China Mobile
Contents
Executive summary
The objective of this report is according to the knowledge of marketing management learning and base on the theory and collected information, help China Mobile to analysis the external macro-economic environment around them and internal company situation then give some strategies for them, which is suitable for China Mobile today’s situation and current competitive environment.
There are 2 main parts of this dissertation, include external analysis and internal analysis.
External analysis: in this part, I will use 2 important models as Porter’s 5 force model and PEST model to analyze and find out what opportunity and threats will bring to China Mobile. Five Force Model which identifies 5 important forces in microenvironment, as: the new entrance; the industry competitors; the bargaining power of Suppliers: the bargaining power of buyers and the threat of substitutes. And PEST model is used to scan the macro-environment, which considers the Political environment, economic environment, social / cultural environment, technological environment. This sector will focus on discussing how these key factors impact China Mobile’s position in the market. Further more. I will also analyze the two main competitors in Chinese telecom communication China Unicom and China Telecom in order to find out the competitive advantages of China Mobile.
Internal analysis: in this part, will from this company’s financial part to analyze, to know this company’s profitability, China Mobile is still the leader of mobile communication industry in china, this company keeps growing in revenue and profit, but because of the intense competition, China Mobile’s profit increase rate decreased. For market mix analysis which includes 4Ps- product, price, place and promotion. China Mobile applies several series of its product and service in this market which meet customers’ demand, like Fetion, 139 mail-box, mobile market, mobile newspaper, international roaming etc. China Mobile has set a different price for different target customers, and facing the competitors’ lower price, China Mobile also set the mobile price packages. In the distribution channel part, China Mobile has many kinds of channels ,and China Mobile made the very good promotion, the main promotion strategy for China Mobile is adverting. The objective of using SWOT analysis in this dissertation is providing a list of “strength, weaknesses, opportunities, and threats” of China Mobile. After analyzing SWOT, it will help how to deal with the weakness and threats, use China Mobile’s advantages and seize the opportunity to develop and gain more profit.
Take the advantage of China Mobile’s brand to expand its business scope and make better service quality, and continue to improve its 3G technology will greatly help China Mobile maintain and strengthen its market position in the future.
1. Introduction
The full name of China Mobile is China Mobile Communications Corporation, officially established on April 20th, 2000. It is a mobile operator, which is based on GSM (global system for mobile communications) and TD-SCDMA network. China Mobile fully holds the Shares of China Mobile (HK) Group Limited. China Mobile is the largest mobile operator in the World.
China mobile is not only just basic voice services but also value-added Services like data transmission, IP telephone and multimedia and so on. And it is known for its brands like GoTone, Easy-Own, and M-Zone. China Mobile has been playing a leading role in the development of the mobile communications industry in China and it is committed to achieve the comprehensive, coordinated and sustainable development in social, economic and environmental aspects. And continue to create a wealth value to achieve the harmonious development. China Mobile aims at building the best service quality.
With the rapid development of communication industry and telecom technology, and in today’s society, mobile telecommunications has become an inseparable part of people’s live, as the use of mobile phones expand and become a very common tool for reading, listening music and internet or other service, the competition between many telecommunication companies is very fierce. And as we know, APPLE I-phone is very popular all over the world now, it has so many customers. Many people are attracted by I-phone. In china, APPLE co-operate with China Telecom and China Unicom, which will bring a lot of profit for the both companies. And I-phone definitely attracts many young users to China Unicom. Also many competitors have developed many preferential policies, like put a telephone bill to sent a mobile phone. Some small communication companies rise up, to attract some potential consumers. So China Mobile has faced threats and challenges.
China Mobile needs to make more improvement to strength its marketing position in the future, although China Mobile has very good reputation in china even in the world.
So in this dissertation, facing such competition situation, I would like to according to the results from analysis of the company and competitors, then to develop a feasibility strategy for China Mobile. I will use company’s advantage to improve its completive strength.
2. Problem Statement
Main problem
Facing the threats and challenges, how should China Mobile in the future strengthens its market position in China?
To answer this problem formulation, the following sub- problems will be analyzed.
Sub problem
1.1What is the advantage and disadvantage of China Mobile?
