Background GrameenPhone is a GSM-based cellular operator in Bangladesh and market leader with more than 50% of the Bangladeshi market share. GrameenPhone started operations on March 26, 1997. It is partly owned by Telenor (62%) and Grameen Telecom (38%). Grameenphone is one of the largest private sector investments in the country with an accumulated investment of BDT 8500 crore up to June 2006. Grameenphone is also one the largest taxpayers in the country, having contributed nearly BDT 5000 crore in direct and indirect taxes to the Government Exchequer over the years. Of this amount, BDT 1670 crore was paid in 2005 alone. GrameenPhone is the largest mobile phone company in Bangladesh with more than 10 million customers as of December 2006. It is also the fastest growing cellular telephone network in Bangladesh. At the end of 2005, it had about 3500 base stations around the country with plans to add about 500 in the following six months. Grameenphone's stated goal is to provide cost-effective and quality cellular services in Bangladesh. On the 16th of November 2006 GP formally changed its logo to match its parent company Telenor's logo. According to GP the new logo symbolizes trust, reliability, quality and constant progress. The name Grameenphone will be kept as part of the new identity. The name Grameenphone carries with it all of the heritage, success and values of our past, added the GP CEO Eric Aas. MARKETING MIX Marketing Mix is the set of controllable tactical marketing tools the firm blends to produce the response it wants in the target market. The marketing mix consists of everything the firm can do to influence the demand for its product. The many possibilities can be collected into four groups of variables known as the “four Ps”: product, price, place, promotion. Figure shows the particular marketing tools under each p. Product Price Variety List price Quality Discount Design Allowance Features Payment period Brand Name Credit terms Packaging Services Target Customers Intended Positioning Promotion Place Advertising Channels Sales proportion Coverage Public relation Assortments Personal selling Locations Inventory Transportation Marketing Mix Product means the goods and services combination the company effect that Product offers to the target market for attention, acquisition, use, or consumption that might satisfy a want or need. Price is the amount of money charged for a product or service, or the sum of Price the values that consumers exchange for the benefits of having or using the product or service. Place Place includes company activities that make the product available to target consumers. Promotion Promotion means activities that communicate the merits of the product and persuade target customer to buy it. Grameenphone Product Mix A product is anything that can be offered to a market and that is potentially valued by a target market for the benefit or satisfactions it provides, including objects, services, organization, places, people and ideas. As in a service providing business Grameenphone provides different types of service in its market as its products. In telecommunication business coverage and quality is more important than the number of product or service offered. With its best coverage and good quality Grameenphone has become the number one mobile operator in Bangladesh. Grameenphone has categorized its products in two types. These are 1. Standardized and 2. Customized Products. Standardized Product Standardized Product also has been divided into two types: Pre-Paid and Post-Paid. Pre-Paid The brand name of prepaid products is Smile Prepaid Standard and Smile (Mobile to Mobile). Smile (Prepaid Standard) Smile Standard prepaid allows consumers to make and receive ISD and NWD call in all telecom operators. Smile (Mobile to Mobile) Smile Mobile to Mobile allows its consumers to make and receive call from any mobile Postpaid Xplore Xplore is the brand name of post paid product of Grameenphone. It is categorized in two types: Xplore Package 1 and Xplore Package 2. Both of these Post-paid products has BTTB (Local, NWD, ISD and Economy ISD) connectivity, Flexible Credit Policy, Wide collection of value added service (SMS, EDGE, Welcome Tune, Voice Mail, Voice SMS) and International Roaming facility. Customized Product “Business Solution” is provided as a customized service to different medium and large organization and Professionals. This customization allows interesting call and sms charge among the member of the organization, fax and internet service within the organization branch. The customized service of one organization is never told to other or disclosed. Separate Strategic Business Unit (SBU) is responsible for the success of each of this product. As the way, this organization has proved that SBU is important for the success of a product in its market. Interestingly “d-juice”, which is claimed as a life style brand of Grameenphone, is not mentioned with this product line. Different types of value added services are provided with these products as product