Marketing Report on Sales Promotion and Advertising of Ufone

Marketing Report
on
Sales Promotion and Advertising UFone
Telecom
　

　
This Report Is a Collaborative Effort Of:
(MB-08-12)
(MB-08-16)
(MB-08-06)
(MB-08-20)
(MB-08-61)
(MB-08-33)
(MB-08-48)
Iqra Khan
Sidra Ghazanfar
Zoya Chaudhry
Kokab Khalid
Mudassir Khalid
Faizan
Muzammil Hanan
　
　
REPORT SUBMISSION
With Due Respect We the Group Members Submit This
Marketing Report to Our Instructor of Marketing
Management
Madam Bushra Baig
　
　
TABLE OF CONTENTS
Preface

Company Profile

Vision & Mission Statement of Ufone

Marketing Department

Business Portfolio
　

　
　
　
　
　
　
　
　
　
　
　
　
　
　
 　
　
　
PREFACE
　
This report reviews the marketing of Ufone, the second
largest telecom company in Pakistan. We give a brief
history of the company and tell about the achievements and
growths of Ufone. It put light on the whole organization
specifically its marketing department and the activities
ongoing in its marketing department. These activities
include two of its major components i.e. Sales Promotion
and Advertising. These two are the main topics of this
report which we have discussed in the depths of the
company’s strategies and functioning. Further we review
Ufone’s strengths, weaknesses, Opportunities and Threats
(SWOT Analysis). In the end we give the future plans of
Ufone and conclude with our views and suggestions for
Ufone.
　
　
　
　
 　
　
　
　
COMPANY PROFILE
BRIEF HISTORY OF UFONE

PTML is a subsidiary of PTCL (Pakistan Telecom Company Limited), the

largest operator in Pakistan.PTML was established to operate cellular
telephony. The company commenced its operations, under the brand name of
Ufone from Islamabad on January 29’ 2001.Since Etisalat took over PTCL in
2006, during the year as a consequence of PTCL’s privatization, 26% of its
shares were acquired by Emirates Telecommunication Corporation (Etisalat).
Being part of PTCL, the management of Ufone has also been handed over to
Etisalat.

In September 2006, Ufone selected Huawei to deploy the nationwide GSM

network at a contract value of above USD550 million. Ufone adopted Huawei's
new-generation GSM solution, including All-IP core network and BTS, to
construct a GSM network covering 1,500 cities and towns of Pakistan.

MISSION OF UFONE

Our mission is to
“

provide best services

with best coverage that
would eventually
 generate profit for the
company and its
stakeholders”
　

UFONE’s ACHIEVEMENTS

►During 2006 Ufone successfully completed the network expansion of Phase

4 in existing as well as in new cities and towns which amounted to more than
US Dollar 170 million. As a result the asset base of the Company has increased
from Rs. 20 billion to Rs. 27 billion.
►Ufone adopted the policy of simplified tariffs with no hidden charges, which
resulted in positive impacts on total subscriber base, which has increased from
2,579k in June 2005 to 7,487k in June 2006.

►Ufone currently caters for international roaming to more than 195 live
operators across 119 countries and introduced International roaming facility for
Prepaid subscribers in Saudi Arabia, United Kingdom, United Arab Emirates,
Singapore, Portugal and Kuwait with lowest rates, featuring no security deposit
and activation charges. GPRS roaming facility is available with more than 75
Live Operators across 59 countries.
►The Company has also been awarded a new License for providing cellular
services in Azad Jammu & Kashmir and the Northern Areas.

OPERATING PERFORMANCE

Ufone’s operational performance has been very encouraging. Despite the stiff
competition in Pakistan telecom market which has led to reduction of prices to
bare minimum level, due to its aggressive policies and exercising strict control
over expenses the Company managed to improve its revenue and after-tax
profit by 87% and 54% respectively, as compared to last year.

GROWTH RATE

As mobile users in the country have reached over 28 million at a very rapid
pace, Ufone has maintained itself as the 2nd largest cellular operator in
Pakistan with a subscriber base of around 6.5 million and a market share of
nearly 25%. Ufone has seen a subscriber growth rate of over 200% in the last
year, and since the start of 2005 Ufone added nearly 5 million subscribers onto
its network. A remarkable achievement indeed, especially considering the fact
that two new international players also entered into the market in 2005.
Subsequently the growth in subscriber base caused a healthy trend in revenues
which have doubled.

