Marketing Management Report 2013

MPK 732 Marketing Management Assignments 1

Marketing Management Report

Vodafone Shades another 128,000 Customers
Student name and Id:
Aishwary Nikam; 212056409 Kiran; 213303655 Dhruv Sharma; 213317564 Amandeep kaur; 212573547

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Marketing Management Report 2013

Executive Summary Vodafone Group, the part manager of Vodafone Hutchison Australia (VHA) has reported a 16 per cent decrease in income for the Telco in the most recent three months of 2012, with 128,000 clients lost (Taylor 2012). The organization, which reports 50% of the increases or misfortunes made by Vodafone Australia and its partner Hutchison Australia, comes about with result that in the most recent three months of 2012, it lost 64,000 clients, carrying the base to 3.1 million (Taylor 2013). In sum, this means Vodafone Australia lost 128,000 clients, to an aggregate base of 6.2 million (Taylor 2013). Since the start of its system evils back in 2010, Vodafone Australia has now lost 1.3 million clients (Taylor 2012; Taylor 2012; Taylor 2013). Vodafone Group faulted a 16 per cent decrease in income somewhat higher than the 14.4 per cent decrease in the keep going quarter on proceeded shortcoming in mark discernment, declining client base, and more level normal income for every client (Taylor 2012; Taylor 2013). The decay is lower than in the keep going quarter in June to September, Vodafone shed 154,000 clients yet contrasted with the same quarter in 2011, Vodafone shed over twofold the 60,000 clients it lost in that period (Taylor 2013). The misfortune arrived in a period where the organization decrease its workforce in a rebuilding move pointed at turning around the fortunes of Australia's third-biggest mobile network supplier. Vodafone Group CFO Andy Halford Vodafone Australia had finished a 35 per cent cut of its headcount, and the organization had finished the update of its system with network system specialist Huawei. The organization's other parent organization, Hutchison, is relied upon to discharge comes about later this month.

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

Whereas Telstra reported picking up 607,000 new portable clients in the most recent six months of 2012, which increased its client base to 14.4 million. Optus will publish its quarterly comes about one week from now (Taylor 2013). The announcement comes as Vodafone's CEO Bill Morrow has called for the government to review the subsidies paid to Telstra to supply fixed-line services in Australia. Communications Minister Stephen Conroy mocked CEO, Morrow for the suggestion, that in spite of companies heavy client loss due to poor service and network, still they want to give lectures to people (Taylor 2013).

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013 Contents:

1. Introduction 2. Background i. ii. iii. iv. v. vi. Macro Marketing Environment The marketing Organization Marketing Intermediaries Customers Competitors Public

3. Problem definition 4. Market Segmentation, Positioning and Targeting 5. Segmentation of Vodafone 6. Targeting of Vodafone 7. Positioning of Vodafone 8. Conclusion 9. References

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

Introduction:
Marketing is present in everything we do and is everywhere, right from clothes we buy to the online shopping, to the advertisements we see daily around us in the market, on television and so on (Kotler and Keller 2012; Kotler and Keller 2012). Thus marketing can be shortly summarised as the science which deals with identifying and satisfying human and social needs (Kotler, Brown et al. 2004; Kotler and Keller 2012).

Background:
The macro marketing environment It is the understanding of the external environment of an organizations ability to develop, and maintain successful transactions with its target customers (Mavondo 1999; Kotler and Keller 2012). These dynamic and changing environmental forces represent both threats and opportunities to an organization (Kotler and Keller 2012). Marketing managers who fail to recognize future trends and adjust their marketing strategies to deal with these trends do so to the detriment of their organization (basic principles of marketing and management) (Mavondo 1999; Pickton and Broderick 2005; Kotler and Keller 2012).

For example, a clothes supplier may fail to gauge the following years fashion trend, an electronics retailer may fail to predict the next technological trend, or a car manufacturer may have the wrong model range. Alternatively, management can take advantage of the opportunities created by the external environment by making the right product available at the right time (promoting skills sharing- free economy community).

It is difficult to envisage the future, but management can minimize the risk of strategic errors by improving the environmental analysis process (Mavondo 1999; Varey and Lewis 1999). Marketers have adapted their strategies in recent times to trends such as the desire for better lifestyles, IT, changing tastes and changes to the law (Varey and Lewis 1999).

