Holistic or Sustainable Marketing

Due to the rapid rate of increase in the population all over the world, combined with the Industrial revolution accompanied by mass production and consumption habits, we have often chosen to ignore the impact of our production and consumption habits on the environment and our societies as a whole. Climate change, loss of biodiversity, a rapid depletion of non-renewable resources and even on resources, which are deemed renewable, to name only a few of the environmental issues the world is facing.

To address all these issues, Vodafone operates a global CR management system. All the Vodafone operating companies, report against 49 KPIs on a bi-annual basis. These KPIs include performance against quantitative targets for energy efficiency, mobile recycling, responsible marketing and network waste management. Each year this information is aggregated to form a full picture of Vodafone’s global footprint and performance. Vodafone Group publishes an online Sustainability Report . This report is accompanied by other local operating company reports such as this one, which focus on the specific impacts within the local country.

                The Vodafone Business Principles represent the commitments Vodafone makes to its stakeholders around the world across all legislative environments. The Principles cover our interactions with customers, employees, suppliers, communities, the environment, government and business partners and competitors.

Products that are making a difference : -
1. Connecting MNCs with Farmers : Contributing towards a larger goal, we collaborated with one of the world's largest confectionery companies to establish direct communication between them and the cocoa producers. Our solutions are helping the cocoa producers to indicate the quantity and date of the produce through a voice portal.The company's sourcing team is able to efficiently plan its collection routes using the information from the portal.
2. Reducing the impact of SIM Cards : Effective July,2011, the surrounding plastic packaging of all the SIM cards sold by Vodafone has been reduced by half. Vodafone is coordinating with its suppliers to implement this fundamental change. As approximately 18 million Vodafone SIM cards are sold every month, this initiatives is resulting in significant reduction of consumption of plastic.
3. Saving trees, one fold at a time : Starting from May, 2011, Vodafone started delivering all the bills to its customers in smaller envelopes. As approximately, 6 million bills are printed every month, the initiative will save a lot of trees from being cut down.

Processes that are making a difference :-

1. Reducing e-waster footprint  -  In order to manage their waste and compliance risks better, Vodafone's supply chain in collaboration with its sustainability team, took up an ambitious exercise of inventorization of all their IT and network waste across the firm this year. This exhaustive exercise resulted in development of a 'Waste Management Manual'. It was developed to ensure the adequate disposal of all the hazardous waste by types such as e-waste, plastic waste, food waste and used lead acid batteries across the organization.      

                These are just a few of the measures adopted by Vodafone to ensure holistic and sustainable marketing of their extensive array of products and services. For more details you can refer to their latest annual sustainability report. The link has been provided below.

Vodafone Group Plc Annual Sustainability Report 2012-13

http://www.vodafone.com/content/dam/sustainability/pdfs/vodafone_sustainability_report_2012_13.pdf 

   

Vodafone's Innovative Approach to its Sales Force Management

          For any organisation, its sales force is a major growth engine and a critical resource in which it makes substantial investments. Managing this resource as a productive and a high performing asset is an  imperative, which  no organization  can  neglect without seriously eroding its top line and bottom line performance. At the same time, it is a hugely challenging  task,  given the  ever increasing product  and  market  complexity, an extremely competitive environment, demanding customers and shortage of high performing sales people.

          Sales Managers need to be effective leaders to transform their sales force to a high performance team in which each and every member must perform to his potential. They need to be equipped with the  latest  concepts and  tools to organize  and optimize  sales force, design  and  allocate territories, deploy their resources optimally, supervise effectively and develop leadership skills to monitor and motivate  their teams. 

       Forward thinking organizations are looking to align both their technologies and their culture around a more social vision of service. They are arming employees with tools that allow them to collaborate across the customer lifecycle, and transform every department and customer touch into a high-value communication that is “customer obsessed.”

          After being unable to provide satisfactory voice and data services to many of its customers in Australia, Vodafone came up with a unique solution to address the problem.

To quickly re-engage their customers and change brand sentiment, Vodafone engaged global business consulting firm Bluewolf to: 

1. Design and execute a multi-channel customer strategy, including an implementation of Salesforce Service Cloud, live chat, and self-service.
   