feature. Value Added Services With Grameenphone‟s VAS, consumer can use mobile phone for many other purposes than making voice calls. With Grameenphone‟s VAS, consumer can use mobile phone to: Send and receive text messages, picture messages, voice messages Download ring tones, logos, wallpapers Obtain news updates, cricket score updates Browse the Internet and also send and receive e-mails Transfer data and send fax Participate in competitions and vote for opinions Health line services. Branding The name or names that identify a company‟s products can be very important in positioning them. The brand name distinguishes a product from competitor‟s products. A strong brand identity creates major competitive advantages. A brand that is recognized by buyers encourages repeat purchases. Grameenphone is successful in its products branding. All most every prepaid mobile phone user is aware about its “Smile” prepaid package and business consumers are aware about “Business Solution”. This Branding images comes from good quality of Grameenphone‟s products as well as its high promotion activities. Corporate branding places primary emphasis on building brand identity using the corporate name. Grameenphone has become a corporate name in telecommunication business in Bangladesh. Corporate branding offers the advantage of using one advertising and sales promotion program to support all of the firm‟s products. And it is often found in Grameenphone advertisements. Corporate branding has become a branding strategy because the product offering is relatively narrow in telecommunication business. Products Life Cycle A company‟s positioning and differentiation strategy must change as the product, market environment and competitor‟s strategy change over time. Product life cycle (PLC) is the course of a product‟s sales and profits over its lifetime. It involves five distinct stages: product development, introduction, growth, maturity and decline. All products have a limited life and profits rise and fall at different stages of the product life cycle. All of Grameenphone‟s products are in maturity stage. Grameenphone hopes that this will continue for other few years. Different features and value added service will be included over time to time with the products to maintain the maturity of the product. Grameenphone’s Strategic Analysis of Existing Products Grameenphone regularly evaluates the performance of its product. This evaluation of the performance of the product portfolio provides its management with diagnostic information to guide its strategies for new products, product modification, and product elimination. But the strategic analysis of existing products requires tracking the performance of the products in the portfolio, as shown below: For tracking product performance Grameenphone‟s management first establish the criteria and levels of performance for gauging product performance. These include both financial and non financial factors. Because of the various demand and cost interrelationships among products, an information system is established to measure how well a particular product is doing. The purpose of this tracking system is to maintain a product review process that will help to spot problem products or products features. Grameenphone‟s management uses the diagnosis to help select a strategy for eliminating the problem. Action includes adding new products, cost reduction, product improvement, marketing strategy alteration or product elimination. Product life cycle analysis The length of product life cycle is shorter in telecommunication business. So in a few years Grameenphone‟s products moved from its introduction in to the growth stage and it is now in maturity stage. This first movement through the product life cycle also creates the need to alter the cycle by introducing new products or products feature. Product portfolio analysis Grameenphone‟s strategic analysis of the products portfolio determines if each product is measuring up to management‟s minimum performance criteria, and assesses the strength and weaknesses of the product relative to other products in the portfolio. Portfolio grids highlight differences among products. After identifying the relative attractiveness and business strength of the products in the portfolio, a more comprehensive analysis of specific performance factors may be appropriate, including: Profit contribution. Barriers to entry. Sales fluctuations. Extent of capacity utilization Responsiveness of sales to prices, promotional activities, service levels, and other influences. The nature of technology (maturity, volatility, and complexity). Alternative production and process opportunities. Several of these factors are included in the grid analysis when composite grid dimensions are used. Grameenphone’s Strategy for existing products Cost reduction, product alteration, product elimination works as a strategy for existing products within this organization. Cost reduction Grameenphone‟s lower cost comparatively its higher class products quality give this