Kotler and Keller (2012) address the micro and the macro-environment and the marketing intelligence system, used to gather data about the macro-environment. The marketing

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

intelligence system is a set of procedures and sources managers use to obtain day to day information about the developments in the marketing environment (Kotler and Keller 2012). Companies and their suppliers, marketing intermediaries, customers, competitors, and publics, all operate in a macro-environment of forces and trends that shape opportunities and pose threats (Mavondo 1999; Kotler and Keller 2012; Kotler and Keller 2012).

These forces represent elements outside the direct control of the organization, to which they must monitor and respond. Within the rapidly changing global picture, the firm should monitor six major external forces, viz., Demographic; Economic; Social-cultural; Natural; Technological, and Political-legal (Achrol, Reve et al. 1983; Mavondo 1999; Kotler and Keller 2012).

In this section we will discuss some of the participants in an organizations microenvironment that encompasses: customers, competitors, suppliers, distributors and dealers that affect an organizations ability to make a profit (Kotler and Keller 2012).

The marketing organization Organisations works with the other specialists to meet their objectives, so it is necessary for all the specialists to understand what each can contribute. Marketing can be seen as the eyes and ears of the organization (Mavondo 1999; Kotler and Keller 2012). It must obtain and analyze market information, as well as get the organization to use the information (Achrol, Reve et al. 1983; Varey and Lewis 1999).

McDonalds is probably the best example of a company that thoroughly utilizes the marketing concept. McDonalds understand its strengths and weaknesses to understand customer needs and respond to changes in the environment (Polonsky 1994; Pitt and Nel 2001).

The interaction of marketers and the other functional specialists will be easier if the organization believes in the marketing concept. If this is not the case, marketing will have a continuing battle to get resources (Kotler and Keller 2012).

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

Marketing intermediaries It is necessary for organizations to form strong relationships with various marketing intermediaries, i.e., organizations that help to promote, distribute and sell a companys goods and services. These intermediaries may include marketing consultants, distributors, financial institutions, etc (Zeithaml 2002; Kotler, Brown et al. 2004). The importance of the relationship between a company and its intermediaries can be seen in the example of a manufacturers reliance on a distributor. A manufacturer should not neglect its distributors and it should have a system that keeps them informed as well as obtaining information from them (Donnelly 1976; Zeithaml 2002). The distributors are nearer the final consumer so they notice changes in consumer requirements, and competitors offerings. The marketing information system should obtain this information using the sales department (Weitz and Jap 1995; Gruen, Summers et al. 2000). A good distribution system is a major strength for a manufacturing company and it takes time and effort to build it up. It is a major waste of resources if, at the final point of sale, a sales assistant, for example, does not make the sale because of a lack of product availability and/or product knowledge (Kotler, Ang et al. 2003).

Customers Customer markets are broken down into five sub-groups according to whether they buy: For personal consumption; For use in processing a product; For retail selling or reselling; To provide government services; or For international marketing.

A company can sell in one or more markets; however, as each market has special characteristics, marketing operations will differ in each market (Kotler and Keller 2012).

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

Competitors An organization should aim to have a continuing competitive advantage, which requires information on what competitors are doing (Ghosh and John 1999). There should be marketing specialists responsible for monitoring competitors activities. They must obtain the information, analyze it, and then distribute to the relevant decision-makers within an organization (Ghosh and John 1999; Juin 2000). In a marketing-oriented organization all the employees should be encouraged to notice what their competitors are doing and pass information to senior management and the marketing specialists (Juin 2000; Gilmore, Carson et al. 2001).

Public There are groups of people and organizations that an organization should keep in touch with, as they could have an effect on the business. This activity is part of the public relations activity of the organization (Kotler and Keller 2012). Kotler (1972) classifies seven types of publics that organizations are involved with (Kotler 1972; Kotler and Keller 2012): Financial Media Government Citizen-action Local General Internal

Problem definition The primary problem of the Vodafone is its reducing customer base which directly impacts the companys revenue. It lost 128,000 subscribers and a revenue decline of 16%. in the last three months of 2012.

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

Customers are moving to emerging players and its competitors because of its network problems which started back in 2010. Vodafone Australia has now lost 1.3 million customers in the recent time. Vodafone Group blamed its decline in revenue on its decreasing brand image, reducing customers. Average revenue per customer is also lower which results in lower margins. Vodafone has already started restructuring the organisation to reduce the costs. Reduction of its workforce by 35% is one step in that direction. Vodafone has to consider other ways of attracting more customers. The underlying problem is to increase average revenue per user and to reduce its costs.

