customer switching from idea to other telecom services

A

Summer Training Project Report

On

“CUSTOMER SWITCHING FROM IDEA TO OTHER TELECOM

SERVICES (DELHI REGION)”

At

IDEA CELLULAR LIMITED

Submitted to

Uttar Pradesh Technical University, Lucknow

For the partial fulfillment of

MASTER OF BUSINESS ADMINISTRATION

2013-15

Submitted To: Submitted By:

Prof. Sarjue Pandita Ayur Varshney

Assistant Professor (HR) Roll no. (1382070014)

AJAY KUMAR GARG INSTITUTE OF MANAGEMENT 27th K.M Stone, NH—24, Delhi Hapur Bypass Road,

Adhyatmik Nagar, Ghaziabad- 201009

Customer Switching From Idea To Others Telecom Services (Delhi Region) Page 1

DECLARATION

I Ayur Varshney hereby declare that this project report is the record of authentic work

carried out by me during the period from 9st June to 25thjuly and has not been submitted

to any other University or Institute for the award of any degree / diploma etc.

Signature:

Name of the student: Ayur Varshney

Date:


ACKNOWELDGEMENT

“The beauty of the destination is half veiled and the fragrance of the success is half dull

until the traces of all those enlightening the path are left to fly with the wind spreading

word of thankfulness”. With this regard to my project carried at Idea cellular Ltd., I

would like to thank each and every person who helped me to prepare this project.

I respect and thank to the DR. (PROF.) T. R. PANDEY, Director, AKGIM Ghaziabad

for giving me an opportunity to do the project and providing us all support and guidance

which made me complete the project on time. I am extremely grateful to him for

providing such a nice support and guidance.

I take this opportunity to express my profound gratitude and deep regards to my Faculty

Guide Prof. SARJUE PANDITA for sharing her valuable time with me and providing

me a specialist’s view point in the concerned subjects.

I am highly indebted to Mr. ABHINEET VARSHNEY, MARKETING MANAGER

& SUNIL THAKUR, HR MANAGER for their guidance and constant supervision as

well as for providing necessary information regarding the project and also for their

support in completing project.

I also take this opportunity to express a deep sense of gratitude to all faculty members of

AKGIM, for their cordial support, valuable information and guidance, which helped me

in completing this task through various stages.

I would like to express my gratitude to those entire customers who have given their

response during the project work to complete it successfully.


TO WHOM SO EVER IT MAY CONCERN

This is to certify that Ayur Varshney is a bonafide student of MBA 2nd year of

this Institute for the session 2013-15 and he has undergone the summer training at

Idea cellular ltd. and prepared Summer Training Research Project Report titled

“Customer switching idea to other telecom services (Delhi region)”of his own

for the partial fulfillment of Master of Business Administration (MBA) at Ajay

Kumar Garg Institute of Management, affiliated to Uttar Pradesh Technical

University, Lucknow.

I wish him all the best for the future endeavors.

Prof. Sarjue Pandita

Date:


TABLE OF CONTENTS

DECLARATION............................................................................................................... 1

EXECUTIVE SUMMARY .............................................................................................. 5

HISTORY OF COMPANY.............................................................................................. 7

COMPANY BACKGROUND AND MARKET SIZE................................................. 12

OBJECTIVE OF STUDY .............................................................................................. 32

LITERATURE REVIEW .............................................................................................. 34

RESEARCH METHODOLOGY .................................................................................. 38

DATA ANALYSIS, PRESENTATION AND INTERPRETATION ......................... 42

FINDINGS ....................................................................................................................... 62

CONCLUSION ............................................................................................................... 63

RECOMMENDATIONS................................................................................................ 64

BIBLOGRAPHY............................................................................................................. 65

APPENDIX ...................................................................................................................... 67


EXECUTIVE SUMMARY


Research has demonstrated conclusively that it is far more costly to win a new customer

than it is to maintain an existing one. And there is no better way to retain a customer than

to exceed his expectations. For this purpose it is essential to know the level of customer

satisfaction. The focus of research was the measurement of customer satisfaction level for

the services provided by idea. My job was not to collect the feedback from the consumer

only but also to get the major complaints resolved through internal counseling and to

determine the strength of the company’s customer retention strategies by askingexisting

customers whether they will recommend the company or not. Even thoughcustomer

relationships are one of the company’s most valuable assets, they are often oneof the

most undervalued assets too. But the research found that there were no better

opportunities to interact with the external as well as the internal customers of an

organization.

In the constant battle to gain new customers, it is easy to overlook the value existing

customer relationship. All corporate profits are ultimately eared from conducting

successful relationship with customers. As the source of all your profits, customer

relationships should be valued and protected.

The study was based on a sample of 83 customers drawn from the Delhi region. Data for

the study obtained mainly from the administration of questionnaires was analyzed

quantitatively using the Microsoft Excel and presented with the aid of frequency

distributions, pie charts, tables, pictures and graphs.


HISTORY OF COMPANY


The Aditya Birla Group is an Indian multinational conglomerate named after Aditya

Vikram Birla, headquartered in the Aditya Birla Centre in Worli, Mumbai, India.

It operates in 33 countries with more than 136,000 employees worldwide. The group was

founded by Seth Shiv Narayan Birla in 1857. The group interests in sectors such as

viscose staple fiber, metals, cement (largest in India), viscose filament yarn, branded

apparel, carbon black, chemicals, fertilizer’s, insulators, financial services, telecom (third

largest in India), BPO and IT services.

The Aditya Birla group is a diversified conglomerate with total revenue of approximately

US$40 billion in year 2012. With gross revenue of USD 40 Billion (in 2012) it is the

third largest Indian private sector conglomerate behind Tata Group with revenue of just

over USD 100 Billion and RIL with revenue of USD 74 Billion.