company major advantage over the competition. Grameenphone‟s technological innovation, marketing productivity and high volume consumer helps to maintain this lower cost. Product alteration Products are often improved by changing their features and quality. A number of features are included with Grameenphone‟s products. And these features provide a way of differentiating a brand against competition. In November, 2006 Grameenphone renamed its products as Easy to Smile; Regular to Explore. A number of new features also have been added with these products in that time. But consumer‟s preferences suggest that quality is more important than features in the choice of taking connection. So quality improvements are also considered as an important strategy for increasing competitive advantage. Product elimination In deciding to drop a product from product line, Grameenphone‟s management considers variety of performance criteria in addition to the product‟s sales and product priorities. In November, 2006 Grameenphone eliminates some of its products from product line such as Any Time-300, Any Time-450 and Any Time-500. But product elimination is a very important decision that is thoroughly evaluated by Grameenphone‟s management. Because Grameenphone‟s core value is “Make it easy”. Those similar type of products confused customer. There fore these have been eliminated so that consumers feel easy to use Grameenphone‟s products. Grameenphone‟s corporate culture committed to provide good quality services .It believes that quality improvement is an organizational responsibility. So this will continuingly introduce good quality services or product comparatively minimum price. Analyzing the Pricing Situation of GP: Price Elasticity: It is the percentage change in the quantity demanded when price changes, divided by the percentage change in the price. GP has gained high price elasticity in the market. Non-price factors: The Gold holders pay a high amount of money in buying to get the high facility. Cost Analysis: Product cost provides essential information for pricing decisions. To analyze cost, GP uses the following steps: Competitor Analysis: Aktel is the major competitor of GP as it is consistent in its rates and facilities and gain a most part of the market shares although Banglalink has more promotional activities and call charge, they have not been able to hold the market yet. GP fixes its competitor on the basis of market share. They fix price in keeping pace with the competitors‟ price and their probable responses to an alternative price strategies. Legal Anbd Ethical Ckonsiderations Of GP: Price fixing in channels of distribution: GP provides its distributors at low cost. In pricing the channels of distribution, it has discrimination. Price information: GP publishes articles and advertisements in all national dailies and television about the form and the availability of price information for the customers. Price of Different Offers of GP at A Glance: XPLORE PACKAGE 1: Tariff and line rent: BTTB Range Any Mobile F&F (local/NWD/ISD) SMS Charge Peak (6 a.m. - 11 p.m.) Tk.1.9/min Off Peak (11 p.m. - 1 Tk. 1.50/min F&F: Tk.0.50 a.m.) Incoming: Free GP: Tk.1.50 Tk.1.0/min Outgoing: GP Tariff Super Off Peak (1 a.m. - + BTTB charge Other 6 a.m.) (Local/ NWD/ ISD) Operator: Tk.2.00 Tk. .30/min* Tk. 1.50/min GP to GP only *Promotional Tariff Line Rent: Tk.100/month BTTB Incoming is absolutely free for Xplore Package 1. XPLORE PACKAGE 2: Package 2 has come up with a very attractive and competitive tariff. BTTB Incoming is absolutely free for xplore Package 2. No Monthly Access Fee/Monthly Line Rent Monthly Package Fee (Minimum Usage): Tk.1000 BTTB Tariff F&F (local/NWD/ISD) SMS Charge GP mobiles (6 am -1 am) Tk.1.50/min Incoming: Free F&F: Tk.0.50 GP mobiles (1 Tk. Outgoing: GP GP: Tk.1.50 Tk.1.0/min am -6 am) .30/min* Tariff + BTTB charge (Local/ Other Operator: Other operators Tk.1.50/min NWD/ ISD) Tk.2.00 (24 Hrs) * Promotional Tariff (Subscriber has to pay the monthly package fee if the monthly usage is below Tk. SMILE PREPAID: OFFERS RATE(taka) USERS Friend and family 1.00 SMS .50 SMILE subscribers will enjoy reduced tariff of only Tk 2.0/min all day for all GP to GP calls and Tk 2.5/min to any other operator. SMS to any GP-GP number is Tk.1.5 and to other local and international operators is Tk. 2. Tariffs: of voice sms For sending (or replying) a Voice SMS, charge is BDT 2.50 per minute. There is no charge for listening a New Voice SMS. Charge is BDT 1.00 per minute to retrieve Old Voice SMS International SMS: Any GP user can send SMS to more than 100 million GSM subscribers all over the world. It costs much less than making a call and is quite convenient to send. Tariff: Product djuice On-Net Off-Net International SMS Smile BDT 1.50 BDT 1.50 BDT 2.00 BDT 2.00 Smile PSTN BDT 1.50 BDT 1.50 BDT 2.00 BDT 2.00 Post paid BDT 1.50 BDT 1.50 BDT 2.00 BDT 2.00 djuice BDT 0.50 BDT 1.00 BDT 1.50 BDT 2.00 News service: GP provides news and sports update. Tariff: BDT 2.0 MP3 tones Grameenphone EDGE Grameenphone