per scheme of arrangement between the company and Reliance Infratel Ltd, the Optic Fiber Undertaking of the company was de-merged and transferred to Reliance Infratel Ltd with effect from April 1, 2008.Also,
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Reliance Gateway Net Ltd, a wholly owned subsidiary of the company amalgamated with the company with effect from July 13, 2009. During the year, the company won the prestigious Global World Communication Awards 09, held in London. They also won this award in the Best Device Category where they participated with a new network device, developed with CISCO. The company was the only Indian company to win an award at WCA 09. The company received the Frost and Sullivan Market Share Leadership award for 'Data Center and Managed Services' category (FY 2009). They also received INFOCOMM - CMAI National Telecom Award for the 'Largest Telecom Network' category, presented by Secretary, DoT and Chairman, Telecom Commission. During the year 2010-11, the company along with its wholly owned subsidiary, Reliance Telecom Ltd (RTL) was awarded 3G spectrum in 13 out of 22 telecom circles, at a price of 85,850 million. The company is one among the only 3 operators who won in 13 circles, the highest circle coverage for any existing player. The company won in all the 3 metros namely Mumbai, Delhi and Kolkata and also in all those circles in which the Company has GSM incumbents. In December 13, 2010, the company became the first operator to offer 3G services to customers in top 3 metro circles namely Mumbai, Delhi and Kolkata. During the year, Flag Pacific Ltd, Flagweb Ltd, Flag Telecom Belgium Network SA, VancoApS, VancoHongkong Solutions Ltd, Vanco Net Direct Limited UK, RCOM Malaysia SDN. BHD, Yipes Systems Inc and Flag Access India Pvt Ltd ceased to be subsidiaries of the company. In June 20, 2010, the Company approved a proposal to acquire Digicable, India's largest Cable TV service provider to be renamed as 'Reliance Digicom'. Integration of the company's DTH, IPTV, retail broadband businesses along with Digicable acquisition will make the Company India's/ Asia's largest and the world's 5th largest digital TV and ultra-high-speed broadband service provider. The Company is awaiting regulatory approvals for completing this transaction. In March 9, 2011, the company signed facility agreement with China Development Bank (CDB) which includes Rs 6,000 crore for refinancing 3G spectrum fee payment by the company and Rs 2,700 crore for equipment imports from Chinese Vendors by the company and Reliance Telecom Ltd. During the year, Reliance Mobile Commerce Limited became the wholly owned subsidiary of the company. Reliance
Communications Maharashtra Pvt Ltd became the wholly owned subsidiary of the
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company through Reliance Telecom Ltd (RTL) during the year and merged into RTL, with effect from May 25, 2011. Global Innovative Solutions Pvt Ltd, a wholly owned subsidiary of the company was amalgamated with the company with effect from May 25, 2011. The appointed date was April 1, 2010. Reliance Global IDC Ltd, a wholly owned subsidiary of Reliance Infratel Ltd (RITL) merged with RITL with effect from May 25, 2011. The appointed date was January 1, 2011. Also, Matrix Innovations Ltd, a wholly owned subsidiary of Reliance Communications Infrastructure Ltd (RCIL) merged with RCIL. The appointed date was April 1, 2010. In January 2012, the company acquired AnComm, creator of Talk About It.
