DISSERTATION PROJECT REPORT

ON
ADVERTISING IN INDIAN TELECOM INDUSTRY
& ITS IMPACT ON CUSTOMERS

Towards the Partial fulfillment of

POST GRADUATE DIPLOMA IN MANAGEMENT

Submitted By :-
GOPAL KUMAR AGARWAL
AICTE NO. 08/OR/KBS/PGDM/FT/029

Under the Guidance of

MR. SUSANTA KUMAR MISHRA
KOUSTUV BUSINESS SCHOOL

KOUSTUV BUSINESS SCHOOL

PATIA, BHUBANESWAR
KOUSTUV BUSINESS SCHOOL 1 | Pag e
 KOUSTUV BUSINESS SCHOOL
PATIA, BHUBANESWAR

DECLARATION

I hereby declare that the project entitled “ A Project report

on Advertising in Indian Telecom Industry & its impact on Customers
has been prepared by me during my academic year 2008-2010 under
the guidance of my faculty guide Mr. Susanta Kumar Mishra.
I also declare that this project is the result of my effort and
has not been submitted to any other University or Institution for the
award of any degree, or personal favors whatsever. All the details and
analysis provided in the report hold to the best of my knowledge.

Place : Bhubaneswar
Date : May 2010 GOPAL KUMAR AGARWAL

KOUSTUV BUSINESS SCHOOL 2 | Pag e

 CERTIFICATE

This is to certify that Mr. GOPAL KUMAR AGARWAL, AICTE No.

08/OR/KBS/PGDM/FT/029, a student of Koustuv Business School, Bhubaneswar
has successfully completed his interim report on “Advertising in Indian Telecom
Industry and its Impact on Customers” under my guidance in partial fulfillment of
PGDM program. This is an original work of his own and has not been carried out
by anyone earlier.

Mr. Susanta Kumar Mishra

(Faculty Guide )
Koustuv Business School

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 ACKNOWLEDGEMENT

In the course of this project I got an insight into the telecom industry,
came to know a lot about that how the Advertising by Telecom Industry is putting
impact on customers.

First and foremost I am very proud to be a student of Koustuv Business

School, Bhubaneswar and am most grateful for having been given the opportunity
to do Research study.

I avail this opportunity to convey my sincere thanks to Mr. K.N MISHRA,

the H.O.D of Koustuv Business School. I am thankful to Mr. Susanta Kumar Mishra,
my project guide for recommending me the necessary information for the report.
His instilling support and enthusiasm, expert guidance and insight have lent my
project a unique touch. I also express my sincere gratitude to Mr. K.N MISHRA,
H.O.D of Koustuv Business School, for providing us an opportunity to interact with
professional people in the real corporate world. I forward my gratitude for the
compulsion of this most wonderful aspect of our MBA curriculum without which
knowledge of management is incomplete and futile.

My acknowledgement would be incomplete if I didn’t thank my team

mates. During the research period we have developed a camaraderie which was
very healthy and enjoyable. I am grateful for everyone’s support and help when
needed. Without them this training would not have been the same.

At last I am also thankful to my family member and friends who had

given me their constructive advice, educative suggestions, encouragement and
co-operation to prepare this report.

GOPAL KUMAR AGARWAL

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 EXECUTIVE SUMMARY

The main area of the study is to study the Advertising in Indian Telecom
Industry and its Impact on Customers. The sources of data collection used in
the study are both primary and secondary in nature. We are going to conduct
a survey to know the impact of advertisements of telecom industry on
customers which is part of primary data. The real aim of the project is to study
the effectiveness and response towards advertisements provided by major
players.
In this project I have covered the Analysis of Telecom Industry of
India. In this analysis I have shown history and present scenario of the Telecom
industry in India. I have complemented this with the internal study of
companies. I have shown history, growth, market share and advertising
strategies adopted by Vodafone, Airtel, Reliance communication, BSNL and
Idea cellular.
The project is based on advertising so I have first explained about
advertising, its importance, managing advertising decisions and types of
advertising. I have analyzed the growth in ad volumes of telecom sector, share
of telecom sector advertising, segment wise growth in telecom sector, share of
key players in advertising, new brands advertised in telecom equipments and
service and share of sales promotion in telecom sector.
Primary data has been collected in which focus group study had
been conducted to design the customer survey questionnaire with a sample
size of 200 respondents. This survey has been conducted in BHUBANESWAR.
Secondary data was collected through websites, newspapers, magazines and
books.

