CHAPTER 1

INTRODUCTION

OVERVIEW OF THE COMPANY

Customer satisfaction, a term frequently used in marketing, is a measure of how products and
services supplied by a company meet or surpass customer expectation. Customer satisfaction is
defined as "the number of customers, or percentage of total customers, whose reported
experience with a firm, its products, or its services (ratings) exceeds specified satisfaction
goalsIn a survey of nearly 200 senior marketing managers, 71 percent responded that they found
a customer satisfaction metric very useful in managing and monitoring their businesses.
It is seen as a key performance indicator within business and is often part of a Balanced
Scorecard. In a competitive marketplace where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy.
Within organizations, customer satisfaction ratings can have powerful effects. They focus
employees on the importance of fulfilling customers expectations. Furthermore, when these
ratings dip, they warn of problems that can affect sales and profitability. . . . These metrics
quantify an important dynamic. When a brand has loyal customers, it gains positive word-ofmouth marketing, which is both free and highly effective."
Therefore, it is essential for businesses to effectively manage customer satisfaction. To be able do
this, firms need reliable and representative measures of satisfaction.
Technology and resources
Vodafones key technologies and resources include the telecommunications licences it holds and
the related network infrastructure, which enable the Group to operate telecommunications
networks in 28controlled and jointly controlled markets around the world.
Network infrastructure
Vodafones network infrastructure provides the means of delivering the Groups mobile and fixed
voice, messaging and data services to its customers. The Groups customers are linked via the
access part of the network, which connects to the core network that manages the set-up and

routing of calls, transfer of messages and data connections, which provide a wide variety of other
services.
Training and development

230,314 days of training were provided, an average of three days per employee.Vodafone

is committed to helping people reach their full potential through ongoing training and
development. In the 2009 financial year, Vodafone provided an aggregate of 230,000 days of
training, an average of three days per employee.
Customers, marketing and distribution
Vodafone endeavours to ensure that customers needs are at the core of all products and services.
Understanding these needs and continuing to serve them is key to Vodafones customer strategy.
Customers
Vodafone has 302.6 million proportionate mobile customers across the globe. The Group seeks to
use its understanding of customers to deliver relevance and value and communicate on an
individual, household, community or business level. In delivering solutions that meet customers
changing needs in a manner thatis easy to access and is available when required, Vodafone aims
to build a longer and deeper customer relationship.
Marketing and brand
Vodafone has continued to build brand value by delivering a superior, consistent and
differentiated customer experience. Communication activities are focused on delivering the
promise of helping customers make the most of their time. The Groups vision is to be the
communications leader in an increasingly connected world expanding the Groups category
from mobile only to total communications. To enable the consistent use of the Vodafone brand in
all customer interactions, a set of detailed guidelines has been developed in areas such as
advertising, retail, online and merchandising.

Distribution
Vodafone directly owns and manages over 1,800 stores selling services to customers and
providing customer support. The store footprint is constantly reviewed in response to market
conditions. The Group also has 5,200Vodafone branded stores, which sell Vodafone products and
services exclusively through franchise and exclusive dealer arrangements. Additionally, in most
operating companies, sales forces are in place to sell directly to business customers. The internet
is increasingly a key channel to promote and sell Vodafones products and services and to
provide customers with an easy, user friendly and accessible way to manage their services and
access support, whilst reducing costs for the Group.
The extent of indirect distribution varies between markets but may include using third party
service providers, independent dealers, distributors and retailers. The Group hosts MVNOs in a
number of markets, selling access to the Vodafone network at a wholesale level.
Where appropriate, Vodafone seeks to enter mutually profitable relationships with MVNO
partners as an additional route to market.
History http://en.wikipedia.org/wiki/Vodafone

The evolution of 'Vodafone' brand started in 1982 with the establishment of 'Racal Strategic Radio
Ltd' subsidiary of Racal Electronics plc UK's largest maker of military radio technology. By initiative
of Jan Stenbeck[7] Racal Strategic Radio Ltd formed a joint venture with Millicom called 'Racal
Vodafone', which would later evolve into the present day Vodafone. [8][9][10]

Vodafone's original logo, used until the introduction of the speechmark logo in 1997

Evolution as a Racal Telecom brand: 1980 to 1991 [edit]

In 1980, Sir Ernest Harrison OBE, the then chairman of Racal Electronics plc. agreed to a deal
with Lord Weinstock of General Electric Company plc to allow Racal to access some of GEC's

tactical battle field radio technology. The head of Racal's military radio division Gerry Whent was
briefed by Ernest Harrison to drive the company into commercial mobile radio. Whent visited GEs
mobile radio factory inVirginia, USA the same year to understand the commercial use of military
radio technology.[11]
Previously in 1979, Jan Stenbeck, a head of a growing Swedish conglomerate, set up an American
company, Millicom, Inc., to pursue mobile communications by applying for licences in the United
States.[12]
In the summer of 1982, Stenbeck approached Racals Whent about bidding jointly for the UKs
second cellular radio licence, soon to be awarded, the first going by prior arrangement to British
Telecom.[12] The two struck a deal giving Racal 60% of the new company, Racal-Millicom, Ltd, and
Millicom 40%. Due to UK concerns about foreign ownership, the terms were revised, and in
December 1982, the Racal-Milicom partnership was awarded the second UK mobile phone network
license.[12] Final ownership of Racal-Millicom, Ltd was 80% Racal, with Millicom holding 15% plus
royalties and venture firm Hambros Technology Trust holding 5%. According to the UK Secretary of
State for Industry, "the bid submitted by Racal-Millicom Ltd provided the best prospect for early
national coverage by cellular radio."[13]
Vodafone was launched on 1 January 1985 under the new name, Racal-Vodafone (Holdings) Ltd,
[14]

with its first office based in the Courtyard in Newbury, Berkshire, and[15]shorty thereafter Racal