Pivotal difference between the two: one is an entrepreneur and the other is not so popular, as his credit is shared among a number of his big daddies. Following a five-hour closely held, hotly debated discussion, the name was announced: Anil DhirubaiAmbani, chairman of Reliance Communications. Anil Ambani joined Reliance Industries (currently promoted by his brother MukeshAmbani, following their split) in 1983 as cochief executive officer. Forbes ranked him number 104 among the World's Richest People in 2006. The Ambani family faced criticism when it announced its ambitious plans to build a countrywide telecom network, as its prior expertise lay in commodities-textiles and petrochemicals- business only. Apart from that telecom needs a service-oriented
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mindset, critics felt. What they did not remember was how the family had served its millions of shareholders. Policies in India are made in line with Ambani's vision, says an industry expert. His business acumen and closeness to politicians assisted him in making it to the RajyaSabha in June 2004, as an independent member. Ambani chose to resign voluntarily on March 25, 2006.The same association with politicos gave him negative returns too when the Mayawati Government in Uttar Pradesh put a spanner on his ambitious plans to build a 1,200-acre SEZ. Media sees his aggression when he announces financial results for the Reliance ADAgroup of companies, and when he attends the annual general meetings and faces questions from shareholders. When he meets the press, he has answers to all their questions. He also remembers to call select journalists by name. To merchant bankers he, who has already contributed immensely to the financial reforms of the country, is one of the financial wizards of the world. May be because of his expertise, he gave up in the race to grab Hutchison Essar stake, after indirectly jacking up the valuation. His negotiations with the Qualcomm chief are also a folk theory now. How did Ambani become the VOICE&DATA Telecom Person of the Year 2007? What are his personal and organizational achievements in the recent past? His path-breaking marketing strategy that was put in by the strongest team of telecom professionals the country has ever seen has made millions of Indians happy as they got the best mobile tariffs in the world. The aggression resulted to adding to his already swollen kitty. Every hour India will be adding around 20,000 new mobile customers and Reliance Communications over 4,000. When mobile telephony first began in India, a local call cost Rs 16 per minute; an STD Rs 50; and a call to the USRs 100 per minute. With Reliance Communications pioneering price initiative, a local call now costs a mere 15 paise per minute, STD 40 paise, and a call to the US cost less than Rs 2 per minute. The presence of Reliance Communications is making the competition in India panicky. Ambani has also recently announced his Rs 1,200 crore buyout of Yipes Holdings. Achiever's Pride Undertook financial restructuring of Reliance communications To spend Rs 16,000 crore to expand and strengthen network coverage After expansion, RCom will have the single largest wireless network in the world Launched the lowest-cost classic brand handset at Rs 777 Subscriber base grew to over 28 mn during last fiscal, registering 60% growth
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Total Revenue shot up to Rs 14,468 crore, an increase of 34% Net Profit rises to Rs 3,163 crore, an increase of over 600% Revenues of the wireless business increased by 46% to Rs 10,728 crore Broadband achieved revenue growth of 123% to Rs 1,144 crore Market capitalization crossed Rs 100,000 crore Will add 23,000 more towers Telecom services will be available in over 23,000 towns and 600,000 villages Next generation DTH network will be launched before the end of the year RComs wireless subscriber base grew to over 28 mn last fiscal, registering a 60% growth. This makes it one of the top two wireless operators in India. "Economic growth in the future will be indexed to connectivity of millions of enterprise and individual customers. Over the next few years, we will have over 100 million customers, making us one of the top 5 telecom players in the world. In four years, we put up a total of 14,000 towers across the country. This year alone we will add 23,000 more towers. Our wireless network is currently available in 10,000 towns. By the end of this year, it will be available in over 23,000 towns and 600,000 villages," Anil Ambani said at the first annual general meeting of Reliance Communications since the re-organization of the Reliance Group in June 2005.
This backbone was commissioned on 28 December 2002, the auspicious occasion of Dhirubais 70th birthday, though sadly after his unexpected demise on 6 July 2002.Reliance Communications has a reliable, high-capacity, integrated (both wireless and wire line) and convergent (voice, data and video)digital network. It is capable of delivering a range of services spanning the entire infocomm (information and communication) value chain, including infrastructure and services for enterprises as well as individuals, applications, and consulting. Today, Reliance Communications is revolutionizing the way India communicates and networks, truly bringing about a new way of life. We will leverage our strengths to execute complex global-scale projects to facilitate leading-edge information and communication services affordable to all individual consumers and businesses in India. We will offer unparalleled value to create customer delight and enhance business productivity. We will also generate value for our
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capabilities beyond Indian borders and enable millions of India's knowledge workers to deliver their services globally.
Literature Review
Customer Satisfaction
1) Introduction
Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four perspectives of a Balanced Scorecard. In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy. There is a substantial body of empirical literature that establishes the benefits of customer satisfaction for firms.
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include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Interdepartmental Teamwork, Front line Service Behaviors, Commitment to the Customer and Innovation. These factors are emphasized for continuous improvement and organizational change measurement and are most often utilized to develop the architecture for satisfaction measurement as an integrated model. Work done by Parasuraman, Zeithaml and Berry between 1985 and 1988 provides the basis for the measurement of customer satisfaction with a service by using the gap between the customer's expectation of performance and their perceived experience of performance. This provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Work done by Cronin and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman, Zeithaml and Berry as two different measures (perception and expectation of performance) into a single measurement of performance according to expectation. According to Garbrand, customer satisfaction equals perception of performance divided by expectation of performance. The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. The customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being measured.