SECTOR OF ADITYA BIRLA GROUP:

1. Non-ferrous metals

2. Cement

3. Carbon black

4. Textile business

5. Telecom Services

6. Agri- Business

7. Wind Power

8. Insulators

9. Mining

10. Retail


11. Financial Services

12. Trading solutions

Aditya Birla Group of Companies:

1. Aditya Birla Capital Advisors Private Limited

2. Aditya Birla Chemicals (India)Limited

3. Aditya Birla Chemicals (Thailand) Limited

4. Aditya Birla Finance Limited

5. Aditya Birla Insurance Brokers

6. Aditya Birla Minacs Worldwide Limited

7. Aditya Birla Minerals

8. Aditya Birla Money Mart Limited

9. Aditya Birla Money Limited

10. Aditya Birla Nuvo

11. Aditya Birla Retail Limited

12. Aditya Birla Science and Technology Company Limited

13. Alexandria Carbon Black Company SAE

14. Alexandria Fiber Company SAE (Egypt)

15. Birla JingweiFibers Company Limited


16. Birla Laos Pulp and Plantations Company Limited

17. Birla Sun Life Asset Management Company Limited

18. Birla Sun Life Insurance

19. DahejHarbour& Infrastructure Limited

20. Hindalco industries

21. DomsjöFabriker

22. Essel Mining and Industries

23. Grasim Industries Limited

24. Idea Cellular Limited

25. Indo Phil Cotton Mills

26. Indo Phil Textile Mills

27. Indo Thai Synthetics

28. Liaoning Birla Carbon Company Limited

29. Novelist Inc.

30. Pan Century Surfactants Inc.

31. Peter England

32. PT Elegant Textile Industry


33. PT Indo Bharat Rayon

34. PT Indo Liberty Textiles

35. PT Indo Raya Kimia

36. PT Sunrise Bumi Textiles

37. Swiss Singapore Overseas Enterprises Pte Limited

38. Thai Acrylic Fibre

39. Thai Carbon Black

40. Thai Rayon

41. Ultra Tech Cement Limited

42. Utkal Alumina International Limited

43. Pantaloons Fashion & Retail


COMPANY BACKGROUND

AND MARKET SIZE


Idea Cellular is an Aditya Birla Group Company, India's first truly multinational

corporation. Idea is a pan-India integrated GSM operator offering 2G and 3G services,

and has its own NLD and ILD operations, and ISP license. With revenue in excess of $4

billion; revenue market share of nearly 15%; and subscriber base of over 121 million in

FY 2013, Idea is India’s third largest mobile operator. Idea ranks among the top 10

country operators in the world with a traffic of over 1.5 billion minutes a day.

Idea’s robust pan-India coverage is built on a network of over 100,000 2G and 3G cell

sites, spread across over 55,000 towns in India.

Using the latest in technology, Idea provides world-class service delivery through the

most extensive network of customer touch points, comprising nearly 4,500 exclusive Idea

outlets, and over 7,000 call centre seats. Idea’s customer service delivery platform is ISO

9001:2008 certified, making it the only operator in the country to have this standard

certification for all 22 service areas and the corporate office.

Idea has consistently stayed ahead of the industry in VLR reporting. Idea’s thought

leadership on Mobile Number Portability (MNP) has enabled it to stay as the top gainer

with the highest net gain. Every 4th mobile user who exercises choice through MNP,

prefers Idea.

Idea offers a range of high-speed mobile broadband devices including Android based 3G

Smartphone’s, dongles etc. Idea’s wide portfolio of 3G Smartphone’s offer the latest in

3G applications and high-end data services such as Idea TV, games, social networking

etc. at affordable prices.


Idea has been a pioneer in introducing customized product offerings for segmented

customers. It is the first mobile operator to introduce innovative value added services in

the Indian telephony market, and has remained ahead of the industry in data product

offerings.

ACHIEVEMENTS:

Idea has received several national and international recognitions for its path-breaking

innovations in mobile telephony products and services.

1. Idea won the prestigious ‘NDTV Business Leadership Award’ in the telecom

category for its solid, consistent performance in 2012.

2. It was the winner of ET Telecom Awards 2012, in the categories — ‘Customer

Experience Enhancement’, ‘Excellence in Marketing’, and ‘Innovative Products’.

Idea also won the ‘Best Ad Campaign of the Year’ award for the popular Honey

Bunny campaign at the Tele.Net Telecom Awards 2012.

3. Idea won the ‘Best Brand Campaign’ at the esteemed World Communication

Awards in 2012 and 2011.

4. It also won the GSM Association Award for ‘Best Billing and Customer Care

Solution’ for two consecutive years, and was awarded ‘Mobile Operator of the

Year Award – India’ for 2007 and 2008 at the Annual Asian Mobile News

Awards.

5. Idea has been ranked 1 in the Telecom sector in “India’s Best Companies to Work

for Study – 2013 and the "Best Place to Work" at the Asia Communication

Awards 2013.


6. Idea Cellular Limited (“Idea”) is the third largest wireless operator in India with a

Revenue Market Share (RMS) of 15.8% (Q2FY14). In the 15 Established Service Areas,

its RMS stands at a strong level of 18.9% (Q2FY14). The company carries around 1.57

billion minutes on a daily basis during the quarter and the seventh largest mobile

telecommunicationscompany (based on operations in a single country) in the world based

on number of subscribers (as determined from data from WCIS, as of September 2013).

Idea is listed on National Stock Exchange and Bombay Stock Exchange in India with a

market capitalization of Rs. 554 billion (as on December 31, 2013).

MISSION:

"We will delight our Customers while meeting their individual communication needs

anytime anywhere"

CORPORATE STRUCTURE:

Idea Cellular Limited (Idea)

100% -- Idea Cellular Infrastructure Services Limited (ICISL)

100% -- Idea Cellular Services Limited (ICSL)

100% -- Idea Telesystems Limited (ITL)

100% -- Idea Mobile Commerce Services Limited (IMCSL)

100% -- Aditya Birla Telecom Limited (ABTL)

16% -- Indus Towers Limited (Indus)

ICISL – A tower company owning towers in Bihar and Orissa service areas.