Strategic Radio was renamed Racal Telecommunications Group Limited. [16] On 29 December 1986,
Racal Electronics bought out the minority shareholders of Vodafone for GB110 million;[17] and
Vodafone became a fully owned brand of Racal.
In September 1988, the company was again renamed Racal Telecom. On 26 October 1988, Racal
Telecom, majority held by Racal Electronics; went public on the London Stock Exchange with 20% of
its stock floated. The successful flotation led to a situation where the Racal's stake in Racal Telecom
was valued more than the whole of Racal Electronics. Under stock market pressure to realise full
value for shareholders of Racal, Harrison decides in 1991 to demerge Racal Telecom. [18][19]

Vodafone Group, then Vodafone Airtouch plc: 1991 to 2000 [edit]

On 16 September 1991, Racal Telecom was demerged from Racal Electronics as Vodafone Group,
[20]

with Gerry Whent as its CEO.

In July 1996, Vodafone acquired the two thirds of Talkland it did not already own for 30.6 million.
[21]

On 19 November 1996, in a defensive move, Vodafone purchased Peoples Phone for 77 million,

a 181 store chain whose customers were overwhelmingly using Vodafone's network. [22] In a similar

move the company acquired the 80% of Astec Communications that it did not own, a service
provider with 21 stores.[23]
In January 1997, Gerald Whent retired and Christopher Gent took over as the CEO. The same year,
Vodafone introduced its Speechmark logo, composed of a quotation mark in a circle, with the O's in
the Vodafone logotype representing opening and closing quotation marks and suggesting
conversation.
On 29 June 1999, Vodafone completed its purchase of AirTouch Communications, Inc. and changed
its name to Vodafone Airtouch plc. The merged company commenced trading on 30 June 1999.
[24]

In order to gain anti-trust approval for the merger, Vodafone sold its 17.2% stake in E-Plus

Mobilfunk.[25] The acquisition gave Vodafone a 35% share of Mannesmann, owner of the largest
German mobile network.
On 21 September 1999, Vodafone agreed to merge its U.S. wireless assets with those of Bell
Atlantic Corp to form Verizon Wireless.[26] The merger was completed on 4 April 2000, just a few
months prior to Bell Atlantic's merger with GTE to form Verizon Communications, Inc.
In November 1999, Vodafone made an unsolicited bid for Mannesmann, which was rejected.
Vodafone's interest in Mannesmann had been increased by the latter purchase ofOrange, the UK
mobile operator.[27] Chris Gent would later say Mannesmann's move into the UK broke a "gentleman's
agreement" not to compete in each other's home territory.[28] The hostile takeover provoked strong
protest in Germany, and a "titanic struggle" which saw Mannesmann resist Vodafone's efforts.
However, on 3 February 2000, the Mannesmann board agreed to an increased offer of 112 billion,
then the largest corporate merger ever.[28] The EU approved the merger in April 2000 when Vodafone
agreed to divest the 'Orange' brand, which was acquired in May 2000 by France Tlcom. The
conglomerate was subsequently broken up and all manufacturing related operations sold off.

Vodafone Group plc: 2000 to present[edit]

The headquarters ofVodafone Romania in Bucharest

On 28 July 2000, the Company reverted to its former name, Vodafone Group plc.
In 2001, the Company acquired Eircell, the largest wireless communications company in Ireland,
from eircom.[29] Eircell was subsequently rebranded as Vodafone Ireland. Vodafone then went on to
acquire Japan's third-largest mobile operator J-Phone, which had introduced camera phones first in
Japan.[30]
On 17 December 2001, Vodafone introduced the concept of "Partner Networks", by
signing TDC Mobil of Denmark. The new concept involved the introduction of Vodafone international
services to the local market, without the need of investment by Vodafone. The concept would be
used to extend the Vodafone brand and services into markets where it does not have stakes in local
operators. Vodafone services would be marketed under the dual-brand scheme, where the Vodafone
brand is added at the end of the local brand. (i.e., TDC Mobil-Vodafone etc.) [31]
In 2007, Vodafone entered into a title sponsorship deal with the McLaren Formula One team, which
traded as "Vodafone McLaren Mercedes" until the sponsorship ended at the end of the 2013 season.
[32][33]

In May 2011, Vodafone Group Plc bought the remaining shares of Vodafone Essar from Essar Group
Ltd for $5 billion.[34]
On 1 December 2011, it acquired the Reading based Bluefish Communications Ltd
an ICT consultancy company.[35] The acquired operations formed the nucleus of a new Unified
Communications and Collaboration practice within its subsidiary Vodafone Global Enterprise,

[35]

which will focus on implementing strategies and solutions in cloud computing, and strengthen

its professional services offering.

In April 2012, Vodafone announced an agreement to acquire Cable & Wireless Worldwide (CWW) for
1.04 billion.[36] Vodafone was advised by UBS AG, while Barclays andRothschild advised Cable &
Wireless.[36] The acquisition will give Vodafone access to CWW's fibre network for businesses,
enabling it to take unified communications solutions to large enterprises in UK and globally; and
expand its enterprise service offerings in emerging markets. On 18 June 2012, Cable & Wireless'
shareholders voted in favour of the Vodafone offer, exceeding the 75% of shares necessary for the
deal to go ahead.[37][38]
On 24 June 2013, Vodafone announced it would be buying German cable company Kabel
Deutschland. The takeover is valued at 7.7 billion, and was recommended over the bid of
rival Liberty Global.[39]
On 2 September 2013, Vodafone announced it would be selling its 45% stake in Verizon
Wireless to Verizon Communications for $130 billion, in one of the biggest deals in corporate history.
[40]