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In the Perceived Quality indicator, Reliance communications obtained a score of 8.3 points for overall quality, way ahead of the scores of the other two operators (both obtained 7.7 points). Reliance communications comes top in all the indicators for perceived quality of network and services: technical quality of the network (8.2 points); customer service and advice capability (7.6 points); quality (8.2 points), diversity (8.0 points) and reliability (7.9 points) of products and services offered; clarity and transparency of information supplied (7.8 points); network coverage (7.9 points) and clarity and transparency of price plans (7.9 points). Similarly, in the indicators measuring the Image of mobile operators, Reliance communications comes top in the five categories analyzed (on a scale of 1 to 10): 'It is a reliable company in terms of what it says and what it does' (8.1 points); 'It is stable and well established in the market' (8.8 points); 'It contributes positively to society' (7.5 points); 'It cares about its customers' (7.6 points); and 'It is innovative and forward looking' (8.5 points). The methodology used in the ECSI Portugal 2007 survey (ECSI European Customer Satisfaction Index) is similar to that used by the European Commission to survey customer satisfaction in 25 Member States, enabling comparisons to be made between the results obtained in each country. The ECSI Portugal 2007 Communications survey was carried out by the Higher Institute of Statistics and Information Management at Lisbon's New University in partnership with the Portuguese Quality Institute and the Portuguese Quality Association, with sponsorship from Anacom.
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advertisements announced that Reliance IndiaMobile was 'Kabhi mobile, kabhi computer' (Sometimes Mobile, Sometimes Computer). Overall, three things emerge from the way Reliance handled the media. Firstly Reliance built a huge public relations exercise around the launch of the product. The public relations gave much leverage to the advertising and gave rise to a word of mouth campaign. Secondly RCom utilized every media vehicle effectively.
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Global Enterprise
Sign long term contracts with existing and new operators to provide pan-India infrastructure and bandwidth. Complete NGN Mediterranean and continue to maintain leadership in the Carriers Carrier market. Increasing IDC capacity and launching new high margin product/service lines. Expanding Managed Services portfolio for higher share of customers wallet and to increase stickiness of our products.
Infratel
Maximize revenues from existing assets of Towers OFC & Ducts. Huge potential of value unlocking for Reliance Communication shareholders.
Home
Aggressive acquisitions to build the subscriber base for long-term revenue. Rigorous program management framework for capex and opex cost efficiencies, esp. Settop box and Content.
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Price There are many ways to price a product. The pricing policy/ strategy vary in various situations. In case of Reliance mobiles they have priced their products very low & they also come up with new plans.
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Monsoon Hungama Scheme: It came out on the 1st of July, in the year 2003. Customers were given a mobile phone for Rs. 501/- only with a monthly rental of Rs. 200/-. It was the biggest promotional success in the history of mobile phones. One million handsets were sold in just 10 days. Place Place is also known as channel, distribution, or intermediary. It is the mechanism through which goods and/or services are moved from the manufacturer/ service provider to the user or consumer. Reliance Mobiles do not find it very difficult to find the distribution channel because they are the old players and distribute their product in India. Promotion Reliance has recently started doing heavy promotions.
Advertising Strategies
Bundling of handsets with service. RCom branded mobile phone instruments. Advertisements based on Bollywood movies and cricket pulse of India. Co-branding with mobile instrument makers reduced ad and promo expense.
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Yes 93
No 7
Yes No
Purpose The main purpose of this question is to know how many respondents use mobile phone.
Interpretation 93% of the respondents are have a mobile phone while 7% of the respondents do not have a mobile phone.
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Q2) Are you aware about telecommunications services? Answers No. of respondents Yes 100 No 0
Yes No
Purpose The main purpose of this question is to know how many respondents are aware of the telecommunication services.
Interpretation All the respondents are aware of these services, hence making it a 100%.7 Q3) Which operators service do you use? Operators service name Airtel Reliance No. of
respondents 35 15
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20 25 5
Purpose The main purpose of this question is to know which network is most used by people.