ICSL – Provides manpower services to Idea.

ITL – Engaged in the business of sale and purchase of communication devices.

IMCSL – To promote mobile banking related initiatives.

ABTL – Holds 16% shareholding in Indus and engaged in the business of sale and

purchase of communication devices.

Indus – A joint venture between Bharti Infratel, Vodafone Essar and Idea (through

ABTL), to provide passive infrastructure services in 15 service areas.

PARTNERS:

Idea welcomes all businesses and individuals interested in partnering with us to enhance

and strengthen the Idea products & services portfolio.

Some of our partners include:

On mobile Asia

Pacific Ltd

Cellebrum India Ltd

Kodiak Ltd Mauj Net4nuts India Ltd

http://www.onmobile.com/

http://www.kodiaknetworks.com/

http://www.mauj.com/

http://www.net4nuts.com/main/index.htm


Yahoo Rediff India times

Sify Mobile2win NDTV

ROAMING

Roamware.inc Star home BhartiTelesoft

MARKETING COMMUNICATIONS

Lowe India Pvt Ltd Mindshare

http://in.yahoo.com/

http://www.rediff.com/

http://sify.com/

http://www.mobile2win.com/

http://www.ndtv.com/

http://www.roamware.com/

http://www.starhome.com/

http://www.bhartitelesoft.com/

http://www.loweworldwide.com/

http://www.lintasmedia.in/


PUBLIC RELATIONS

Imprimis PR

NETWORK

PROMOTERS:

Idea Cellular is part of the Aditya Birla Group, India's first truly multinational

corporation. Global in vision, rooted in Indian values, the Group is driven by a

performance ethic pegged on value creation for its multiple stakeholders.

The group operates in 25 countries, and is anchored by over 100,000 employees

belonging to 25 nationalities. The Group has been adjudged 'The Best Employer in India

and among the Top 20 in Asia' by the Hewitt-Economic Times and Wall Street Journal

Study 2007.

A premium conglomerate, the Aditya Birla Group is a leader in swathe of products -

viscose staple fibre, aluminium, cement, copper, carbon black, insulators, and garments.

http://www.imprimispr.com/

http://www.nokia.co.in/

http://www.siemens.com/

http://www.ericsson.com/in/


The Group has also made successful forays into financial services, telecom, software,

BPO and retail sectors. Today, the Group is India's most diversified business house.

Promoters are:

# Aditya Birla Nuvo Limited

# Grasim Industries Limited

# Hind Alco Industries Limited

# Birla TMT Holdings Private Limited

HOLDING:

Initially the Birla’s, the Tata’s and AT&T Wireless each held one-third equity in the

company. But following AT&T Wireless' merger with Cingular Wireless in 2004,

Cingular decided to sell its 32.9% stake in Idea. This stake was bought by both the Tata’s

and Birla’s at 16.45% each.

Tata's foray into the cellular market with its own subsidiary, Tata Indicom, a CDMA-

based mobile provider, cropped differences between the Tata’s and the Birla’s. This dual

holding by the Tata’s also became a major reason for the delay in Idea being granted a

license to operate in Mumbai. This was because as per Department of

Telecommunications (DOT) license norms, one promoter could not have more than 10%

stake in two companies operating in the same circle and Tata Indicom was already

operating in Mumbai when Idea filed for its license.

The Birla’s thus approached the DOT and sought its intervention and the Tata’s replied

by saying that they would exit Idea but only for a good price. On 10 April 2006, the

Aditya Birla Group announced its acquisition of the 48.18% stake held by the Tata’s at

Rs. 40.51 a share amounting to Rs. 44.06 billion. While 15% of the 48.14% stake was


acquired by Aditya Birla Nuvo, a company in-charge of the Birla’s new business

initiatives, the remaining stake was acquired by Birla TMT holdings Private Ltd., an AV

Birla family-owned company. Currently, Aditya Birla Group holds 49.1% of the total

shares of the company. Malaysia based Axiat a controls a 14.99% stake in the company.

SERVICE S:

3G:

On 19 May 2010, the 3G spectrum auction in India ended. Idea paid 57685.9 million

for spectrum in 12 circles. The circles it will provide 3G in are Andhra Pradesh, Gujarat,

Haryana, Kolkata, Himachal Pradesh, Jammu & Kashmir, Kerala, Tamil nadu, Madhya

Pradesh, Maharashtra & Goa, Punjab, Uttar Pradesh (East) and Uttar Pradesh (West)

On 28 March 2011, Idea launched 3G services in Gujarat, Himachal Pradesh and Madhya

Pradesh. The launch cities were Ahmedabad, Shimla and Indore. This makes Idea the

sixth private operator (eighth overall) to launch its 3G services in the country following

Tata Docomo, Reliance Communications, Airtel, Aircel and Vodafone .Idea currently

supports up to 21.1 Mbit/s over 2G speeds of 256 Kbit/s. However, different handsets

support different speeds, from 384 Kbit/s, 3.6 Mbit/s, 7.2 Mbit/s or 21.1 Mbit/s. Speeds

also depend on the 3G plan/recharge that users opt for. The operator announced that

IDEA 3G services will be available in 200 towns of 11 3G circles by mid-April 2011,

progressively growing at the rate of ten towns per day to cover 750 towns by mid-2011

and 4000 towns by the end of 2012.


Idea cellular has announced a cut of 70% in the tariff of its 3G services. On 23 November

2011 Idea Cellular launched two affordable 3G handsets in India: Idea 3G Smartphone

Blades priced at 7,992 and Idea 3G Smartphone priced at 5,850. Both handsets are

based on Android 2.2 Froyo. Idea has also launched a Dual-SIM Android Smartphone in

India on 15 June 2012 named as Idea ID-918 at a price point of Rs. 5,994 ($108 approx.)

