Vodafone Planning Principles in competition

Vodafone Planning Principles in competitionIntroduction trade is the core of only calling. To outperform the competition requires solid tradeing k at presentledge and precision in grocery storeing decision making. To merchandiseplace comp alls product or portion, it is necessary to event positioning, positioning of its products and work depend on the cookery and implementation of intelligent and aggressive st dictategical market plans.As this designation requires choosing an geological formation which fosters strategic merchandising coundealing process thus, Vodafone multi-national UK- al-Qaedad ready vane operating company has been picked.About VodafoneThe Vodafone group is a smooth net income operator headquartered inNewbury, England. They made their first b arrangement call just minutes aftermidnighton the 1stof January in 1985. In 1987 it was already recognized as the largest roving meshwork in the founding. Today it is the biggest telecommunications n etwork provider in the world by turnover and has a market value of about one hundred billion pounds. It is a FTSE ampere-second company and is ranked 3rd overall just behind violet Dutch carapace and the BP group. Vodafone currently has equity sidelines in twenty-five countries and has former(a) bulgener networks with as stages in a nonher forty one countries. It is the second largest erratic telecom group in the world behind China erratic and has more than than ten million customers in theUnited Kingdom,Germany,India,Italy,Spain,Turkey,Egyptand theUnited States.At a glance of Vodafone 1Type Public Limited Company (PLC) manufacture TelecommunicationsFounded 1984Headquarters Newbury, United KingdomArea Served World wideWebsite www.vodafone.com1 en.wikipedia.org/wiki/Vodafone occupation 11.1 Vodafone trade Planning PrinciplesVodafone market planning involves deciding on merchandising strategies that entrust help the company attain its overall strategic neutrals.A deta iled marketing plan is needed for distributively business, product, or brand. It has external and internal environments where plenty of strategic elements ar involved. As part of marketing planning principles, large-environmental s go offning pass on be conducted by analyzing probatory macro factors coining the telecom industry while Porters five forces, thrum abstract (SW-for micro environment and OT-for macro environment) will be utilised to assess the micro-environment surrounding telecom industry. Later, BCG intercellular substance as part of Vodafone portfolio compendium technique is explained.1.2 Vodafone Plan Development Using Analytical Tools and Techniques1.2.1 Macro-environmental factorsTo analyze the macro factors of the Vodafone Plc, pestisEL analysis, SWOT analysis (OT is detailed in macro environmental issues) is described.1) PESTEL analysisPolitical factorsRegulations- Mobile visits licenses are tightly controlled and are very expensive. In most cases tig ht mea originals are implemented by the governing body in order to decrease mobile phone use for children because of health issues.Infrastructure- To manakin up an infrastructure to support the network usually requires permission from the government activity and separate regulative bodies.Economical factorsThe recession has decreased the amount of gold customers are willing to spend, hence there is a scathe con fly the coop between leading network providers to drive down exists of calls and SMS to withdraw more customers.Cost of licensing-When the engine room of 3G was introduced there was a bid contend amongst leading companies which ended up in a utmost expending of acquiring this technologySocial-cultural factorsFashion- In some countries especially in europiumit is in fashion to take hold a mobile phone. The market inEuropeis so big that all kind of phones are be sold here. These days in iphone by Apple has conquered most of the market and is the best seller in t heUKat the momentDemographics- Mobile phones tend to be used by the younger members of society. In a verdant where the population is ageing, which is the trend across the EU, the demographics may shift to a more aged population who may dumbfound less use for mobile phones.Technological factors3G (3rd Generation)-The introduction of this technology take hold helped Vodafone to interact easier with their phone and they were able to sourer services worry the mobile internet or known social networking sites like facebook directly nettleible from the phone.It is now often easier for business customers to arrange tackleings and get information directly on their handset. Vodafone similarly supplys tailored charge plans for business customers.GPS (Global Positioning System) It is now possible to get a navigation programme on the handset where supported. Instead of get expensive navigation systems the customer apprize pay one off fees and use the systemThe technology advancem ent in general will help Vodafone to cope with the growing competition all over the worked and will help them growth to attract more customers through these technology developments.environmental factorsVodafone cede established a recycling programme for phones in order to help the environment and recycle and reuse the materials used in the handset. They conk incentives in terms of money to customers hand in their old phone in exchange for a rising one.Legal factorsLaw-There are some laws which regulates the actions of business e.g. The Sales of Goods Act 1974 stating all products must be go over for the purpose they are intended. A mobile phone must therefore work. These laws are created to regulate particular industries for guinea pig the toss on mobile phones while driving. This signifi backtly gaind the sale of headsets.2) SWOT analysis (PART 1 OT under macro environment)OpportunitiesEmerging markets offers Vodafone to introduce their unique services to that market where the market has high rate of growth. They can become a market leader as they are the biggest network provider in the world and their experience could help them to achieve that.At the moment having a mobile phone is a necessity for many people and the trend is handout up that people are tending to have one or more mobile phone. This could turn out positive for Vodafone as the market tends to increase by size and volume in terms of sales.threats disceptation could be a threat organization as more opposite products and services are being offered by diametric companies. The iphone for example introduced by o2 has significantly decreased sales of other products and services because they reserved the rights to be the only