   Thanks to the Vodafone multichannel approach, customers can pick the forum where they want to voice question or complaint -- this can be Twitter, Facebook, email or chat. A seamless experience for the customer equals an engaged, happy customer.
2. Employ a suite of social tools including the Salesforce Marketing Cloud to monitor and manage brand sentiment.
   
   With the ability to monitor brand sentiment, Vodafone is able to deal with crisis situations, reach new audiences, and assess competitive activity.
3. Set up the Social Hub to integrate social conversations as live cases in the Service Cloud.
   
   With this additional functionality and the appropriate processes, Vodafone is able to quickly route feedback internally so that they can engage with customers faster, thereby improving customer satisfaction.

               This approach proved extremely effective and changed the tide for Vodafone vis-a-vis the customer numbers and their satisfaction and sentiment. All the negative chatter about Vodafone on various social media platforms turned into positive chatter. Vodafone is trying to implement this strategy into many more markets where it currently operates.

                     To  learn about how Vodafone helps other companies improve their sales forces, please click on the link given below.

http://www.vodafone.com/content/dam/vodafone/about/what/case_studies/IT_Pulitalia_CS_ENG_Jun12.pdf

Analyzing Business Markets for the telecommunications(mobile) Industry in India

           As Vodafone is in both B2C and B2B markets, it's important to understand the difference in the customer's decision making processes in both the cases.

            The main difference between the two is in B2B transactions the need is derived and it can't be stimulated and created as in the B2C transactions. Also, the information research and alternative evaluation is a lot more sophisticated and thorough in B2B transactions as compared to in B2C transactions. In B2C transactions, purchase behaviors are more sentiment driven and in B2B transactions, they are more logic and need driven. 

          Thus, only the brands that have already been well-established and who are both efficient as well as creative, can cater efficiently to both B2C and B2B clients. Also, in B2B transactions, it's critical to follow up sales of solutions/products with great service which requires both extensive distribution channels, delivery systems and extremely skilled task forces. Vodafone not only manages to connect with its consumers through its various creative IMC campaigns but it also differentiates itself from its competitors by providing a comparatively superior service. 

              Thus Vodafone has all the requisite competencies as a brand and as an organization to cater to both of its B2C and B2B customers efficiently. It's not only designing innovative products and services for both its B2B and B2C clients, but it's also delivering the same very efficiently and is way ahead in the curve as compared to its other competitors. 

   

Vodafone's Branding Strategy

       Vodafone has continued to focus on delivering a superior, consistent and differentiated customer experience through its brand and communication activities. A new marketing framework has been developed and implemented across the business. which includes a new vision of expanding the group's category from mobile only to total communications 'to be the communications leader in an extremely connected and dynamic world'. Brand and customer experience continues to deliver on Vodafone's promise of 'helping customers make most of their time'. The brand function has also developed a strategy to develop a competitive local market brand positioning, with local positioning projects now implemented in 12 markets all over the globe.

         In September 2007, Vodafone welcomed India with its 'Hutch is now Vodafone' campaign. The migration from Hutch to Vodafone was one of the fastest and most comprehensive brand transitions in the history of the group, with 4,00,000 multi-brand outlets, over 350 Vodafone stores, over 1000 mini stores and over 3000 brand touch points rebranded, with 60% completed in the first 48 hours.   

      

Strengths :          - Strong brand name

                           - Wide distribution network
                           - Financially stable
                           - Strong customer base

Weaknesses :      - People in the Semi-urban and rural areas can't easily relate to the brand
                            - Low margins for distributors and retailers
                 
Opportunities :     - Untapped rural markets
                             - Introduction of new technologies
                             - Value added service market
                             - Business markets

- High brand recall and awareness due to creative campaigns and large customer base
- Extremely high brand equity as it's a globally recognized brand with strong values
- Favorite among the youth due to its unique positioning

Vodafone's Segmentation, Targeting and Positioning

         Vodafone is is continuing to grow a solid, loyal customer base because the company offers excellent product along with excellent customer service.The company continues to offer a variety of services, including data, messaging, voice and broadband. It's continuous advancement in the data services, they offer by developing its 3G networks and the capabilities of various handsets.