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 Table Of Contents
Topics Page No.
1. Introduction

1.1 Research Problem 8

1.2 Objectives of the Project 8

1.3 Limitations of the Project 8

1.4 Methodology 9

2. SWOT Analysis of Telecom Industry 12

3. Major Players in Telecom Industry 12

4. Advertising by Telecom Industry 14

5. Data Analysis & Interpretation 22

6. Findings 33

7. Suggestions 34

8. Annexure 34

8.1 Questionnaire 34

9. Bibliography 36

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 INTRODUCTION
RESEARCH PROBLEM
OBJECTIVE OF THE PROJECT
LIMITATIONS OF THE PROJECT
METHODOLOGY

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 RESEARCH PROBLEM

Advertising of Telecom Industry in India and its impact on customers.

OBJECTIVES OF THE PROJECT

To study the performance of Telecom Industry in India.
To know the impact of advertisements of telecom industry on customers.
To study the effectiveness and response towards advertisements provided by
major players.
To analyze the growth in ad volumes of telecom sector.

LIMITATIONS OF THE STUDY

1. Respondents were reluctant to share their experience accurately.

2. Unwillingness of respected personnel’s of Telecom Companies to provide
relevant data for my studies.
3. Time allotted for the project was not sufficient to go for detailed analysis
of the research problem.

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 METHODOLOGY

RESEARCH DESIGN:
The research design is Descriptive studies. Descriptive studies are well structured,
they tend to be rigid and its approach cannot be changed every now and then.

Descriptive studies are undertaken in many circumstances:

When the researcher is interested in knowing the characteristics of certain

groups such as age, profession.
When the researcher is interested in knowing the proportion of people in
given population who have behaved in a particular manner, making
projection of certain things.

The objective of this kind of study is to answer the why, who, what, when and
how of the subject under consideration.

I have taken descriptive because my research includes the knowing the behavior
of customer towards advertisement. I have analyzed how people of various age
groups respond to different advertising or their perception towards
advertisement. Also my survey is related to companies like Vodafone, Airtel,
Reliance communications, BSNL and Idea cellular.

Types of Questions:

OPEN ENDED:
They give the respondents complete freedom to decide the form , length and
detail of the answer. Open questions are preferred when the researchers is

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 interested in knowing what is upper most in the mind of respondents.

DICHOTOMOUS:
This type of questions have only two type of answer, yes or no. true or false etc.

MULTIPLE CHOICE QUESTIONS:

In the case of multiple choice question the respondents is offered two or more
choices. The researcher exhausts all the possible choices and the respondent has
to indicate which one is applicable in this case.

The research methodology that I undertook for the purpose of this

study is enumerated below:

PRIMARY RESEARCH:
This consisted questionnaire and interaction from various people. A focus group
study will be conducted to design the customer survey questionnaire with a
sample size of 200 respondents.

SECONDARY RESEARCH:
Sources of secondary data were primarily the Internet, journals, newspaper,
annual report, database available in the library, catalogues and presentations.

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 TELECOM SUBSCRIBER BASE IN INDIA

Indian telecommunication Industry is one of the fastest growing telecom market

in the world. The mobile sector has grown from around 10 million subscribers in
2002 to reach 150 million by early 2007 registering an average growth of over
90%. The two major reasons that have fuelled this growth are low tariffs coupled
with falling handset prices.

Surprisingly, CDMA market has increased it market share up to 30% thanks to

Reliance Communication. However, across the globe, CDMA has been losing out
numbers to popular GSM technology, contrary to the scenario in India.