It features Android v2.3 OS, 3.2-inch capacitive touch screen, 3G, Wi-Fi and 3.2 MP rear

facing camera. On 5 March 2013, Idea launched another 3G smartphone called Idea Zeal

3G which is a Dual SIM phone with 3 Megapixel camera.

Pan-India 3G coverage:

Airtel, Vodafone and Idea have begun collaborating to provide 3G coverage to their

customers pan India. The agreement aims to provide for these companies to offer 3G

services to their customers in circles where they have not won any spectrum. It is

expected that the 3 companies will be able to provide 3G services in all circles in India

except Orissa where the three have not won any spectrum.

STRATETEGY FOR IDEA CELLULAR:

The Idea Cellular Limited falls in the “question mark” quadrant of BCG matrix and in the

High attractive and Strong Competitive strength category as per the GE Matrix. Thus

they need to formulate some strategies to try capturing some market share, growing and

building their brand image as well as brand value.


Market penetration

The company enters where the products and the market already exists. IDEA being a

question mark that means it is competing in a high growth market but with a relatively

low share compare to its competitors. Market penetration can be done by attracting

competitor’s customers that implies increase in market share. The strategy that IDEA can

adapt under market penetration is to attract non-users and convince to use their product

more often.

They are different market penetration strategies like cutting price, increase in promotion

and creating innovative distribution tactics. The target should be in such a way that IDEA

sales volume relative to its competitors should be high as expressed in percentage.

IDEA’s present market share is about 12%, and competitors like Airtel, Vodafone, and

BSNL have a market share of about 31, 23, and 19 percent respectively. Though telecom

industry is growing rapidly every year, there is always a little increment in the percentage

of sales for IDEA. To overcome this problem and to occupy the competitor’s position

idea recommend following strategies.

Increasing the mobile circles which are at present are only 11, so there is always a

need to expand its services.

Target the rural segment in India which is expected to grow by 15% every year

Launch different types of packages as per the requirements for different segments

of the customers

Provide more high end services like GPRS, mobile internet services


Collaboration with different service providers on global basis to provide better

facility to customers on roaming.

Tracing out the search patterns which are left untapped by the competitors to

reveal new markets.

Backward Integration – In July 2008Swedish equipment supplier entered into a contract

to provide technology “Ericsson Mobile organizer” to Idea cellular enabling its

subscribers to serve email facility on its cell phones.

Forward Integration – Company operate approximately 589 Idea” n “U and other

showrooms which supplement the distribution channels and provide customer service.

Horizontal Integration: Idea acquired the Modifamily’s stake of 40.8% in spice which

ultimately in a way increased the market share of Idea. This can be seen as horizontal

integration.

COMPETITORS:

Idea competes with 14 other mobile operators throughout India. They are Aircel, Airtel,

BSNL, Loop Mobile, MTNL, MTS, Ping Mobile, Reliance Communications, S Tel, Tata

DoCoMo, Tata Indicom, Uninor, Videocon, Virgin Mobile, T24, and Vodafone.

COMPETITOR OVERVIEW:

Major Players

There are three types of players in telecom services:

• State owned companies (BSNL and MTNL)


• Private Indian owned companies (Reliance Infocomm, Tata Teleservices, VODAFONE,

and AIRTEL)

• Foreign invested companies

BHARAT SANCHAR NIGAM LIMITED (BSNL):

Year of Establishment

Year of Establishment 2000 Company Profile Bharat Sanchar Nigam Ltd. is World's 7th

largest Telecommunications Company providing comprehensive range of telecom

services in India: Wire line, CDMA mobile, GSM Mobile, Internet, Broadband, Carrier

service, MPLS-VPN, VSAT, VoIP services, IN Services etc. Within a span of five years

it has become one of the largest public sector units in India.

Network

It has a network of over 45 million lines covering 5000 Network towns with over 35

million telephone connections.

Alliances

Future Prospect BSNL plans to expand its customer base from present 47 million lines to

125 million lines and infrastructure investment plan to the tune of Rs. 733 crores (US$

16.67 million) in the next three years.


MAHANAGAR TELEPHONE NIGAM LIMITED (MTNL):


Company Profile MTNL was set up by the Government of India to upgrade the quality of

telecom services in 1986, expand the telecom network, and introduce new services and to

raise revenue for telecom development needs of India’s key metros. MTNL with a

market share of about 13% of the National telecom Network has a customer base of 5.92

million. The Govt. of India currently holds 56.25% stake in the company.

Alliances

MTNL has formed a Joint Venture company in Nepal by the name of United Telecom

Ltd. (UTL) in collaboration with Telecom Consultants India Limited (TCIL) in 2001 for

providing WLL based basic services in Nepal. MTNL has set up its 100% subsidiary

.Mahanagar Telephone Mauritius Limited. (MTML) in Mauritius, for providing basic,

mobile and international long distance

RELIANCE COMMUNICATION:


Company Profile Reliance Telecom's cellular services are available in 340 towns within

its eight-circle footprint in 1999. Reliance Infocomm also offered for the first time in

India, mobile data services through its World mobile portal. This portal leverages the data

capability of the CDMA 1X network. Reliance Infocomm offers a complete range of

telecom services covering mobile and fixed line telephony including broadband, national


and international long distance services, data services and a wide range of value added

services and applications aimed at enhancing productivity of enterprises and individuals.

Network

Reliance Communications has IP-enabled connectivity infrastructure comprising over

150,000 kilometers of fiber-optic cable systems in India, the US, Europe, Middle East,

and the Asia Pacific region.

Alliances

International wholesale telecommunications service provider, FLAG Telecom

amalgamates with Reliance Gateway, a wholly owned subsidiary of Reliance Infocomm

in 2004

TATA TELESERVICES:

Year of Establishment 1996 Company Profile Tata Teleservices is a part of the $12

billion Tata Group, which has 93 companies, over 200,000 employees and more than 2.3

million shareholders. Tata Teleservices’ bouquet of telephony services includes Mobile

services, Wireless Desktop Phones, Public Booth Telephony and Wire line services.