In October 2013, Vodafone began its rollout of 4G to provincial New Zealand, with the launch of the
system in holiday hotspots around Coromandel.[41]
In February 2014, Vodafone made an offer to acquire Spains largest cable operator, ONO, in a deal
rumoured to be around 7 billion.[42]

PROFILE OF THE COMPANY

Introduction:
Vodafone is a mobile network operator headquartered in Berkshire, England, UK. It is the
largest mobile telecommunications network company in the world by turnover and has a market

value of about 75 billion (August 2008). Vodafone currently has operations in 25 countries and
partner networks in a further 42 countries.
The name Vodafone comes from Voice data fone, chosen by the company to "reflect the
provision of voice and data services over mobile phones."
As of 2006 Vodafone had an estimated 260 million customers in 25 markets across 5 continents.
On this measure, it is the second largest mobile telecom group in the world behind China Mobile.
In the United States, Vodafone owns 45% of Verizon Wireless.
Mission:
Vodafone is primarily a user of technology rather than a developer of it, and this fact is reflected
in the emphasis of our work program on enabling new applications of mobile communications,
using new technology for new services, research for improving operational efficiency and quality
of our networks, and providing technology vision and leadership that can contribute directly to
business decisions.
MISSION
We will be the communications leader in an increasingly connected world Vodafone Group Plc is the
world's leading mobile telecommunications company, with a significant presence in Europe, the
Middle East, Africa, Asia Pacific and the United States through the Company's subsidiary
undertakings, joint ventures, associated undertakings and investments

Vision:
Our Vision is to be the worlds mobile communication leader enriching customers lives,
helping individuals, businesses and Communities be more connected in a mobile world.
Vodafone can help to transform societies by bringing innovative products and services to our 404 million
customers, 68% of whom live in emerging markets.
Mobile technology is already a vital tool in peoples lives and our ambition is for Vodafones mobile services to
further improve peoples livelihoods and quality of life.
At the same time, we aim to help consumers, governments and businesses tackle some of the significant challenges they
face from food shortages and ageing populations, to lack of access to communications, healthcare and financial services.

Our business focus on emerging markets, enterprise, data and new services gives us the ability to achieve our ambition to
contribute to global development in this way, while continuing to grow our business at the same time, by developing
commercially viable, scalable services that support sustainable development.

http://www.vodafone.com/content/index/about/sustainability/our_vision.html
http://www.slideshare.net/mustafa1210/vodafone-4261566

PROBLEMS OF THE ORGANIZATION

Rapidly Falling ARPU

The competitive intensity in the telecom industry in India is one of the highest in the world and
has lead
to sustained fall in realisation for the service providers. Intense competitive pressure and cut
throat
pricing has resulted in declining ARPUs. With increasing number of new entrants in the telecom
space the competitive intensity is likely to continue, putting further downward pressures on the
telecom tariffs. Thus, the telecom companies might have to grapple with further decline in
ARPUs, going forward.Further, with the telecom companies moving their focus to the rural areas
for driving the future subscribergrowth they might not witness a commensurate increase in
revenues. In fact, the risk of steep decline in ARPUs will increase going forward as the telecom
companies penetrate rural markets that are characterised by higher concentration of lowincome,
low-usage customers. A higher-than-expected decline in ARPU posesa risk of reduction in

margins of service providers. Alternatively, telecom operators are turning their focus to steadily
increasing the minutes of usage (MoU) to counter the sustained fall in ARPUs. Likewise, the
growth of the VAS is also crucial for some improvement in the ARPUs of operators.

Lack of Telecom Infrastructure

Lack of telecom infrastructure in semi-rural and rural areas could be one of the major hindrances
in tappingthe huge rural potential market, going forward. The service providers have to incur a
huge initial fixed cost to enter rural service areas. Further, as many rural areas in India lack basic
infrastructure such as road and power, developing telecom infrastructure in these areas involve
greater logistical risks and also extendthe time taken to roll out telecom services. The lack of
trained personnel in the rural area to operate and maintain the cellular infrastructure, especially
passive infrastructure such as towers, is also seen as a hurdle for extending telecom services to
the under penetrated rural areas.

Rural Areas Continue to Remain Under Penetrated

A rural teledensity of merely 15% point towards the fact that a majority of Indian population still
do not have access to telecom services. The rural India seems to have remained untouched by the
telecom revolution witnessed in the last few years. A huge 'digital divide', which is reflected by
the enormous difference of 74% between the urban and rural teledensity, reiterates this fact.
However, with the urban markets reaching a saturation point, the telecom service providers are
penetrating rural areas for driving future growth. Thus, the service providers entering new rural
marketsmight witness substantial increase in subscriber base. The expansion in the rural areas,
however, has increased the risk of further decline in the ARPUs. Nonetheless the revenue growth
from these regions is unlikely to match the surge in the subscriber base.

Excessive Competition

Another major concern that has come to the forefront in the recent past has been heightened
competitive intensity in the industry that has correspondingly fuelled the price war between
industry players. The Indian wireless market is one of the worlds most competitive markets,
with 12 operators across 23 wireless circles and 6 to 8 competing operators in each circle. The
auction of new 3G licences and the introduction of mobile number portability (MNP) are likely
to heat up competition in the industry, going Spectrum is the most important resource that is
required for providing mobile services. Given that spectrum is a finite resource, the availability
of the same would be inversely proportional to the number of operators. Thus, larger the number
of service providers smaller will be the amount of spectrum available to each of them.Scarcity of
spectrum leads to higher capex on deployment of mobile networks for the operators as theyneed
more cell sites to improve service quality. Further the growing usage of spectrum and the
resultant scarcity may lead to re-use of spectrum and increase chances of congestion in networks
leading to constraints on service quality.Evidently, the competition in the industry is expected to
intensify further with the entry of new players, both domestic as well as foreign players. With the
competitive intensity of the industry already at such high levels new operators might find it
difficult to gather significant share in Indian telecom market. While thenew players may benefit
from a faster network rollout through tower sharing, they will face challenges in terms of high
subscriber acquisition costs and lower ARPU customers.