Interpretation The pie chart clearly represents that there are more users for Airtel, followed by Vodafone.
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Yes No
Interpretation Here 100% of respondents are aware about Reliance communications Services.
Q5) From which source you came to know about Reliance communications?
Purpose The purpose behind this question is to know from which source the respondents came to know about Reliance communications.
No. of respondents 63 52 35 26
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Source
Interpretation 36% of the respondents are aware about Reliance communications through Advertisements, 29% are aware because of Hoardings while 20% and 15% of the respondents are aware because of Newspapers and Mouth Publicity respectively.
Q6) Since how long have you been using Reliance communications Services?
Purpose The purpose behind this question is to know about the usage time of Reliance communications customers i.e. since how long they are using Reliance communications services.
Time period
No. of respondents
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Less than 1 month 2-6 months 6-12 months More than 1 year
0 7 4 4
Time Period
Less than 1 month 2-6 months 6-12 months More than 1 year
Interpretation Major Respondents using Reliance communications are old customers. 39% of the respondents use Reliance communications services from past more than 1 year while the lowest is 14% respondents using Reliance communications services less than 1 month.
Purpose The purpose behind this question is to know which services do the Reliance communications customer use, Pre-Paid or Post-Paid.
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No. of respondents 11 4 25 5 6
Type of service
Pre-paid Post-paid Net-dongle Tablet 3G Service None
Interpretation 11% of the respondents use pre-paid services while only 4% of the respondents use post-paid services. There are more number of people who dont use any kind of RCom services or products.
Q8) Which services are more helpful to you while using Reliance communications Services? Purpose The purpose behind this question is to know which services are more helpful to the respondent while using Reliance communications.
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No. of respondents 15 7 14
Services
Interpretation Here, about half of the respondents are youngsters, so the SMS Services are regularly used by almost 50% of the users of Reliance network.
Yes No
10 5
Purpose The purpose of this question is to know how many times and how often the respondents call at customer care of Reliance communications
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Yes No
Interpretation 87% of the respondent calls at customer care while 13% respondents do not call at customer care.
No. of respondents 0 1 3 11
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Time Period
Interpretation Major respondents here call customer care occasionally. 31% respondents respondents call customer care once a month while 16% and 7% of respondents call once a week and daily respectively.
Q9) For what reason you call customer care? Purpose The main purpose of this question is to know the reason of the respondents regarding calling at customer care.
Reasons Value Added Services Information regarding new schemes Complaining Other queries
No. of respondents 10 9 7 5
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Time Period
Interpretation Approximately 66% of the respondents call customer care regarding value added services, 60 percent call for information related to new schemes and offers. Almost 46% call to complain and almost 33% call for other queries. This shows that Reliance has to look more into providing their services in a better way.
Q10) Rate the following services on the basis of your satisfaction. Services Excellent Very Good Network SMS rates New schemes and offers Customer Care Recharge outlets Call Rates Value Added Services 3 4 2 8 2 3 5 3 5 2 2 10 3 4 9 7 4 3 6 5 3 12 Fairly good Average Poor
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Q12) Why you are not using Reliance communications services? (Multi-choice)
No. of Respondents 0 23 35 42
Reasons
No 85
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Recommend?
Yes No
This pie chart highlights the number of respondents who wouldnt recommend Reliance to other people, such as their friends, colleagues, family etc. This shows that the company has a few areas in which it should greatly improve.
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Following are some of the suggestions given by me so that Reliance communications can serve people and its customers in an improved way: Reliance communications should decrease call rates for local users. Reliance communications should provide more offers to Post-Paid customers so that the number of Post-Paid customers increase. Reliance communications should bring introduce some new SMS schemes for the youngsters. Reliance communications should introduce more schemes and offers. Reliance communications should provide more schemes and offers to its old and loyal customers. Reliance communications should decrease call rates of STD and ISD.
Findings
There are a large number of mobile users than those who do not use them. But, 100% of the respondents are aware about telecommunications services. These respodents are also aware of Relaince Communications. Among the listed networks, Airtel is the most preferred one. This is mainly because of the vast network coverage it offers.
The respondents got to know about RCom through various sources. Out of which, the highest number goes to the advertisements on tv. Followed by the billboards that are placed in the city.