offers EDGE (Enhanced Data Rates for Global Evolution), an advanced mobile technology which enables high-speed mobile Internet and data services. It is about 8 times faster than GPRS. Tariff Structure PACKAGE 1 PACKAGE 2 Subscribers ALL Post Paid Only Monthly Access Fee None BDT 1,000.00 Browsing Charge BDT 0.02 / kb NIL Content Download As per content As per content Pricing: The following table shows price of different contents offered by GP: Contents Price (in BDT) 1 Poly tones 15 2 True tones 20 3 Wallpaper 10 4 Animation 10 5 Color Logo 10 6 J2ME Games 40 7 Video Clips 30 8 Themes 20 Grameenphone Distribution Mix Importance Of Distribution In GP: To perform the above task effectively GP uses its own distribution channels, which are distinguishable from others. When initially selecting a channel of distribution for a new product, the pricing strategy and desired positioning of the product may influence the choice of the channel. Once the channel of distribution design is complete and responsibilities for performing the various marketing functions are assigned, these decisions establish guidelines for pricing, advertising and personal selling strategies. GP is very much efficient in establishing these types of strategies. It helps them to maintain an exclusive distribution channel to serve the end-users. Mission Of GP’s Distribution Strategy: The motto of GP in establishing distribution channels is: to be the nearest of the customers. And exactly their motto is realistic. GP is the nearest company of the customers. It has opened all the doors to serve their customers most conveniently. Overview Of GP’s Distribution System: The number of GP owned distribution centers all over the country is around 18. The centers serve customers directly and deal them with guidelines and advices to make the communication through network system easier and quicker. Besides there are around 60 franchises spreading all over the country right now. These franchises deal with the customer problems and requirements; they gets complains from customers, they collect creative suggestions from the valuable customers. And other channels- such as dealers, retailers- are making the products and services of GP more diversified to the customers. GP has not come to its present situation instantly. Various types of changes incurred during the years of its business. We will see the different channels at different time period one by one. Initial Distribution Channels From the beginning of the business of GP, it supplied its SIM to the distribution centers. Dealers got the product from the centers and sold those to retailers. The retailers, at last, sold the product to end users. This was a traditional channel. Sometimes, end-users purchased products from dealers as a whole to minimize the purchasing cost. Company did not sell directly to the customers at that time. Only three years ago GP introduced a new and convenient channels of distribution to overcome the traditional system. The two tails of the channel is the most attraction part to the customers. Through around 30 distribution centers, GP distributes all key parts of the country. Dealers, as an intermediary, purchase the products from the centers and disburse those to two types of retailers. One is – exclusive retail outlet and another one is – non-exclusive retail outlets are permitted to sell the products of only GP. They are the guaranteed or authorized retailers. Non-exclusive retail outlets can sell other companies‟ product as well as they have no relation the customers or end-users buy products from either of two types of retail outlets. They get the product or service of company in the most convenient way at the student time period. Grameenphone Promotional Mix Grameenphone uses promotional activities that communicate the merits of the product and persuade target customers to buy it. Grameenphone can succeed to acquire more than 10 million customers as of December 2006 not only providing good service but also using high frequency promotional activities. Grameenphone uses most of the promotional tools to give message for its customers on the new product & existing product and product features. Grameenphone must do more than make good product- they have to inform customers about product benefits and carefully position products in consumers‟ mind. To do this Grameenphone promotes the promotion tools are: Grameenphone Promotional tools Advertising Sales Promotion Public Relation Personal Selling o Newspaper o Price packs o Publications o Inside Sales o Television o Cash Refund Offers o Events Force o Radio o Prizes o News o Magazines o Patronage Award o Sponsorships o Newsletter o Premium o Public service o Internet o Price Offs activities o Identity Media Grameenphone Advertising process : Any paid form of nonperson presentation and promotion of ideas, goods or services by an identified sponsor. Grameenphone advertising can introduce the company and the products. If the product embodies new features, advertising can explain them. Advertising can remind