EXECUTIVE SUMMARY Telenor was launched in Pakistan in March 2005. Despite facing fierce competition it has managed to make its mark in the telecommunication industry and captured a huge consumer base. It is a provider of high quality telecommunications and media communication services and is ranked, as the 7th largest mobile operator in the world, and caters to over 153 million subscribers. Today after six years of its existence in Pakistan, Telenor is the fastest growing cellular network in the country. It offers a variety of packages which cater to the needs of people from all walks of life.
Telenor has been technically innovative coming up with various new services such as easy-load, Telenor mobile TV, Auto location service? to name a few. Its marketing efforts in promoting such services have ensured that their product is differentiated from its competitors, which helped them take hold of a large portion of the market share. This report covers all major aspects of Telenor’s leading telecommunication services in Pakistan including a thorough analysis of its progress and future goals for the years to come.
Telenor Pakistan is a Pakistani GSM cellular service provider, and is a subsidiary of Telenor, Norway. Telenor Pakistan is 100% owned by Telenor ASA and adds on to its operations in Asia together with Thailand, Malaysia and Bangladesh. Telenor Pakistan launched its operations in March 2005 as the single largest direct European investment in Pakistan, setting precedence for further foreign investments in the telecom sector. The company has crossed many milestones and grown in a number of directions, making Telenor Pakistan a leading telecom operator of the country.
They are the fastest growing mobile network in the country, with coverage reaching deep into many of the remotest areas of Pakistan. In the most difficult terrains of the country, from the hilly northern areas to the sprawling deserts in the south, at times they are the only operator connecting the previously unconnected. It is spread across Pakistan, creating 2,500 direct and 25,000-plus indirect employment opportunities. It has a network of 23 company-owned sales and service centers, more than 200 franchisees and some 100,000 retail outlets. Telenor acquired the license for providing GSM ervices in Pakistan in April 2004, and had launched its services commercially in Islamabad, Rawalpindi and Karachi on 15 March 2005, and on 23 March 2005, Telenor started its services in Lahore, Faisalabad and Hyderabad. Telenor has its corporate headquarters in Islamabad, with regional offices in Karachi and Lahore. On January 28, 2005, Telenor established its first call centre in Lahore. Telenor is the 2nd largest network of Pakistan after Mobilink. Telenor believes: “What matters most is the right strategy, at the right time and precision in execution. ” Telenor’s Product Strategy
To get the real fruits of more open market at regional level requires the satisfaction of the demands of the target market and this satisfaction can only be achieved if the product or service offered in the market is suitable and acceptable for its purpose and this can be obtained by adopting a regional product strategy suitable for company and the market as well. Telenor’s study indicates that it is acting quite on this concept that, in order to be more competitive in the world market, firms should shift their emphasis from local customized products to globally standardized products that are advanced, functional, reliable and low priced.
But here low priced strategy be to compromise and later on due to its quality, Telenor’s low price strategy takes shift from low to high but competitive. Buzzel (1968) argued that product standardization has different benefits (a) economies of scale, (b) faster accumulation of learning experience and (c) reduced costs of design modification. In the regional open market, Telenor is taking the fruit of this by adopting the product standardization but the situation can be different in other markets. The company used a multi domestic strategy to gain competitive advantage in its target markets.
A key factor in the strategy is the encouragement of senior managers to be entrepreneurial in responding to local customer needs, product quality and customer services. Telenor’s decision to standardize or adapt its products is based on cost/benefit analysis of what they believe the implications of adaptation and standardization are for profitability and market share. According to Doole (2000) in normal circumstances, the cost of adaptation would be expected to be greater than the cost of successful standardization.
Telenor believes in long term advantages and not in satisfaction of immediate demand, that’s why they continue the exposure to the standardized products and services which leads them to greater market share in the longer term. Our research shows that there are three factors which enforced the company towards more standardized strategy and these are illustrated in figure below. •Homogeneity of markets •Increase in number of regionalizing firms •Identifiable international consumer segments. Summarizing it, regionalization forced the company to rethink about its strategies towards product, to be more competitive in the open market.