TECHNOLOGY

After Mobilink, Ufone is the second cellular service provider company that is
based on GSM technology. Basically they are using GSM 900 technology with
version 2001. Apart from this they are very strong in technological
developments especially they have a well-established research and
development department that is working on new technological developments in
their products. Like they are the first company in Pakistan that is offering
GPRS facility to their subscribers

　
　
STRUCTURE OF THE ORGANIZATION
In Ufone the hierarchy is very lean, in general the whole setup is centralized, all
the matters are to be reported to the main company and all the policies and
targets are approved at the higher level. But at the department level the
structure is decentralized.

► UFONE has following functional departments:-

Technical

Customer operations

Finance

Administration & Procurement

Human Resource

Co-ordination (Govt. relations)

Marketing

►Current CEO (Chief Executive Officer) & President of UFONE is

Mr.Mubashir

Naqvi

►Ufone’s Head Offices is in Islamabad

MARKETING DEPARTMENT
Marketing department handles all the marketing activities concerning all Ufone
packages and brands. A recent marketing survey conducted by a prominent
marketing research company showed that Ufone has considerably increased its
brand visibility and image through its vibrant marketing strategies.

►Marketing department’s hierarchy is as follows:-

 CMO
ASSISTANT MANAGERS

HEAD OF DEPARTMENTS///

MANAGEMENT TRAINEES

SENIOR EXECUTIVES

INTERNEES

(Head Office : Islamabad)

(Head Office : Islamabad)

(Regional)

(Regional)

(Regional)

(Regional)

►Sub Departments of Marketing Department:-

Brand Activation

Value Added Services

International Roaming

Media Planning (Marketing Strategies)

Marketing Finance
 Marketing Operations

►Current CMO (Chief Marketing Officer) of Ufone is Mr. Arshad Yaqoob

Khan

BUSINESS PORTFOLIO
BRANDS:

BRANDS TARGET MARKET REASON FOR TARGETTING

PostPay Corporate class High usage for business & working people

Life Youth Night dwellers

PACKAGES:

PACKAGES TARGET MARKET REASON FOR TARGETTING

Public Demand Lower class/Rural youth High usage

UWON Lower/socio economic class High usage

Ladies’ intention of 5 min chat usually

5 ka 15 Ladies
exceeds to 15 min or more

Walkie talkie Working class/ business class Call conferencing

SERVICES

Both Post-Paid and Pre-Paid Ufone subscribers can enjoy any/all Ufone
services including GPRS based services (MMS, Ufone Internet, Pocket Stocks),
Global SMS, etc

Ufone is proving these all services to its consumers:-

• Internal Excess
• Online Billing Payment

• Power SIM

• WAP

• International Roaming

• Voice Mail

• Call Management

• Messaging

MOBILE PRODUCTS

Ufone is offering the following Mobile Products:-

Utalk

Missed Call Notification

Phonebook Saver

Trivia Quiz

Ushare

Uloan

Voice Bucket

Utunes

Awaz SMS

Uchat

Ugames
 Call Block

Self Service Kiosk

U kisaan

U health

Ufone prize bond

Ubazar

Hajj Guide

MARKETING STRATEGIES
► MARKET SEGMENTATION

Cellular service market is a diverse set of people. Ufone as well as other

cellular service companies segment their market on four bases: - economy, age,
gender & occupation.

I. ECONOMY : Upper class, Middle class, socio-economic class, lower

class

II. AGE : Teenagers, youngsters, middle age, aged people

III. GENDER : Male & Female

IV. OCCUPATION : corporate class, Business class, working class etc

► TARGET MARKETS

Cellular phones are the technology of new era, the 21st century. These cellular phones are the main
focus of our youngsters. All the cellular companies are targeting The Youth one way or other. Ufone is no longer a follower in this race.
Its main focus is “THE YOUTH” of Pakistan which is its Target Market.

