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Service Management Project
Service Management Project
Service Management Project
The PIE CHART below shows the distribution of marketing expenses i.e. proportion of sales promotion expenses and that of others such as commission, rebates, discounts, expenses on direct selling agents in the marketing expenses.
Expenses on sales promotion constitute a high proportion in marketing expenses since Vodafone is a private company. It really spends a lot on promoting its sales in order to increase revenue from operations. Vodafone like any other telecom industry did not give much rebates and discounts to its customers.
Average of sales promotion expenses and other expenses under marketing expenses of year 2006- 10
Bar graph showing marketing expenses and profit (PAT) earned in each annual year from 2006 to 2010 is shown below.
Profit after tax in year 2009 is much less than any other year. This is due to increased competition and tough macro economic conditions.
Demerged passive infrastructure and long distance businesses to separate subsidiaries for effective and focused management of network and resources. The company successfully won 3G spectrum for 9 circles at the cost of Rs. 11.617 crores. These circles cover over 60% of the current customer base having the maximum number of circles in metros, A & B categories.
Important points from Directors Reports (2006-2010): Marketing Expenses in 2005-06 Company added another first by launching its new VAS innovation-Background Tones across all 8 circles in March 2006. Background Tones is a service wherein (background) music is played after the call is connected. Company launched the exclusive Women's Card in April 2006. Available on both prepaid and postpaid connections, the Women's Card is packed with thoughtful value adds such as tips on beauty, fashion, health etc and safety alerts to near and dear ones. Company sponsored the IIFA Awards 2006. With IDEA IIFA, privileged customers of IDEA had access to specially created merchandise, contests, video and MMS downloads and several other value added services. Marketing Expenses in 2006-07 Idea subscriber can easily copy the dialer tone of another idea subscriber, whom he/she has called. Company sponsored the IIFA Awards 2007. With IDEA IIFA, privileged customers of IDEA had access to specially created merchandise, contests, video and MMS downloads and several other value added services.
Marketing Expenses in 2007-08 Company has launched Idea Radio, in collaboration with Geodesic, an innovator in communication, collaboration entertainment applications on mobile and Internet platforms. Marketing Expenses in 2008-09 Company launched Nokia Life Tools which is a rural VAS product aimed at enhancing the productivity of the farmers and rural folks by providing Mandi Prices, Weather Information and Agricultural related information over mobile. Idea has tied-up with Indian Oil Corporation (IOC), to use their petrol pumps and gas agencies for branding and distribution of Idea Sim Cards and Recharge Vouchers. Ideas Fans of cricket campaign around IPL team Mumbai Indians received an excellent response with more than 44 lac calls received. Idea launched the Idea Mobile Roadie Challenge, a customer engagement programme designed exclusively for Idea customers integrating user experience on web and mobile. Idea strengthened its brand through a series of media properties like Idea Khatron Ke Khiladi-Level2, Idea Bharat ki Shaan on DD, Idea rocks India -4, Idea IIFA Awards and Idea Filmfare Awards. Marketing Expenses in 2009-10 The Company conceptualized and launched Insta Alert, an innovative tool to convey latest offers and service related communication to customers. Idea launched a standardized self care portal CARE which gives information to the customer on products / tariffs and information of their account such as billed amount. Idea strengthened its brand through a series of media properties like the Idea Cup, Cricket Series, Talk for India, Bingo Night, etc. Idea associated with IPL teams, Deccan Chargers and Delhi Daredevils as Principal Partners.
Average Selling & distribution expenses for years 2006-2010 were 6769.16. Advertising expenses were major portion of the same. *no distribution expenses were incurred
Average Marketing expenses for years 2006-2010 were 3886.4. Sales promotion expenses were major portion of the same. *no rebates and discount expenses were
BSNL
Mona Sharma (8502936) Kritika Prasad (8502937)
1. Selling and distribution costs- The selling and distribution costs of the BNSL can be
broken down into two- Advertising cost and Marketing cost. The selling and distribution cost is shown below-
Reason BSNL is a govt. owned company due to lack of expertise it does not spend much amount of money on rebates and sales promotion.
2. Marketing expenses and new promotional projects- Many New projects and initiatives
have been undertaken by BSNL which mainly focuses on developing the market and promoting the new services.
There has been a sharp decline in the fixed access services revenue and number of subscribers, which is attributed mainly to customers preference to wire-less services over wire-line. However, the Broadband services have contributed significantly in arresting the decline to some extent. To arrest the decline and promote wire-line services, Company has initiated various measures to strengthen the Sales and Distribution and Marketing set ups. Project Udaan is one such initiative under Project Shikhar, which aims to bring back the wireline business to growth path. The key enabler of the Project Udaan is Creation of dedicated sales team, as a result, BSNLs own strong sales team of 4500 personnel have started selling products. Strengthening of marketing, sales and distribution Channels (Project Vijay) - The fast commoditization of the telecom service/products had necessitated strong initiatives in the Sales and Distribution network. As part of strengthening the sales and distribution channels for ensuring continuous and uninterrupted supply of products, Your Company has initiated steps for increasing the No of territories from 1,601 to 2,147; increase in No of retailers from 3,88,565 to 8,00,000; and creation of a dedicated Sales team of 4500 BSNL employees.
3. Other intiatives
Continous improvement in Customer Care (Project Smile) Implementation of CDR billing system Internet Data Centre (IDC) ERP system implementation plan Introduction and offering of VAS Services to Wireline subscribers Rural Broadband expansion under USO Fund Connectiong Universities and Colleges with Broadband under National Mission for Education(NME) Connecting 1 Lakh Common Service Centres (CSCs) across entire rural India Broadband connectivity to Village Panchayats Village Public Telephones [VPTs] Bharat Nirman Programme Replacement of Multi Access Radio Relay (MARR) VPTs
ix. x. xi.