SEGMENTATION:-

Segmentation is the process of splitting (segmenting) the entire market into smaller groups. Demographics is the most common variable of market segmentation that includes age, gender, income, geographic, psychograhpic and behavioural.Markets are made up of many distinct groups of people who have common characteristics as consumers. Some of those groups may not be immediately obvious. All of them command tremendous buying power. But they direct it to products and services that address them as a highly individual subdivision or segment of the market.

Vodafone's Segmentation :

1. Demographics - Age > 13 to 65

                            - Income > Small, Middle and High level Markets(Both B2B and B2C)

                            - Urban, Semi-urban and rural areas

2. Psychographics - Preferably Youth and and People in the Urban and Semi-urban areas

                              - People who are willing to pay more for a premium service

Vodafone's Targeting Strategies :-

1. B2C Market : Recharge plans starting from as low as INR 10 and going up to INR 500.

                        - Data plans ranging from INR 44 to INR 250

2. B2B Market : Recently launched plans and packages for SMEs as well as large scale 

                          businesses which can be customized according to their needs

3. Value Added Services and Discounts : To target home-makers, students & professionals

         Due to the extensive price range of its various voice, messaging and data services and it's variety of value added services which can be customized as per individual customers' needs and wants, Vodafone strategically targets customers and consumers of all ages and incomes.

Vodafone's Positioning :-

Product       :   Both Premium and Basic ( Voice, data and messaging services as well as 

                       mobile transfer and IT solutions for businesses) 

Price           :   For small, middle and high level markets ( Depending on the requirements,

                       voice, data and messaging packages are available in different price ranges)

Distribution :   Exclusive Retail Stores as well as sales at small retail shops to reach as 

                       many customers as possible 

  

                              

Vodafone's IMC Campaigns

'Delight' and 'Everybody's Welcome' Campaigns during the transition from Hutch-Essar to Vodafone.

Rebranding Campaign : 'Change is Good.' and 'Happy to help.'

Zoo-Zoo Campaigns

Integrated Plan :-

1. Television - More than 25 new ads during IPL-2

2. Print and Outdoor - Supplemented with print and outdoor ads

3. Sponsorship - IPL - 2

4. Internet and Social media - Facebook Page, Downloadable Ringtones

5. Smartphones - Apps(What kind of ZooZoo are you?)

Vodafone's Distribution Channels

Indirect channel challenges
• 593k villages, 92% have population of less than 10k1
• 66% of population in villages of less than 10k1
• Ratio of Urban to Rural per capita is 2.72
• Tele-density - Urban 163%, Rural 35%3
• Predominantly prepaid market
• Unorganized retail

Vodafone's Pricing Strategy

             When launched in India back in 2007, after acquiring their Indian partner Essar’s stake in the company, Vodafone group had positioned themselves as a premium voice and messaging service providing company, targeted mostly at customers in the urban and semi-urban areas. Due to their superior service as compared to their competitors, the customers who could afford the service were willing to pay higher charges for Vodafone services.

                In recent years, after realizing the potential of the rural Indian market, they have launched their products and services at comparatively lower prices as compared to their prices in the urban and semi-urban markets to penetrate the rural markets. They have introduced recharge plans starting from as low as INR 10 and extending up to as high as INR 500.

                To encourage data consumption, Vodafone also promotes usage with its Mobile Internet packs competitively priced. The starting price of 3G package is from INR 44 in Mumbai. Education on 3G usage is one of the strategies of Vodafone India. The telecoms will try to offer 3G package and better Internet experience in several malls in Mumbai. Engaging situations related to categories such as Music, GPS Navigation etc. have been developed. Vodafone Be Smart Mobile Internet initiative communicates the need for synergizing 3G technology with HSPA enabled handsets, for a faster, smarter and better mobile internet experience.

                Last year as part of their Diwali bonanza packages  to its customers, Vodafone India on had slashed data rates by up to 80 per cent across the country. In June, the company had reduced the price from 10 paisa per 10 KB to 2 paisa per 10 KB in Karnataka, UP West and Madhya Pradesh and Chhattisgarh circles and it had extended the same rates to all its circles from November 1. The company said same rates will be charged even if the customer is in roaming. Vodafone’s ‘Pay as you Go’ rates, which were the same for both 2G and 3G, were the lowest in market.