Price War Between the Service Providers Putting Pressure on Margins

The ever-increasing competitive intensity in the sector, with licenses and spectrum in several
circles allotted to newer operators, is also a concern and could lead to unrealistic pricing levels to
grab subscribers. The pricing strategy of per second billing already has taken the price war
between telecom operators to the next level. The intensifying price war could put significant
downward pressure on the industry revenue growth. Further, the ongoing price war and the
concomitant decline in telecom traffic could raise the entry barrier for new companies.

Spectrum Allocation

3G Spectrum availability is one of the major concerns for the industry. Lack of adequate
spectrum which is the most integral part of the mobile telephony sector could hamper its growth
severely. However, the spectrum allotment has been the most controversial issues in the Indian
telecom sector. The smooth process of scheduled 3G and BWA spectrum allocation is likely to be
one of the key factors affecting the industry dynamics, going forward. Given the highlycompetitive nature of the Indian telecom industry on one hand, and limited licenses in the 3G
network on the other, the risk of excessive biding by the service providers has increased.
Irrational bidding, especially in some circles, might render 3G services financially-unviable.
Further, there exists a risk of delay in allotment of proposed spectrum to the service providers
who have successfully bid for the 3G spectrum.

Regulatory Charges

The regulatory charges in the telecom sector have a complicated structure because multiple
levies impede the smooth implementation of telecom projects in India. Given the continuouslydeclining ARPUs, and the extremely-low tariffs, sustianing the current growth rates of the
industry requires urgent attention towards rationalising the convoluted tax structure in the sector.

SWOT ANALYSIS

SWOT Analysis is a strategic planning method used to evaluate the Strengths,

Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It
involves specifying the objective of the business venture or project and identifying the internal
and external factors that are favorable and unfavorable to achieving that objective. The technique
is credited to Albert Humphrey, who led a research project at Stanford University in the 1960s
and 1970s using data from Fortune 500 companies.
Strengths:
The main strength of Vodafone within the telecommunications market lies in its brand
image and recognition. Vodafone, having established a global presence and having invested
highly in marketing a differentiated image by promoting a Vodafone life style, currently enjoys a

differentiating advantage that, if exploited

properly, can offer a lead in competition. The

presence of Vodafone in numerous countries within Europe as well as in all part of the world
enhances this image. It allows customers to travel and enjoy easily the services of their home
country operator. In the few countries that Vodafone is not physically present (e.g. Norway) it
has well established strategic alliances which allow for a better service of mobile clients.
Weaknesses:
The expansion of Vodafone has been completed at the expense of direct control of its
operations. The company grew through a process of acquisitions of national telecommunications
companies (e.g. the acquisition of the third biggest Czech mobile phone operator, Cesky mobile)
rather than organic growth. This increased its subscribers base quickly, offering direct market
knowledge and immediate additions of customer bases at the expense of direct effective control
of the subsidiaries. At the same time though, it implicitly imposed a centralized operational
structure for the group, nominating the UK headquarters as the leading business unit running a
much centralised marketing and handset procurement at group level. This has resulted in the
neglect of local markets and local differences, allowing market share to be gained by smaller
local competitors. Due to the highly saturated Western European market this has resulted in an
increase in the price elasticity of demand, with consumers becoming continuously price oriented.
This has resulted in high customer churn rates reaching the level of 32.8% in the UK compared
to O2s 24%.
Opportunities:
The telecommunications market, even though highly saturated in some regions offers
great potential due to the ageing population and the sophistication of the consumers. It offers
great opportunities through a careful market segmentation and exploitation of particular
profitable segments. Different strategies should be pursued simple phones and simplified
pricing plans to the ageing population and more updated, sophisticated solutions for younger
generations. The expanding Boundaries of the market could provide further opportunities by
allowing Vodafone to enter more aggressively into fixedline service and to better enjoy the
benefits of its high investment in 3G technology. Moreover the company has undertaken its first
steps in establishing strategic alliances to develop customized solutions for endusers: Vodafone

recently announced two new partnerships, one with supermarket group ASDA to launch an
ASDA branded mobile service in the UK, and another with electrical retailer DSG International
to provide mobile solutions to small businesses. This could further be enhanced to avoid being a
lateentrant in this new method of distribution which offers access to a wide potential customer
base.

Threats:
The European part of Vodafones market is characterized by existing high levels of
competition. Major brands such as O2 and TMobile are exploiting the price sensitivity of
customers and in this way they are building a stronger image and presence in the market. Indirect
competition is also increasing further, through the presence of Skype and other related (not only
voice) Internetbased services. This combined with the upcoming European legislative measures
is expected to limit further the tariffs for the network providers imposing further need for price
cuts which could harm the bottom line profitability of the company.

COMPETITORS ENVIRONMENT

Compititors of vodafone are:

i)

Airtel

ii)

Aircel

I). Customer satisfaction of Airtel

"Satisfaction is the level of a persons felt state resulting from comparing a products
perceived performance in relations to the person's expectations". If the performance matches the
expectations, the customers are satisfied; otherwise, he is an unsatisfied customer. In today's
competitive environment, companies are aiming for total customer satisfaction Companies seeking
to win in today's market must tract their customer's expectations, perceived company performance
and customer satisfaction. For customer's expectations, perceived company performance and
customer satisfaction is both a goal and a marketing tool. Today, companies are including
developing stronger bonds and loyalty with their intimate customers. They need to pay closer
attention to their customer defection rate and undertake steps to reduce it. To create customer
satisfaction companies must manage their value chain as well as the whole value delivery system in a
customer-centered way. The company's goal is not to get customers but even more importantly, to
retain customers.

