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Chapter 1

Introduction
1.1 Background
India's telecommunication network is the second largest in the world based on the total number
of telephone users (both fixed and mobile phone). It has one of the lowest call tariffs in the world
enabled by the mega telephone networks and hyper-competition among them. It has the world's
third-largest Internet user-base with over 137 million as of June 2012. Major sectors of the
Indian telecommunication industry are telephony, internet and television broadcasting.
The Indian telecom network with 895.51 million telephone connections, including 864.72
million wireless telephone connections, at the end of December 2012 is second largest network
in the world after China. Out of this, 338.59 million telephone connections are in rural areas
and556.92 million are in urban areas of the country. There were 24.01 million Internet
subscribers including 14.68 million Broadband subscribers at the end of September 2012. The
number of Broadband subscribers increased to 14.98 million, end of December 2012. (TRAI,
2013)
Growth in Indias mobile telephone sector has been nothing short of spectacular in the past few
years, aided by higher subscriber volumes, lower tariffs and falling handset prices. India is home
to a number of global mobile operators working with local companies and mobile market has
consistently experienced very high annual growth rates with the continuous decline in tariff.
At present, there are more than 15 players in the telecom operators in India. All of them compete
with each other to grab customers by providing wide range of services. They not only offer basic
services of cell phone but also produce other value added services. Along with the normal
services all of the operators are now offer internet facilities which enable the subscribers to reach
the whole world through internet easily and their services includes prepaid, post-paid, internet,
value added services, roaming and devices. The hasty growth and development in information
technology and mobile devices has made the Indian mobile phone service markets more and
more competitive. It is assumed by all mobile service providers that value added services
increases the customer loyalty. But does value-added services fulfil all the customer needs and is

it the only factor that play a significant role in maintaining and building up the loyalty of the
customers. On the other hand according to Lee et al (2001) the mobile providers should build up
customer commitment by providing good quality service to their customers.
The success of telecommunication industry depends on prudent efforts and feasible investments.
In a competitive market, service providers are expected to compete on both price and quality of
services and also it is necessary for the service providers to meet the consumers requirements
and expectations in price and service quality(Melody, 2001). The positive relationship of service
quality with customer satisfaction (Danaher and Mattson, 1994; Kim et al., 2004), customer
preference (Ranaweera and neely, 2003), profitability (Cornell 1992; Danaher and Rust, 1996),
competitiveness (Rapert and Wren, 1998), is well proven in the academic literature. The
customers now-a-days, are choosing their telecom service providers on the basis of various
factors which include service offerings, their quality, affordability, etc.
1.2 Objectives of the study
As competition has been escalating among the corporations, it is ardently necessary for them to
learn about the consumers perception about the communication quality, call services, facility,
price, customer care, service providers capabilities and other important factors that may have
been playing a vital role in selecting the telecommunication service providers. Therefore, the
major objective of this study is to cautiously examine the factors that have been affecting the
consumers perception to select mobile telecommunication service, particularly in India.
The objectives of the study are:

To find out the factors determining the perception of customers towards telecom service
providers in India.

To find out the effectiveness of various factors in determining the perception of


customers towards telecom service providers in India.

To recommend the telecommunication service providers in order to gain value perception


in the minds of the customers.

Chapter2
Literature Review
2.1 Introduction to Indian Service Sector
The services sector covers a wide array of activities ranging from services provided by the most
sophisticated sectors like telecommunications, satellite mapping, and computer software to
simple services like those performed by the barber, the carpenter, and the plumber; highly
capital-intensive activities like civil aviation and shipping to employment-oriented activities like
tourism, real-estate, and housing; infrastructure-related activities like railways, roadways, and
ports to social sector related activities like health and education. Thus, there is no one-sizefitsall definition of services resulting in some overlapping and some borderline inclusions. The
National Accounts classification of the services sector incorporates trade, hotels, and restaurants;
transport, storage, and communication; financing, insurance, real estate, and business services;
and community, social, and personal services. In the World Trade Organization (WTO) list of
services and the Reserve Bank of India (RBI) classification, construction is also included.
Indias services sector has emerged as prominent sector in terms of its contribution to national
and states incomes, trade flows, FDI inflows, and employment. According to The Economic
Survey (2012-13), growth story overall and services of world and India in the 2000s began from
almost the same level of around 4-5 per cent in 2000. But over the years, Indias overall and
services growth rates have outpaced those of the world. Interestingly, unlike world services
growth, which has been moving in tandem with its overall growth with mild see-saw movements
over the years, Indias services growth has been consistently above its overall growth in the last
decade except for 2003. Thus, for more than a decade, this sector has been pulling up the growth
of the Indian economy with a great amount of stability. The share of services in Indias GDP at
factor cost (at current prices) increased from 33.3 per cent. In 1950-51 to 56.5 per cent in 201213. Including construction, the share would increase to 64.8 per cent in 2012-13. With an18.0 per
cent share, trade, hotels, and restaurants as a group is the largest contributor to GDP among the
various services sub-sectors, followed by financing, insurance, real estate, and business services
with a 16.6 per cent share. Both these services showed perceptible improvement in their shares

over the years. Community, social, and personal services with a share of 14.0 per cent is in third
place. Construction, a borderline services inclusion, is at fourth place with an 8.2 per cent share.
The CAGR of the services sector GDP at 10per cent for the period 2004-5 to 2011-12 has been
higher than the 8.5 per cent CAGR of overall GDP during the same period. However in 2011-12
and2012-13, there has also been a deceleration in growth rate of services sector at 8.2 per cent
and 6.6 percent respectively. Among the major broad categories of services, financing,
insurance, real estate, and business services, which continued to grow robustly both in 2010-11
and 2011-12 decelerated to 8.6 percent in 2012-13. While in 2011-12 growth in trade, hotels,
and restaurants and transport, storage, and communication slowed down to 6.2 per cent and8.4
per cent respectively, in 2012-13 trade, hotels, and restaurants and transport, storage, and
communication combined grew by an estimated 5.2 per cent.
2.2 Telecom Industry in India
Telecommunications has evolved as a basic infrastructure like electricity, roads, water etc. and
has also emerged as one of the critical components of economic growth required for overall
socio economic development of the country. The Indian telecom sector has registered
phenomenal growth during the past few years and has become second largest telephone network
in the world, only after China. A series of reform measures by the Government, the wireless
technology and active participation by private sector played an important role in the exponential
growth of telecom sector in the country. National Telecom Policy-2012 (NTP-2012) has been
announced during the current year with the primary objective of maximizing public good by
making available affordable, reliable and secure telecommunication and broadband services
across the entire country.
In the last ten years, the mobile revolution has truly changed the socio-economic landscape of
India and played pivotal role in the growth and development of the economy.
Todays development of communication technology ignores the global border and makes the
world as global village (McLuhan, 1964). This reform of the communication technology since
been expanded to include the transformation of the traditional voice telecom network into an
expanded and enhanced information infrastructure, which is capable of communicating all forms
of information content(Melody, 2003). The nature of the competition today in the global

