Virgin Mobile India-Think Hat Ke Vision To be the favourite mobile service of India’s youth Company Overview Virgin Group, Ltd. operates as a venture capital company. The company engages in various businesses, including mobile telephony, travel and tourism, financial services, leisure and pleasure, transportation, social and environment, music, holidays, shopping, media, publishing, and retailing. It has operations in Africa, Asia, Australia, Canada, Europe, the United Kingdom, and the United States. Virgin Group, Ltd. was founded in 1970 and is based in London, the United Kingdom.
Virgin mobile is Virgin’s third India play – after Virgin Air’s India routes and a radio station, Fever 104 FM. And it’s Virgin Mobile’s seventh telecom market. (others include U. S. , France and South Africa) Virgin mobile Virgin has 15 million youth customers across 4 continents. In Indian mobile market, Virgin mobile is a unique player based on its business model and strategy. It is the only service provider which does not hold any bandwidth and mobile setup infrastructure but uses Tata Teleservices (50:50 joint venture) spectrum and is penetrating market totally on its branding and marketing strategy.
Creating a niche brand and promoting it to specific customer segment with proper marketing has been key to success for virgin mobile across the globe. Current scenario Almost 80 per cent of the Indian mobile telephony is GSM based and Virgin is counting big on the urban youth segment for growth in the segment. Virgin Mobile has launched GSM services in six telecom circles, including Uttar Pradesh (East), UP (West),Madhya Pradesh & Chhattisgarh, Haryana, Kolkata and Bihar. Now Virgin has GSM services in a total of 14 telecom circles. (June 2010).
Virgin Mobile launched a high-speed Internet service vFlash in the country with a monthly tariff of as low as Rs 250 per month on January 13,2010. To encash on this IPL fever Virgin Mobile India announced the launch of Indian Panga League on april,2010 . A unique online campaign for cricket enthusiast . A similar campaign was launched last year by Virgin Mobile named Indian Hatke League which did wonders during the IPL season. Apart from this Virgin is launching new offers for Value Added Services and reduced call rate schemes time to time. Short term Targets
Virgin is targeting 10 per cent market share in the urban youth segment, which accounts for almost 50 per cent of the total mobile market in India. “We aim to garner five million subscribers till December 2010”says Virgin Mobile CEO Mr. M A Madhusudan. Understanding Virgin’s business Model Virgin’s team of 250 spent nearly nine months researching their target audience. They discovered that the key to India’s youth is their goal success. Virgin has promoted itself as the brand for young India, keeping the Indian youth as its target customer segment.
The idea behind targeting this segment can be found inherited in virgin’s business model. The salient features of Virgin’s business model from customer perspective are: 1) With intensive competition and reducing voice tariffs, the profit margins for voice service are decreasing day by day. So, the future profit strategy is maximizing profit margins through data services and it is youth segment which provides maximum data service revenues. 2)Future projection of increasing young and working population of India as 65% of overall population by 2020. ) Increased use of data services in future due to technological advancements. So in mobile sector where all other players are trying to provide similar service to different customer segments, virgin is targeting specific segment with tailor made plans keeping its long term goals in mind. Communicating the Virgin Brand Virgin mobile has communicated itself as the youth oriented brand of India through various communication channels. They are: a) “Think Hat ke” advertisement campaign targeting youth b) Red and vibrant website look with youth focused language c) Tailor made plans for young segment ) Getting paid for incoming calls: a source of recharge option for youth e) Running various campaigns for youth segment for eg. “vTurk” designed for college going youths f) providing mobile van service center in big cities in a particular area. e) Virgin Mobile website depicting youth flavor with red and vibrant colour (implying younger look) The Target Market: * The market numbers are compelling. Out of India’s total cellular user base of 242 million, 215 million are between 15 and 25 years old. And with India being the world’s fastest-growing cellular market—India adds 8. million subscribers a month. * The Virgin Mobile Brand, targets Indian youth aged between 13 and 30 years. There are 400 million people in this age group. (source Business week). Though young subscribers constitute only 30 percent of the total mobile subscribers, they contribute more than 50 percent of the revenues of telecom industry Rs 50,000 crore (Rs 500 billion) revenues in 2007-08. * By 2010, this group is expected to contribute 60-70 % of the total revenues of industry over Rs 35,000 crore (Rs 350 billion). (source: Business Standard) Why only youth? India has a total internet user base of 49. 40 millions of which “ under 25 age”accounts for 52%. (source: Business Standard) * Increased use of data services (internet usage, downloads) in future by youths,which would contribute in a significant proportion with the upcoming 3G services. Youth make more & longer calls double than industry average (Rs 155 CDMA, Rs 210 GSM) * High usage of SMS, data services (internet surfing & downloads) & other value added services (Ringtone, Caller tune, wall papers, Hence Huge opportunity to be tapped. Have short handset up gradation cycle –under 12 months as compared to 2 years for people above 25 yrs of age. * Future projection of increasing young and working population of India as 65% of overall population by 2020. (source: Economic times & planning commission). * Hence this segment offers a huge revenue opportunity not just from the entire group switching to a common service provider but also from the customized offer services like CUG. Urban youth mobile service revenue will be more than 350 billion by end of 2010 COMPETITIORS IN THE BATTLE
Virgin Mobile has entered into a very competitive industry where Airtel, Vodafone and Reliance are the dominant players. The compititiors are as follows: 1. Reliance Mobile(ADAG Group) –Reliance has 17. 93% market share. Virgin Mobile faces stiff competition from Reliance CDMA phones (in terms of excellent quality,and cheaper terrifs). Now Reliance is shifting towards GSM. So Reliance is going to be a very tough compititior for Virgin. 2. Tata Indicom – Tata has 9. 42% market share. And Tata’s marketing is to cover whole corporate area. 3.