Other services include value added services like voice portal, roaming, post-paid Internet

services, 3-way conferencing, group calling, Wi-Fi Internet, USB Modem, data cards,

calling card services and enterprise services.

Network

Tata Teleservices has presence in across 19 circles that includes Andhra Pradesh,

Chennai, Gujarat, Karnataka, Delhi, Maharashtra, Mumbai, Tamil Nadu, Orissa, Bihar,


Rajasthan, Punjab, Haryana, Himachal Pradesh, Uttar Pradesh (E), Uttar Pradesh (W),

Kerala, Kolkata, Madhya Pradesh and West Bengal.

Alliances

Tata Teleservices has acquired Hughes Tele.com (India) Limited [now renamed Tata

Teleservices (Maharashtra) Limited] in 2002 Future Prospect The company is also

expanding its footprint, and has paid Rs. 4.17 billion ($90 million) to Dot for 11 new

licenses under the IUC (interconnect usage charges) regime.

IDEA COMMUNICATION:

Year of Establishment Acquired majority stake in Hutch Essar in India, by buying out

complete stake of Hutch in 2007, Essar is still minority stakeholder in company.

Company Profile Idea Essar in India is a subsidiary of Idea Group Plc and commenced

operations in 1994 when its predecessor Hutchison Telecom acquired the cellular license

for Mumbai. Idea Essar now has operations in 16 circles covering 86% of India's mobile

customer base, with over 45.78 million customers. Idea Essar, under the Hutch brand, has

been named the 'Most Respected Telecom Company', the 'Best Mobile Service in the

country' and the 'Most Creative and Most Effective Advertiser of the Year'.

Network

Has a customer base of over 17 million, IDEA Cellular has operations in Delhi,

Maharashtra, Goa, Gujarat, Andhra Pradesh, Madhya Pradesh, Chhattisgarh, Uttaranchal,

Haryana, UP West, Himachal Pradesh and Kerala. Acquisitions / Strategic


Alliances

Future Prospect Idea Essar is expecting to touch over 35 million customers across

400,000 shops and thousand of hutch’s own employees along with employees of its

business associates.

Year of Establishment 1995

Company Profile Idea Cellular is part of the Aditya Birla Group, which is India's first

truly multinational corporation. Aditya Birla Nuvo Ltd. holds 35.7 per cent, Birla TMT

Holdings Ltd. 44.9 per cent, Grasim 7.5 per cent, and Hindalco 10.1 per cent in Idea.

Alliances

Merged with Tata Cellular Limited in 2001, thereby acquiring original license for the

Andhra Pradesh Circle Acquired RPG Cellular Limited and consequently the license for

the Madhya Pradesh (including Chhattisgarh) Circlein 2001 In 2004 acquired Escotel,

incumbent cellular service provider in Haryana, UP(W) & Kerala and new licensee in HP

Acquired Escorts Telecommunications Limited (subsequently renamed as Idea

Telecommunications Limited) in 2006 Merger of seven subsidiaries with Idea Cellular

Limited in 2007 Future Prospect Idea also plans to enter rural and neglected circles as a

strategy to gain subscribers. Other advancements in the telecom industry will help it cut

costs - use of e-mail to send bills to customers; sharing cell sites; smaller base

transmission stations that will mean lesser infrastructure requirements and expenses and

independent tower operators. Along with its plan to go for a national long distance

license, it will also look at international long distance in the near future.


BRANDING:


STRENGTH AREAS:

Revenue Market Share (RMS):

The incumbency advantage coupled with the benefit of 900 MHz spectrum gives Idea an

absolute leadership status with combined RMS of 26.4%in these eight circles. These

service areas contribute over 40% of national mobile industry revenue and over 67% of

Idea’s revenue. Inspire of intense competition Idea has improved its revenue market share

by 2.4% in these 8 service areas over last one year (Q2FY13 RMS 24.0%) delivering

59.1% incremental RMS on YoY basis in Q2FY14.Idea has rolled out 3G service in all

these 8 strategically important service areas. Idea’s GSM and 3G spectrum footprint in

these service areas places Idea in an advantageous competitive position.

Growth Opportunity:

Idea has 7 New Service Areas namely, Tamil Nadu, Kolkata, West Bengal, Orissa, J&K,

Assam and North East, with 1800 MHz spectrum, representing over 20% of Indian

Mobility Market. The revenue contribution of these service areas is 5.0% of Idea revenue

while EBITDA losses stand at Rs. 1,581 million in Q3FY14. The combined ‘Revenue

Market Share’ (RMS) in these 7 service areas was 4.1% in Q2FY14. The incremental

RMS in these 7 new service areas between Q2FY14 to Q2FY13 is 13.7%, indicating

good potential of improving Idea presence in these service areas.

Leader in Mobile Number Portability Net Adds:

The Mobile Number Portability (MNP) was implemented nation-wide on 20th January,

2011. The trends emerging from MNP are clearly distinguishing the strong operators in


terms of customers’ preference for better quality of services and brand value. In a see-

saw battle over the last 36 months for supremacy in the MNP space, Idea has maintained

leadership position since June’11 on overall MNP Net Adds, other than a brief period

between October-December 2012. Idea has a net gain of 8.4 million MNP customers (as

on December 31, 2013) from other existing telecom operators with around one out of

every four existing mobile customers, who chooses to port out, preferring to shift to Idea

services.

Tower Investment:

Indus towers, a joint venture between Bharti Infratel, Vodafone India and Idea Cellular

(thru ABTL), is one of the world’s leading tower company with around 112,600 towers

and tenancy ratio of 2.04 as of December 31, 2013. The mobile operations of these

shareholders group have combined Revenue Market Share of 69.1% (Q2FY14). Idea

(thru ABTL) holds 16% equity stake in Indus towers. The consolidated financials

includes 16% consolidation from Indus Towers. Besides investment in Indus Tower, Idea

owns 9,486 towers, which have a tenancy ratio of 1.57 as on December 31, 2013.


