Analysis: Virgin Mobile's Marketing Strategy in India

Virgin Mobile's strategy in India has been a different from others and the concept of paying for incoming calls has left many people won...

Virgin Mobile's strategy in India has been a different from others and the concept of paying for incoming calls has left many people wondering as to what are they up to. Virgin Mobile's Ads in India are also funny and have attracted attention so lets take a look at what they are up to (via this long BS article)
Strategy:
We believe existing operators are all pursuing the same strategy: to get as many subscribers as quickly as possible. Our strategy is to deliver a more tailored, more relevant offering for a single, distinct segment," said Branson of Virgin Mobile.
Segmentation:
That segment is the Indian youth. There are 215 million Indians aged between 14 and 25 years, of whom 70 million own mobile phones. Over the next three years, Virgin executives expect this segment to add another 50 million new mobile phone subscribers.
Why is this segment so important? Young subscribers may account for less than 30 per cent of the total, but they contributed over 50 per cent of the telecom industry's Rs 50,000 crore (Rs 500 billion) revenues in 2007-08. By 2010, this group is expected to earn the industry over Rs 35,000 crore (Rs 350 billion).
Market Research
Youth make more and longer out-bound voice calls, which means huge billing potential for service providers. Then, they have large circles of friends for both making and receiving calls -- which offers a revenue opportunity not just from the entire group switching to a common service provider but also from customised services like closed user groups and so on. The youth are also significant users of SMS and are potentially large customers for other value added services (VAS). The VAS market was in excess of Rs 4,800 crore (Rs 48 billion) in 2007, with SMS making up 40 per cent of revenues, followed closely by ringtones. Younger customers also have a shorter handset upgradation cycle -- under 12 months, compared to two years for those over 25 years.
Implementation
Young customers aren't likely to have huge disposable incomes, although they will demand cutting-edge technology and style.Virgin's handsets are therefore named and priced to appeal to its target audience -- vKewl retails at Rs 3,999, while vBling sells for Rs 2,500, which is about half the price at which competitors will sell similar handsets. "We looked at a combination of looks, features and more affordable handsets as the youth need style but also value," confirms Virgin Mobile. According to Virgin's homework, nearly 95 per cent of young users are pre-paid subscribers, who typically run out of both talktime and recharging money by the month-end.The solution? Get paid to receive calls: Virgin offers its customers a 10-paise credit for every minute of incoming call, regardless of the originating network.
Good thinking, research,targeting and advertising but I am skeptical about this scheme part nevertheless its a true fact the youth market is the only market where loyalty towards an operator is the least and can be converted lets see however how this strategy works out what do you guys think will this strategy work.
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9 comments

pAwAn rAj said...

i read ur whole artcle .. and i have a wonderful idea to capture the market much effectively but i dont know how to send this idea to virgin mobile (india) ..

Abhishek said...

Why send the idea to them why not start your own company with the idea :)

Abhinav Nanda said...

Nice Study.

sapna said...

Great article. i like your blog. thanks for sharing the information. Mobile india provides latest mobile reviews, news, specification.

amar jethwa said...

that is a very close and interesting study on their marketing strategies in india ... thank u helped loads ...

amar jethwa said...

that is a very close and interesting study on their marketing strategies in india ... thank u helped loads ...

amar jethwa said...

that is a very close and interesting study on their marketing strategies in india ... thank u helped loads ...

Vinay said...

hi friends, in my opinion, the strategy may back fire unless the top line and botom line are in well connect. just to creat buzz u come up with creative idea may work but the question then is which way now, which is always critical, as you need to build on which takes them to next level, the way VODAFON is doing at the moment..................

Vinay said...

hi friends, in my opinion, the strategy may back fire unless the top line and botom line are in well connect. just to creat buzz u come up with creative idea may work but the question then is which way now, which is always critical, as you need to build on which takes them to next level, the way VODAFON is doing at the moment..................

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