                This 80 per cent reduction in mobile Internet charges for customers using 2G was an important step in Vodafone’s strategy to drive mobile Internet and it facilitated in faster adoption and better usage of the same. As part of its strategy to "democratise" data, Vodafone is educating current and potential users about how Internet can add significant value to them. The company is also building content partnerships, simplifying pricing, educating retailers and offering choice to customer on the basis their interests and consumption patterns.

Vodafone's Product Mix

          After years of focus on voice-based business,  Vodafone is slowly changing course to include new areas such as IT solutions and mobile payments to drive growth in India.Up until now, Vodafone had primarily focused on expanding its reach from being a metro-centric service provider to one with a pan-India presence. Since its acquisition of Hutch Essar in February 2007, it has invested over Rs 50,000 crore on expansion and adding new network. It added 80,000 new network sites and expanded presence in all the 23 circles in the country by acquiring seven new licences in less than five years.

           Vodafone, is overhauling its strategy to focus on enterprise business: voice, data services, leased lines, conferencing, etc, for companies.The world’s largest telecom operator hopes to leverage on its global reach to drive this growth. The Vodafone group operates in 30 countries, and it already has 2,000 global enterprise customers. For example, it is working with soft drink maker PepsiCo to develop a pre-programmed SIM that would track inventory in the refrigerator used by retailers to store cold drinks. The SIMs will be designed to collate the data by sensing the weight of the bottles in the refrigerator. A master server will ping the SIM to receive the data gathered, which will then be provided to the company. The information will help PepsiCo raise its distribution efficiency.In addition to enterprise solutions, mobile money transfer and payment services are another of the company’s focus areas.

Vodafone's Product/Service Mix :-

1. Voice, messaging and Internet(data) services

2. Handsets(66 new models launched)

3. Smartphones(All leading brands presented, including i-phone in 14 countries & also launched two

    tailor made Vodafone-360 handsets)

4. Value added services(Health, Entertainment and Travel)

5. Dongles for surfing the internet

6. MPesa(Mobile Transfer)

7. IT Solutions   

Vodafone's Marketing Mix

Product :-
- Voice and messaging services
- 2G and 3G(in select circles) Internet Services
- Various value added services like Healthcare, Entertainment and Traveling
- MPesa(Mobile money transfer)

Place :-
- Total of 7590 retail stores all over India
- Also sells through independent retailers
- Availability in the hinterland and hilly geographies of India, e.g. Rajasthan and Tripura

Price :-
- Operates in all three categories, e.g. Small, middle and high level markets
- Recently launched plans and packages for SMEs and large scale businesses which can be customized according to their needs and requirements
- Various Value added services in different price ranges for different customers

Promotion
- ZooZoo campaigns
- Creative Print-Ad and TVC campaign
- IMC

Product Life Cycle

Every product or service available in the market goes through its life cycle which broadly entails four stages: introduction, growth, maturity and decline. The PLC concept can be used to analyze a product category, a product form, a product or a brand. Depending upon the current demand for a product in the market & its future growth potential along with many other micro & macroeconomic changes that take place during a product’s evolution  & the ability of the producers, marketers & the sellers of the product to continue to adapt & innovate at every stage of that evolution, each product goes through its unique life cycle.

             The producers/providers, the marketeers as well as the marketers must adapt with changing times & find new ways to keep their businesses profitable & stay relevant in the market. At every stage of the evolution of a product, it’s the unique value propositions, offerings & positioning that can differentiate a particular brand from its competitors. As this blog is dedicated to illustrating & understanding various aspects of marketing  by relating them to various marketing & other strategies adopted to promote & sell a particular product/service, which in this case is Vodafone, we will now focus on various strategies adopted by Vodafone at different stages of its evolution as a brand to prove how Vodafone as a brand has managed not only to evolve & change but also to continuously progress through innovation and implementation.

             Here, I am going to use the deductive reasoning method to prove my point where I would propose a hypothesis & move forward by providing all the relevant information & data to prove my hypothesis, so my hypothesis is that as a brand Vodafone’s life cycle is going to be a one with scalloped pattern. Before I move forward, I must explain in brief what a scalloped pattern of a PLC is & what it looks like.

                              

                 Shown above is a scalloped patterned growth trajectory of a product. Here, sales pass through a succession of life cycles based on the discovery of new product characteristics, uses or users. My hypothesis is that Vodafone as a brand will go through such a growth trajectory as it continues to innovate & reinvent itself by not only recognizing the opportunities available in the market but also by continuing to build its brand value by delivering a superior, consistent & differentiated customer experience.