Seller must assess the total customer value and total customer cost associated with each
competitor offer to know how his or her own offers rates in the buyers mind. Second, the seller who is
at a delivered value disadvantage has two alternatives. The seller can try to increase total customers
calls for strengthening or augmenting the offer's product, services, personnel and image benefits. The
latter calls for reducing the buyer's costs by reducing the Price, simplifying the ordering and
delivery process, or absorbing some buyer risk by offering a warranty. Whether the buyer is
satisfied after purchase depends on the offer's performance in relation to the buyer's expectations.
In general:
Satisfaction is a person feeling of pleasure or disappointed resulting from comparing a
product's performance (or outcome) in relation to his her expectations. As this definition makes
clear, satisfaction is a function of perceived performance and expectations. If the performance falls
short

of expectations, the customer is dissatisfied. If the performance matches the expectations,

the customer is satisfied. If the performance exceeds expectations, the customer is highly satisfied or
delighted.
Many companies are aiming for high satisfaction because customers who are just satisfied
still find it easy to switch. High satisfaction or delight creates an emotional bonds with the brand,
not a just a rational preference. The result is high customer loyalty. Xerox's senior management
believes that a very satisfied or delighted customer is worth 10 times as much to the company as
satisfied customer. A very delighted customer is likely to stay with Xerox many more years and
buy more than a satisfied customer will.

2). Customer satisfaction of Aircel

Since its inception, Aircel has continuously strived to provide the best products and services to
its valuable customers. It is this passion and enthusiasm that has helped us grow leaps and
bounds from what started as a one state operation in Tamil Nadu in 1999, to a pan-India presence
across

22

circles

today.

Aircel has been recognized for its consistent and innovative approach, , receiving the highest
rating for overall customer satisfaction and network quality by Voice and Data in 2006, an
accolade given only to a select few. Aircel was recognized for the same award by IDC in 2007
for being successful in fulfilling our promises to our customers.
Aircel also emerged as the top mid-size utility company in Businessworld's 'List of Best MidSize Companies' in 2007. Additionally, the companyhave also been awarded as the best regional

operator by the Tele.net publication in 2007 and have been honoured by CMAI INFOCOM for
excellence

in

marketing

of

new

telecom

service

in

2009.

Aircel's commitment to provide the best and the most innovative products and services will be an
ongoing endeavour.

CHAPTER 2
OBJECTIVES AND
METHODOLOGY

SIGNIFICANCE
Importance of customer satisfaction
Sometimes companies are misguided by the notion that customers depend on them. The truth of
the matter is that we very much so depend on them. Many researchers and academia have
highlighted the importance of customers in todays market. The level of satisfaction a customer
has with a company has profound effects. Studies have found that the level of customers
satisfaction has a positive effect on profitability:

A totally satisfied customer contributes 2.6 times as much revenue to a company as a

somewhat satisfied customer.

A totally satisfied customer contributes 17 times as much revenue as a somewhat

dissatisfied customer.

A totally dissatisfied customer decreases revenue at a rate equal to 18 times what a totally
satisfied customer contributes to a company.

Research has shown that when a person is satisfied with a company or service they are likely to
share their experience with other people to the order of perhaps five or six people. However,
dissatisfied customers are likely to tell another ten people of their unfortunate experience. With
social media readily available for consumers to tell their story to all of those online, you can
easily go to Twitter or Facebook and read about someones experience with a company or
service.
Benefits of study:
There are many benefits related to take this study. Some of the benefits of taking this
study are as follows:
By analyzing this information, the company would be able to better design schemes &
services & target right prospects needs & wants.
More people will get aware about Vodafone that will increase profit level of Vodafone.

 This study helps to identify the behavior of consumer when there are no offers & schemes
from Vodafone.

OBJECTIVES
Aim of considering customer satisfaction
The primary aim of customer satisfaction research is to provide increased understanding of your
customers satisfaction with and expectations of the services you offer. This knowledge enables
you to identify potential areas for improvement.
Following are the main objective to study about the customer satisfaction on Vodafone.
To study telecommunication industry.
To study the company profile of Vodafone.
To study customer satisfaction of Vodafone.
To study the various services provided by Vodafone.

SCOPE
Customer satisfaction matters. It matters not only to the customer, but even more so to the
business because it directly impacts a company's bottom line profits. Furthermore, it is one of the
most important components of a company's positive brand image.
The reason why customer satisfaction directly affects bottom line profitability is quite simple: it
costs far less to retain a happy client than it does to find a new client. Businesses that have
been successful retaining the business of their loyal clients have shown over time to consistently
increase profits from their installed client base. The impact of customer loyalty is impossible to
overlook. This white paper will examine not only the significance of customer satisfaction, but
also some of the factors that businesses need to consider in order to accurately define, measure,
and integrate this concept into practice.

