Considering E is the market leader of this slow-growing market, G products are positioned as Cash Cow for E. This means E can stably earn huge amount of revenue from the G products without the need of huge investment into it. Therefore, the G market needs to be milked continuously with as little investment as possible to generate enough cash for E to invest in its future growth strategy. 6 Segmentation-Targeting-positioning The following analysis looks at See’s current SST strategies and identifies attention areas for improvement.
First of all, segmentation is the process of dividing the market into segments according to their affinity or similar characteristics to analyses the buying behavior of these groups and adjust the communications for each group accordingly Jansen, 2007). A consumer market is most often segmented by demographic variables such as income level, age, socio economic status etc (McDonald & Ian, 2004). However, Brayer (2010) suggests that behavioral segmentation approach is more suitable for telecoms companies.
Sub-segments can be characterized by attributes such s their retention likelihood, their ‘stickiness’ (use of different Value Added Services), their promotion score (response to marketing offers) and their average value. After the market is grouped into different segments, E needs to choose one or a few segments to target their communications and offers at. This is especially important for a new brand like E to find a mutual profitable customer group from T-Mobile and Orange’s very distinct target market in the past. One method to do this is the customer lifetime value assessment as proposed by Brayer (2010).
Following the Parent principles, the pop 20% customer group who have the highest predicted contribution to overall organizational profitability will attribute 80% of the company’s profit and therefore can be selected as the target market (Figure 7). In 2013, E revealed to aim at Avoidance’s target customers who are mainly young tech- saws for their latest G launching campaign (Chapman, 2013), indicating that this is the most profitable segment that E has identified to focus at. Within the chosen target market, E needs a positioning strategy to highlight its differentiation from the competitors.
This can be analyses through a recapture mapping of the mobile network providers’ perceived quality and price by the customers. The quality scores are taken from Which? Report (Figure 8) and relative prices are calculated based on the pricing analysis in Appendix 1. E claimed to position itself as a premium brand against Avoidance and 02 in both pricing and quality (Reilly, 2014). However, looking at Figure g, E is actually perceived as an expensive brand that delivers low quality services, implying E can lose market share into other competitors with better fair value perception.
Therefore, E has to either reduce their rice to move to the low-market end or improve their perceived quality offered to gain competitive advantage. Considering See’s pioneering position in G service, recommendation is that E should improve their product and customer service quality to increase their value for money position and strengthen the market leader position. 7 SOOT Analysis SOOT will summaries the most important points from the External and Internal analysis to develop appropriate marketing objectives and strategies. 7. Strengths Market leader position in the mobile network providers industry. Pioneers the G market and owns the largest G customer base in the KICK. Wide coverage which will be further extended in public locations (McCall, 2014). Highest performance levels in speed and was the first operator that introduced G+ in central London (E&ME, 2014). Security of devices and data. First ILK operator to pre-install the ‘Lookout Mobile Security app’ on smartness in order to protect customers’ privacy when their devices lost or stolen (E, 2014). . 2 Weaknesses owe brand recognition. According to Gee (2014), around 77% of E customers still associate their network as Orange or T-Mobile instead of E. Perceived as a brand that has low value-for-money proposition. Roily rated customer service compared with other network providers (Which? , 2013). No G roaming available when E consumers travel abroad (experimenter, 2013). High level of customers’ complaints related to report cases that are unsolved and billing and switching issues (Foci, 2014). 7. Opportunities More chances to advance its products and services by offering new packages to customers thanks to the increasing usage of smartness tablets amongst consumers (Longboats, 2013). Drive profit through strengthening post-paid customers base. This aligns with See’s strategic objective to be “the number en for customer loyalty in the UK”. Opportunity to penetrate E newly introduced own-brand’s smartness and tablets (E Eagle) to improve profit. 7. 4 Threats The increasing popularity of free applications (e. G. Skippy, Watchstrap or Fiber) thanks to the WIFE coverage ongoing expansion.
Aggressive competition from Avoidance, 02 and Three who are getting more advanced in their G offerings. 8 Marketing Objectives and Proposed Strategies Following the thorough analysis above, it is decided that the key area that E needs to improve on its marketing approach is its perceived quality especially n customer service to retain See’s current customers and secure the market leader position in the telecoms market. In addition, E is recommended to also focus on driving G subscribers to avoid losing the competitive advantage and pioneering reputation into the aggressive G followers such as Avoidance and 02.
Therefore, two key objectives Were proposed as follows. Objective 1: Increase the number of satisfied customers by 20% in the next year. Customers’ satisfaction leads to success in loyalty escalation and the company’s superiority within the telecommunication industry (Tripartite & Squid, 2010). Researches indicate that the resources network providers invest in order to approach a new client can be exponential compared to the resources require to preserve the existing customer base (Neumann et al. , 2009).
Especially considering the very low customer satisfaction with E, it is essential to firstly tackle this problem to avoid losing customers before investing in acquiring new ones. 2/ups aspects Will be considered to achieve this objective. Product/Essence For network operators, the service is provided through different channels such as call centre, shops, complaints’ management departments, back office, Bessie, and social media. Customers throughout their interactions with the channels need to feel respected (Avery et al. , 2014), reciprocated emotionally and treated like a part of the company (Tripartite, 2014).
Some of the key values that consumers seek are to have a prompt response to their request, expeditious a straight forward solution to their problems from their first contact (Tax et al. , 1998), investing the least possible effort (Dixon, et al. , 2010). Considering its high rates of complaints, the company must initially take actions to build a more efficient complaints’ management network by tapping the relevant department with intelligent, well trained and inspired employees that would be ready to provide high quality service and turn their subscribers’ disappointment to satisfaction (Olivarez et al. 201 1). As new smartened and tablet models are released constantly, E could also provide a new service that would permit their subscribers to change their handset by adding an amortized subsidy cost within the ongoing contract to satisfy their customer needs of acquiring the newest devices. This action would increase the customer satisfaction through a tangible offer (Lamb et al. , 201 1). Promotion The main promotion tool chosen for the objective is Public Relations.
PR is “the management of relationships between organizations and their stakeholders” (Fill, 2013), which in this case is especially applicable to the customers’ relationship with E. Firstly, a reliable identification of their customers’ desires and perspectives must be done (Buys & Deism, 201 3) and this would be achieved throughout surveys and direct meetings with consumers concerning their overall satisfaction. Consequently, the firm would acquire extensive knowledge of all the problems that their subscribers are having and encounter those (Lutz & Fond, 2008).
After, all these interactions will be advertised via the social networks to establish communities orientated for instance to youth or corporate customers (Hajji et al. , 2014). E can also use media relations through press releases or conferences to promote how customer-oriented the company is to tackle the poor perception of See’s Customer service. In addition, the formation of a department that would provide personalized treatment to high value customers who can influence See’s image among large number of followers.
Direct marketing can also be employed. Sales and customer service representatives would provide a efferent approach to continuously promote new products and packages to the existing customers to make sure they are aware of the most suitable offer for their needs (West et al. 2010). This helps keep the customers always satisfied with the package they have and avoid losing them to competitors’ more attractive offers. Objective 2: Increase G subscribers by 30% in the next year. G was chosen as the area for E customer acquisition as it is the main market driver at the moment for telecoms companies. In 4 months, E attracted 2 million G subscribers (Williams, 2014) and the number nearly triples after a year Thomas, 2014). Even though the growth rate will slow down significantly, the G penetration rate in the UK is still around 7% (Styles, 2013), indicating an enormous potential to continue exploiting the market with an ambitious growth target.