OBJECTIVE OF STUDY


I have done my summer internship at IDEA CELLULAR LTD., DELHI. The

internship was for duration of about 45 days and it involved a lot of learning activities all

around. I was needed to carry a research which involved a study to find out the best

selling products of our competitors. The research involved, preparing questionnaire,

collecting data doing a market study.

Project Objective’s:

1. To study the reasons as to why the customers are switching from idea to other service

providers.

2. To find out the problems faced by idea users.

Scope:

1. The present study can be extended to other geographical areas.

2. It can be extended to study the usage of mobile services of different age groups

and accordingly new plans can be formulated.

3. This study can be extended to understand the switching behaviour of a particular

cellular service provider.


LITERATURE REVIEW


The references for the literature review used for the problem in hand are as follows:

1. M.Sathish, K.Santhosh Kumar, K.J.Naveen, V.Jeevanantham (2011)

“A Study with reference to Chennai: Far East Journal of Psychology and Business

They have attempted to identify the factors that affect the consumers into switching the

service provider. To find the major influences that goes into the decision of purchasing a

SIM card, to find the likeliness of switching the service provider. The study reveals that

call rates play the most important role in switching the service provider followed by

network coverage; value added service, Consumer care and advertisement which plays

the least important role. It is found that there is a relation between switching the service

provider and the factors (Customer service, service problem, usage cost, etc.). The

findings also suggest that managers of these mobile operators should shift focus on

building corporate image and analyze more carefully the reason for consumers to switch

brands in this industry in order to aboveincrease loyalty among theseconsumers.

2 Aneeta Sidhu, (2002)

“Canadian Cellular Industry: Consumer Switching Behaviour”

The author of this paper finds out that customers with one year contract are more likely

to switch. Customers find using their services as expensive whereas, customers who are

attached to the service provider for a long time are less likely to switch. Some of the

strategies have been identified like building value for the customers by providing them

with better service and reliable reception.


3 M.Sathish PSG Institute of Management (PSG College of Technology), Coimbatore

K.Santhosh Kumar Priyadarshini Engineering College, Vaniyambadi-Vellore

K.J.Naveen,V.JeevananthamPSG Institute of Management (PSG College of Technology),

Coimbatore

The results from the study reveal that call rates plays the most important role in switching

the service provider followed by network coverage, value added service and customer

care while advertisement plays the least important role. It is found that there is a relation

between switching the service provider and the factors (customer service, service

problem, usage cost, etc.). After analyzing the findings of the study, we propose that the

mobile providers concentrate on increasing network stability and setting tariff rates

competitively.

4 Mohammed Sohel Islam (2008),

In his study examined the relationship between switching cost, corporate image, trust

and Customer loyalty. The research finds that although all the independent variables,

switching cost, corporate image, and trust have certain degree of relationship with the

dependent variable, Customer loyalty, only trust has the strongest relationship with

Customer loyalty.

5 Mitja Pirc, Universitat Pompeu Fabra (2006), Spain,

The Mobile telecommunications service sector, in spite of providing high service quality and

striving for Customer satisfaction, is characterized by dynamic Customer activities and

provider switching. By using the consumption system perspective on mobile services and

mobile phone, he provides the explanation on the factors of Customer switching. It is found


that the mobile services usage effect on switching intentions is curvilinear (positive linear

and negative quadratic) and that only the budgetary constraint regarding the service matters

and not the one related to the mobile phone. Past mobile service providers switching

experience also contributes to the intention to switch. Mobile phone ego involvement has

positive impact on Customer retention; however purchase involvement (both mobile phone

and mobile services) increases Customer risk.


RESEARCH METHODOLOGY


TITLE OF THE PROJECT

“CUSTOMER SWITCHING FROM IDEA TO OTHER TELECOM SERVICES

(DELHI REGION)”

OBJECTIVES:

1. To study the reasons as to why the customers are switching from Idea to other

service providers.

2. To find out the problems faced by Idea users.

SAMPLE DESIGN:

Population for this research is 83customers, who switched over from Idea to other service

provider.

SAMPLE SIZE = 83

SAMPLING METHOD:

The process of drawing sample units from the population is called sampling method.

In order to have the unbiased results in the survey, the using method is100% sampling

DURATION OF THE PROJECT

Period of 9th June 2014 to 24th July 2014

FIELD WORK

This market research involved a fieldwork of 6 weeks where I have carried out the survey

to 83respondents by having the personal interaction with them.


TOOLS USED FOR ANALYSIS:

1. Graphical Representation of Analysis:

a. Pie charts

b. Bar Diagrams

DATA COLLECTION APPROACH:

Primary data

Primary data has been used to carry out the research successfully. The secondary data has

been collected from various websites. For the purpose of gathering primary data a

structure and non-disguised questionnaire was designed to collect data from the customer.

The questionnaire contains both open-ended and close-ended questions.

Method of Communication:

In order to minimize the biasness in data collection, the method of written

communication through questionnaire was adopted.

THE SOURCES OF THE DATA ARE AS FOLLOWS

The study relies to a great extent on primary data and to some extent on secondary data:

PRIMARY DATA:

Questionnaire.


SECONDARY DATA:

Information has been collected through various websites.

From various reports

Journals and literature Reviews

LIMITATION OF THE STUDY:

The study is restricted in the scope owing to the following limitations:

1. The study is limited to a particular geographical area.

2. The information and data collected and analyzed is restricted to the

researchers’ knowledge and ability.

3. The answers that I have got from the customers cannot be considered as

totally perfect because of various personal and other limitations.

4. Cost and time was also another limiting factor that affected the study.

As customer’s expectations and experiences include more of psychological aspects the

survey made during a particular time period will give the information about the

customers during that particular time period. In order to be up-to-date in understanding

the level of satisfaction periodic surveys are necessary.