RESEARCH METHODOLOGY
5.3) Process of Marketing Research:
The marketing research is done in systematic process. The Researcher has pursued the
below process of marketing for my study at Vodafone:

Problem Identification

Research Design

Data Collection

Data Analysis & Interpretation

Research Report & Presentation

5.3.1) Problem Identification:

The first and the most important step of marketing research is properly defining the
problem. In order to identify the research problem two categories of problem should be carefully
noticed.
Here the researchers problems are: A number of customers are not satisfied with services, new schemes and offers.
A number of customers are not satisfied with the network coverage.
A number of customers are not satisfied with the current call rates of Vodafone.
A number of customers are not satisfied with the Free SMS schemes.
A number of customers are not satisfied with the service of customer care of Vodafone.
5.4.2) RESEARCH DESIGN:
Research design indicates the methods and procedure of conducting research study.
Research design can be done in following three types:Descriptive Research:Descriptive research is undertaken when the researcher want to know the characteristics
of certain groups.
The Research Design is: Descriptive Research Design
5.4.3) Data Collection and Sampling:
A) Sources of Data Collection:Basically there are two types of data i.e. secondary and primary:

I)

Primary Data Collection:-

Primary data collection contains the following methods: 2 survey Method:

It contains Personal Interview, Telephone Interview and Mail Interview.
II)

Secondary Data Collection: It can be collected from internal as well as external sources

1 Internal Source:
Various internal sources like employee, books, sales activity, stock availability, product
cost, etc.
2 External Sources:
Libraries, trade publications, literatures, etc are some important sources of external data.
The Researcher has used primary data for the core purpose of the project and this primary
data has been gathered by survey method. The researcher has also used secondary data
B) Data collection Tools:
To conduct a survey, the Researcher has selected a structured questionnaire as an instruction
for gathering valuable information from the customers. Questionnaire, which is used for the
survey, is consisting of questions and checklist questions to check the customer feedback.
C) Sampling Plan:
The researcher has design a sampling plan that is consist of five decisions.
I)

Sampling unit:

The Researcher has selected youngsters, businessmen, and housewives, employees to

conduct survey and to measure satisfaction level.
II)

Sampling types:

There are two types of sampling i.e. Probability Sampling and Non probability Sampling.

i)

Probability Sampling : Probability sampling means each unit of the universe has equal chance of getting selected.

The most frequently used probability sampling methods are as below:

ii)

Non Probability Sampling:For this purpose the researcher has used non probability convenience sampling. Non-

probability sampling is a sampling technique where the samples are gathered in a process that
does not give all the individuals in the population equal chances of being selected.
III)

Sample Size:
Sample size means limited numbers of respondents covered under the research study

from a population and the researcher has taken a survey of 100 respondents to know the
satisfaction level of customer.
IV)

Sampling Area:
Here the researcher has randomly selected the respondents of the Delhi city.

Data Analysis and Interpretation

After all the above steps are completed now the important step is data analyzing and
interpretation. For this there are various analytical and statistical tools. Some of these tools are
Percentage, Average, etc.

CHAPTER 3
CONCEPTUAL
DISCUSSION

Customer Satisfaction
Introduction:
Customer satisfaction, a business term, is a measure of how products and services supplied by a
company meet or surpass customer expectation. It is seen as a key performance indicator within
business and is part of the four perspectives of a Balanced Scorecard.
In a competitive marketplace where businesses compete for customers, customer satisfaction is
seen as a key differentiator and increasingly has become a key element of business strategy.
There is a substantial body of empirical literature that establishes the benefits of customer
satisfaction for firms.
Importance of Customer Satisfaction

Understanding the needs of the customer is critical.

A business relationship, just like any other relationship, relies on both people getting their
needs met. No matter what type of business you are in, all customers want the same
thing. They want to feel welcomed and appreciated by you and your staff. They don't
want to get the impression that they are just being used by you for money. Small
interactions like "Thank you" and a nice smile can go a long way toward customer
satisfaction.

Make sure your employees operate with the same principles.

A big part of customer satisfaction is reliability. If customers come to expect a certain
mode of behavior from you and your employees, you should deliver it to them each and
every time. Customers want to be able to rely on you. They expect consistent delivery
times (if applicable) and support. By training your employees to treat all customers with
the same respect, your customers will all have the same experience with your company,
which will increase customer satisfaction.

Be honest when you don't meet expectations.

Customer satisfaction is at its most important when something goes wrong in the chain of
delivery. Whether a customer was double charged or didn't receive what she ordered,
your employees need to handle the situation with the utmost care. Your employee should
apologize and take steps to rectify the situation. The phrase "the customer is always right"
is at the core of a good customer satisfaction strategy. It doesn't matter whether or not the
customer misread the instructions or made the mistake; your employee should take steps
to make the customer happy.

Customer satisfaction is the foundation of a good business.

Satisfied customers will make a great foundation for return business, and they may also
bring in their friends and associates. Remember that customers are the heart of any
business. Keep them satisfied, and encourage them to tell their friends about their
experiences with your business.

Measuring customer satisfaction

Organizations are increasingly interested in retaining existing customers while targeting noncustomers; measuring customer satisfaction provides an indication of how successful the
organization is at providing products and/or services to the marketplace.
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the
state of satisfaction will vary from person to person and product/service to product/service. The
state of satisfaction depends on a number of both psychological and physical variables which
correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction
can also vary depending on other options the customer may have and other products against
which the customer can compare the organization's products.
Because satisfaction is basically a psychological state, care should be taken in the effort of
quantitative measurement, although a large quantity of research in this area has recently been
developed. Work done by Berry, Brodeur between 1990 and 1998 defined ten 'Quality Values'

which influence satisfaction behavior, further expanded by Berry in 2002 and known as the ten
domains of satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness,
Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front line Service
Behaviors, Commitment to the Customer and Innovation. These factors are emphasized for
continuous improvement and organizational change measurement and are most often utilized to
develop the architecture for satisfaction measurement as an integrated model. Work done by
Parasuraman, Zeithaml and Berry between 1985 and 1988 provides the basis for the
measurement of customer satisfaction with a service by using the gap between the customer's
expectation of performance and their perceived experience of performance. This provides the
measurer with a satisfaction "gap" which is objective and quantitative in nature. Work done by
Cronin and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap"
described by Parasuraman, Zeithaml and Berry as two different measures (perception and
expectation of performance) into a single measurement of performance according to expectation.
According to Garbrand, customer satisfaction equals perception of performance divided by
expectation of performance.
The usual measures of customer satisfaction involve a survey with a set of statements using a
Likert Technique or scale. The customer is asked to evaluate each statement and in term of their
perception and expectation of performance of the organization being measured.