RELIANCE COMMUNICATIONS( Annual Financial Standalone for year 2006-2010) Tushar Gupta(08502938) A-8 Ast ha Bansal(08502939) A-8 A. Different marketing expenses mentioned by CMIE
1. 2. 3. 4. Advertising Rebates and discount Sales promotion Distribution expenses
During the year under review, the company has earned income of Rs.12,614.02 crore against 12,511.72 crore in the previous year. The Company has incurred loss ofRs. 757.99 crore compared to profit after tax of Rs. 478.93 crore in the previous year.
BHARTI AIRTEL
AASTHA DHAMIJA(08502940) DIVYA GARG(08502943) DDM 2008-13
INDIVIDUAL COMPANY ASSIGNMENT Different marketing strategies of Bharti Airtel (as per CMIE)
Advertising Rebates and discount Sales promotion Distribution expenses
ANALYSIS As you can see over the years, company has spent minimum on rebates and discounts bacause of standard telecom rates, there is not much scope for discounts and rebates. Maximum expenses are of sales promotion, in which airtel included many big celebrities for more popularity. And airtel has no distributional expenses.
Annual Finance Standalon e Rs. Million Total Income Bharti Airtel Ltd. 113318.3 180055.8 260640.8 345395.6 368381
Marketing expenses (includes commissions, rebates, Profit after discounts, sales promotional, expenses on direct selling tax agents & entertainment expenses) Bharti Airtel Ltd. Bharti Airtel Ltd. 20120.8 4038.2 40332.3 7238.7 62441.9 12470.6 77438.4 15535.1 94262 18541
400000 350000 300000 250000 200000 150000 100000 50000 0 2006 2007 2008 2009 2010 total incom e P AT m arketingex penses
ANALYSIS
As we can see over the years as the company increased its marketing expenses it s overall profit increases as it is able to capture to more market share by creating awareness about its brand among the consumers, by launching new products and their new allainces.
Directors report
Bharti Airtel is one of Asias leading telecommunication service providers with presence in all the 22 licensed jurisdictions (known as Telecom Circles) in India and also in Sri Lanka and Bangladesh.
Bharti Airtel has been rated as the Strongest Brand by the Economic Times Brand Finance Brand Power Rating. Brand Airtel was the only corporate brand to be awarded the AAA rating which means extremely strong and it improved its rating from the previous AA+, which helped increasing the brand value of airtel in the telecom market.
Airtel continued with its segmenting approach, which strengthened the brands
relevanceacross various socio-economic segments of mobile users in the country.
The company uses best HR policies for its employees, by introducing ESOP
schemes ( Employee Stock opertation Policy) under 2001 and 2005.
Airtel has launched many new products like airtel app central, airtel hosted
mail, ultra fast 50 MBPS broadcasting, airtel digital TV recorder etc.
Many major agreements and alliances were also signed int his year, some of
which are with global telcos, Limelight networks, HTMT,dow jones, twitter etc.
PAT Marketing expenses 80396.3 2352.9 62058.7 2546.3 28093.1 2265.8 6548.5 3021.6 -16226.5 3243.6
Analysis This business is now characterized by increased competition and falling rates and margins, both in India and internationally. The same has caused the profit to fall. Therefore, Companys focus was on increasing volumes and thus revenues, while improving margins by cutting costs.
Analysis Tata Communication has transformed itself into a customer-focused organization. The charter of the Customer Service Organization is to support the entire customer life cycle from service delivery to service assurance, including retention and growth. To support its international presence, the Company is defining and implementing stringent service delivery standards that adhere to global best practices.
Continued growth of mobile penetration, especially in developing countries; Surge in mobile data traffic, enabled by adoption of 3G technology and increased penetration of smarter end-user devices like smart phones, tablets etc.
Video becoming a growing part of both consumer and business traffic; Businesses looking for managed services and turn-key solutions that help improve their operational efficiency; and Growth in traffic, within and to emerging markets / new geographies.
Ranking of companies according to total income. Total Company Bharti Airtel Ltd. Bharat Sanchar Nigam Ltd. Income 368381 320716.6
Reliance Communications Ltd. Idea Cellular Ltd. Vodafone India Ltd. Total income
Income for all the companies shows an increasing trend except BSNL. BSNL being a government owned enterprise , didnt occur much advertising and sales promotion expenses whereas other companies spend large amounts on the same and thus creating awareness about its new schemes, actively sponsoring many mega events, resulting in attracting more customers and increasing total income.
All the private companies showed an increasing trend in the PAT from 2006 to 2010 except Vodafone which could not cope with increasing competition and tough macro-economic conditions. Also BSNL showed sharp fall in PAT in these years due to their weak promotional and advertising strategy. BSNL incurred heavy losses in year 2010.
Expenses Expenses can be categorized as following Sales and distribution expenses a. Marketing expense b. Advertisement expenses c. Distribution expenses
Marketing expenses are further divided into two: Rebates and discounts expenses Sales promotion expenses.
Vodafone didnt incur many expenses on selling and distribution as compared to others, they maintained their customer base throughout these years and reached a landmark of 100 million customers in 2010.
Average selling and distribution expenses companies for all the years is 7713.708
for all
the
No distribution expenses were incurred. The trend shows that marketing expenses constitute a larger part of selling and distribution expenses. This is because in telecom industry different sales promotion strategies are required for different market segments.
Marketing Expenses Average Marketing Expenses for all the companies for all the years is 5482.848
In Telecom industry, usually less rebates and discounts are given and hence, sales promotion expenses form the major part of marketing expenses.