distributor of the phone in theUK.The effect of rules and regulation by the government can in like manner be threat to Vodafone as they could ban or set outlay regulations.3) Marketing MixVodafone uses its advantage as being a large global organization and implement s incompatibleiation and cost leadership strategy as they benefit from economies of scale. This al belittleds them to have a agonistical advantage and adding more value to their range of services to the customers compared to other competitors.The marketing mix consists of many different factors, which are grouped together into quatern main categories product, place, price and promotion.Product-Vodafone offers different type of products to different type of customers and so can segment their market in this field. Since the introduction of 3g services they can offer more than just voice calls and messaging. Customers are able to access he internet and other multimedia applications on the go and can benefit from the unique quality of Vodafone.Price-They are able to offer different services for different customers like pre pay phones, pay monthly contracts and business solutions for businesses. This allows them structure their pricing method towards different needs of the customer.Pl ace-Vodafone operates mainly through their retail stores all over theUK. There are over three hundred retail outlets and they as well offer their services through independent retailer like Phones4u.Promotion-Vodafone affectively operated a solid marketing structure which includes advertising visiting card on the street, TV campaign and also use famous celebrities like David Beckham to advertise their products. This ensures people are sensible of their special offers and discounts.1.2.2 Micro environmental factors1) SWOT analysis (PART 2 SW under micro-environment)StrengthsThe size of the organization plays an significant factor when we are speaking about their talent. Their global carriage and network makes it easy for them to be more matched even on a global scale.Vodafone is reputable company and there are famous for being the best in their field. Their brand image is very important when it comes to sales and increasing them.Standardized customer relation management is als o a feature of Vodafone. The company is developing a group-wide standard in customer relation management to ensure an aware(predicate)ness of its customer base and their preferences in order to help the cost-effective sales of its new services and products.WeaknessesDeveloping new technologies can turn out very expensive. If these technologies authorize off to succeed in the market this could end up in a huge loss which would be hard to recover from.They can non introduce new technologies where it is not possible this could be because they are cladding the legal issues within that country.2) Porters 5 forcesBy using the five forces mildew of completion, competitor analysis network by understanding how the threat of new entrants, the bargaining power of secureers, the bargaining power of suppliers, the threat of substitutes and the competition of other firms and how they affect the company directly.Competitive Rivalry The competition in theUKfor example is very much intense a nd big organizations like O2,Orange and T-Mobile have a significant impact on revenues.Bargaining power of buyers Customers have the choice of many different type of product at give way time due to the high level of competition. In terms of different type of packages and different prices people tend to go for other companies and buy their product.Bargaining power of suppliers Vodafone is one of the largest network providers in the world and therefore they are able to use the benefits of economies of scale and reduce their production costs. This allows them to increase their profit margin compared to other companies and offer better a price to value ratio to the customer.Threat of substitutes There is a low try of substitutes for Vodafone as they have established a well- playd brand image. asunder from that as they benefit from economies of scale they can sell their services at the same price like their competitors.Threat of new entry As there is no threat for other companies to enter the market because of rules and regulations and the high cost of licenses required to operate a network, Vodafone has to continue being efficient and reducing costs in order to price match their competitors.Threat ofNewEntrantsBargainingPower ofBuyerCompetitiveRivalry(O2, Orange, 3 mobile, T-mobile)BargainingPower ofSupplierThreat ofSubstitutionFigure 01 Porters 5 forces of VodafoneFigure Source http//www.mindtools.com/pages/article/newTMC_08.htm4) BCG (Boston Consultancy Group) Matrix doubt MarksStarsDogsCash cow HighMarket GrowthLowLow Market piece HighFigure 02 BCG (Boston Consultancy Group) Matrix of VodafoneStars The star of their products which is the main product they offer are the monthly contracts they offer as these are very popular amongst the customers.Cash Cows this is the product which generated revenue but is at a stage where it does not grow. The messaging services they offer generate good revenue for them and as there is no opportunity to expand as that thi s service is their cash cow.Dogs This would be their analogue services as they do not really generate revenue because of too much competition.Question Mark This product is the one with high growth potential and low market share. In this case it would be the 3g serves they offer. As there are other companies offering the same services it hard to gain a higher market share. parturiency 22.1 Strategic Marketing Options for VodafoneMarketing strategy always considers options where it can be applied. In Vodafone, the following marketing strategy options can be applied though both matrixes have got some advantages and disadvantages as well. prevalent Electric/McKinsey (GE) MatrixGE matrix is used mainly for market attractor. The examination and understanding of market attraction is very important in determining investiture strategies in a country of operation. The advantages and disadvantages of GE matrix are given as followsAdvantagesDisadvantages fundamental competitive analysis prov ides a basis for ranking relative strength of business units in their particular environment.Formal definition of components is not put across or simple (Johnson 1985)Analysis is difficult for outsiders to reproduce (Johnson 1985).Determinants Industry attractiveness and business strength.The following figure shows the concept of GE Matrix.Figure 03 General Electric (GE) MatrixSource www.marketingt for apiece one(prenominal)er.comcuticle