Vodafone had highest customer satisfaction index in 2007

Lisbon, 25 August 2008 - Vodafone obtained the highest customer satisfaction index in the
telecommunications sector in 2007, according to annual results published by Anacom. Vodafone
achieved a satisfaction index of 74.4 (on a scale of 0 to 100), the highest score of all the
companies in the Portuguese telecommunications market and considerably above the sector
average of 67.6.
In the report published by Anacom, Vodafone is ranked in first place in all the indicators included
in the survey: Satisfaction with the operator, Image that customers have of the operator,
Customer Expectations, Perceived Quality of the operator's network and services, Perceived

Value for Money, Complaints received and their handling, and Loyalty of customers to their
operator.
In the Perceived Quality indicator, Vodafone obtained a score of 8.3 points for overall quality,
way ahead of the scores of the other two operators (both obtained 7.7 points). Vodafone comes
top in all the indicators for perceived quality of network and services: technical quality of the
network (8.2 points); customer service and advice capability (7.6 points); quality (8.2 points),
diversity (8.0 points) and reliability (7.9 points) of products and services offered; clarity and
transparency of information supplied (7.8 points); network coverage (7.9 points) and clarity and
transparency of price plans (7.9 points).
Similarly, in the indicators measuring the Image of mobile operators, Vodafone comes top in the
five categories analyzed (on a scale of 1 to 10): 'It is a reliable company in terms of what it says
and what it does' (8.1 points); 'It is stable and well established in the market' (8.8 points); 'It
contributes positively to society' (7.5 points); 'It cares about its customers' (7.6 points); and 'It is
innovative and forward looking' (8.5 points).
The methodology used in the ECSI Portugal 2007 survey (ECSI European Customer
Satisfaction Index) is similar to that used by the European Commission to survey customer
satisfaction in 25 Member States, enabling comparisons to be made between the results obtained
in each country.
The ECSI Portugal 2007 Communications survey was carried out by the Higher Institute of
Statistics and Information Management at Lisbon's New University in partnership with the
Portuguese Quality Institute and the Portuguese Quality Association, with sponsorship from
Anacom.

CHAPTER 4
DATA ANALYSIS

Suggestions

Yes

No

No. of respondents

93

A. Do you have a mobile phone?

Purpose:s
The main purpose of this question is to know how many respondents use mobile phone.

7%

Yes

No

93%

Interpretation:
93% of the respondents are have a mobile phone while 7% of the respondents do not have
a mobile phone.

B. Are you aware about telecommunications services?

Suggestions

Yes

No

No. of respondents

95

Purpose:
The main purpose behind this question is to know about the

awareness of respondents regarding different telecommunications services and also to know

about which telecommunication(operators) service they use.

5%

Yes
No

95%

Interpretation:
95% of the respondents are aware about telecommunications services while 5% are not
aware.

Which operators service do you use?

Operators service name

No. of respondents

Vodafone

87

Airtel

29

Idea

17

Reliance

21

BSNL

Tata Indicom

3%2%
13%

Vodafone
Airtel
Idea

10%
54%

Reliance
BSNL

18%

Tata Indicom

Interpretation:
Major respondents using mobile are enjoying Vodafone services. 16% of the respondents
use Airtel, 6% respondents use Idea while 12%, 4% and 2% respondents use Reliance, BSNL
and Tata Indicom respectively.

C. Are you aware about Vodafone?

Purpose:
The purpose behind this question is to know about the awareness of Vodafone among all
the respondents.

Suggestions

Yes

No

No. of respondents

87

Yes
No

100%

Interpretation:
Here 100% of respondents are aware about Vodafone Services.

D. From which source you came to know about Vodafone?

Purpose:

The purpose behind this question is to know from which source the respondents came to
know about Vodafone.
Sources

No. of respondents

Advertisements

63

Hoardings

52

Newspapers

35

Mouth Publicity

26

15%
36%
20%

Advertisements
Hoardings
Newspapers
Mouth Publicity

30%

Interpretation:
36% of the respondents are aware about Vodafone through Advertisements, 29% are aware
because of Hoardings while 20% and 15% of the respondents are aware because of Newspapers
and Mouth Publicity respectively.

E. Since how long you are using Vodafone Services?

Purpose:

The purpose behind this question is to know about the usage time of Vodafone customers
i.e. since how long they are using Vodafone services.
Time period

No. of respondents

Less than 1 month

12

2-6 months

19

6-12 months

22

More than 1 year

34

14%
39%
22%

Less than 1 month

2-6 months
6-12 months
More than 1 year

25%

Interpretation:
Major Respondents using Vodafone are old customers. 39% of the respondents use
Vodafone services from past more than 1 year while the lowest is 14% respondents using
Vodafone services less than 1 month.

F Which services are more helpful to you while using Vodafone Services?

Purpose:
The purpose behind this question is to know which services are more helpful to the
respondent while using Vodafone.
Services

No. of respondents

Call Rates

27

SMS Rates

48

Network

36

Value Added Services

19

15%

21%
Call Rates
SMS services
Network
Value Added services

28%
37%

Interpretation:
Here major Respondents are youngsters so they mainly use SMS services of Vodafone.
37% of the respondents use Vodafone for SMS services while only 14% of the respondents use
Vodafone for Value Added Services.