telecommunications industry seems to centre on market activities that aim at gaining competitive
advantages through strategic combinations of resources and presences in multiple products and
geographical areas (Chan-Olmsted and Jamison, 2001). The success of telecommunication
industry depends on prudent efforts and feasible investments. In competitive market, service
providers are expected to compete on both price and quality of services and also it is necessary
for the service providers to meet the consumers requirements and expectations in price and
service quality (Melody, 2001). The telecommunication system has been a fastest growing
medium of communication rejuvenating global interface interactions. Since, currently
telecommunication sector is experiencing phenomenal global change with the liberalization and
privatization of the sector (Beard and Hartmann, 1999), which intern, widens a fierce
competition. The system has opened an ocean of opportunities for the potential consumers to
enjoy versatile choices among the service providers. Now days, due to breathtaking competition,
the telecommunication service providers tend to offer innovative services as well as competitive
prices just to attract handful magnitude of customers.
Mobile phones may be categorized as common communication medium for almost 31% of the
global population uses them (Motorola, 2006). Lot of studies has been conducted in the recent
times on mobile phone use and customers satisfaction. This section presents a brief review of
some of the significant studies on this. This is not an elaborate review of studies on this subject.
It is only an attempt to present some of the important recent studies on the subject concerned to
understand the various facets of this area that being researched.
According to Cellular Operator Association of India (COAI), India ranks between the top ten
telecom network in the world and the second largest in Asia. India is also one of the fastest
growing markets in mobile communications. Telecom Regulatory Authority of Indias report on
Telecom Services Performance (TRAI, 2010) indicates cellular mobile subscriber base touching
735.71million in June 2012. Growth in Indias mobile telephone sector has been nothing short of
spectacular in the past few years, aided by higher subscriber volumes, lower tariffs and falling
handset prices. India is home to a number of global mobile operators working with local
companies and mobile market has consistently experienced very high annual growth rates with
the continuous decline in tariff.

2.2.1 History and Evolution


The history of Indian telecom can be started with the introduction of telegraph. The Indian postal
and telecom sectors are one of the worlds oldest. In 1850, the first experimental electric
telegraph line was started between Calcutta and Diamond Harbor. In 1851, it was opened for the
use of the British East India Company. The Posts and Telegraphs department occupied a small
corner of the Public Works Department, at that time.
Subsequently, the construction of 4,000 miles (6,400 km) of telegraph lines connecting Kolkata
(then Calcutta) and Peshawar in the north along with Agra, Mumbai (then Bombay) through
Sindwa Ghats, and Chennai (then Madras) in the south, as well as Ootacamund and Bangalore
was started in November 1853. William O'Shaughnessy, who pioneered the telegraph and
telephone in India, belonged to the Public Works Department, and worked towards the
development of telecom throughout this period. A separate department was opened in 1854 when
telegraph facilities were opened to the public.
In 1890, two telephone companies namely The Oriental Telephone Company Ltd. and The
Anglo-Indian Telephone Company Ltd. approached the Government of India to establish the
telephone exchanges in India. The permission was refused on the grounds that the establishment
of telephones was a Government monopoly and that the Government itself would undertake the
work. In 1881, the Government later reversed its earlier decision and a license was granted to the
Oriental Telephone Company Limited of England for opening telephone exchanges at Calcutta,
Bombay, Madras and Ahmedabad and the first formal telephone service was established in the
country. On 28 January 1882, Major E. Baring, Member of the Governor General of India's
Council declared open the Telephone Exchanges in Calcutta, Bombay and Madras. The
exchange in Calcutta named the "Central Exchange" had a total of 93 subscribers in its early
stage. Later that year, Bombay also witnessed the opening of a telephone exchange.
The Telecommunication Timeline
Pre-1902 Cable telegraph
1902 First wireless telegraph station established between Sagar Island and Sandhead.
1907 First Central Battery of telephones introduced in Kanpur.

19131914 First Automatic Exchange installed in Shimla.


1927 Radio-telegraph system between the UK and India, with Imperial Wireless Chain beam
stations at Khadki and Daund which was inaugurated by Lord Irwin on 23 July by exchanging
greetings with King George V.
1933 Radiotelephone system inaugurated between the UK and India.
1953 12 channel carrier system introduced.
1960 First subscriber trunk dialing route commissioned between Lucknow and Kanpur
1975 First PCM system commissioned between Mumbai City and Andheri telephone
exchanges.
1976 First digital microwave junction.
1979 First optical fibre system for local junction commissioned at Pune.
1980 First satellite earth station for domestic communications established at Sikandarabad,
U.P.
1983 First analogue Stored Program Control exchange for trunk lines commissioned at
Mumbai.
1984 C-DOT established for indigenous development and production of digital exchanges.
1995 First mobile telephone service started on non-commercial basis on 15 August 1995 in
Delhi.
1995 Internet Introduced in India starting with Mumbai, Delhi, Calcutta, Chennai and Pune on
15 August 1995.
2.2.2 Current Scenario
According to the Telecom Industry Annual Report 2012-13, Indian telecom network with 895.51
million telephone connections, including 864.72millionwireless telephone connections, at the
end of December 2012 is second largest network in the world after China. Out of this, 338.59

million telephone connections are in rural areas and 556.92 million are in urban areas of the
country. There were 24.01 million Internet subscribers including 14.68 million Broadband
subscribers at the end of September 2012. The number of Broadband subscribers increased to
14.98 million, end of December 2012.
Present Status of the Telecommunication Sector (as on December 31, 2012)

Indian telecom network is second largest in the world after China.

The country has 895.51 million telephone connections, including 864.72 million wireless
telephone connections

Overall tele-density in the country is 73.34%.

Urban tele-density is 149.55%, whereas rural tele-density is 39.90%.

The share of wireless telephones in total telephones is 96.56%.

The share of private sector in total telephones is 85.51%.

Number of Broadband connections is 14.98 million.

Network status during current financial year (2012-13)


The total number of telephones continued to increase till June 2012 and increased from
951.35million to 965.52 million during the period April to June 2012. Thereafter, number of
telephone connections declined to 895.51 million by the end of December 2012. The decline in
telecom user base after June 2012 has been primarily due to the removal of inactive mobile
telephone connections by the service providers. The rural telephones have increased from 330.83
million to 343.88 million during the period April to June 2012 and declined thereafter to 338.59
million by the end of December 2012. The urban telephones increased from 620.52 million to
621.65million during the period April to June 2012 and then declined to 556.92 million by the
end of December 2012.
The given chart in Fig2.1 shows the variation of Telephone connections during 2012-13 on
monthly basis.

980

Apr'12

960

May'12

940

Jun'12

920

Jul'12
Aug'12

900

Sep'12

880

Oct'12

860
Number of Telephone Connections

Nov'12

Fig2.1 No. of Telephone Connections (source: Telecom Annual Report 2012-13)

Tele-density Tele-density, which shows the number of telephones per 100 populations, is
an important indicator of telecom penetration in the country. Tele-density, which was
78.66% at the end of March 2012, increased to 79.58% by the end of June 2012 and then
declined to 73.34% by the end of December 2012. Among the service areas, Tamil Nadu
(109.64%) has the highest teledensity followed by Himachal Pradesh (102.76%), Punjab
(101.92%), Kerala (100.76%) and Karnataka (91.26%). Among the three metros, Delhi
tops with 220.00% tele-density, followed by Mumbai (159.57%) and Kolkata (155.10%).
On the other hand, the service areas such as Assam (46.50%), Bihar (46.53%), M.P.
(52.23%), U.P. (56.20%), West Bengal (56.85%) and J&K (58.41%) have comparatively
low tele-density. There has been slight improvement in the rural tele-density during
2012-13 and it increased from 39.26% at the end of March 2012 to 39.90% at the end of
December 2012. However, the urban tele-density decreased from 169.17% to 149.55%
during this period.