                 Before I talk about various strategies adopted by Vodafone, lets first define what a strategy is. As per Johnson’s and Scoles’ definition, strategy is the direction and scope of an organization over the long term which achieves advantage for the organization through its configuration of resources within changing environments to meet the needs of the markets and to fulfil stakeholders’ expectations. Now let’s see what strategies Vodafone has adopted over the years & what others it is planning to adopt in the future & check whether all those strategies fit in the definition mentioned above.

                 The first thing which differentiates Vodafone from its competitors is its method of segmentation. The main categories in which Vodafone has segmented its customers are Geographic (Circle A, Circle B, Circle C), Demographic (Income, Age, Nature of the customer), Psychographic (Lifestyle & personality), Behavioral (Benefits sought, usage rate, Types of services required). Thus, Vodafone provides customized services to the customers as per their requirements & usage patterns. For example they offer prepaid plans ranging from INR 10 to INR 200.

                  The next part of their unique strategy is their marketing & advertising. A new Marketing Framework has been developed and implemented across the business, which includes a new vision of expanding the Group’s category from mobile only to total communications. Their aim is to be the communications leader in an increasingly connected world. Through their various creative advertising & promotion campaigns they have demonstrated that great ideas executed with a vision & passion make more of a difference than  other clichéd promotion techniques. Even though Vodafone has not hired a known face toendorse itself, it has still managed to establish a very high “emotional connect” with its customers through its brilliantly conceived marketing strategies. For example Zoozoos Vs Shahrukh Khan, Deepika Padukone, M.S. Dhoni & Abhishek Bachhan.

           Another very crucial factor is brand experience. Vodafone continues to implement Vodafone’s promise of “helping customers make the most of their time”. Their communication strategy has always focused on “Happy to help” which tends to strike an emotional chord with the customer. Vodafone continues to use a customer measurement system called “customer delight” to monitor and drive customer satisfaction in the Group’s controlled markets at a local and global level which identifies areas for improvement and focus. 2006: 69.9%, 2007: 70.6%, 2008: 73.1%.

                  The most important factors of Vodafone’s strategy are product development & diversification. It’s 3G service in India which would be a quantum leap for browsing and internet based mobile applications and services. 3G would also result in improved connectivity and clearer reception as it provides a greater network capacity which is achieved through improved spectral efficiency. In order to diversify its current market portfolio, Vodafone is launching a global Machine to Machine (M2M) service platform for helping companies to deploy and manage large, wireless M2M projects for applications in customer service enhancement and central control and automation of projects. In the Indian context, M2M is an untapped sector with enormous potential for growth. WiBRO (Wireless Broadband) ,has the capacity to overcome data rate of limitation of mobile phones by providing a staggering 30 to 50 MB/s speed. As in the case of M2M platforms, WiBRO is a very promising market in India. Providing these two services in India would open new avenues of growth for Vodafone and would help it diversify into different market verticals.

                   

Vodafone's Flexible Competitive Advantage

       

       In a strategy for differentiation one or more criteria used for selection by buyers in a market are chosen - and then a business plan is used to uniquely meet those criteria. Differentiation is about charging a premium price that more than covers the additional production costs, and about giving customers clear reasons to prefer the product over other, less differentiated products.Vodafone came up with a differentiation strategy when they launched the I phone service, even though they were charging their customer more than their competitors but they still got the edge over others by offering free Vodafone to Vodafone calls for life time calls and better network strength compared to other competitors.

       In a strategy for cost leadership, a company aims to differentiate within just one or a small number of target market segments.Vodafone introduced One Net, a hosted fixed and mobile voice service for SMEs.This move is regarded as to be very effective move for Vodafone as Vodafone's model is to charge per user, per month and claims the total One Net solution can be 15%-20% cheaper than SMEs pay for typical services currently.

          And of lately they have kept a focused on customers services in order to maintain high standards of customer satisfaction. In addition to above points Vodafone understands the change in market requirements with time and have always tried to come up with new innovative idea to attract more and more costumers for example:-of lately they have understood the need to penetrate in business organizations for which they have started 3 new plans which are catering to small, medium and large scale businesses with various plans and packages which can be customized according to their needs and requirements.