F. Rate the following on the basis of your satisfaction.

Services

Excellent

Very Good

Fairly Good

Average

Poor

Network

31

29

17

SMS Rates

19

35

24

New schemes and 3

14

27

33

10

offers
Customer Care

32

29

15

Recharge Outlets

12

28

31

14

Call Rates

20

43

19

Added 9

24

29

19

Value
Services

Services

13%
3%
45%

17%

9%
4% 9%

G. Why you are not using Vodafone Services?

Purpose:

Network
SMS rates
New schemes and offers
Customer Care
Recharge outlets
Call rates
value added service

Suggestions

Yes

No

No. of respondents

78

The purpose of this question is to know why

other respondents do not use Vodafone services.

Reasons

No. of respondents

Lack of awareness

High Prices

Poor Services

Poor Network

15%

15%
Lack of awareness
High Prices
Poor services
Poor Network

23%
46%

Interpretation:
6 dont use Vodafone services because of high prices. 3 respondents dont use Vodafone
services because of poor services while 2 respondents each dont use vodafone services because
of lack of awareness and poor network.

H. Would you like to recommend Vodafone to others?

Purpose:
The purpose of this question is to know the recommendations of the respondents towards
Vodafone, whether they would like to recommend the Vodafone services to others or not.

10%

Yes
No

90%

Interpretation:
90% of the Vodafone customers would like to recommend Vodafone services to others
while 10% of the Vodafone Customers wont recommend to others.

CHAPTER 5
FINDINGS AND
RECOMMENDATIONS

FINDINGS

 93% of the respondents are have a mobile phone while 7% of the respondents do not have a
mobile phone.
100% of the respondents are aware about telecommunications services.
16% of the respondents use Airtel, 6% respondents use Idea while 12%, 4% and 2%
respondents use Reliance, BSNL and Tata Indicom respectively.
100% of respondents are aware about Vodafone Services.
36% of the respondents are aware about Vodafone through Advertisements, 29% are aware
because of Hoardings while 20% and 15% of the respondents are aware because of
Newspapers and Mouth Publicity respectively.
39% of the respondents use Vodafone services from past more than 1 year while the lowest is
14% respondents using Vodafone services less than 1 month.
37% of the respondents use Vodafone for SMS services while only 14% of the respondents
use Vodafone for Value Added Services.
5 respondents among the total no. of respondents dont use Vodafone services because of
high prices. 3 respondents dont use Vodafone services because of poor services while 2
respondents each dont use vodafone services because of lack of awareness and poor
network.
90% of the Vodafone customers would like to recommend Vodafone services to others while
10% of the Vodafone Customers wont recommend to others.

RECOMMENDATIONS

Following are some of the recommenations given by the researcher so that Vodafone can serve
people and its customers in an improved way:
Vodafone should decrease call rates for local users.
Vodafone should provide more offers to Post-Paid customers so that the number of PostPaid customers increase.
Vodafone should bring introduce some new SMS schemes for the youngsters.
Vodafone should introduce more schemes and offers.
Vodafone should provide more schemes and offers to its old customers.
Vodafone should decrease call rates of STD and ISD.

BIBLIOGRAPHY

Books:
Marketing Management Philip Kotler, Kevin Lane Keller.

Websites:
http://www.vodafone.com/start/media_relations/news/local_press_releases/portugal/p

ortugal_press_release/vodafone_had_highest.html
http://en.wikipedia.org/wiki/Customer_satisfaction
http://en.wikipedia.org/wiki/Hutch_(Indian_cellular_company)
http://en.wikipedia.org/wiki/Vodafone
http://bora.nhh.no/bitstream/2330/1919/1/Saplitsa%202008.pdf
www.anacom.pt/render.jsp?contentId=606658
www.iimcal.ac.in/community/consclub/reports/telecom.pdf
www.scribd.com

ANNEXURE
A. Do you have a mobile phone?

o Yes
o No
B. Are you aware about telecommunications service?
o Yes
o No
If yes, then which operators Service do you use?
o Vodafone

(Multi-choice)

o Airtel
o Idea
o Reliance
o BSNL
o Tata Indicom ( If not Vodafone then go to Q12 )
C. Are you aware about Vodafone?
o Yes
o No

(If No, then go to Q11 )

D. From which source you came to know about Vodafone?

o Advertisement

(Multi-choice)

o Hoardings
o Newspapers
o Mouth Publicity
E. Since how long you are using Vodafone services?
o Less than 1 month
o 2-6 months
o 6-12 months
o More than 1 year
F. Which services are more helpful to you while using Vodafone services?

o Call rates

(Multi-choice)

o SMS service
o Network
o Value Added Services

G. Rate the following services on the basis of your satisfaction.

Services

Excellent

Very Good

Fairly good

Average

Poor

Network
SMS rates
New schemes and offers
Customer Care
Recharge outlets
Call Rates
Value Added Services

H. Why you are not using Vodafone services?

o Lack of awareness

(Multi-choice)

o High Prices
o Poor Services
o Poor network
I. Would you like to recommend Vodafone to others?
o Yes
o No
Give your suggestions to help in serve you better.
______________________________________________________________________________
______________________________________________________________________________

_____________________________________________________________________________

Name: ________________
Age: _____
Sex: Male/Female
Contact no.: ___________
Signature: _____________

taj
Vision

The Taj Group of Hotels commits itself to the overall improvement of the ecological
environment, which we are all a part of.

We recognize that we are not owners but caretakers of the Planet and owe it to our children
and future generations of humankind.

It is our endeavor not only to conserve and protect but also to renew and regenerate the
environment in which we live and operate

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