1.2 How are the competitive environment in China and how could China Mobile improving its market position in current market?
3. Delimitation
I will focus on China Mobile’s advantage and disadvantage also competitive environment to analyze how China Mobile strengthen its market position in the future.
4. Method
In my dissertation, I will have external analysis and internal analysis of China Mobile, so I use the following method to analyze the company.
Model
Purpose
Porter’s 5 forces
Used for analysis of the competitive strategy and it can effectively to the customer’s competitive environment.
PEST
In order to have a board and coherent understanding of the macro –environment in China.
Marketing mix analysis
To have a better understanding of the company's internal structure
SWOT
We can know the strength, weakness, opportunity and threat of this company and then make a good plan for China Mobile to develop.
5. Company description
5.1 mission and goal
Mission
“Creating unlimited communication world, becoming pillars for information society” 1this is China Mobile‘s historical mission. With the progress of social civilization, with the improvement of life level, the people demand of communication also become higher and higher. China Mobile regards customers as the centre of the company, to create a new way of life and provide rich life content.
Creating unlimited communication world means China Mobile will always stand in front of the technology development and changes in market demand create new communication world. Let tired, busy modern people at the no communication restriction and barriers world enjoy unlimited joy in anytime and anywhere.
Becoming pillars for information society means China Mobile be the industry leader but not the follower. It is a must for China Mobile to keep innovating the operation and institution. So it can lead the society to the information-oriented direction, and become a pioneer and a leading force of the information society. Also, China Mobile continues increasing the network technology and capacity, to become an import foundation and bridge of information.
Goal
The goal of China Mobile is to become the creator of excellent quality. Becoming the creator of excellent quality means the company needs to deeply know and understand the customer’s demand, and make a better product and high quality service to create a classic and permanent trust brand for customers.
6. Porter’s 5 force
Porter 5 force was suggested by Michal Porter in 1980s, it has a global impact to a company’s strategy development. Here, I use Porter’s 5 forces to give the whole picture of the communication industry competition situation. And effectively analyze China Mobile’s competition environment. The 5 force is the new entrance, industry’s competition, the bargaining power of suppliers, the bargaining power of buyer and the substitutes. (See figure 6.0)
Figure6.0. Porter’s Five-Force Model2
6.1 The new entrance
The new entrants to the mobile communication industry will bring new product capacity and new resources, but it also will bring the competition into the same industry. China is a populous country, and it has the largest mobile communications customer group. With China and the world more integrated, the threat of foreign entrant increase, China’s mobile communication industry has opened to many countries, and many foreign mobile communication operators aim at Chinese market. With the development of 3G, many foreign operator will entrant to Chinese market and compete with mobile communication industry. Also, in China, the mobile communication has a very broad prospects and huge potential market and mobile communication is the most profitable business in the current telecommunications industry, so many operators want to be the new operator of the mobile communications market in China.
With the diversification of customer needs, a simple mobile business cannot meet customer needs, with the development of 3G in the future, there would be more and more operators enter the Chinese mobile communications industry.
6.2 Industry competitors
At the present time, there are three operators in China’s mobile communications market: China Mobile, China Unicom and China Telecom. China Mobile has the business for a long time, in market share, technical reserves, capital accumulation and the network coverage has a leading edge. And China Unicom as the biggest competitor, although it has the advantage of the operating mechanism and policies, the fundamentals are relatively weak. For China Telecom, it relay on its strong fixed net base also its strong customer base , Vigorously explore the development of mobile telecommunications .The three mobile operators in the Chinese mobile communications market constantly applying new technology to increase their own users and improve service levels and to seize new market high - end users. But currently, China Mobile still is the leader of mobile communication industry. In short time, China Mobile won’t be catch up, but China Mobile need to be aware of the threat. And strengthen its marketing position in the market.
6.3 The bargaining power of suppliers
The supplier of China Mobile is communications equipment manufactures, and nowadays the competition in the market is insensitive, the profit of the entire market become average. Also customer’s demand become more diversification, it requires the mobile communication operator offer excellent quality, advanced technology and perfect after –sales service. So the product technology of equipment manufactures need to improve and the technology upgrade fast. All of this will make the operator cost increase. So the supplier will force buyers to accept high price. In addition, for the new mobile operators, because the technological advances too fast, the third generations mobile communication system is a new technology, equipment suppliers need to recover the huge investment in research and development within a short period of time, the price of the equipment will be much higher than the cost.