Telenor’s Price Strategy Pricing across the borders is comparatively difficult from other decisions though it is believed that pricing is the most flexible and controllable marketing mix element. Companies operating in different markets experience extraordinarily difference across the borders. This can be due to the exchange rate difference and other barriers. But in our study, this matter is not much sensitive because of psychic distance factor. Cultural environment and a geographical neighborhood influence the pricing policy of Telenor.
On the other hand, being a non member of European Union, it can be totally opposite of the general strategies adopted by the companies located in European Union. Telenor’s pricing policy is influenced by different factors among them five are much important and they are indicated below: •Market survival •Sales growth •Market position •Maximization of Profits •Maintenance of product’s quality though lower price is considered a suitable policy and in case of Telenor, it is effective due to regionalization but not so much but competition factor is given special consideration before development of price strategy.
That’s why Telenor has high price strategy due to high quality products and services but at certain level penetration price strategy is adopted to stimulate sales growth. Here, at this aspect if we talk about the standardization or adaptation strategy of pricing, Telenor follows adaptation policy as well because it allows each local subsidiary or partner to set a price which is considered to be the most suitable for local conditions. On the other hand, lack of control can be the weakness of this strategy and it may require some cost for management Telenor’s Place Strategy
To manage the foreign channels of distribution is a key area in a company’s efforts to be more competitive in the market. According to (Doole, 2001), as products become more standardized across the world, the ability to compete on customer becomes more vital. Channels of distributions developed by Telenor follow the cultural traditions of the target market because it is important to understand and manage cultural differences amongst different markets and Telenor has deep analysis of the markets before developing its positioning strategy because cultural differences add to control difficulties.
In regional marketing, Telenor is taking advantages of his heavy infrastructural products and its financial worth. In our study, we found that company is adopting those strategies which are not used by the others commonly. To make a huge as well as direct investment in the form of acquisitions and wholly owned subsidiaries is high risky but more profitable decision for Telenor. Open borders give a number of alternatives for position the products and Telenor is using different distribution channels which vary from market to market and country to country.
As Telenor is involved in telecommunication business so usually it doesn’t involve in physical distribution but it has the partnership strategy and on the local level, shops and customer care centers are used as place strategy. Telenor’s Promotional Strategy It is quite obvious from the business environment, that there is a rapid increase in competition and markets became mature at the regional level. These factors demand the companies to offer high quality products and services at competitive price level through suitable distribution channel.
In addition to its traditional role of promoting products and services, international marketing communications is increasingly used to facilitate the company with an important way of differentiation in open internal market. According to our findings, there are a variety of promotional tools which are used by Telenor to inform and motivate its valuable consumers in the regional market. The company developed a standardized promotional package which is sufficiently flexible with the different ways in different cultures and norms.
Besides it, that package is also flexible in such a way, in which subsidiaries can develop their own marketing positioning and related promotional strategy. During our study of Telenor as a regional company, we found that the company builds up its promotional strategies with two basic issues. First, the company should have the clear picture of the objectives for regional marketing communication strategy and, second is, how the company can combine the different promotional tools and activities for the higher level of cost effectiveness.
On the other hand Telenor’s regional marketing communication strategy can be adapted because the market structures and distribution channels can be different from market to market and country to country. However, mostly these factors are not those, which can said to be crucial for the company like Telenor. Summarizing it, regionalization factor has influenced the Telenor’s promotional part of marketing mix but in all the way it has positive edge for the company and its business throughout the region. Telenor’s People Strategy:
Telenor does highly focus on the ‘People’ element of the 8 P’s of the services marketing mix i. e front-line staff for any company will have a direct impact on perceptions of the consumers. Telenor provides training and further education programs that ensure a high professional standard amongst employees. Telenor believes that a talented and loyal workforce plays a crucial role in the organization’s ongoing business success. It maintains a policy of non-discrimination towards all employees and applicants for employment.
All aspects of employment are governed by merit, competence, suitability and qualifications, and are not influenced in any manner by gender, age, race, color, religion, national origin or disability. Today, Telenor’s workforce proves that; with 18% women working at all levels in the organization, both foreign and local educational backgrounds. Their aim is to stay ahead of the industrial pace, develop, design and execute responsibilities in a way that enable to contribute most productively towards thier organizational success. Telenor’s competitive edge is ttributed to the well managed work dynamics and the ability to change and mould quickly as per the needs of the hour. Telenor’s Process Strategy Telenor Group is considered to be an international provider of tele data and media communication services along with various operations of mobile phones in a number of 13 markets across Asia, Central and Eastern Europe and in the Nordic region. Franchise network of Telenor Pakistan is intensifying for the Sales, Distribution and Customer Services Operation. It has provided the sound business professionals of 11 cities with the offer of setting up Telenor franchise operations.