180
160
140
120
100

Rural

80

Urban
Overall

60
40
20
0
2007

2008

2009

2010

2011

2012

Dec'12

Fig2.2 Teledensity (source: Telecom Annual Report, 2012-13)

Broadband Increase in Broadband connectivity is being seen as an integral driver of


improved socioeconomic performance. Broadband services empower masses and allow
individuals to access new career and educational opportunities, help businesses reach new
markets and improve efficiency and enhance the Governments capacity to deliver
critical services like health, banking and commerce to all of its citizens. There were 14.98
million Broadband subscribers in the country by the end of December 2012.
2.2.3 Composition of Telephones
Public Vs Private Players
Operator-wise classification, at the end of December 2012, reveals that PSUs still have large
share of nearly 79.57% in the wire line segment. Private operators, on the other hand, have a
share of 87.83% in the wireless segment. Overall, Bharti Group with 20.68% of the total
telephones, both landlines and mobiles taken together, in the country has the largest share
followed by Vodafone Group (16.47%), two PSUs BSNL & MTNL put together
(14.49%),Reliance (13.38%) and Idea (12.72%) etc.

The share of private sector, in terms of number of subscribers, increased from 86.31% to86.64%
during the period from April to June 2012 and thereafter declined to 85.51% by the end of
December 2012. On the other hand, share of public sector declined from 13.69% to13.36%
during the period April to June 2012 and then increased to 14.49% by the end of December
2012.
Wire line Vs Wireless
The preference for use of wireless telephony continues. The share of wireless telephones
increased from 96.62% as on 31.03.2012 to 96.74% by the end of June 2012 and thereafter
slightly declined to 96.56% by the end of December 2012.On the other hand, the share of
landline telephones slightly increased from 3.38% to 3.44%during the period from April to
December 2012.
2.3 Market Players in Indian Telecom Industry
(a) Bharti Airtel Ltd.
Bharti Airtel Limited, commonly known as Airtel, is an Indian multinational telecommunications
Services Company headquartered at New Delhi, India. It operates in 20 countries across South
Asia, Africa and the Channel Islands. Airtel has GSM network in all countries in which it
operates, providing 2G, 3G and 4G services depending upon the country of operation. Airtel is
the world's third largest mobile telecommunications company with over 261 million subscribers
across 20 countries as of August 2012. It is the largest cellular service provider in India, with
183.61 million subscribers as of November 2012. Airtel is the third largest in-country mobile
operator by subscriber base, behind China Mobile and China Unicom.
(b) Vodafone
Vodafone Group Plc is a British multinational telecommunications company headquartered in
London and with its registered office in Newbury, Berkshire. It is the world's second-largest
mobile telecommunications company measured by both subscribers and 2012 revenues (in each
case behind China Mobile), and had 439 million subscribers as of December 2012.

(c) Idea Cellular


IDEA Cellular is a publicly listed company, having listed on BSE & NSE in March 2007. It is
the 3rd largest mobile services operator in India with wireless revenue market share at 15 % in
Q1 FY 2013, and subscriber base of over 117 million. Idea has consistently stayed ahead of the
industry in VLR reporting, and has the 3rd highest base of active subscribers. Idea is a pan-India
integrated GSM operator and has its own NLD and ILD operations, and ISP license.
(d) BSNL
Bharat Sanchar Nigam Ltd. was incorporated on 15th September, 2000. It took over the business
of providing of telecom services and network management from the erstwhile Central
Government Departments of Telecom Services (DTS) and Telecom Operations (DTO), with
effect from 1st October, 2000 on going concern basis. It is one of the largest & leading public
sector units providing comprehensive range of telecom services in India.
BSNL has installed Quality Telecom Network in the country & now focusing on improving it,
expanding the network, introducing new telecom services with ICT applications in villages &
winning customer's confidence. Today, it has about 43.74 million line basic telephone capacity,
8.83 million WLL capacity, 72.60 million GSM capacity, 37,885 fixed exchanges, 68,162 GSM
BTSs, 12,071 CDMA Towers, 197 Satellite Stations, 6,86,644 RKm. of OFC, 50,430 RKm. of
microwave network connecting 623 districts, 7330 cities/towns & 5.8 lakhs villages .
BSNL is the only service provider, making focused efforts & planned initiatives to bridge the
rural-urban digital divide in ICT sector. In fact there is no telecom operator in the country to beat
its reach with its wide network giving services in every nook & corner of the country & operates
across India except New Delhi & Mumbai. Whether it is inaccessible areas of Siachen glacier or
North-Eastern regions of the country, BSNL serves its customers with a wide bouquet of telecom
services namely Wire line, CDMA mobile, GSM mobile, Internet, Broadband, Carrier service,
MPLS-VPN, VSAT, VoIP, IN Services, FTTH, etc.
(e) Aircel
The Aircel Group is a result of alliance between Maxis Communications Berhad of Malaysia
(74% equity) and Sindya Securities & Investments Private Limited (26% equity).

The Aircel Group, formed in 1994, offers affordable and outstanding mobile services to a vast
subscriber base in India. Aircel has a vision of delighting its customers by giving them the
respect they deserve. Its goal is to provide our customers with exemplary service and persistently
look for new ways to surpass their expectations.
(f) Reliance Communications
Reliance Groups flagship company, Reliance Communications, is India's largest private sector
information and communications company, with over 150 million subscribers. It has established
a pan-India, high-capacity, integrated (wireless and wire line), convergent (voice, data and video)
digital network, to offer services spanning the entire infocomm value chain.
(g) Tata Communications
Tata Communications' depth and breadth of reach in emerging markets includes leadership in
Indian enterprise data services, leadership in global international voice, and strategic investments
in South Africa (Neotel), Sri Lanka (Tata Communications Lanka Limited) and Nepal (United
Telecom Limited)
With new players coming in, the intensity of competition in the industry has increased, especially
in last four years. The market share of telecom operators of the telcom companies reflects the
fragmented nature of industry, with as many as 15 players. As of April 30, 2012 Bharti Telecom
led the market with 19.94%, Reliance 16.58%, Vodafone 16.41, Idea 12.40%, BSNL 10.51%,
Tata 8.77%, Aircel 6.93% with the remaining share being held by small operators.