customers of how to use the products and reassures them about their purchase. Grameenphone Advertising Objectives: Grameenphone uses advertising as a promotional tool to make a communication task to be accomplished with a specific target audience during a specific period of time. Grameenphone Advertising objectives Informative advertising Telling the market about a new product Suggesting new uses for a product Informing the market of a price change Explain how the product works Describing available services Building a company image Persuasive Advertising Building brand preference Encouraging switching to Grameenphone Changing customer‟s perception of product attributes Persuading customer to purchase now Persuading customer to receive a sales call Reminder Advertising Reminding consumer that the product may be needed in the near future Reminding consumer where to buy it Grameenphone Advertising tools: Grameenphone uses different types of media to acquire different types of objectives. To select media depend on the target audience, product characteristics, message characteristics and cost. The advertising tools that grameenphone uses as a media to communicate with the existing and potential customers are: o Newspapers Newspaper covers all sorts of information about grameenphone‟s product. It mainly covers the informative and reminder advertising. Target audience Message characteristics Duration Cost Literate people. Flexibility, high believability Short life Lower o Television Television is an effective media for good mass-market coverage. Television telecasts messages about new product and it is mostly used for persuasive advertisement. Target audience Message characteristics Duration Cost All types of people High attention, high reach, high Long life High but teenagers clutter influences more o Radio Within a lower cost, grameenphone broadcast their massage through radio. It is a better way for persuasive advertisement. Target audience Message characteristics Duration Cost All types of people Audio presentation only but usage Relatively Lower but teenagers mass and cover high geographical area. short life influences more. o Magazines An effective media that grameenphone uses as a promotional tool to achieve the customer‟s awareness about grameenphone and its product. It is an effective media for informative and persuasive advertisement. Target audience Message characteristics Duration Cost Middle and Upper- High-quality reproduction, credibility long life Medium income audience. and prestige. o Newsletters Grameenphone publishes newsletter regularly to inform existing customer as well as potential customer about company‟s recent activities and offer. Target audience Message characteristics Duration Cost Loyal consumers Very high selectivity, full control. Short life Relatively and interest low cost persons o Internet Internet performs effective promotional tools grameenphone advertising. It gathers all sort of information about grameenphone. Target audience Message characteristics Duration Cost Internet browser High selectivity, interactive Long time Relatively possibilities. still update low cost Grameenphone Sales promotions Process : Grameenphone uses sales promotions that consist of a diverse collection of incentive tools, mostly short term, designed to simulate quicker or greater purchase of particular products or service by consumers or the trade. Grameenphone Sales Promotion Objectives: Sales promotion tools vary on their specific objectives. Grameenphone uses sales promotion to acquire broader promotion objectives: Grameenphone Sales promotion objectives For consumer Encouraging purchase of large sized units. Building trail among nonusers Attracting switchers away competitors‟ brand For retailers Persuading retailers to carry new items Encouraging stocking of related items Offsetting competitive promotions Building brand loyalty Gaining entry into new retailers outlets For the sales force Including encouraging support of a new product Encouraging more prospecting Sales promotion tools: Many tools can used to accomplish sales promotion objectives. Describes of the main consumer, trade and business tools that grameenphone uses as short-term incentives to encourages the purchase the product follow: o Price-packs: Nokia handset festival @ GPC’s Grameenphone Ltd. kicked off the first handset bundled promotion at its Grameenphone Centers around the country. Under this promotion free GP connections and bonus talk time, Tk.660 to Tk.2000 depending on handset, are being offered with select popular Nokia models. o Cash Refund Offers: thankyou thankyou is grameenphone way of expressing their gratitude, because not only has consumer loyalty touched us but has also made grameenphone the preferred mobile operator. Grameenphone thankyou program provides consumer with a number of rewards that will make consumer mobile phone experience with gramophone even more satisfying. o Prizes: grameenphone pothe pothe utchob Grameenphone‟s mobile transport travels all around the country and arranges