The other reason that has tremendously helped the telecom Industry is the
regulatory changes and reforms that have been pushed for last 10 years by
successive Indian governments. According to Telecom Regulatory Authority of
India (TRAI) the rate of market expansion would increase with further regulatory
and structural reforms. Even though the fixed line market share has been
dropping consistently, the overall (fixed and mobile) subscribers have risen to
more than 200 million by first quarter of 2007. The telecom reforms have
allowed the foreign telecommunication companies to enter Indian market which
has still got huge potential. International telecom companies like Vodafone have
made entry into Indian market in a big way.

Currently the Indian Telecommunication market is valued at around $100 billion

(Rupees 400,000 crore). Two telecom players dominate this market - Bharti Airtel
with 27% market share and Reliance Communication with 20% along with other
players like BSNL (Bharat Sanchar Nigam Limited).

The Ministry of Communications and Information Technology (MCIT) is has very

aggressive plans to increase the pace of growth, targeting 500 million telephone
subscribers by the end of 2010.

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 SWOT ANALYSIS OF INDIAN TELECOM INDUSTRY

To summarize the SWOT analysis we can draw the following framework for
telecom industry:

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 MAJOR PLAYERS IN TELECOM INDUSTRY

TOP FIVE COMPANIES:

The Top five companies, on the basis of ‘Market Share’ as on 31st January, 2010
are:

Bharti Airtel Ltd.

Reliance Communications Ltd.
Vodafone Essar Ltd.
BSNL
Idea Cellular + Spice

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 ADVERTISING BY TELECOM INDUSTRY ON TV

Key Findings:

 2007

Telecom sector advertising on TV grew by 61 per cent during 2007

compared to 2006.

Telecommunication Services segment had more than 60 per cent share of

overall Telecom sector advertising on TV.

Telecommunication Services has seen a rise of 108 per cent in TV

advertising, whereas Telecommunication Equipments saw a rise of 17 per
cent during 2007 over 2006.

Bharti Airtel Ltd was the number one advertiser under Telecommunication
Services and Nokia Corporation led Telecommunication Equipments
advertising on TV during 2007.

 2008

TV advertising of Telecom sector saw a rise of 99 per cent during January -

August 2008 compared to January - August 2007.

'Telecommunication Services' garnered a high share of Telecom sector

advertising on TV during January - August 2008.

TV advertising of 'Telecommunication Equipments' saw a growth of 45 per

cent and that of 'Telecommunication Services' grew by 127 per cent during
January - August 2008.

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 'Nokia Corporation' leads in advertising of 'Telecommunication Equipments'
and ' Vodafone Essar Ltd' was number one advertisers for
'Telecommunication Services' on TV during January - August 2008.

'R Madhavan' had the maximum ad volumes of Celebrity Endorsement of

Telecom sector on TV during January - August 2008.

 2009
Telecom sector has seen a decline of 16 per cent in its TV ad volumes
during Jan - Mar '09 compared to Jan - Mar '08.

High share of 'telecommunication services' advertising on TV during Jan-

Mar '09.

'Sony Ericsson (India)' was the top advertisers under 'telecommunication

equipments' and 'Bharti Airtel Ltd' leads in 'telecommunication services'
advertising on TV during Q1 '09.

'Sony Ericsson W595' and 'Sony Ericsson F305' were top two new brands
advertised under 'telecommunication equipments' on TV during Q1 '09.

Virgin vGlide Phones (slider) topped the chart of new 'telecommunication

services' advertised on TV during Q1 '09.

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 GROWTH IN ADS VOLUMES OF TELECOM SECTOR

 2009

16 per cent drop in telecom sector advertising on TV during first quarter of

2009 compared to same period in 2008

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 SHARE OF SEGMENTS OF TELECOM SECTOR

 2009

With 87 per cent share 'telecommunication services' leads in advertising of

'telecom sector' on TV, followed by 'telecommunication equipments' and
'corporate brand image' with 11 per cent and two per cent share
respectively during Q1 '09.