Target marketing strategy

Ufone has always been targeting Youth Market by using young brand endorsers or ambassadors. It always brings such packages and

offers that precisely meet the needs of our young people. No doubt it has also launched packages, brands and offers for working people,
business class, ladies and aged ones. Ufone seeks to target masses in the long run.

► POSITIONING

Positioning is the process of creating an image of company’s brand in the mind of market. Companies position themselves emotionally,

functionally or on the basis of brand quality. Ufone is still a market challenger in comparison to market leader MOBILINK. It is still to
reach to the top most position of cellular companies. So Ufone positions itself on the basis of its services.

Ufone’s former Positioning Statement:

“Everybody Loves to Ufone Prepay “

Ufone’s new Positioning Statement:

“Ufone tum hi toh ho! “

Or

“It’s All About U”

Ufone’s positioning strategy:

Ufone changed the image of mobile phones from a luxury only affordable by the elite, to a necessity affordable by the common man.
Since its inception, Ufone has positioned its brand for “MASSES” on the basis of services it is providing and its lowest call rates. It makes
them believe that it satisfies the needs of everyone (viz all classes, age & genders). It tells them that Ufone is there when anybody needs

it. The brand name UFONE itself is a positioning statement.

► DIFFERENTIATION

In these days of intense competition marketers find it hard to differentiate their services from those of competitors. Now customer care
about only price. An unsatisfied customer will immediately go for brand switching. Thus leaving a customer unsatisfied and not meeting

his/her demands is out of question for marketers.

Differentiation Strategy :

Ufone has always strategized in satisfying the demands of its customers. In doing so it has been successful in differentiating itself in terms
of:-

Price
 Quality service

Technology

► CUSTOMER RELATIONSHIP

With 28 million mobile users in Pakistan, Ufone is having a subscriber base of around 7 million. Ufone is showing a remarkable growth
rate. It is maintaining a healthy customer relationship through its “customer service centers” and “call centers”. Its department of

“Customer Operations” is specially designed for maintaining Customer Relationships.

Customer Relationship Strategy:

Ufone strategize to build and maintain strong customer relationships in order to build long-term customer loyalty and to capture customer
lifetime value. In this context Ufone has been training its internees and permanent employees in the fine art of interacting with customers.
It is also strategizing to offer gifts & rewards for its long-term customers in its PostPay to match the wonderful customer relationship
strategy of INDIGO.

► TOTAL MARKET ORIENTATION

Total Market Orientation is about understanding and meeting customer’s expressed and latent needs.

Strategy :

Ufone has always considered the ever growing needs of low call rates and quality service. It has provided its customers their needed
packages and has introduced such brands & packages that meet customer’s latent needs as well. For example 5 ka 15 is result of a latent

need of women of our society. They plan to make a short call but it becomes a long one unintentionally due to gossips and chit chats 

► COMPETITORS

There is a hard core competition among the cellular service providers in Pakistan. Ufone is a market challenger in its competitive
position, where MOBILINK is the market leader. Warid, Telenor and newly introduced ZONG are also strong contenders in market

challenger category. Ufone has the following four direct competitors:-

Mobilink

Telenor

Warid
Ufone also considers the following as its competitors:-

ZONG (former PAKTEL)

PTCL WIRELESS

Wateen

WorldCall

Competitive strategy:

Ufone’s competitive strategies are Customer intimacy and Differentiation. Ufone aims at fore passing Mobilink in its competitive race.

► MARKETING MIX

1 - PRODUCT/SERVICES

Ufone is a service providing company. Service is any intangible product that consists of activities, benefits or satisfactions offered for
sale.

Strategy:

Ufone makes strategies to provide a better cellular telephonic service which excels its competitors at all levels. When Ufone launches a

new package in a market, it actually makes it a complete package of core benefit, design, features, brand name, quality, and after sale
service.

2 - PRICE

Cellular service providers are facing intense price competition in contemporary market. Customers perceive pricing as the heart of brand
selection. Price has always been the core differentiation of Ufone. Ufone is the one who is offering least call rates off-network.
Strategy :

Ufone strategize to capture the existing pricing needs of its customers and use it well on occasional or timely basis. For example Ufone
offered very good call rates on international calls in Eid days. It offered hourly call rates in Ramadan when people were least likely to

avail the offer that much that it might prove unprofitable for Ufone. It was a fantastic strategy to beautify the brand image in term of
pricing in customer’s minds as well as remain profitable in doing so. Ufone follows market penetration pricing strategy and dynamic

pricing strategy to meet the customer needs and ever changing price competition.