different types of amusing game/contest for their loyal customers and offers attractive prizes who win the game /contest. o Patronage Awards: thankyou crown, Be Special, Be crown Grameenphone offers the prestigious thankyou crown membership to especially cater to you. To enrich your life, grameenphone offers premium services and exclusive discounts. Membership Average Monthly Usage Over Last Six Discount on SIM Months Replacement Platinum BDT 6500 and above 100% Gold BDT 4500 to below BDT 6500 75% Silver BDT 2500 to below BDT 4500 50% You will also enjoy exceptional service at all our customer touch-points. Just introduce yourself with your Grameenphone number and put your feet up! We will take care of your problem while you relax. o Premium: Enjoy free stuffs with a new xplore Package2 connection With every new xplore Package 2 connection, you will get 25 Text SMSs & 25 free Voice SMSs, and 5 GP branded Ring tones. Subscriber has to use the free content and VAS within 2 months after activation. o Price-Off: 450 minutes free! All Business Solutions postpaid subscribers will enjoy 150 minutes free talktime per month for 3 months to call their F&F numbers. For new subscribers, the offer is valid from the date of activation and for existing subscribers, the offer is valid from 28 March '07. Grameenphone Public relations process: Public relation is one of the grameenphone strategic promotion tools building good relations with the company‟s various publics by obtaining favorable publicity, building up a good “corporate image”. Grameenphone Public relation Objectives: Public relations can have a strong impact on public awareness at a muck lower cost than advertising can. Grameenphone use public relations to communicate with their publics by setting some public relation objectives. The objectives are: Grameenphone Public relation objectives Build marketing excitement before media advertising tools. Build a one-to-one relationship with consumers. Build a core customer base. Turn satisfied customers into advocates. Grameenphone Public relation tools: Grameenphone public relation uses several tools. The tools are following: o Publications: Grameenphone published some sorts of materials to reach and influence their target market. Some publication materials are: Annual report Articles Grameenphone Newsletter o Events: Grameenphone arranges some special event to draw attention to new products or companies activities. Some special events that grameenphone arranges frequently: Seminar Conference Trade shows o Sponsorship: Grameenphone promote their brands and corporate name by sponsoring sport and cultural events and highly regarded causes. Some current sponsorship by grameenphone are: Grameenphone sponsors International Conference on ICT Official sponsor of Bangladesh Cricket Grameenphone sponsor International Trade Fair in Khulna o News: Grameenphone finds or creates favorable news about the company, its product and its people and get the media to accept press release and attend press conference. Grameenphone in its official website media site covers all news about grameenphone, its product and its people. o Public-Service Activities: Grameenphone has always been more than just a mobile phone service provider in Bangladesh. It builds goodwill by contributing money and time to good causes. Public service activities that performed by grameenphone are: Mother's Day thankyou vaccination discount. On the occasion of „World Mothers‟ Day‟, subscribers may also receive the following benefits: Samorita Hospital offers 25% off on screening test. Japan Bangladesh Friendship Hospital offers 50% off on screening test and free EPI vaccination. Honoring unsung heroes. Grameenphone in collaboration with Prothom Alo, a leading daily newspaper in Bangladesh, organized a program titled “Prothom Alo- Grameenphone Shommanona 2006”. The aim of this program was to bring the little-known development practitioners to the limelight creating inspiration and confidence for others. o Identify Media: Grameenphone creates a good image by using promotional tools. Grameenphone promotes the public relationship by its attractive logo, signs, uniform and others. Grameenphone personal selling process: Grameenphone personal selling is a good way to communicate the target customers. It focuses on more creative types of selling and the processes of building and managing an effective sale forces. Grameenphone personal selling Objectives: Personal selling serves as the grameenphone‟s personal link to customer. The sales representative is the grameenphone to many of its customers. Personal selling performs for establish some objectives. Those are: Grameenphone personal selling objectives To diagnose customer problem and providing services to the customers. Information gathering about the market. Building company‟s goodwill. Increasing the sales forces. Grameenphone personal selling tool: Grameenphone mainly focus on inside sales forces that conduct business from their customer care centre via telephone or visits from prospective buyers.