Market Segmentation, Targeting, and Positioning strategies

Market segmentation
Market segmentation is a process which involves grouping of various customers into segments who have common needs or who will respond similarly to a marketing strategy (Kotler and Keller 2012). Each segment of consumers responds to a various marketing mix strategies which may also consist of mix of strategies, with each offering alternate growth and profit opportunities (WEDEL 2000; Kotler and Keller 2012). The different ways by which the market can be segmented is as follows:

Demographics: It focuses on the characteristics of the customer. For example age, gender, income bracket, education, job and cultural background.

Psychographics: It refers to the customer group's lifestyle factors. For example, their lifestyle, social class, attitudes, personality and opinions.

Behavior: It is based on customer or consumers behaviors. For example, online shoppers, shopping centre customers, brand image and its preference and prior experienced goods.

Geographical location: Such as continent, country, state, city or rural. The place where the customer group resides or it may depend upon topography like coastal area, hilly area, plateau and so on.

MPM 722 Marketing Management Assignment Task 1

Marketing Management Report 2013

All these factors affect the uptake and consumption of goods and services and are prudent to be considered for marketing and organizations success (Thomas 1980; WEDEL 2000; Yankelovich and Meer 2006; Kotler and Keller 2012).

Targeting
After market segmentation based on the different groups and classes, there is a need to choose the targets i.e. target population. One strategy never suits different consumer groups, so to develop specific strategies for our selected target markets is very important (Kotler, Brown et al. 2004). In general, there are three for selecting the target markets (Kotler, Brown et al. 2004).

Undifferentiated Targeting: This approach considers the entire market as one group with no individual segments; therefore a single marketing strategy can be used in this context. This strategy can be applied and can be useful for an organization or product with little competition where you may not need to tailor strategies according to different needs (Kotler, Brown et al. 2004).

Concentrated Targeting: In this approach a particular market niche or segment on which marketing efforts can be targeted is selected. The organization in this context focuses on a single segment so that one can concentrate on understanding and assessing the needs and wants of that particular market segment very closely. Small business often benefit from this strategy as focusing on single segment enables them to compete effectively against larger business corporations (Kotler, Brown et al. 2004).

Multi-Segment Targeting: This approach is used if when there is a need to focus on two or more well defined market segments and when one wants to develop multiple and varied strategies for them. Multi segment targeting offers many benefits but it involves greater input from company management, more elaborate market research and more promotional strategies which can be a costly affair (Moschis 2003; Kotler, Brown et al. 2004). Prior to selecting a particular targeting strategy, a cost benefit analysis which is a type of economic evaluation should be undertaken between all available strategic alternatives to analyze which will suit the situation in best manner to maximize the benefits within similar

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allocation of resources (Debruyne, Moenaertb et al. 2002; Moschis 2003; Kotler, Brown et al. 2004; Torrance and Drummond 2005). Positioning Positioning is to develop and conceptualizing a brand image of a product in the front of the consumers (Myers 1996; Kotler, Brown et al. 2004). It can likewise comprise of altering the knowledge of client's appreciation about the item and enhancing it assuming that they will decide to buy the item or services. Marketing can emphatically impact the recognitions of its target clients through usage of vital special strategies and via deliberately applying the business by marketing mix strategy (Myers 1996; Chen and Uysal 2002; Kotler, Brown et al. 2004). Solid and successful positioning includes a careful comprehension of elective contending products and the profits that may be looked for by the target market (Chen and Uysal 2002). It additionally requires a need to distinguish a differential point of interest with which it can convey the needed profits in the middle of the rivalry. The point of marketing from business perspective ought to be to characterize it in the eyes of their clients in connection to the rivalry in the business sector (segmentation of product, targeting of the product and positioning- small business toolkit for the product). (Chen and Uysal 2002; Kotler, Brown et al. 2004) Vodafone is a leading brand in combined telecommunications organization which works in 20 different nations on the planet. The organization ranks around the top 5 versatile network system suppliers worldwide as far as number of subscribers. The organization's item offerings incorporate 2g, 3g and 4g services, fixed land line, high velocity broadband connection through DSL, IPTV, DTH, venture services incorporating national & worldwide long distance services to different carriers. Vodafone had achieved 246 million clients across its network operations at the end of February 2012. SEGMENTATION OF VODAFONE On the basis of Geographic variables:Region wise Australian East Region Australian West Region Australian South Region
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Marketing Management Report 2013