More than two and a half times greater success is received by franchising and it enjoys a small amount of business success rate as compared to the small stand alone business. Identifying and developing a franchise outlet as per Telenors condition. Creating a Sales, Distribution and customer services team and retail network in line with Telenors visualization. Customer attainment and retention through Telenors portfolio of products and services. Being the shareholders with telenor in terms of dividends, franchise operators can anticipate enormous financial and non financial incentives.
On the whole, Franchises are considered as a fundamental part of telenors operations. Telenor’s Physical Environment Strategy Telenor believe in creating a work environment that allows its employees to work when and where they want, enables them to communicate freely with their co-workers and managers, and ensures their safety and well-being. * Flexible working hours At Telenor their employees perform best when they enjoy the benefits and flexibility that Telenor communication technology allows: with a laptop, a cell phone and network access, they can do their job almost anywhere, at any time.
Parents can combine work and family in a way that better suits their schedule; employees who like to work at odd hours may do so. * Open-plan offices At Telenor there are no individual offices. Open-plan office solutions were first installed at the Telenor headquarters in Norway in 2002. Since then their offices in Pakistan, Serbia, Hungary, Malaysia, Denmark, India, Sweden, Thailand, Bangladesh and Montenegro have adopted, or started to adopt, similar office structures. Open-plan offices make it easy for employees to communicate with one another, solve problems and share knowledge.
Managers and employees talk more freely. In the end, it makes each employee, as well as the entire organization, more efficient. Telenor Pakistan has successfully invented a unique, new and a workable way to carry forward their operations with a key focus on quality and simplicity, coupled with productivity and output. The open space environment is unique in its own right as there is no protocol, no red tape and no bureaucracy. With the high levels of approachability, people can now get work done formally as well as informally, by avoiding systems of “requests and appointments”
Conclusion Telenor is the leading telecommunication company, which are the most advanced telecommunication markets in the world. The Telenor Group is committed to engage in the local communities where it operates. In Pakistan telenor launched its operations in March 2005 as the single largest direct European investment in Pakistan. The company has crossed many milestones and grown in a number of directions, making Telenor Pakistan a leading telecom operator of the country.
They are providing a service in almost 2500 cites of Pakistan and it is most growing telecom industry in this country. In short it start its business when there is a very high competition in market and take very little time to grow in the market and now it has almost 20% market share in Pakistan and standing at second place along with Ufone who also has 20%. They are now providing different services to its customers at a high quality which helps them to progress rapidly in country and in features their objectives shows that in next few years the will become the market leaders in Pakistan.
Suggestion: Key Issues: •Issue 1: Maintain network quality •Issue 2: Low market penetration •Issue 3: Rolling Customers •Issue 4: Untapped market segments- Women •Issue 5: Mobile number portability •Issue 6: Documentation to avoid mischievous •Issue 7: Should be low price •Issue 8: Maintain Customer Relationship Management Strategic Direction •Building an organization with competency, capabilities and resource strengths •Developing Technical Knowhow in Employees Developing budgets to steer ample resources into critical value chain activities
• Creating strategy supportive policies and procedures •Instituting best practices and a commitment to continuous improvement •Installing support systems and Value added Services •Maintain low cost Recommendation In the modern world telecommunication companies should develop dynamic marketing strategic location-based advertising, content, and services. In order to establish strong position in the enterprise market the company should enhance its cross-cultural communication strategies.
Telenor should pursue its growth opportunities in total communication Large corporate as well as well small and medium sized businesses require effective communication in order to form a consumer pulling market. It should also maintain connections with stockholders to keep them satisfied. Thecompany should keep such managers who are decisive and quick. The dynamic environment requires the managers to adapt quickly to the changing conditions. This is imperative for the survival of the company. The company should increase its risk taking policy. This is necessary for effective expansion.