Essay: Vodafone: Marketing in An Operational Context

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  • Vodafone: Marketing in An Operational Context
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INTRODUCTION

Vodafone is one of the world’s leading mobile communications providers, operating in around 26 countries and are in partnership with over 55 networks. Captivating around 444 million customers around the world and around 19.5 million in the UK itself (Vodafone (2019). This British company was founded 27 years ago on 16th September 1991 by Ernest Harrison and Gary Whent. 1983 Racal Electronics Group won bid for private sector UK cellular license and thus announcing the name Vodafone in the consecutive year on 22nd March 1984. The first cellular network in UK Vodafone analogue network made a call from St. Katherine’s Dock in London to Newbury 1985. Today, Vodafone creates 2,100 jobs in UK, which is part of long-term commitment to UK investment and is the first operator to abolish Vodafone global roaming charging across 50 European Countries and continues to expand coverage around the world (Interact Telecoms 2019). In this report there will an analysis done on Vodafone highlighting its Objectives, Market trend & Captivity, Evaluations and a given recommendation on their marketing strategy.

PERFORMANCE OBJECTIVES

With the vision to improve people’s livelihood and quality of life by delivering connectivity and innovative services to them, Vodafone sets its mission to create opportunities ever day with the help of the communication with a tagline “Power to you”. Their Mission statement communicates to all stakeholders of the company including the employees as it is the employees who will mostly contribute to achieve this mission by committing to achieve company’s aims and objectives by offering superior and innovative services. Not just offering the basic services like calls and texting services, Vodafone also offers advanced services like, Vodafone Passport which allows customers to take their “tariffs home plans abroad”, Vodafone Home and Office which is “integrated for household and businesses”, and others like Vodafone 3G, Mobile Connect and Live (StudyMoose 2016). With such services Vodafone strives to meet its objective and provide the best services to its customers as of being the first cellular network provider in the UK.

CUSTOMER ANALYSIS

Vodafone operates as B2C business to consumers where they are directly providing services to the actual consumers. No customers expect to be the cash cows, so it is recorded that no one is being overcharged for same services and products which is done by marketing openly and honestly by communicating to the customers. Consumers choose plans as per their feasibility and requirement. Vodafone uses a customer measurement system called “customer delight” which monitors and drives customer satisfaction in controlled markets at a local and global level which helps them identify any areas for improvement and focus (Vodafone.com 2019). Consumers purchase by looking at different criteria’s like pricing where there are simpler price plans and tariff liability and flexibility. International calling rates, data provided, validity are all different for every customer as per their requirement. Product safety as before purchasing any product is reliable like purchasing a network locked phone. They are typically classified as prepaid or contract customers where prepaid customers they pay in advance and have no bounds to any minimum contractual commitments whereas contact customers have a predetermined length of time usually on monthly basis. Increasingly, the company now offers SIM only tariffs which allow customers to benefit from the network while keeping their existing handset.

MARKETING ENVIRONMENTAL TREND ANALYSIS

PESTLE:

POLITICAL: Political factors play an important role in understanding the long-term impact profitability in a country/market.

  • Taxation
  • Level of Corruption
  • Wage Legislation

ECONOMIC: Macro and Micro environments to indicate Wireless Communication industry growth consumer spending.

  • Exchange rates: the costs that is being offered as per the country’s stability forces Vodafone to keep its prices accordingly.
  • Labour costs: the amount of workforce required in a Tech company and the amount being paid and bringing productivity in the economy.
  • Efficiency in Financial Market: Need of capital raise in the local market or the operations are going fine.

SOCIAL: Shared beliefs, attitudes, society’s culture and the ways of operations impact the culture of an organisation in an environment.

  • Culture
  • Hierarchy and Class Structure
  • Leisure Interests

TECHNOLOGY: Technology is fast disrupting all the industries. In last 5 years there has been a really fast transformation in the technology sector for example still there are lot of places where internet availability is a problem but now there is 5g internet for mobile users.

  • Cost of Wireless Communication
  • Technology Developments
  • Impact on product offering

ENVIRONMENTAL: Different markets around the world have different norms for the environmental impact.

  • Climate Change/Weather
  • Endangered Species
  • Recycling

LEGAL: Protection of property rights of any organisation.

  • Data Protection
  • Copy Rights/Patents
  • Discrimination Law

After doing the above analysis the main factor that impacts Vodafone the most are the Economic factors where macro environment factors like savings rate, inflation rates, economic cycle, and foreign exchange rates determine the aggregate investment and demand in any country which Vodafone needs to keep in mind for every country. On the other hand Micro environment factors like competition norms impact the competitive advantage of the company but the company should work on such economic factors.