DATA ANALYSIS, PRESENTATION

AND INTERPRETATION


The Data analysis, presentation and interpretation of findings on the data collected from

the leaving customers by Idea. The study sampled all leaving customers to study the

switching behaviour. The data was interpreted as per the research questions. The findings

were presented in form of bar charts and pie charts.

Customers can mark more than one reason among the following:

1. Gender

The data in the pie chart shows that out of 83 respondents there are 69% male and 31%

Female.

Male69%

Female31%

Gender

Male

Female


2. Age

The data in the pie chart shows out of 83 respondents 55% lies between 18-25 age group,

27% respondents lies between 26-35, 18% respondents’ lies between 36-50 and there are

no respondent in the age of 51- above.

55%27%

18%

0%

Age

18-25

26-35

36-50

51-above


3. Occupation

The data in the pie chart shows out of 83 respondents 31% are engaged in business , 25%

are doing job, 40% are student and remaining 4% are engaged in other occupation.

31%

25%

40%

4%

Occupation

Business

Job

Student

Others


4. Which one was your first service operator?

The data in the bar chart shows that 19% respondent used Aircel as their first service

operator, 16% used Airtel, 18% used Idea, 14% used BSNL/MTNL, 6% used Reliance

and 26% used Vodafone.

0

5

10

15

20

25

30

19.27

15.6618.07

14.45

6.02

26.5

First Sevice Operator


5. How much long you are using idea connection?

The data in the bar chart shows that 33% respondent used Idea service operator for 0-1

year, 34% used for 1-3 year,27% used for 3-5year,7% used more than 5year.

0

5

10

15

20

25

30

0-1 year 1-3 year 3-5 year 5-above

32.53 33.73

26.50

7.22

Period of time


6. What type of service you are using?

The data in the bar chart shows that 19% respondent used postpaid connection and 81%

used prepaid connection.

0

10

20

30

40

50

60

70

Postpaid prepaid

19.27

80.72

Service


7. What is your experience to use this current operator?

a) Signal strength

The data in the bar chart shows that 30% respondents thinks that the signal strength is

poor, 25%Estimates it is good, 21% Estimates it is neutral, 14% Estimates it is very good,

8% estimates it is Excellent.

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

poor good nuetral very good execellent

30.12

25.30

21.69

14.46

8.43

Signal Strength


b) Network congestion facility

The data in the bar chart shows that 23% respondents thinks that the network congestion

facility is poor, 30% Estimates it is good, 27% Estimates it is neutral, 12% Estimates it is

very good, 8% estimates it is Excellent.

0

5

10

15

20

25


22.89

30.12

26.50

12.04

8.43

Network congestion Facility


c) Internet Speed

The data in the bar chart shows that 10% respondents thinks that the Internet speed is

poor, 27% Estimates it is good, 31% Estimates it is neutral, 22% Estimates it is very

good, 11% estimates it is Excellent.

0

5

10

15

20

25

30


9.63

26.50

31.32

21.68

10.84

Internet Speed


d) Voice clarity

The data in the bar chart shows that 27% respondents thinks that the Voice clarity is poor,

20% Estimates it is good, 18% Estimates it is neutral, 20% Estimates it is very good, 14%

estimates it is Excellent.

0.00

5.00

10.00

15.00

20.00

25.00

30.00


26.51

20.4818.07

20.48

14.46

Voice Clarity


e) Unwanted Balance Reduction

The data in the bar chart shows that 22% respondents thinks that the Unwanted balance

reduction is poor, 24% Estimates it is good, 20% Estimates it is neutral, 19% Estimates it

is very good, 14% estimates it is Excellent.

0

5

10

15

20


21.68

24.09

20.4819.27

14.45

Unwanted Balance Reduction


f) Call Conference Facility

The data in the bar chart shows that 13% respondents thinks that the Call conference

Facility is poor, 14% Estimates it is good, 34% Estimates it is neutral, 20% Estimates it is

very good, 19% estimates it is Excellent.

0

5

10

15

20

25

30


13.25 14.45

32.53

20.4819.27

Call Conference Facility


g) Tariff Plans

The data in the bar chart shows that 18% respondents thinks that the tariff plans is poor,

37% Estimates it is good, 51% Estimates it is neutral, 47% Estimates it is very good, 20%

estimates it is Excellent

0.00

10.00

20.00

30.00

40.00

50.00

60.00


18.07

37.35

50.6046.99

20.48

Tariff Plans


h) Value added services

The data in the bar chart shows that 28% respondents thinks that the Value added

Services is poor, 20% Estimates it is good, 25% Estimates it is neutral, 17% Estimates it

is very good, 10% estimates it is Excellent.

0.00

5.00

10.00

15.00

20.00

25.00

30.00


27.71

20.48

25.30

16.87

9.64

Value added services


i) Roaming facilities

The data in the bar chart shows that 23% respondents thinks that the Roaming Facilities

is poor, 25% Estimates it is good, 24% Estimates it is neutral, 21% Estimates it is very


0.0

5.0

10.0

15.0

20.0

25.0

30.0


22.925.3

24.1

20.5

7.2

Roaming Facilities


j) Customer Care

The data in the bar chart shows that 15% respondents thinks that the Customer care is

poor, 19% Estimates it is good, 28% Estimates it is neutral, 17% Estimates it is very


0.0

5.0

10.0

15.0

20.0

25.0

30.0


14.5

19.3

27.7

16.9

21.7

Customer Care


8. Why you Switch Idea?

The data in the bar chart shows that 17% respondents switched from Idea to other service

operator due to weak signal strength, 8% switched due to network congestion, 7%

switched because of internet problem, 13% switched due to voice facility, 14% switched

due to unwanted balance reduction, 6% switched due to call conference problem, 5%

switched due to tariff plans, 11% switched due to value added service, 12% switched due

to roaming, 4% switched due to worst attitude of customer care personnel while 2%

respondents gave other reasons for switching.