Subscriber Market Share


Bharti Airtel
Vodafone
Reliance
Idea
BSNL
Aircel
Tata
Others

Fig 2.3 Subscriber Market Share of Players (source: A Brief Report on Telecom Sector in India, AS&A)

Revenue Market Share


Airtel
Vodafone
Idea
Tata
Reliance
BSNL+MTNL
Aircel
Others

Fig2.4 Revenue Market Share (source: TRAI)

2.4 Telecom Industry Challenges


The services provided by the telecom industry form the foundation of our connected lives in the
Digital World. However, despite the importance of these services, the health of the telecom
industry is threatened by multiple challenges including:
Declining Core Revenue Stream Competitive and regulatory pressures are straining the
telecom industry. Ultra-low cost and free voice services have commoditized
communication service providers' core revenue streams of voice and text message
services. The rise of over the top players is a growing threat. Today, Skype carries nearly
25% of international long distance traffic and services such as Apple's iMessage platform
are further pressuring CSPs. Voice-based tariffs have also declined due to regulatory
interventions. (Malviya and Varma, 2012)
Data Monetization Gap Both fixed and mobile broadband networks are experiencing an
explosion in data traffic due to the adoption of bandwidth-intensive applications such as
video streaming, online gaming and social networking. However, this surge in data traffic
has not translated to an equivalent growth in revenues for CSPs. In fact, the gap between

data traffic and service provider revenues is steadily rising, with data traffic growth
expected to outpace revenue growth3 by a factor of 9 between 2012 and 2016. On the
other hand, investments required to expand capacity and coverage and keep pace with
technology advancements continue to grow, further impacting profitability.(Malviya and
Varma, 2012)
These challenges are compounded by growing consumer expectations for a best-in-class
customer experience. Customers have grown accustomed to the relatively seamless service
experience provided in the retail and financial services sectors. As CSPs venture into providing
more value added services, customers will begin to expect similar levels of customer service.
2.5 Services and Service Quality
In order to achieving higher levels of quality service in service companies should deliver higher
levels of service quality and in the present context customers perceptions are highest (Hossain
and Leo 2009).
According to Agus et. al (2007) there are two perspectives to the ongoing pursuit of service
quality. From the perspective of the service organization, there is a desire to survive and compete
in a global environment. From the perspective of the customer, there is a desire for better quality
services. In fact the private sectors singular focus is on economic efficiency, as it is generally
viewed that profit and/or cost reduction are key ingredients to survival and growth (Cooper,
2004). Agus et al. (2007) also find out that a strong correlation between service quality
dimensions, service performance and customer satisfaction.
They also mentioned that service providers classified as excellent were rated most favorably in
terms of responsiveness, access and credibility. On the other hand Competitive advantage is a
value-creating strategy, simultaneously which is not implemented by any existing or potential
competitors (Barney, 1991). Moreover, according to them, a competitive advantage also
sustained when other companies are able to duplicate the benefits of this strategy. Service is a
form of attitude which is related to satisfaction and also leads to consumer loyalty (Johnson and
Sirikit, 2002) and future purchase. In particular consumers prefer service quality when the price
another cost elements are held constant (Boyer and Hult, 2005). It has become a distinct and
important aspect of the product and service offering (Wal et al., 2002). According to Leisen and

Vance (2001) service quality helps to create the necessary competitive advantage by being an
effective differentiating factor.
Service quality was initiated in the 1980s as the worldwide trend when marketers realized that
only a quality product could not be guaranteed to maintain competitive advantage (Wal et al.,
2002).
Services mainly depend on some factors and customers always try to buy the product which has
many factors or attributes fulfilling their desire. Recently the concept of customer satisfaction
has received much attention. In cellular mobile market, customers bring higher expectations for
communication from its service providers and if companies are not able to meet these
expectations, the customers will take their business elsewhere. The consumers want and
expectations are altering all the time, this directs to a condition where customers create ever
higher benchmarks. Applying customer satisfaction approach means recognizing customers, and
then finding their wants and expectations, and to end with their perceptions. A companys most
important success factor is the ability to deliver better customer value than competitors do and
the objective of a strategy is to deliver value to the customers in order to provide required returns
to the share holders and employees.
Parasuraman et al. (1985, 1988) conceived that service quality is the difference between
customers expectation and their perceived performance of a service. Based on this concept,
Parasuraman et al. (1988) developed the SERVQUAL model (including five dimensions, namely
tangible, responsiveness, reliability, assurance, and empathy) to measure service quality. This
model has drawn attention from the academic and the practical circles. A Multiple-Item Scale
for Measuring Customer Perceptions of Service Quality study was revolutionary as it didnt
depend on the earlier dimension of goods quality in the manufacturing sector. The initial study
based on the focus groups yielded 10 dimensions of service quality that included tangibles,
reliability, responsiveness, competence, courtesy, credibility, security, access, communication,
and understanding the customer. A 22 item scale, called SERVQUAL which would measure the
service quality based on five dimensions, viz. tangibles, reliability, responsiveness, assurance
and empathy was derived based one further empirical study. The authors defined service quality
as the degree of discrepancy between customers normative expectations for the service and their
perceptions of the service performance.

However, many scholars have questioned about the conceptual framework and measurement
method of this model. For instance, Cronin and Taylor (1992) pointed out that using service
quality performance (SERVPERF, i.e. the perceived service in SERVUQAL) to measure service
quality produces better results of reliability, validity, and predictive power than using
SERVQUAL. Some other studies (Boulding et al., 1993; McAlexander et al., 1994; Parasuraman
et al., 1994; Zeithaml et al., 1996) also maintained that SERVPERF is more accurate than
SERVQUAL in the measurement of service quality, and SERVQUAL can provide better
diagnostic information. In the studies of the information industry, similar findings have been
proposed (Pitt et al., 1997; Van Dyke et al., 1997; Landrum & Prybutok, 2004), and Zeithaml et
al. (2002) proposed that it is not necessary to use customers expectation to measure the service
quality. Transaction records are important to customers as they ensure reliability of the company.
Therefore, this study will directly use perceived service quality to measure the service quality of
telecommunication services.
2.5.1 The Service Quality Gap
In the current scenario, meeting and exceeding expectations of clients and customers is
perspective that has gained most attraction. This concept is all inclusive and cuts across service
domains, but expectations change and experiences with alternate service providers could shape
the customers expectations. The important research gap here is attaining customers expectation
towards a particular service.
A gap is the difference, imbalance or disparity which is determined to exist between customers
perception of firm performance and their prior expectation. Service quality (SQ) perceived by
customers is therefore as a result of a comparison of customers expectation (E) of services that
the organization should offer versus their perception of the performance (P) delivered by the
service organization.
Management of service quality largely focuses on managing the gaps between expectations and
perceptions of customers. The goal of the firm is to minimize the gap between (P) and (E).

2.6 Customers Perceived Value


Customers perceived value can be defined from the perspectives of money, quality, benefit, and
social psychology. The Monetary perspective indicates that values generated when less is paid
(such as by using coupons or promotions) for goods (Bishop, 1984). In other words, it is the
concept of consumer surplus in economics; perceived value is the difference between the highest
price that consumers are willing to pay for a product or a service and the amount practically paid.
According to the quality perspective, value is the difference between the money paid for a certain
product and the quality of the product (Bishop, 1984). In other words, when less money is paid
for a high quality product, positive perceived value will be created. The benefit perspective
indicates that perceived value is customers overall evaluation of the utility of perceived benefits
and perceived sacrifices (Zeithaml, 1988). In other words, consumers may cognitively integrate
their perceptions of what they get and what they have to give up in order to obtaining goods.
However, the sacrifice means more than the money paid for a certain goods. Non-monetary
costs, such as transaction cost, search cost, negotiation cost, and time incurred during the
purchase, should also be included (Zeithaml, 1988; Cronin et al., 1997; Keeney, 1999; Cronin et
al., 2000). The social psychology perspective points out that the generation of value lies in the
meaning of purchasing a certain goods to the buyers community (Sheth et al., 1991). That is,
goods carrying particular meanings (such as social economic status and social culture) can
increase the effect of social self-concept (Sweeney &Soutar, 2001; Wang et al., 2004). In this
study, perceived value is the evaluation of the benefits of a product or a service by customers
based on their advance sacrifices index-post perceived performance when they use
telecommunication services.
In the research of the relationships between service quality and customers perceived value in
conventional retailing and online shopping, most of the empirical studies have pointed out that
service quality will positively influence perceived value (Cronin et al., 1997; Cronin et al., 2000;
Brady et al., 2001; Bauer et al., 2006).
Among the studies of the telecom industry, Wang et al. (2004) and True and Cerenkov (2006)
respectively investigated the mobile services in China and Canada and found out that service
quality is positively related to perceived value.