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 GROWTH IN AD VOL.S OF SEGMENTS OF
TELECOM SECTOR

 2009

'Telecommunication services' have seen a decline of 7 per cent in its TV ad

volumes during Jan - Mar '09 compared to Jan - Mar '08.

TV advertising of 'telecommunication equipments' recorded a drop of 56

per cent during Q1 '09 compared to Q1 '08.

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 TOP FIVE ADVERTISERS UNDER THE
TELECOM SEGMENTS

 2009

'Bharti Airtel Ltd', 'Vodafone Essar Ltd' and 'Bharat Sanchar Nigam Ltd' the
top three key players of 'telecommunication services' together accounted
for 65 per cent share on TV during Q1 '09.

During Q1 '09, top three advertiser together contributed for 83 per cent of
overall 'telecommunication equipment' TV advertising share viz. 'Sony
Ericsson (India)', 'Nokia Corporation' and 'LG Electronics India Ltd'.

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 NEW BRANDS ADVERTISED IN TELECOM
EQUIPMENTS AND SERVICES

 2009

Top 3 'telecom services' advertised on TV were 'Virgin vGlide Phones

(slider)', 'Vodafone Blackberry Storm' and 'Apple Music Caller Tunes'.

'Sony Ericsson W595 ', 'Sony Ericsson F305' and 'Samsung Guru 1410' were
the top three new 'telecommunication equipments' advertised on TV
during Q1 '09.

Top 10 list of new brands of 'telecommunication equipments' advertised on

TV, comprised of three brands of 'Sony Ericsson' and two were of 'HTC
Corporation' during Q1 '09.

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 TOP ADVERTISERS WITH CELEBRITY
ENDORSEMENT AD VOLUMES

 2009

Top three celebrities endorsing telecom products on TV during the first

quarter of 2009 were 'Deepika Padukone', 'Saif Ali Khan' and 'Kareena
Kapoor'

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 DATA ANALYSIS AND INTERPRETATION

The main area of the study is the Advertising in Telecom Industry in India and its
Impact on Customers. For this purpose I conducted a survey of 200 people in
BHUBANESWAR city.

GENDER VALUE PERCENTAGE

MALE 118 59%

FEMALE 82 41%

GENDER

FEMALE
41%

MALE MALE
59%
FEMALE

Out of 200 respondents, 118 were male and 82 were female.

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 Age: (a) 15-25 (b) 26-35 (c) 36-45 (d) Above 45

AGE VALUE PERCENTAGE

15-25 64 32%

26-35 60 30%

36-45 56 28%

Above 45 20 10%

AGE
45 AND ABOVE
10%
26-35
30%
36-45
28% 45 AND ABOVE
36-45
15-25
15-25
32% 26-35

Out of 200 respondents, 64 were between the age of 15-25, 60 were between the
age of 26-35, 56 were between the age of 36-45 and 20 were above 45.

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 Education: (a) Matriculate (b) Intermediate (C) Graduation (d)

Postgraduate

EDUCATION VALUE PERCENTAGE

MATRICULATE 28 14%

INTERMEDIATE 40 20%

GRADUATE 72 36%

POSTGRADUATE 60 30%

EDUCATION

Matriculate
Postgraduate 14%
30%
Intermediate
Matriculate
20%
Intermediate
Graduate
Graduate
36% Postgraduate

Out of 200 respondents 28 were matriculate, 40 were intermediate, 72 were

graduate and 60 were postgraduate.

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 Who is your current service provider?

(a) Airtel (b) Vodafone (c) Reliance (d) BSNL (e) Idea (f) other

CURRENT SERVICE VALUE PERCENTAGE

PROVIDER

AIRTEL 50 25%

VODAFONE 34 17%

RELIANCE 36 18%

BSNL 26 13%

IDEA 22 11%

OTHER 32 16%

CURRENT SERVICE PROVIDER

OTHER RELIANCE
16% 18%
IDEA RELIANCE
11% VODAFONE VODAFONE
17%
BSNL AIRTEL
13% BSNL
AIRTEL
25% IDEA
OTHER

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 Out of 200 respondents 50 were using Airtel, 34 were using Vodafone, 36 were
using Reliance, 26 were using BSNL, 22 were using Idea and 32 were using others.