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00 16.87

8.437.23

13.2514.46

6.024.82

10.8412.05

3.612.41

Why Switch Idea


9. Did the company make an effort to contact you to know the reasons for leaving

the Network?

The data in the pie chart shows that 59% respondents saying yes and 41% saying no for

company effort to contact with the customer to know the reason for leaving the Network.

yes, 40.96

no, 59.04

yes

no


SUMMARY OF FINDINGS,

CONCLUSIONS

&

RECOMMENDATIONS


FINDINGS

Based on the analysis and the interpretation of the data, findings are recorded which are

as follows:-

1. Majority of the sample respondents belongs to the age group of 18 – 25 years.

2. Majority of the sample respondents belongs to the occupation of Student and

Business man.

3. Majority of sample respondents are using Vodafone as a first operating network.

4. Majority of sample respondents are using the Idea connection up to 1-3 years.

5. Majority of sample respondents are using prepaid connection.

6. People shift from Idea to other service providers due to Signal Strength issues and

unwanted balance reduction.

7. Majority of the sample respondents says that the attitude of customer care is

excellent.

8. Complaint handling appears to be at the core of all customer issues. It is observed

that majority of the sample respondents say that the company people do not solve

customer problems satisfactorily.

9. Vodafone and Airtel are leading competitors to Idea in terms of tariff plans.

10. Idea leads closest competitors Vodafone, and TATA Docomo in terms of network

and value added services.


CONCLUSION

The study reveals that Signal Strength plays the most important role in making customer

switch his service provider followed by unwanted balance reduction, voice facility,

roaming facility which plays the least important role. It is found that there is a relation

between switching the service provider and the factors (Customer care, voice facility,

tariff plan, etc.). After analyzing the findings of the study, we suggest that cellular service

providers concentrate more on increasing network stability and improve unwanted

balance reduction competitively. The findings also suggest that managers of these mobile

operators should shift focus on building corporate image and analyze more carefully the

reason for consumers to switch brands in this industry in order to increase loyalty among

these consumers.

Customers’ expectations constantly keep changing, especially from a growing sector like

telecom where the choices are ample and the customers get close to being insatiable.

High quality and low cost are no longer USPs’ (Unique Selling Proposition) for any

service provider. These are assumed. Today’s mobile user wants more.

Firstly, the customer is constantly in search of a better “offer” that fits his / her need.

Hence, loyalty is a rarity in the telecom business, the difficulty in using a new number

while switching service providers will be eliminated. The service providers will have to

constantly endeavor to maintain their market shares.

Secondly, branding and other promotional activities seem to help only to a certain extent .

In order to achieve customer loyalty, the journey promises to be tough and never ending.


Finally, today’s customer is very sensitive to issues like responses to complaints, billing

system, value for money etc. These issues deserve special concern.

RECOMMENDATIONS

Based on the findings of the study the following suggestions are made:

Idea should:

1. Come up with more plans suited for the age group of above 26 - 30 years.

2. Try to contact the people who have left the Idea network and focus on the

cause due to which they have left Idea.

3. Improve the signal strength.

4. Re-look towards reducing unwanted balance reduction.

5. Come up with more and more attractive schemes like loyalty discounts etc.


BIBLOGRAPHY


1 M.Sathish, K.J.Naveen, V.Jeevanantham (2011). Far East Journal of Psychology and

Business. A thesis submitted in partial fulfillment of the requirements of PSG College of

Technology of Coimbatore for the degree of Master of Business Administration.

K.Santhosh Kumar: Priyadarshini Engineering.

http://www.fareastjournals.com/files/v2n2p5.pdf [Accessed: 20th June 2012]

2 Aneeta Sidhu (2002). Canadian Cellular Industry: Consumer Switching Behaviour.

3 M.Sathish, K.J.Naveen, V.Jeevanantham (2010). Far East Journal of Psychology and

Business. A thesis submitted in partial fulfillment of the requirements of PSG College of

Technology of Coimbatore for the degree of Master of Business Administration.

K.Santhosh Kumar: Priyadarshini Engineering.

4 Mohammed Sohel Islam (2008).

5 Mitja Pirc (2006). A thesis submitted in partial fulfillment of the Requirements of

university Pompeu Fabra for the degree of Master of Science, Spain.

http://www.fareastjournals.com/files/v2n2p5.pdf


APPENDIX


CUSTOMMER QUESTIONAIRE

Dear customer,

We are employees of idea cellular ltd. working on a project for consumer behavior research about

service operator.All information will be kept confidential.

Please put a () in the appropriate

Basic information:-

Name-

……………………………………………………………………………………………………..

Male Female

2- Which age group are you in?

18 – 25 26 – 35

36 – 50 51 or above

3-Occupation:-

Businessman Job

Student Others


Research information-

4- Which one was your first service operator?

Aircel Airtel Idea MTNL /BSNL Reliance Vodafone

5- How much long you are using idea connection?

0 To 1 year 1 To 3 year 3 To 5 year 5 to more

6- What type of service you are using?

Postpaid

Prepaid

7- What is your experience to use this current operator? – Please rate the service on the

basis of following parameters:

[Poor……………………Excellent]

Parameter↓/Grade→ 1 2 3 4 5

(a)Signal Strength

(b)Network Congestion facility

(c)Internet Problem/Speed

(d)voice clearity

(e)Unwanted Balance Reductions

(f)Call Conferences facility

(g)Tariff Plans

(h)Value Added Services

(i)Roaming Facilities

(j)Customer Care Attitude


8- Why you switch idea? (Choose any one reason)

9. Did the company make an effort to contact you to know the reasons again for

leaving the Network?

Yes No

PARAMETERS Reason

(a)Signal Strength

(b)Network Congestion Facility

(c)Internet Problem/Speed

(d)voice facility

(e)Unwanted Balance Reductions

(f)Call Conferences Problems

(g)Tariff Plans

(h)Value Added Services

(i)Roaming Facilities

(j)Customer Care Attitude

(k) others


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