2.7 Factors Determining Customers Value Perception


In the following section, we would try to find out the determinants of customers choice of
telecom service providers. These factors in turn would develop our hypotheses.
2.7.1 Service Quality of Telecommunication Services
The success of telecommunication industry depends on prudent efforts and feasible investments.
In a competitive market, service providers are expected to compete on both price and quality of
services and also it is necessary for the service providers to meet the consumers requirements
and expectations in price and service quality (Melody, 2001). The positive relationship of service
quality with customer satisfaction (Danaher and Mattson, 1994; Kim et al., 2004), customer
preference (Ranaweera and Neely, 2003), profitability (Fornell, 1992; Danaher and Rust, 1996),
competitiveness (Rapert and Wren, 1998), is well proven in the academic literature.
Service quality is essential and important for a telecommunication service provider company to
ensure the quality service for establishing and maintaining loyal and profitable customer
(Zeithaml, 1988). Conversely, Johnson and Sirikit (2002) state as service delivery systems have
the ability to allow managers of company to identify the real customer feedback and satisfaction
on their telecommunication service. Since, quality reflects the customers expectations about a
product or service. Lovelock (1996) stated that this customer driven quality replaced the
traditional marketing philosophies which was based on products and process. Service quality is
different from the quality of goods. Since, services are intangible, perishable, produced and
consumed simultaneously and heterogeneously (Zeithaml and Bitner, 2000). So, it sounds a
major problem for the telecommunication service providers, especially for the mobile
telecommunication service providers to deliver quality service consistently as changes in market
compositions and competing characteristics have been surfacing incessantly. According to Wang
and Lo (2002), marketing and economics quality often depends on the level of product attributes.
They also state that there are two primary dimensions for quality in operations management. At
first, fitness of use, which refers to product or services that is supposed to do and possess
features to meet the customer needs. The other one is reliability, which represents the product
that is free from deficiencies. Accordingly, it is important for a company to understand how
customers perceive their service quality. Consequently, Rust and Oliver (1994) pointed out that

companies need to measure consumers satisfaction with their products and services. A higher
frequency of errors means worse quality of telecommunication services. Generally, service and
product quality always lies in the minds of the consumers depending on individual buying
capacity, buying behavior, demand, taste, and fashion criteria and obviously the competitive
markets that provide significant differentiation strategies. Therefore, it seems a downright
necessity for the mobile telecommunication service provider to communicate directly with the
potential consumers for measuring possible quality attributes. According to Wal et al., (2002),
quality reflects the extent to which a product or service meets or exceeds consumers
expectations.
Wang and Lo (2002) studied on comprehensive integrated framework for service quality,
customer value, and customer satisfaction and behavioral intentions of customers in Chinas
mobile phone sector. They conceptualized factors with service quality as antecedents to
customers overall evaluation of service quality rather than dimensions or components of the
construct. Herein, they found that the competition between two mobile phone service providers
is more intense than ever. This competition is not only in ensuring network quality by a large
amount of investment in network extension and upgrading but also in customer acquisition and
retention by direct and indirect price reduction efforts.
Government of India - Department of Telecommunications data shows that, both BSNL and
MTNL are losing market share to private operators in the mobile telephony segment. BSNL and
MTNL together are down from a 17% market share at the beginning of March 2008 to 13.6% in
August2009. In contrast, the private sectors share jumped from 83% to 86.4% during the same
period. So the challenge for the mobile service providers in India is to find out the critical factors
that influence the customers preference.
Investigators have also found customer satisfaction from multidimensional nature and view
overall satisfaction as a function of satisfaction with multiple experiences with the service
provider. In general satisfaction is developed on the information from all prior experiences with
the service supplier and is consider as a function of all prior transaction and information
(Parasuraman et al., 2000). Nowadays cellular mobile is a very necessary product for our daily
communication. Customers are mainly purchase this product for instant communication and
various services provided by the companies.

2.7.2 Price of Services


Yin and Paswan (2007) indicate that price volatility is negatively associated with internal
reference price. Consumers price comparison propensity and price knowledge positively
influence external reference price. They also mentioned that price volatility has a significant
negative influence on consumer knowledge. Price is significant indicator of quality across
services categories. It is been find that both consumer price knowledge and advertising exposure
increase the use of the price quality cue, while product complexity was found to have no
significant impact on price-quality cue utilization for financial services (Estelami, 2008).
Draganska and Jain (2003) state that a common strategy for a company extending their product
or service is to differentiate their offerings vertically. In this era of information age, price
competition has become cut throat in mobile telecommunication industry.
Trebing (2001) mentioned that there are three sets of strategies for pricing behavior. The first is
limit entry pricing, which is used for protection of the market position of the firm; second is the
high access charges for new entrants, and the third one is tie-in sales to write off old plant or
standard investment against captive customers. According to the author, limit entry pricing
involves setting low prices in highly elastic markets to attractor retain large customers with
monopolistic buying power, while maintaining high prices in inelastic markets.
Price plays a vital role in telecommunication market especially for the mobile telecommunication
service providers. It includes not only the buying price but also the call and rental charges.
Generally, a price-dominated mass market leads to customers having more choices and
opportunities to compare the pricing structures of diverse service providers. A company that
offers lower charges would be able to attract more customers committing themselves to the
telephone networks, and hence; significant number of call minutes might be achieved. Income
from the number of call minutes determines the basic commercial success for the network
providers. He also added that the success of the telecommunication sector in a market place
largely depends on continuing usage and pricing policies, which need to be considered on several
levels. (Kollmann, 2000)

2.7.3 Promotion of Services


Meanwhile promotion is a tool that can help an organization in the achievement of its objectives
(Alvarez and Casielles; 2005). Promotion is when companies inform, persuade, or remind
customers and the general public of its products (Kotler and Armstrong, 2003). Promotions
impact consumers purchasing behavior and decisions towards that particular brand, especially
during the sales promotion period (Freo, 2005). More specifically, the objectives of any
promotional strategy are: increase sales; maintain or improve market share; create or improve
brand recognition; create favorable climate for future sales; inform and educate the market;
create competitive advantage, relative to competitors products or market position; improve
promotional efficiency (Rowley, 1998). Promotion is one of the medium which is used by
organization to communicate with consumers with respect to their product offerings (Rowley,
1998).
It is an important part for all companies, especially when penetrating new markets and making
more or new customers (Kotler et al., 1999). The authors also state that promotion is the activity
that communicate about the products or services and its potential merits to the target customers
and eventually persuades them to buy.
Generally, promotion is concerned with ensuring that consumers are aware about the
company/firm and its products that the organization makes available to those consumers (Root,
1994).
According to Alvarez and Casielles (2005), promotion is a set of stimuli that are offered
sporadically, and it reinforces publicity actions to promote the purchasing of a certain product.
Promotional offer consists of several different objects to create a better sale impact, for example,
coupons, samples, premiums, discounts, contests, point-of-purchase displays and frequent-buyer
programs. Each of the promotion techniques is intended to have a direct impact on buying
behavior and perception about the company or service providers. The objectives of promotion
will be reached to a greater extent when it is done sporadically, when the consumer does not
expect it. Promotional actions must be well planned, systematically organized, and commonly
integrated into the subject corporations strategic marketing plan.