Airtel and Vodafone – giving competition to virgin in terms of targeting youth segments Virgin Mobile have taken a ‘hatke’ route and launched the brand only for the youth segment. The tie up with Tata Teleservices enables it to fight competition as the network quality of Tata Teleservices was ranked first by DOT. MARKETING MIX: The marketing mix is the combination of marketing activities that an organisation in so as to best meet the needs of its targeted market. Product: Virgin Mobile offers six RUIM enabled handsets with colour screen, FM radio and include one touch access for Vbytes-Virgin Mobile’s VAS portal.
Price: The handsets are priced in the range of Rs2000-5000. The call tariff is very nominal which is 50p per call both local and STD subject to terms and conditions. Place: The focus of Virgin Mobile on customer acquisition has so far been in the top 60 cities of India and is set to extend to more cities. The product is available across a host of modern retail outlets The Mobile Store, Hotspot, RPG Cellucom, Croma etc. Promotion: Virgin Mobile entered the Indian market in grand style. The company surprised the readers of a leading Indian daily when all the headlines on the front page were in the colour red.
Virgin Mobile has used a very vibrant colour to relate itself with the targeted market. Apart from traditional media, internet and outdoor youth centric advertising has been used wisely to attract the targeted audience. ADL and BDL strategies Above The Line-Virgin mobile is doing very good through various media channels for eg. By Tv adds (signed Ranveer Kapoor and Jineliya Khan as Virgin’s brand ambessdors), print media (using Newspapers as media channel), and by hordings in the populated areas. Virgin Mobile India put up its online character ‘Pebo’ on Youtube, propagating its 50 paise per minute STD calls and other services.
Below The Line-Making the brand popular by various retail outlets,leaf-lets,buntings & dummy boxes(in red and vibrant colours),and also growing public contacts by running various campaigns like “vTurk and Anti Ragging” in public places and colleges. Brand activation model of virgin mobile Virgin mobile is going on very high pace to popularize its brand. It is running various campaigns (for eg. vTurk – making virgin’s representatives in colleges,campuses and giving them certificates and incentives for the excellent job,It also ran campaign against RAGGING) to increase its brand value in youths.
In its advertisements it is depicting especially funn loving guys showing the “Think Hat Ke” theme. Thats why it signed very young brand ambessdors(Ranveer Kapoor and Jineliya Khan) to symbolize the youths. Virgin mobile is trying to win consumer’s trust by providing Simple tariff plans, no hidden charges, totally dedicated customer services, awesome downloads and features in there handset, games,wallpapers, superior network coverage,top notch call quality and many exiting and unique offers. Positioning This is very good example of virgin’s marketing strategy
Reasons why you’re not with us????? You Love Quantum Physics- And complicated tariff plans & hidden charges. You like people with helpo noto phobia – And basically enjoy being put on hold, calling customer care 100 times only not to have your queries answered. You like yawning a lot- Out of boredom, out of being not able to do much with your phone. You adore jam packed things-Even in your network which results into disconnected calls. You love strict, conservative, old school things-Including the boring corporatish service provider you’re with. You love not being reachable.
Not by choice, but by force- Your network coverage or rather lack of it, allows you to stay disconnected from the world for longer than what you would want to. Awards and recognition * Awarded the coveted Infcom award for the “Most Innovative Mobile services” for the year 2009. * Virgin Mobile India has been ranked as No. 1 in Customer Satisfaction of SAARC countries Mobile users. * Virgin voted the most admired brand in UK in 2007 * Virgin Mobile tops TRAI benchmark of User Satisfaction in the year 2008 * Virgin is winner of 8JD powers customer satisfaction award in 7 years.