For how long you are using this mobile connection?

(a) Less than 6 months. (b) 6 to 12 months. (c) Above 12 months.

TIME PERIOD VALUE PERCENTAGE

LESS THAN 6 MONTHS 22 11%

6 TO 12 MONTHS 56 28%

ABOVE 12 MONTHS 120 61%

TIME PERIOD OF CONNECTION

LESS THEN 6
MONTHS
11%

6-12 MONTHS LESS THEN 6 MONTHS

MORE THAN 12 28%
MONTHS 6-12 MONTHS
61% MORE THAN 12 MONTHS

Out of 200 respondents 22 were using the current connection for less than 6
months, 56 were using it from 6-12 months and 120 were using it from more than
1 year.

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 What were the reasons for choosing this mobile connection?

(a) Recommended by friends or relatives. (b) Recommended by retailers.

(c) Brand image (d) Advertisement

BUYING FORCE VALUE PERCENTAGE

FRIENDS / RELATIVES 76 38%

RETAILERS 24 12%

BRAND IMAGE 16 8%

ADVERTISEMENT 84 42%

BUYING FORCE

FRIENDS
RELATIVE
ADVERTISEMENT 38% FRIENDS RELATIVE
42%
RETAILERS

RETAILERS BRAND IMAGE

12% ADVERTISEMENT

BRAND IMAGE
8%

Out of 200 respondents 76 were influenced by friends and relatives, 24 were

influenced by retailers, 16 were influenced by brand image and 84 were
influenced by advertisements.
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 While purchasing a connection advertising plays any role? (a) Yes (b) No

ADVERTISING IN VALUE PERCENTAGE

PURCHASE

YES 168 84%

NO 32 16%

ROLE OF ADVERTISING IN PURCHASE

NO
16%

YES
YES NO
84%

Out of 200 respondents 168 agreed that advertisements play a role in making
purchase decision and 32 did not agree on that.

From where do you watch advertisements the most?

(a) Television (b) Radio (c) Newspaper (d) Magazines (e) Other

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 SOURCE OF VALUE PERCENTAGE
ADVERTISEMENT

TELEVISION 110 55%

RADIO 6 3%

NEWSPAPER 50 25%

MAGAZINE 14 7%

OTHER 20 10%

SOURCE OF ADVERTISEMENT
MAGAZINES
7% OTHERS
10%
TELEVISION
NEWSPAPERS TELEVISION RADIO
25% 55% NEWSPAPERS
MAGAZINES
OTHERS

RADIO
3%

Out of 200 respondents 110 replied Television, 6 replied Radio, 50 replied

Newspapers, 14 replied Magazines and 20 replied Others.

Which telecommunication company has good advertising?

(a) Airtel (b) Vodafone (c) Reliance (d) BSNL (e) Idea (f) other

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 GOOD ADVERTISING VALUE PERCENTAGE

AIRTEL 50 25%

VODAFONE 64 32%

RELIANCE 30 15%

BSNL 16 8%

IDEA 40 20%

OTHER 0 0%

OTHER
GOOD ADVERTISING
0%

BSNL RELIANCE
IDEA 8% 15%
20% RELIANCE
VODAFONE
VODAFONE AIRTEL
32%
AIRTEL IDEA
25% BSNL
OTHER

Out of 200 respondents 50 liked the advertisements of Airtel, 64 liked

advertisements of Vodafone, 30 liked the advertisements of Reliance, 16 liked the
advertisements of BSNL and 40 liked the advertisements of IDEA.

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 Do you think that advertisement made by company informs you about their
products?