Australian North Region Australian Central Region

On the basis Demographic variables:Age 1) From age group 18 < 35 As a large portion of the individuals begin utilizing a versatile from the age of 18 so a section of age group 18 to 35 is acknowledged. The greater parts of these are people are student and remaining is constituted by adolescent working professional in some services or industry. So there fundamental needs constitute of SMS plans for chatting and cheap calling rates. We might furnish this group by offering a plan "FRIENDZ" to them with zero rentals. 2) 35 and above The vast majority of this working class comprises of working population and do not use mobile for SMS or chatting. So the need of this working class population is calling at a sensible rate. This group might keep utilizing the general plans with cheap calling rates.

Income
PREPAID & POSTPAID For the most part the versatile administration suppliers arrange their advertising methodologies as per the prepaid market and postpaid market. So it essentially hinges on the salary of the customer that if he chooses the prepaid or postpaid. Usually the purchasers with low pay pick prepaid and shoppers with high earnings pick postpaid.

On the basis of Behavioral segmentation: Brand Loyalty: We can additionally portion it on the groundwork of the customer loyalty and nondedicated clients of the brand. We can give different plans and offers to the steadfast clients to hold them with Vodafone loyalty.

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Targeting of Vodafone Vodafone has focused on the premium and upper-middle working class. The witticism behind this is just target those fragments ought to be focused on who value the time and have the paying capacity. Throughout the presentation organize there was an enormous force to get consumer to hook up over with their brand, on the grounds that getting them to Vodafone by their brand loyalty was too tough. Vodafone advertisers have been focusing completely on the business official class however now that the essential reasonable volume has been built up and costs have declined to a certain degree they want to step further field.

TARGETING AREAS In Promotion marketing, targeting postpaid customer by giving free calls services in postpaid circle. Visionary by giving different arrange plans in which they might get inside calling free.

To target young generation introducing a new scheme FRIENDZ.

Targeting Students by presenting postpaid connection on zero rentals only for students. (Barnes and Scornavacca 2004)

Positioning: The mobile connectivity should be a business proficiency instrument. To remove stress is to evacuate confusion that the wireless is a costly method of correspondence. It's normal utilization merchandise and is no more an image of status. By promoting, by complexity, includes messages regularly free data, for example traffic movement reports or climate forecast free to the buyer on request. The mixture nature of data and promoting of draw publicizing smears the line between promoting advertising in the free data provided to the customers(Scharl, Dickinger et al. 2005).

Vodafone Branding Evaluation of Vodafone Brand Elements Memorability: Easily recognized Easily recalled

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Marketing Management Report 2013

The brand elements of Vodafone are memorable. It has no complexity in their brand elements. At least people can easily recognize and recall the parent brand Vodafone. Though its sub-brands are little bit tough to recognize and recall. So we can say parent brand are highly memorable(Dodourova 2003).

Meaningfulness: Descriptive Persuasive

Brand components might undertake numerous types of importance, with either clear or enticing substance. The brand components of Vodafone have elucidating significance and infer something about the item classification.

Likability: Fun and interesting Rich visual and verbal imagery Aesthetically pleasing

Vodafone utilization its parent brand name in distinctive font and style as their logo and image of guardian brand. Distinctive brands of Vodafone utilization diverse brand components. Brand components of Vodafone are so much agreeable. It is affable particularly to the learned or to the brand loyal individuals.

Transferability: Transferability within and across product category Transferability across geographic boundaries and cultures Transferability implies how advantageous is the brand components for line or classification enlargement. As a rule the less particular the name, the all the more effectively it might be exchanged crosswise over classifications. In that sense Vodafone is solid as far as transferability. Customer has already accepted the product line offered by Vodafone.

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Adaptability: Flexible Updatable The fifth thought for brand components is their versatility over the long haul. The mark Vodafone is exceedingly adjustable and updatable. It was started in 7 July 1995, and proceeding by the same name. It doesn't need to face any issue to change or upgrade the brand components with the change of time. Protect ability: Legally Competitively This is the last attention of assessment criteria. The mark components of Vodafone are secure capable both in a legitimate and an competitive sense in light of the fact that it is enrolled with the suitable lawful figures and overwhelmingly protected trademark from unapproved encroachment or unauthorized infringement.