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Although Reliance Communications and Reliance Network have been around for years, the number of users was very low. Despite knowing that the company is reliable, people still choose other networks over Reliance mainly because of the network coverage and other schemes that are not offered by this company.
Through this survey, it is found out that there are more pre-paid users than post-paid. Post-paid users mainly use their phones for calling, rather than texting unlike the youngsters who use the SMS service more than the calling service. Other value added services are also used but not as much as the above services.
The users do not call the customer care very often, but when they do it is to find out about schemes, or for activate and deactivation of other value added services like validy, call rates, sms pack, caller tunes etc. Most of the users who were satisfied with the customer service were also satisfied with the process of getting their queries solved. Some callers also call the customer care to lodge complaints. The respondents who dont use this network were asked for the reason, and different answers were given such as high call rates, poor services and poor network coverage. Some said that they considered getting a Reliance connection for their mobile phone, but found out that the recharge vouchers are not readily available everywhere like the rest of the networks vouchers are.
Despite the relatively fairly moderate customer base, it is evident that there are some old customers who have stayed loyal to the company and are unwilling to switch to a different network any time soon.
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Conclusion
Follwing are the conclusions that I found after the survey.
From the above analysis the researcher concludes that major respondents are dissatisfied with some of the major services like call rates, SMS rates and new schemes & offers. Respondents use services of other telecommunication companies rather than Reliance.
Part of the customers of Reliance communications are old customers, therefore they are satisfied with the company and its services and thus they would like to recommend Reliance communications to others. Major respondents using Reliance communications use pre-paid services compared to post-paid services. Most of the respondents are youngsters so they need more SMS facilities and low call rates, but Reliance communications dissatisfies these age group as their call rates and SMS rates are much high.
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BIBLIOGRAPHY
Websites
iimcal.ac.in en.wikipedia.org anacom.pt www.rcom.co.in marketing91.com www.COAI.in www.AUSPI.in
References Bauer, Thomas, Motivation and satisfaction of mega-business event attendees, 2008 Ferguson, Rick, Telecom's search for the ultimate customer loyalty platform, 2008 Robins, Fread, The marketing of 3G, vol 21, no 6, 200 Ramman, S.Raghu, People Management issues in Indian KPOs, 2007 Shankar, Ravi, Innovation in the Indian Telecom Industry, Feb, 2006
Journals
The Indian Telecom Industry, IIM Calutta, VatsalGoyal, 2007 Investment Surge in the Indian Telecom Space, Times Global, Issue 2, 2008 A multiple-perspective model for technology assessment, vol 3, 2008 The marketing of 3G, Vol 21, no. 6, 2003
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ANNEXURE
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Questionnaire
Q1) Do you have a mobile phone? Yes No
Q2) Are you aware about telecommunications service? Yes No If yes, then which operators Service do you use? (Multi-choice) Airtel Reliance Idea Vodafone BSNL Tata Indicom ( If not Reliance communications then go to Q12 )
Q3) Are you aware about Reliance communications? Yes No (If No, then go to Q11 )
Q4) From which source you came to know about Reliance Communications? (Multi-choice) Advertisement Hoardings Newspapers Mouth Publicity
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Q5) Since how long you are using Reliance communications services? Less than 1 month 2-6 months 6-12 months More than 1 year
Q6) Which of the following services do you use of Reliance communications? Pre-paid Post-paid Net dongle Tablet apps 3G Service
Q7) Which services are more helpful to you while using Reliance communications services? (Multi-choice) Call rates SMS service Network Value Added Services
If yes, how often you call at customer care? Daily Once a week Once a month Occasionally
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Q9) For what reason you call at customer care? Value added services Information regarding new schemes Other queries Complaining (Multi-choice)
Q10) Rate the following services on the basis of your satisfaction. Services Network SMS rates New schemes and offers Customer Care Recharge outlets Call Rates Value Added Services Excellent Very Good Fairly good Average Poor
Q11) What makes you unaware about Reliance communications? Less Advertisements Less Publicity Others
Q12) Why you are not using Reliance communications services? (Multi-choice) Lack of awareness High Prices Poor Services Poor network
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Q14) Give your suggestions to help in serve you better. ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________
Name: ________________ Age: ___ years Sex: Male/Female Contact no.: ___________ Signature: __________