              Also, Vodafone is way ahead of its competitors when it comes to its retail footprint in India.

Customer Decision Making Process

1.       Which attributes are important and why?

-  Availability and Affordability : - As not all the telecom service  providers cater to  customers of all socio-economic classes and all the geographies,factors like availability and affordability play a critical role in  the consumer decision  making process  when it comes to choosing a telecom service provider. Vodafone is still trying to penetrate the rural Indian market and due to many hurdles like  lack of  adequate  infrastructure and awareness among  consumers, the progress  is comparatively  slow. Also, due to its unique  positioning in  the market as a  premium service provider, consumers in the urban and semi-urban areas can’t relate to the brand.

-  Quality of Service :-  Quality of service is the second most important factor in the customer decision making process after checking for the affordability and availability of a service provider in their desired price range and geography.Due to easy accessibility and availability various telecom service providers in almost the same price ranges and in almost all the geographies, a customer will switch to a competitor's services if a service provider is providing comparatively inferior service.

-  Value Added Services - As all the major service providers have started focusing on not only the core voice, data and messaging services but also on various value added services suited to each customer's individual needs, they are a critical part of a customer's decision making process when they choose a particular service provider.

    

- Customer relationship management :- As a customer is choosing to subscribe to a service and not just buying a product, customer relationship management becomes and indispensable component of a service provider's value propositions and a customer's decision making process.

2.       Which problem will the product solve and why?

-  The most basic problem which Vodafone’s products/services solve is that it helps people stay connected. In these extremely dynamic and competitive contemporary times, the exchange of ideas and information is a quintessential component of people’s lives and Vodafone helps them do not just that but a lot more than that. With its various value added services and superior connectivity and quality of service, it satisfies a lot more than just the core needs of its customers and consumers.

3.       Who buys this item?

     - People of all ages and professions belonging to almost all the social classes and geographies all over the world who want to stay connected and who can afford such services.

4.   How will the customer who is subscribing to the service for the very first time think as  compared to a customer who is already a subscriber and is choosing to either continue with the  same service provider or switching to a different service provider?

-   - All the factors which have already been mentioned in answering the first question are the factors a customer will consider if he is choosing to subscribe to the service for the first time. For a customer who has already subscribed to services of a particular service provider, the decision to either continue with services of the same service provider or switch to a different provider will depend on the quality of service and variety of customized value added services provided by the current provider and other personal contingencies. E.g.  If you are shifting to a different part of the country or a different country altogether.

Customer Value and Benefits

The role of the customer is central because the customer is a cocreator of value. As such, marketing is a process of doing things in interaction with the customer. Value is perceived and determined by the consumer on the basis of value in use. Consequently, firms cannot add value but can only offer value propositions.“Goods are distribution mechanisms for service provision”

Value occurs in interaction with resources. Satisfying the unmet needs of the masses through well defined and affordable products and services is an important trend in contemporary marketing. Satisfying the unmet needs of the masses through well defined and affordable products and services is an important trend in contemporary marketing.

Holbrook identifies eight types of customer value: efficiency (output to input ratios or output less input), excellence  (quality), status (fashion), esteem  (materialism), play (fun), aesthetics (beauty), ethics (justice, virtue, and morality), and spirituality (rapture and ecstasy).

Due to the extensive array of products and services offered by Vodafone, its value proposition includes all the categories mentioned above except ‘Ethics’ and with its various innovative corporate responsibility initiatives, ‘Ethics’ will soon be part of Vodafone’s value propositions.

Looking at Maslow’s hierarchy of needs, it’s clear that as a service provider Vodafone satisfies all the needs except the very basic ones like physiological needs and the very extreme ones like transcendence and self actualization. Vodafone satisfies the very basic need like safety and belonging and love by helping their consumers stay in touch with not just their loved ones but also their peers and colleagues and even enables them to contact the relevant authorities via various platforms in case of any emergencies. As we go higher up the pyramid, Vodafone also satisfies the needs for ‘Esteem’ and ‘Aesthetics’  due to its array of extremely innovative products and services and its unique positioning in the market as a provider of premium products and services. A very few service providers of any category can claim to be doing the same as Vodafone is doing for all its consumers.
In the next entry, we will focus on the consumer decision making process.