6.4The bargaining power of buyers
With the mobile communication terminal price and mobile communication tariffs continue to decline, mobile communications has already begun to enter ordinary people live, and gradually from a luxury become a necessity of life
As the mobile communications market is a competitive market, consumers have more choices, the consumer's bargaining power is still the rising. Operators will face more and more critical and rational consumers in the future.
Network quality and service levels have increasingly become a key factor of consumer concern. According to the survey3: users intent to switch to other networks more 60% ,and the main factor for China Mobile users to switch the network is the high price, poor service while the main reason for China Unicom users to switch the network is poor network quality and the coverage is not wide. So the bargaining power of buyer in this area is still increasing.
6.5The threat of substituted
In communication industry, for mobile communications business, the main alternative business could be the telecommunication business. The main alternative is fixed line telecommunication. From the current point of view, the development trend of the communication is wireless and mobile. And future mobile communication will be mainly used for people in the mobile personal communications; fixed communications may be more used for work and family communication and entertainment. With the mobile communication charge rates continue to drop, as a way of communication, mobile communication will not be too much substituted by fixed telephone.
However, PHS (personal handy-phone system) is the relative mobility of the quasi-mobile services. It meets people's basic mobile needs, because it is inexpensive and convenient. Though the service quality provided by PHS is not as good as the service providing by China Mobile and China Unicom due to the immature technology - such as bad signal even lose signal or noisy, but it is still welcomed by the Chinese customers because of its lower price. PHS has great market space.
7. Competitor analysis
In this part, I am going to analyze the competitors of China Mobile in China to find out the competitive advantage of China Mobile, and then analyze how to improve this.
In China, there are three main operators in the mobile communications market: China Mobile, China Unicom and China Telecom.
7.1Analysis of China Telecom
China Telecom is a large state-owned communications enterprise in China. As a principal telecom enterprise and the largest infrastructure network operator, China Telecom owns the world's largest fixed telephone network; it covers both urban and rural area. It provides fixed telephone, mobile communications, date, internet access and application of integrated information services.
China Telecom in the fixed-network field has greater advantages, and also showed a strong marketing capability. In 1st, October 2008, China telecom acquire China Unicom’s CDMA network4, this helped China Telecom quickly enter the mobile market. After China Telecom got the mobile business ,with the help of multiple services bundled mobile development as well as existing fixed-line business opportunity, improve its overall competitiveness and brand image become China Telecom’s business core.
China Telecom network infrastructure has improved. 20 years of reform and opening up, China Telecom has built a nationwide coverage, it has the advanced technology and basic transmission network, access network, switching network and data communications networks and intelligent network. All of these increased its capacity. The advantage of the network of China Telecom has become the core competencies of its enterprise development.
Although China Telecom has a rich client resource, network facilities, as well as a large number of reserve personnel, but it lack of a necessary strategic concept for the development of the modern enterprise, like the concept of innovation.China Telecom's existing infrastructure can’t provide users with special services. China Telecom has a relatively complete network infrastructure; most are not based on the actual needs of the market, but in order to meet the needs of the universal service.
However, for brand, China Mobile’s branding in consumers’ mind has formed a very good psychological effect. On the product, China Mobile’s mobile network quality, coverage, stability is still strong support. TD-SCDMA as the highlights of the national innovation strategy, naturally at the product level has a policy resource. In contrast, telecommunications is relatively weak in these areas. Consumers’ mainly impression of telecommunications is fixed-network and broadband. This is greatly differing from the mobile phone business. Even telecommunications has a dominant position in the fixed network, in recent years the number of fixed-network users is declining.
7.2 Analysis of China Unicom
China Unicom is one of the most influencing mobile communication companies in China. China Unicom's main business scope include: fixed communication services; mobile communications business; domestic and international communication infrastructure services ; satellite international private line services , data communication services , network access services ,IP telephony and various types of value-added services and so on.