2.7.4 Brand Image


The image construct appraises the fundamental image of the company. Image applies to the
brand name and the type of association customers get from the product/company (Andreassen
and Lindestad, 1998) indicated that image is an important component of customer satisfaction.
For the companies, image is a result of being reliable, professional and inventive, having
contributions to society, and adding good reputation to its customers. It is expected that image
has a positive effect on customer satisfaction posited that corporate image, through a filtering
effect, impacts a customers evaluation of service quality, value, and satisfaction. In other words,
corporate image creates a halo effect on customer satisfaction. According to Nguyen and Leblanc
(2002), consumers who develop a positive mental scheme with a brand will tend toward high
customer satisfaction through a halo effect where all things associated with the brand are
similarly valued. Corporate image is a result of a customers overall consumption experiences.
The same mechanism is available for overall satisfaction. Since customer satisfaction and
corporate image measures are collected simultaneously, customers consumption experiences,
which can be summarized as satisfaction, naturally affect the evaluations of corporate image. In
this study corporate image can be defined as the image of the company service provider which
that influence the customer perception.
Consciously or unconsciously customers use their preferences to project their own self image.
According tithe Belks theory of extended self, people define themselves by the possessions they
have, manage or create (Belk 1988). Consumers prefer brands with personality traits which are
congruent with the personality traits which represent their self schemas (Aaker, 1999). Brand
loyalty is also influenced by attractiveness of the brand personality (Kim et al., 2001) and the
extent to which it enhances the self image (Tidwell and Horgan, 1993).
Oliver (1999) argues that for fully bonded loyalty the consumable must be part of the consumers
self-identity and his or her social-identity.
According to Morgan and Hunt (1994) brand trust leads to brand loyalty because trust creates
exchange relationships that are highly valued.
Chauduri and Holbrook (2001) found that brand trust is directly related to both purchase and
attitudinal loyalty.

2.7.5 SERVQUAL Dimensions of Service Quality


Dimension

Refers to

Specific Criteria which


consumers use

Tangibility

Your ability to perform the Timeliness


promised service dependably Consistency/Regularity
and accurately.

Reliability

Accuracy

The knowledge and courtesy Staff competence


of staff; their ability to inspire Respect for stakeholders
trust and confidence.

Credibility
Probity and confidentiality
Safety and security

Responsiveness

The physical representations Physical facilities


or images of your service.

Equipment
Technology
Employees
Communication materials

Assurance

The

caring

individualized Access

(to staff, services,

attention you provide your information)


stakeholders.

Communication

(Clear,

appropriate and timely)


Understanding the stakeholder
Services

appropriate

for

stakeholders needs
Individualized attention
Empathy

Your

willingness

customers

and

prompt service.

to

to

help Willingness to help

provide Prompt attention to requests,


questions
Problem resolution
Complaint handling
Flexibility

Chapter 3
Research Design
3.1 Introduction
The quality of any project will be enhanced by a good understanding of research design. This
will inform your thinking and lay the foundations for the design of a project. Research is not a
single thing but a process; it is an activity requiring a whole set of different actions. From the
very beginning, identification of the subject to investigate, followed by an organized and creative
journey which will result in the presentation of findings? Each step of the process has its own
outcome and enables to confidently move on next stage of research.
The aim of this study is to gather information and to analyze the customers perception towards
telecom service providers and their services.
A research model is a way of proceeding through the research process. By breaking the process
down into logical step each action can be designed more effectively. A logical step by step
process of the research is given below:
Define Research Objective: Decide very specifically the question that needs to be answered.
Do preliminary research: Collect any information that will help define the objective very
clearly, including existing statistics on that area.
Design the formal research: Develop the data collection instruments (such as questionnaires or
interview protocols), decide on how the target group will be sampled (randomly, by occupation).
Do field work: Collect the data, making sure that the procedure is free of bias as possible.
Analyze the data: Analyze, interpret, and report the result. (Wolf, 1990)

3.2 Research Question: Following are the research questions which led to the objectivity of the
study:

What are the factors determining the perception of customers towards telecom service
providers in India?

What is the effectiveness of various factors in determining the perception of customers


towards telecom service providers in India?

What can be the recommendations for the telecommunication service providers in India?

3.3 Objectives of the Research: There are following objectives of conducting this study:

To find out the factors determining the perception of customers towards telecom service
providers in India.

To find out the effectiveness of various factors in determining the perception of


customers towards telecom service providers in India.

To find out the recommendations for the telecommunication service providers.

3.4 Research Design: The design of the research is descriptive survey study.
3.5 Research Variables Following variables/factors are identified and analyzed for the purpose
of the study:
Factor

Description

Supporting Study

It includes not only the buying price but Draganska


also
Price

the

Promotions
purchasing

call

and

rental

impact
behavior

and

Jain

charges. (2003)

consumers Kollmann (2000)


and

decisions Freo (2005)

towards that particular brand, especially Rowley (1998)


during the sales promotion period.
It is an aspect related to service quality
of telecommunication services.
Both fixed and mobile broadband
Quality of service

networks are experiencing an explosion


in data traffic due to the adoption of
bandwidth-intensive applications such

Malviya

and

Varma

(2012)
Danaher and Mattson
(1994)

as video streaming, online gaming and


social networking.
Brand trust is directly related to both
Brand Image

purchase and attitudinal loyalty.

Aaker (1999)
Chauduri and Holbrook
(2001)
Morgan and Hunt (1994)

Tangibility

Your ability to perform the promised Parasuraman

et

al.

service dependably and accurately.

(1985, 1988)
Zeithaml et al. (2002)

Reliability

Parasuraman
The knowledge and courtesy of staff; their
ability to inspire trust and confidence
(1985, 1988)

et

al.

Zeithaml et al. (2002)

Assurance

Parasuraman
The caring individualized attention you
provide your stakeholders.
(1985, 1988)

et

al.

Zeithaml et al. (2002)


Landrum & Prybutok

Responsiveness

(2004)
The physical representations or images of
your service
Parasuraman

et

al.

(1985, 1988)
Zeithaml et al. (2002)

Empathy

Parasuraman
Your willingness to help customers and to
provide prompt service.
(1985, 1988)

et

al.

Zeithaml et al. (2002)

Table 3.1: Factors influencing the Consumers Perception

3.6 Research Hypotheses: Following hypotheses have been taken from the literature review
before the questionnaire design:

H1: Price affects the value perception of customers towards telecommunication service
providers.

H2: Quality of service affects the value perception of customers towards


telecommunication service providers.

H3: Brand image affects the value perception of customers towards telecommunication
service providers.

H4: Tangibility affects the value perception of customers towards telecommunication


service providers.

H5: Reliability affects the value perception of customers towards telecommunication


service providers.

H6: Assurance affects the value perception of customers towards telecommunication


service providers.