Discussion and Conclusion

In recent three years, Vodafone Hutchison Australia has encountered what each advertiser fears. Confronted with misfortunes of 700,000 clients in 2011 and 2012, years of negativity in the commercial center and far reaching social feedback also the wavering risk of a claim from displeased previous contract holders the mark has been whipped, battered and wounded. However with affliction comes the chance to study, and for Vodafone's as of late introduced senior official group, the premise for its deliberations to recapture consumers trust (Cameroon 2013). Vodafone's executive of consumer shopper business, Kim e, is at the coalface of the Telcos endeavors to shore up client steady loss and enhance its mark picture with the Australian public. The business lost its center as it fought poor network system and administrations and a conflicting client approach (Cameroon 2013). Vodafone Hutchison Australia is a fiftyfifty joint venture shaped between Vodafone and Hutchison in June 2009. Although was

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delegated to her post keep going October by then new CEO Bill Morrow, and is part of a change group tasked with updating the business' course. Vodafone endeavors to meet this test through a mix of item changes, inside realignment, stronger client engagement, consistency in correspondence, and promoting brand smarts (Gattorna 1998; Cameroon 2013). Two center issues are majorly highlighted in Vodafone and are striving to overcome as a major aspect of its brand change. The principal is system connectivity and the need to enhance unwavering quality crosswise over items and administrations, something Vodafone is presently tending to with a $1bn infusion into system redesigns for better network in excess of a two-year period (Gattorna 1998). The different is enhancing clients' experience by guaranteeing reliable and pertinent engagement constantly and cross-channeling. Vodafone has initiated on this trip with a thorough audit of client touch focuses and also innovation technological venture (Gattorna 1998). All investment in the system is unsurprising given her expert foundation. She began her profession as a specialist at Telstra before exchanging to item showcasing, and then ascending the ranks at Vodafone until she was administering worldwide business from the UK. Taking after parts with begins up administrations business Mobile Mentor, and programming engineer White Rabbit, she joined Salesforce.com as Vice-president of marketing in region of Asia-Pacific, where she met Morrow (Cameroon 2013). Repairing the brand With any mark change provoke, it is significant to begin with the main root of the issue. In the meantime, it needed strived to recognize Vodafone's qualities and lift those to the highest point of its re-engagement strategy. These structure the foundation for an exhaustive change program (Cameroon 2013). A case of how things are, no doubt, being realigned inside is the re-designing of distribution channels so that third party owned, Vodafone marked retail stores have an immediate association with the corporate group. These 17,000 purposes of vicinity were long ago

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administered by a middleman (Cameroon 2013). Supervising the correspondence chain all the more nearly so its unwavering and determining the story and voice of the mark is clear is likewise discriminating, if its through the call center, the website entrance or social media (Chan-Olmsted and Jamison 2001; Rao and Minakakis 2003; Cameroon 2013). Marketing alignment Creating a message around Vodafone's enhancements is basic too, and the evident beginning stage should be the upgrades in the administration experience (Mah 2004; Cameroon 2013). The Vodafone should start an arrangement of above-the-line crusades offering system that ensures by taking responsibility for its administration levels, all pointed at client maintenance (Gattorna 1998). Similarly as with any advertiser today, information and measurements are moulding the way Vodafone moves its client relationships and highlighted net promoter scores (NPS) around mark dismissal and promotion as key ways Vodafone is checking client maintenance methodology. From NPS highs of +18 in June 2010, the mark plunged to -27 against an industry normal of zero yet is currently living up to expectations its direction move up (Gattorna 1998; Cameroon 2013). Vodafone is not out of the woods yet, losing 108,000 clients in the first quarter of in the not so distant future (Cameroon 2013). In an offer to capture the slide, Vodafone has put resources into additional dissection assets, and now has 25 per cent for the advertising group committed to encounters which drive NPS, and taking in what reduces a great client experience. These are prompting better monetary results for the business (Cameroon 2013). Clients that have joined Vodafone since July 2012 have given the business a NPS score of +4. It's no place close where it used to be and it should not rest on that.

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