3 – PLACE

Place plays a very important part in the distribution and promotion of services.

Competitors of Ufone are seeking to penetrate into places where others haven’t reached. Cellular service providers are drastically

widening their network & coverage in every area of Pakistan. Mobilink has this edge in place excellence because it is the pioneer in
cellular telephonic field.

Strategy :

Ufone strategize to widen its coverage to all places in Pakistan in order to meet the requirements of its increasing customer base. Now

Ufone is heading from cities to remote northern areas in expanding its network. Ufone has intensive promotion in cities, but it is also
considering improving its promotion in rural areas as well.

4 - PROMOTION

Ufone believes in Integrated Marketing Communication which is a carefully blended mix of promotion tools. Ufone employ different

marketing activities and channels to communicate and deliver value to customer. These activities are coordinated to provide maximum
communication output. These communication channels includes:-

Advertising, sales promotion, public relations, direct marketing & personal selling.

Ufone strategize to carry out promotion in order to increase its market share.

Strategy :

Advertising (discussed later)

Sales Promotion (discussed later)

Public Relations : Ufone is less conscious of developing its general public relations. But recently it has

launched its “Hajj Guide” service on Ufone. It avoids getting in news stories and controversies but sometimes it

proves inevitable.
 Direct Marketing : Ufone employ on-road umbrella franchises where the directly market and sell their

connections and Sims.

Personal Selling : Ufone administer personal selling facility to sell their PostPay connections targeting well to

do people and businessmen

› It won’t be an exaggeration to say that Ufone has placed itself where it is now through brilliant promotions.

REPORT TOPIC : SALES PROMOTION & ADVERTISING

“SALES PROMOTION”

“Sales promotions are short term incentives to encourage the purchase or sale of a product or service”

Ufone utilizes sales promotion activities to boost its sales. It follows all four of the promotion budgeting methods viz affordable method,
percentage of sales method, competitive parity method and objective & task method.

Ufone uses following sales promotion tools

Contests:

Ufone carried out contest for cricket talent hunt in the year 200_______. Our renowned Pakistani cricketer Shoaib Akhtar was used as
patron for this contest. However this contest didn’t do much good to Ufone’s image or sales. But Ufone holds future plans to carry out

such activities in more effective and profitable ways.

Games:

Ufone is currently running its game show on ATV prime time. This game show rewards the winning participants. Ufone updates its
customers every now and then to participate in this game show. The problem we see in this activity is that Ufone is not properly

advertising it.

Premiums:

All the cellular services are now offering premiums for their customers. This premium is offered, when a customer don’t use his/her sim
for more than 3-6 months, in the form of extra credit balance delivered to their numbers for free

Free tickets:

Ufone recently offered free trip to Dubai. It was Ufone’s first Eid offer. Every time you make any international call of 5 minutes or

longer than 5 minutes, you enter the lucky draw to win a return ticket to Dubai. The more calls you make, more is your chance to win.
Promotional Products:

“Phone bhi Ufone bhi”. It was a promotional offer By Ufone where it offered a mobile phone, free air time, Ufone connection and Rs.100
airtime all for Rs.999.And now Ufone also offers Blackberry mobile sets with PostPay connection.

Another recent promotional offer by Ufone is that with your HBL Credit Card; get a free handset of your choice, a Ufone PostPay
connection and airtime. Existing as well as new HBL Credit Card customers may avail this offer.

SALES PROMOTION STRATEGY:

Ufone strategize to take aid of sales promotion whenever it sees a minor drop in its usage by its customers. They mostly go for pull

strategy in promotion i.e. they spend a lot on advertising and consumer promotion to induce final customers to avail their services. Ufone
applies sales promotion schemes continually in order to keep its customers loyal and happy.