H7:

Responsiveness

affects

the

value

perception

of

customers

towards

telecommunication service providers.

H8: Empathy affects the value perception of customers towards telecommunication


service providers.

3.7 Research Methodology: To study the customers perception towards telecommunication


service providers in India, primary data was collected through questionnaire survey. However, to
identify the influencing factors, secondary research was conducted. The second stage comprised
of determining the objective of the study and drafting the questionnaire where a questionnaire
was prepared. The following figure illustrates the steps followed in conducting this research:

Problem identification and Definition


Research Design
Sampling and Questionnaire Design

Data Gathering
Data Processing and Analysis
Conclusion and Report

3.8 Sampling: Since telecommunication services are used by most of the people, random
sampling has been adopted for the questionnaire survey.
3.9 Questionnaire Design Survey A total of 246 questionnaires were filled by the respondents.
Respondents were from all the sections in terms of gender, income level, occupations, age group.

This ensured the responses from the sample to be closer to the actual condition in the
telecommunication services market.
3.10 Questionnaire Design
The questionnaire was designed with 8 broad aspects in mind
i.

Respondents Profile

ii.

Price related questions

iii.

Quality of service related questions

iv.

Brand image related questions.

v.

Tangibility related questions.

vi.

Reliability related questions.

vii.

Assurance related questions.

viii.

Responsiveness related questions.

ix.

Empathy related questions.

x.

Value perception related questions

3.10.1 Questionnaire Format


Items

No. of questions

Remarks

Respondents profile

Multiple Choice

Price related questions

Likert Scale

Quality of service related questions

Likert Scale

Brand image related questions

Likert Scale

Tangibility related questions

Likert Scale

Reliability related questions

Likert Scale

Assurance related questions

Likert Scale

Responsiveness related questions

Likert Scale

Empathy related questions

Likert Scale

Value perception related questions

Likert Scale

Chapter 4
Data Analysis & Interpretation
4.1 Introduction
Before processing collected data through survey, raw questionnaire data was entered into SPSS
and coded into a set of 31 different variables. All collected questionnaires were then coded into
SPSS, allowing statistical processing of the samples answers. This chapter presents all produced
results along with their analysis. Different statistical tool are used to analyze the collected data.
Firstly Micro analysis has been done of the respondents demographic profile. Then, the analysis
of factors determining the value perception of customers is done with the help of linear
regression analysis.
4.2 Data Analysis
4.2.1 Macro Analysis of Respondents profile
Gender of the respondents

Gender of respondents

Male
Female

Fig 4.1: Gender of respondents

Analysis: 151 males and 95 females were included in the study as respondents. So, the sample
contained males 61.4% and 38.6 % females.
Age of respondents
Age

Frequency
Valid Below
11
18
18-30
166
30-45
55
Above
14
45
Total
246
Table 4.1: Age of respondents

Percent

Valid
Percent

Cumulative
Percent

4.5

4.5

4.5

67.5
22.4

67.5
22.4

72.0
94.3

5.7

5.7

100.0

100.0

100.0

Analysis: 67.5% of the respondents were from the age group of 18-30 years, 22.4% from 30-45
years. So, a major part of the respondents belong to 18-45 years of age.
Occupation of Respondents

Occupation

Student
Business
Service
Others

Fig 4.2: Occupation of Respondents

Analysis: 39.4% of respondents are students, businessmen and service contribute around 23 and
28 per cent respectively.
Income of Respondents
Income

Frequency
Valid
Below 15k
108
15k-30k
55
30-50k
67
50k-100k
8
Above 1lac
8
Total
246
Table 4.2 : Income of respondents

Percent
43.9
22.4
27.2
3.3
3.3
100.0

Valid Percent
43.9
22.4
27.2
3.3
3.3
100.0

Cumulative
Percent
43.9
66.3
93.5
96.7
100.0

Analysis: Most of the respondents (43.9%) belong to the category having income less than Rs.
15k per month followed by 30-50k and 15k- 30k.

Educational Qualification of Respondents

Analysis: Most of the respondents are graduate followed by post graduates and above and
intermediate respectively.
4.3 Reliability Analysis
I have calculated the value of Cronbachs Alfa with the help of SPSS. Those factors whose
Cronbachs Alfa value are greater than or equal to 0.5 are acceptable. It means that the factor is
reliable. If the value of is less than 0.5 than hit and trial method is applied by dropping one of
the items. If even after dropping one of the items the value of Cronbachs Alfa is not greater than
or equal to 0.5 then the same method is applied by dropping 2 items. But it should be taken care
that there should be at least 3 items which are able to predict the variation in the factor. If even
after dropping few of the items the Cronbachs Alfa value is not greater than 0.5 then it shows
that the taken factor is not reliable and it should be dropped.
Item-Total Statistics

Price
Quality of
service
Brand image
Tangibility
Reliability
Assurance
Responsiveness
empathy

Scale
Scale Mean if Variance if
Item Deleted Item Deleted
27.9492
16.138

Corrected
Item-Total
Correlation
.706

Squared
Multiple
Correlation

Cronbach's
Alpha if
Item Deleted
.
.871

27.5075

16.995

.626

.878

27.9492
27.5711
27.5318
27.5102
27.5075
27.5854

16.138
17.505
17.442
17.040
16.995
17.280

.706
.708
.718
.641
.626
.604

.
.
.
.
.
.

.871
.872
.871
.877
.878
.881

Table 4.3: Reliability Analysis


Analysis: The following analysis can be made with respect to the reliability of the factors and the
questions and scales formed:

Price: Chronbachs Alpha for the Price factor is 0.871, which makes the factor reliable
with the 3 items.

Quality of Service: Chronbachs Alpha for the Quality of service factor is 0.878, which
makes the factor reliable with the 3 items.

Brand image: Chronbachs Alpha for the Brand image factor is 0.871, which makes
the factor reliable with the 3 items.

Tangibility: Chronbachs Alpha for the Tangibility factor is 0.872, which makes the
factor reliable with the 3 items.

Reliability: Chronbachs Alpha for the Reliability factor is 0.871, which makes the
factor reliable with the 3 items.

Assurance: Chronbachs Alpha for the Assurance factor is 0.877, which makes the
factor reliable with the 3 items.

Responsiveness: Chronbachs Alpha for the Responsiveness factor is 0.878, which


makes the factor reliable with the 3 items.

Empathy: Chronbachs Alpha for the Empathy factor is 0.881, which makes the factor
reliable with the 3 items.

Value Perception: Chronbachs Alpha for the Value Perception factor is 0.889, which
makes the factor reliable with the 3 items.

S. No.

Factor

Items

Items Dropped

Value

Price

.835

Quality of service

.880

Brand image

.910

Tangibility

.919

Reliability

.543

Assurance

.837

Responsiveness

.897

Empathy

.858

Value Perception

.889

Table 4.4: Reliability Statistics


4.4 Mean Calculation and Regression Analysis
After conducting the Reliability analysis of the 8 factors in the study, the mean for the items in
each factor was calculated, which then served as an input to the Regression analysis.
Regression analysis is a statistical tool for the investigation of relationships between variables.
Regression analysis includes many techniques for modeling and analyzing several variables,

when the focus is on the relationship between a dependent variable and one or more independent
variables. More specifically, regression analysis helps one understand how the typical value of
the dependent variable changes when any one of the independent variables is varied, while the
other independent variables are held fixed. In this research the Dependent Variable is Value
perception, while the independent variables are Price, Quality of Service, Brand Image,
Tangibility, Reliability, Assurance, Responsiveness and Empathy.