SWOT:

STRENGTHS:

  • Subscribers: Vodafone has global presence giving it massive subscriber base which they retain efficiently. As of 2018, Vodafone has total of around 444 million users.
  • Marketing: Vodafone comes out with great campaigns. The Vodafone Pug and the Vodafone Zoozoo’s were a brilliant and endearing campaign ideas which people loved. These campaigns keep people interested and be loyal to their network provider.
  • Revenues Generations: Vodafone is ranked 104 in its sales across the globe 2000 list and number 84 in market value.
  • Market Coverage: Operations in 26 countries. Ranked 395th by Forbes in top 2000 brands. Second largest subscriber base in India

WEAKNESSES:

  • Poor Performance: 40% of the revenues are coming from India and not from UK or US. Due to Economic conditions in Europe and Brexit, performance has been poor in the home country.
  • Loss of Market Share in USA: Verizon and AT&T both are leading companies in USA and thus Vodafone not providing premium services is making it lack behind.
  • Loss of Subscribers: In the last 4 years there have been rise of other service providers around the globe and Vodafone is losing subscriber base, so they need to implement different strategies and strengthen its core values to acquire more customers.

OPPORTUNITIES:

  • Network Coverage: In 2016 India Vodafone came out with a mobile phone app which showed the network coverage and also help customers to find and report any problems that are being occurred.
  • 4G/5G – 4G has caused disruption but at same time it gave people to look for the best network operators’ once again. Vodafone struggled to attract more customer for their services but now once again they have got chance as 5G spectrum has started taking and place if Vodafone comes up to be the first company to introduce 5G in UK it will benefit.

THREATS:

  • Competition: The major problem for Vodafone is the competition from everyone else. Main competitors taking over are Three and EE.
  • Saturation: Brand spending more on customer acquisition and getting lesser customer for the same amount, this is because of the competition in the market.
  • Low Margins: Too much competition resulting in marginal loss because revenues generated has been dropping for all the brands in last 2-3 years.
  • Phone Number Portability: If any other company introduces any other plans which are cheaper or with more consumption allowance, customers change/port their phone numbers to other brands because of which Vodafone is losing its brand equity.

RECOMMENDATIONS ON MARKETING STRATEGY

As per analysing Vodafone’s customers, its market and doing the SWOT evaluation, there are recommendations on marketing strategy for Vodafone. There’s a level of competition in the telecommunication industry and Vodafone’s operation has become fierce. To strive in the market Vodafone needs to have effective strategies. Following are the strategies that may be effective for Vodafone:

  • Develop additional features for same products and services which values existing consumers for which they can even charge a little extra.
  • Investment in research and development to learn the market trend in the case of their other services.
  • Expansion of the current size and financial resources that can commit to higher level of R&D.
  • Ensuring consistency and an appropriate level across all groups in operating standards.
  • Broaden access to communications to all sections of society to capture the potential of mobile to bring socio-economic value in both developed markets and emerging economies.

CONCLUSION

This report helped me in investigating what Vodafone is and where it stands in this market, how it differs from other companies, what impact does it have on the market in terms of social cultures, economic differences, other global factors and all this was achievable by doing a lot of primary research and getting the work evaluated from the tutor. This Global brand aims to keep everyone happy its society, customers, stakeholders, government and most importantly its employees who help in achieving these targets. Competition is lot especially in this technology sector as of the growing markets but still the company strives to keep up with the position in many countries capturing big markets like India and other countries.

REFERENCES

1) Vodafone (2019). Vodafone UK’s Company History and Achievements – Vodafone.
Retrieved February 15, 2019, from https://www.vodafone.co.uk/about-us/company-history/

2) Interact Telecoms. (2019). The History of Vodafone.
Retrieved on February 15, 2019, from https://www.interact-uk.org.uk/consumer-connect/vodafone/history-of-vodafone/

3) StudyMoose. (2016). The Goals and Objectives Vodafone as a Company.
Retrieved on 16th February, 2019, from https://studymoose.com/the-goals-and-objectives-of-vodafone-as-a-company-essay

4) Vodafone.com. (2019). Customers, marketing and distribution- Business – Vodafone Annual Report 2009.
Retrieved on 17th February, 2019 from https://www.vodafone.com/content/annualreport/annual_report09/business/brand_and_distribution.html

5) Hoang, P. (2014). International baccalaureate business and management.
Cambridge: Ibid Press.

6) Fern Fort University. (2019). Vodafone SWOT Analysis Matrix [step by step] Weighted SWOT.
Retrieved on 15th February, 2019 from http://fernfortuniversity.com/term-papers/swot/1433/1019-vodafone.php

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