ADVERTISING (& DEVELOPING AD COMPAIGNS)

“Any paid form of non personal presentation and promotion of ideas, goods, or services by an identified sponsor”

ADVERTISING OBJECTIVES:

Ufone use advertisements when…

It has to inform the customers about new or available services

It seeks to persuade people to purchase their service or switch to their connection from any other connection

ADVERTISING BUDGET

Ufone is a heavy spender on advertising in electronic media as well as other media. Recently Ufone invested a huge amount on mass
advertising. It was definitely a risk to take such decision. They are developing and playing new advertisements on electronic media not

even with a month’s gap or so.

A single Ufone advertisement played 15-20 times per day on a TV channel costs millions varying with the time of day when it is played.

Ufone spends 20% of its profit on advertising and sales promotion.

ADVERTISING STRATEGIES
Advertising strategy consists of two major elements: Advertising Message & Advertising Media. Ufone has the following strategies

regarding the Message and Media of advertising:-

ADVERTISING MESSAGE:

Message Content --»The very first content of Ufone’s advertising message was humor, and then in its blooming stage it shifted its
message content to youthful excitement. Recently Ufone has again adopted humorous theme for its message content. This time Ufone is

winning the hearts of people through humor and it has increased RPI of Ufone. Ufone has already generated much revenue through it.

Message Format --»The format of Ufone’s advertisements has always been very colorful and eye catching. The shocking Orange & Green
colours used by Ufone have always attracted people. These colors look beautiful on wall printing of Ufone.

Message Source --»The very first Ufone advertisements had Faisal Qureshi as its message source. Afterwards Ufone hired non-celebrity

young models for its youthful message theme. Ufone also hired three lollywood queens i.e. Meera, Jia Ali and Veena Malik with Mikaal
in an advertisement of “Baat Ban Jaye”. This advertisement created a big controversy regarding the erotic and sexually attracting acts by

the three female models. Due to negative response by people Ufone had to vacate its billboards and eradicate its banners, posters etc
overnight, as directed by CEO and CMO of Ufone.

But now Ufone has again hired a comedian trio featuring Faisal Qureshi, Mikaal & Hammad. The strategy behind hiring this trio is that
they are economical and are personal favorites of people. Ufone always hire endorsers in group

• Mr.Waqas Anjum (Senior Marketing Executive-Multan) is of view that you must bring changes in marketing to

attract customers. For this purpose Ufone is re-launching itself under the name of one single brand called
“UFONE”. This brand would have Orange & Black as its corporate color instead of conventional Orange & Green

color.

ADVERTISING MEDIA: To increase the reach and frequency of advertisement Ufone is using repetitive strategy for its advertisements.

And the humorous theme always makes the ads more appealing and engaging the minds of customers. Ufone advertise in the following
media types:-

Print Media --»Ufone tries and print ads in all leading newspapers including The Dawn, Jung, Nawa-i-Waqt, Khabrain and local Sindhi
newspapers as well. Ufone place its ads in all leading magazines as well i.e. Sunday magazine, akhabr-e-jahan, Libas, Mag etc

Broadcast Media --» It is the prior choice for Ufone. It includes the electronic media television and radio. Ufone is advertising in all
Pakistani channels including GEO, Hum, ARY, Indus, TV one, HBO, Cartoon Network etc (except MTV Pakistan). Ufone also plays its

ads on local channels like WASEB and Punjab TV.

Display Media --»This type of media is the second choice of Ufone where it carries out its most of sales promotion and advertising. Ufone

advertise using billboards, hoardings, signs (on Shop boards etc), posters, wall paintings etc. SME Multan has used a new and innovative
vehicle in display media i.e. Ufone’s painted rickshaws
Online Media --» Internet is the online media. Ufone places flashing ads on famous portals like coolbuddy.com, pakfellows.com etc. But

Ufone is not carrying out direct mail or direct e-mail advertising

Events --» Ufone has sponsored many events in the past and holds future plans concerning it. The famous event sponsored by Ufone in

2006 was a series of musical concerts did all over Pakistan, featuring Mikaal Hassan and Junoon, it named UROCK

AD SHOOTS: The ads of Ufone are shot mostly within Pakistan. But the PostPay ads are shot in foreign locations. Recently Ufone shot

in the picturesque locations of northern areas of Pakistan in its advertisement of UWON “sabse sasti call”

SWOT ANALYSIS

SWOT analysis is an overall evaluation of the company’s

Strengths (S)

Weaknesses (W)

Opportunities (O)

Threats (T)

STRENGTHS

Strengths include internal capabilities, resources, and positive situational factors that may help the company to serve its customers and

achieve its objectives.