(a) Yes (b) No (c) Undecided

INFORMATION IN ADS VALUE PERCENTAGE

YES 140 70%

NO 48 24%

UNDECIDED 12 6%

UNDECIDED
INFORMATION IN ADVERTISEMENTS
6%

NO
24%

YES
YES NO
70% UNDECIDED

Out of 200 respondents 140 were in favor of that advertisements provides

information about the products, 48 were not in favor of that and 12 were not able
to decide.

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 Based on advertisements made by company, would you like to go for more
connections for you or your family in future?

(a) Yes. (b) No. (c) Undecided.

ADS FOR REFERENCE VALUE PERCENTAGE

YES 148 74%

NO 44 22%

UNDECIDED 8 4%

ADVERTISEMENTS AS FUTURE REFERENCE

UNDECIDED
4%

NO
22%

YES
NO
YES
74% UNDECIDED

Out of 200 respondents 148 agreed that they would buy connection on the basis
of advertisement made by companies, 44 did not agree and 8 were not able to
decide.

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 FINDINGS

74% of the people believes that advertisements play a role while making
purchase decision for new connection. So the companies should handle the
advertising properly and should try to deliver the information properly.

In telecom industry the most important factor which affects the purchase
decision of the customers is advertisement. Suggestions of friends and
relatives also plays major role in this. So the companies should take care of
the existing customers so that they can be recommended to others.

55% of the people likes to watch advertisements on television. And after

television people rated newspapers. So the companies should focus more
on television ads and newspaper ads.

32% of the people like Vodafone advertisements more than others. After
that Airtel and Idea comes. So the other companies should try to make
advertisements which can connect to the customers.

74% of the people believe that advertisements provide information about

the products. So the companies should try to deliver all the information
about the plans and offers through advertisements.

Majority of the people wants to buy the connections for family and friends
on the basis of advertisements. So advertisements should be given more
focus and importance by the telecom companies.

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 SUGGESTIONS

Information may be communicated to the customers regularly for better

feedback from customers.
The Companies may focus more on Television ads & Newspapers ads to
increase the effectiveness of the ads.
The Advertisements can provide all the relevant information to the
customers which are necessary for them.
The Companies may focus on rural areas while designing advertisement
campaign.

ANNEXURE
QUESTIONNAIRE

1. Name _________________________________________

2. Gender: (a) Male (b) Female

3. Age: (a) 15-25 (b) 26-35 (c) 36-45 (d) Above 45

4. Education: (a) Matriculate (b) Intermediate (C) Graduation (d)

Postgraduate

5. Who is your current service provider?

(a) Airtel (b) Vodafone (c) Reliance (d) BSNL (e) Idea (f) other

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 6. For how long you are using this mobile connection?
(a) Less than 6 months. (b) 6 to 12 months. (c) Above 12 months.

7. What were the reasons for choosing this mobile connection?

(a) Recommended by friends or relatives.
(b) Recommended by retailers.
(c) Brand image
(d) Advertisement

8. While purchasing a connection advertising plays any role? (a) Yes (b) No

9. From where do you watch advertisements the most?

(a) Television (b) Radio (c) Newspaper (d) Magazines (e) Other

10. Which telecommunication company has good advertising?

(a) Airtel (b) Vodafone (c) Reliance (d) BSNL (e) Idea (f) other

11. Do you think that advertisement made by company informs you about their
products?
(a) Yes (b) No (c) Undecided

12. Based on advertisements made by company , would you like to go for more
connections for you or your family in future?
(a) Yes. (b) No. (c) Undecided.

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 BIBLIOGRAPHY

Faculty Guide: MR. SUSHANT KUMAR MISHRA

Websites:

 www.vodafone.in
 www.airtel.in
 www.rcom.co.in
 www.bsnl.co.in
 www.ideacellular.com
 www.google.com

Newspapers:

 Dainik Bhaskar
 Rajasthan Patrika
 The Times Of India

Books:

 Foundations of advertising by S.A. Chunawala & K.C. Sethia

 Advertising management by Rajeev Batra & John Myers
 Advertising and promotion by George & Michal Belch

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