Directional Policy Matrix 2The compositors case Directional Policy Matrix is another refinement upon the Boston Matrix. along the horizontal axis areprospects for business sector profitability, and along the vertical axis is a companys competitive capability. As with the GE Business inter the location of a Strategic Business Unit (SBU) in any cell of the matrix implies different strategic decisions. However decisions often drag options and in practice thezonesare an irregular shape and do not tend to be accommodated by box shapes. Instead they blend into each other.AdvantagesDisadvantagesConsiders both, internationalist capabilities of the company and competitors capabilities.Market Position is restricted to market share.Assumes countries have stable semipolitical, social and economic environments.Only regulatory aspects pertaining to Shells products have been addressed.Determinants Companys competitive capabilities and business sector prospects.The following figure shows the concept of SDP Matrix.Figure 04 Shell Directional Policy MatrixSource www.marketingteacher.com2 http//www.mbaknol.com/strategic-management/shells-directional- insurance policy-matrix/2.2 Evaluation of Marketing Strategy Options for Vodafonepatronage the shortcomings of previous studies and models, attempts at reaching an understandable model for determining international business strategy have been ongoing.The marketing literature presents a number of models designed to guide managers in making strategic investment decisions for Vodafone Plc.inclu de in that number are matrix approaches such as Shell directional policy matrix (Robinson, Hichens, and Wade 1978), and GE/McKinsey (Taylor 1976).These models have each provided a unique contribution to the strategy process but each also has distinct disadvantages.The advantages and disadvantages of each are, particularly concerned for firms interested in the international market is the fact that these models do not take into comity the international environment.Many multinational companies still confront the problem of compound environmental assessments into decision making in a systematic and objective manner.The task facing them is how to translate recognition of the business situation into action. anterior models are limited in their generalizability across different types of industries and actual environments worldwide.Task 33.1 Current Changes in the Marketing Environment in VodafoneAs Vodafone is a worldwide company and operates in over 27 different countries, this makes an alyzing the external environment fairly difficult using a PEST analysis. The PEST analysis in this report is mainly directed at Vodafones UK external environment in terms of strategic marketing management policy.PEST analysisPoliticalPolitical factors can have a direct impact on the way businesses operate. Decisions made by the governmentaffectour everyday lives and can come in the form of policy or legislation. The Governments introduction of a statutory minimum wage affects all businesses, as do consumer, Health Safety laws and so on. The current increase in global petrol prices is having a profound impact on major economies, it is estimated that 200bn has been added to the global fuel bill since the price increases started.Another political factor is OFTEL, the telecommunications regulator in the UK whose purpose is to ensure phone companies, meet their obligations under telecoms and competition laws and regulations.The UK government regulates this industry through OFTEL.Economi cal both businesses are affected by economical factors nationwide and globally. Interest rate policy and fiscal policy will have to be set accordingly. Within the UK the climate of the scrimping dictates how consumer may behave within society. Whether an economy is in a boom, recession or recovery willalso affect consumer confidence and activities.Economies internationally also have an impact on UK businesses, cheaper labor abroad affects the competitiveness of UK products nationally and globally. An increase in interest rates in the USA will influence the share price of UK stocks.A truly global player like Vodafone has to be aware of economic conditions across all borders and ensure they employ strategies and tactics that protection their business and marketing investment.Socio-culturalWithin society forces such as family, friends, and media affect our attitude, interest and opinions. These forces shape who we are as people and the way we behave and what we ultimately purchase. T he end users of wireless products are becoming increasingly aware of quality and expect a product that is reliable during use. GSM has been an unqualified achievement because it works, offers definite advantages over first generation and is at a price where everyone can access the technology. One problem that has been apparent over youthful years is the high market exposure given to new features and technologies, which are not well proven and tested before launch. WAP was a rush example of this. A great deal of effort has been injected into WAP to make sure the early teething problems have been overcome, but the public can sometimes demonstrate memory akin to an elephant and changing opinions is a much harder marketing nut to crack. The market expectation for Bluetooth and 3G has been raised considerably so now we are at a critical stage in fulfilling the publicise dream.TechnologicalAdvanced technology is changing the way businesses operate. The net profit is having a profoun d impact on the marketing mix strategy of organizations. Consumers can now shop 24 hours a day, comfortably from their homes. Vodafone has been using the Internet for advertising like a lot of other organizations trying to sell their business.There is renewed interest by many governments to encourage investment in research and development and to develop technology that will give their country the competitive edge. The one-stop-shop customer need, and the manufacturers success in integrating cellular, cordless and internet user applications into a single unit has meant that a wireless test company has to consider all major technologies and review each for their commercial benefits. In some instances some technology advancements will not create a profitable business in isolation. Vodafone has introduced new technology such as Vodafone Live, and now the introduction of the new 3G mobile phones direction Vodafone will implement the new technology into their system to bring the service t o the customer.3.2 Analyzing Vodafones Potential Responses to the Strategic Marketing Changes3.3 Recommendation and Conclusion