The strengths of Ufone are as follows:-

Ufone’s differentiation is its biggest strength. Ufone offers lowest off-net call rates that differentiate it from its

competitors

Ufone is offering more and better Value Added Services (VAS) than its competitors i.e. Ufone’s Walkie

talkie,_______________________________

Ufone is enjoying the second largest cellular network in Pakistan

Ufone has the most promising and attractive ATL (Above The Line) activities
 Ufone has great management within the organization (internally & externally)

WEAKNESSES

Weaknesses include internal limitations and negative situational factors that may interfere with the company’s performance.

The weaknesses of Ufone are as follows:-

Ufone has less professionalism within the organizational members

As Ufone is a subsidiary of PTCL, which was formerly under government management, Ufone still has a

shadow of a government organization

Ufone still has room for the betterment of its network coverage in comparison to The Market Giant

“MOBILINK”

Ufone has pathetic billing system for postpaid connections. This faulty system creates a negative vibe among its

customers

OPPORTUNITIES

Opportunities are favorable factors or trends in the external environment that the company may be able to exploit to its advantage.

Ufone has following opportunities in its way:-

Ufone’s biggest opportunity lying ahead in near future is the phase of conversion of their GSM technology Into

3G (satellite based) technology

Ufone has the opportunity of growing its customer base due to increasing trend of using mobile phones

Ufone has the opportunity to win the customers of its competitors by providing them superior services on lower

price

Ufone has the opportunity that it is pioneer in southern Punjab where it can promote itself and become market

leader on the basis of this very fact

THREATS

Threats are unfavorable external factors or trends that may present challenges to performance.
Ufone is facing/about to face the following threats:-

Ufone’s biggest opportunity is its biggest threat as well. The phase of its conversion of GSM technology to 3G

technology can be a threat for it if not carried out properly

The boosting customer base of Warid and Zong is also a big threat for Ufone

The decreasing economy rate and instability of Pakistan is a big threat for all businesses in Pakistan including

Ufone

COMPETITIVE ADVANTAGES

It’s an advantage over competitors gained by offering consumers greater value than competitor’s offer. Ufone strategizes to gain more and
more competitive advantages. It also uses these competitive advantages well enough for its promotion. Currently Ufone is enjoying the

following competitive advantages:-

Lowest overall call rates

Value added Services (VAS)

Call block service

Corporate color

CHALLENGES

Ufone face many challenges with the ever growing needs of telecommunication. It must remain profitable with the decreasing economical

situation of Pakistan. It must grow as well in these dark times if it has to remain IN the market. Ufone face very strong competition from
its competitors. It must offer lowest rates with better quality service. New features and services should be introduced to make its

customers loyal, happy and satisfied.

FUTURE PLANS

►Keeping in view the growth potential of the cellular industry there is no option but to be aggressive in order to remain a potent force in

the cellular industry.

►In order to extend cellular network Ufone has finalized a huge network expansion contract amounting to about USD 550 million, which
will enhance the subscribers’ capacity by 10 million. This is the largest ever expansion project of Ufone.
►A strong focus will be on maintaining high quality of service, which is always a benchmark of Ufone, increasing usage and exploring

new revenue streams on value added services, market visibility through various market initiatives to fulfill subscribers’ satisfaction and
demand and above all to increase the value of investment for the shareholders.

CONCLUSION

By keenly analyzing the marketing of Ufone, we group member agree that Ufone is not a safe player in the market. It is penetrating its
market by taking risks and aggressively promoting & advertising itself. It holds second largest market share and is seeking to become the

market leader anyway possible. We came through very unconventional strategies and ad campaigns while working on this report. We
believe that mobile services are the toughest market to enter and survive. And in this tough market Ufone isn’t only surviving but growing

at an exceptional rate.

Ufone is using humorous theme in its ads which has become its benchmark. People enjoy watching, discussing and following Ufone ads

the most. And it is the biggest achievement of Ufone in recent times.

We wish a very best of luck to Ufone. May it progress in this field and achieve its desired goals. (AMEEN)