Variables Entered/Removed(b)

Model
1

Variables Entered

Variables
Removed

Quality_Service,
empathy,
Responsiveness,
brand_img, Price,
Assurance,
Tangibility,
Reliability(a)

Method

. Enter

Table 4.5: Variables Entered/Removed


Model Summary
Std. Error
Mode
Adjusted
of the
l
R
R Square R Square
Estimate
1
.800(a)
.640
.633
.65346
a Predictors: (Constant), Quality_Service, empathy, Responsiveness, brand_img, Price,
Assurance, Tangibility, Reliability
Table 4.6: Model Summary
ANOVA(b)
Mode
l
1
Regressio
n
Residual
Total
Table 4.6: ANOVA

Sum of
Squares

Mean
Square

Df

46.896

5.862

48.734
95.630

237
245

.206

F
28.508

Sig.
.000(a)

Coefficients(a)
Unstandardized
Standardized
Coefficients
Coefficients
Std.
B
Error
Beta
1.209
.245
.191
.049
.237
.019
.051
.024

B
4.925
3.932
.380

Sig.
Std.
Error
.000
.000
.704

.043

.244

4.420

.000

.069
.067
.052
.046

.166
.141
.000
.132

2.294
2.025
2.007
2.097

.023
.044
.041
.037

.048

-.090

2.661

.048

Mode
l
1
(Constant)
Empathy
Assurance
Responsivenes
.190
s
Reliability
.159
Tangibility
.135
Price
.000
Brand image
.096
Quality of
.095
Service
a Dependent Variable: value_per

Table 4.7: COefficients


4.4.1 Adjusted R Square (Model Fitness Index)
Adjusted R Square is a measure of how well the independent, or predictor, variables predict the
dependent, or outcome, variable. A higher adjusted R-square indicates a better model. Adjusted
R-square is calculated based on the R-square, which denotes the percentage of variation in the
dependent variable that can be explained by the independent variables. The adjusted R-squared
adjusts the R-square for the sample size and the number of variables in the regression model.
Therefore, the adjusted R-square is a better comparison between models with different numbers
of variables and different sample sizes.
Here the adjusted R square is .633, which means that 63.3% of the dependent variable is
explained by independent variable and 36.7% of the dependent variable is not explained by the
independent variables.
4.4.2 Sig value (p-value)
P-value explains that which variables are significant for the dependent variable to be determined.
Sig value for various independent variables can be explained as below:

Price: The sig value of .041 explains that price is a determinant factor in determining the
Value perception of the customers towards telecom service providers.

Quality of service: The sig value of .048 explains that the quality of service is a
determinant factor in determining the Value perception of the customers towards telecom
service providers.

Brand image: The sig value of .037 explains that brand image is a determinant factor in
determining the Value perception of the customers towards telecom service providers.

Tangibility: The sig value of .044 explains that Tangibility is a determinant factor in
determining the Value perception of the customers towards telecom service providers.

Reliability: The sig value of .023 explains that Reliability is a determinant factor in
determining the Value perception of the customers towards telecom service providers.

Responsiveness: The sig value of .000 explains that Responsiveness is a determinant


factor in determining the Value perception of the customers towards telecom service
providers.

Assurance: The sig value of .704 explains that Assurance is not a determinant factor in
determining the Value perception of the customers towards telecom service providers.

Empathy: The sig value of .000 explains that Empathy is a determinant factor in
determining the Value perception of the customers towards telecom service providers.

4.5 Hypotheses Testing: As discussed in chapter 3 8 hypotheses have been developed in the
study. Now, we will test them on the basis of our analysis.

H1: This hypothesis stated that Price affects the value perception of customers towards
telecommunication service providers. From the Regression Analysis, it is clear that this
hypothesis holds true from the study.

H2: This hypothesis stated that Quality of service affects the value perception of
customers towards telecommunication service providers. From the Regression Analysis,
it is clear that this hypothesis holds true from the study.

H3: This hypothesis stated that Brand image affects the value perception of customers
towards telecommunication service providers. From the Regression Analysis, it is clear
that this hypothesis holds true from the study.

H4: This hypothesis stated that Tangibility affects the value perception of customers
towards telecommunication service providers. From the Regression Analysis, it is clear
that this hypothesis holds true from the study.

H5: This hypothesis stated that Reliability affects the value perception of customers
towards telecommunication service providers. From the Regression Analysis, it is clear
that this hypothesis holds true from the study.

H6: This hypothesis stated that Assurance affects the value perception of customers
towards telecommunication service providers. From the Regression Analysis, it is clear
that this hypothesis does not hold true from the study.

H7: This hypothesis stated that Responsiveness affects the value perception of
customers towards telecommunication service providers. From the Regression Analysis,
it is clear that this hypothesis holds true from the study.

H8: This hypothesis stated that Empathy affects the value perception of customers
towards telecommunication service providers. From the Regression Analysis, it is clear
that this hypothesis holds true from the study.

4.6 Importance of various factors


The Regression analysis gives us the value of sig, from which the significance of each variable
can be determined. From the study, I have found out the following order for the importance of
the factors:

Empathy = Responsiveness > Reliability > Brand Image > Price > Tangibility
> Quality of Service> Assurance
4.7 Conclusion
This chapter dealt with the findings pertaining to factors influencing the Marketing Performance.
Various statistical tools are used and data were analyzed with the help of SPSS. From Reliability
test it was found that all the independent variables are reliable. The regression analysis was also
used to check the relationship between the dependent and independent variables.

Chapter 5
Findings and Recommendations
After the Data analysis, I have found out the various determinant factors which determine the
value perception of customer towards telecom service providers in India. We have also
conducted a Reliability validity analysis of the study which proves the reliability of our studied
factors and the scale.
5.1 Findings
Following factors have been found out suitable for the customers to determine the value
perception of the customers towards telecom service providers in India.

Price is a relevant factor for the customers to determine the value perception of the
customers towards telecom service providers in India.

Brand image is a relevant factor for the customers to determine the value perception of
the customers towards telecom service providers in India.

Quality of service is a relevant factor for the customers to determine the value perception
of the customers towards telecom service providers in India.

Tangibility is a relevant factor for the customers to determine the value perception of the
customers towards telecom service providers in India.

Reliability is a relevant factor for the customers to determine the value perception of the
customers towards telecom service providers in India.

Responsiveness is a relevant factor for the customers to determine the value perception of
the customers towards telecom service providers in India.

Assurance is not a relevant factor for the customers to determine the value perception of
the customers towards telecom service providers in India.

Empathy is a relevant factor for the customers to determine the value perception of the
customers towards telecom service providers in India.

5.2 Recommendations
From the study, it can be recommended to the telecommunication service providers in India:

Empathy and Responsiveness are the most important factors for the customers. So,
the service providers should focus on these factors in order to be successful and
develop a brand image of a value providing service providers.

Reliability is another factor of importance for the customers. So, the service providers
should focus on these factors in order to be successful and develop a brand image of a
value providing service providers.

Price and quality of service need to be maintained. These factors play a vital role in
customers value perception.

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