China Unicom is the biggest competitor for China Mobile in China. As the biggest competitor in China, China Unicom has a very strong advantage in the current funding, etc., for many years in the field of mobile communications it already has the extensive capital and experience, as well as the strong customer base. The competitive strategy of China Unicom is relative to its unique network operation (CDMA), lower service price, and value-added services.
China Unicom’s main customer group is low-end customer, China Unicom's customer base is very close to PHS’s customer base, and its position is between China Mobile’s high-end and PHS’s low-end. Thus it is a dilemma in a price war for China Unicom. In order to respond quickly to market war, China Unicom reduces the price to to further attract more clients and expand the market. Because of the decision of China Unicom, make the reduction war spread from the low-end market to high-end customers. In addition, China Unicom cooperate with Apple Company, it is a good strength to China Unicom. Nowadays, the trend of mobile market is I phone. Because of the brand of I phone, China Unicom get more new customers. China Mobile faces the threat of a gradual loss of its target customers; they are forced to cut prices to protect themselves.
The WCDMA networks that China Unicom used is the most widely used in three 3G standards, its the most mature 3G technology, 3G technology also the mobile terminal is quite abundant and cheap. Combined with the needs of domestic customer and it can form unique competitive core. However, China Mobile‘s 3G technology was lagging behind China Unicom and China Telecom. The speed of China Mobile‘s 3G internet is slow and its network doesn’t achieve the full coverage. And when users use the 3G network of China Mobile, customer often face the problem that is get through, break or bad quality of sound. China Mobile should improve its 3G technology to gain more customers.
8. PEST analysis
Before analyzing Company’s internal situation, it is necessary to know the background of the current macro-environment of this company, so here I will use PEST to analyze the macro-environment of China Mobile. PEST analysis considers the Political environment, economic environment, social / cultural environment, technological environment.
8.1 Political factors
In recent years, China’s mobile communication market grows fast, and the mobile phone has entered working-customer class, the customers are very sensitive about the increasing charge. Before, China Mobile’s charge way is like “Less than a half month according to a half month charge, surpasses a half month according to one month charge”. Many customers think his charge way is very unreasonable. In 2002, Chinese government required China Mobile’s charge way in the monthly charge.5 It required that China Mobile charge the fee based on how many days customers use. The adjusted policy shows a new idea of telecommunications charges and it helps company improve its service quality.
On the one hand, the Chinese government supports the development of the communications industry, and encourages competition; on the other hand, they increase macro - monitoring efforts. In 2007, Government issued No. 75 files and No.453 files 6to enforce the regulation of mobile communication operators and the scope of regulation, involving agents, charges, partners, services, business processes, technology and equipment standards etc. It enables operators to relatively standardize the operating behavior.
In order to improve the competition in China’s mobile communication industry, Chinese government allows China Unicom could reduce their service charge 10-20% lower than China Mobile. 7This policy helped China Unicom to enhance its products competitiveness.
8.2 Economic factors
Since the reform and opening up, China’s economic develop rapidly, the phone users and mobile phone users are also substantial growth year after year
8.2.1 GDP
Since China implemented an ‘open door’ policy in 1978, China’s economy has expanded a lot. China has still kept dynamic economic growth (see figure 8.2.1)
Figure 8.2.1 the development of the Chinese GDP8
From the figure8.2.1, it is obvious that from 1978s, China GDP keep growing. The average GDP annual growth rate is 9.1%, the proportion of communication industry in the national economy keep rising. It also means that people’s social consumption ability increase. The demand of communication service increase as well. So this is a good chance for communication industries develops and expand business in china.
8.2.2 Unemployment
About the unemployment, in China, this is still a big problem. Even Chinese economic grow; the unemployment rate is still high. Figure 8.2.2 shows China unemployment rate.
Figure 8.2.2Unemployment rate in China9
From the figure8.2.2, we can see that from 2008 to 2012, the unemployment rate from 4% in 2008 raised to 4.3% in 2010，and reached the highest 4.3 percent. In the end of 2011, the unemployment rate reached the highest 4.3 percent again, which means more people, lost their jobs. From the figure we can see that, nowadays there are still many people who don't find their jobs or lose their jobs. In other words, China Mobile might lose some these people’s market.
8.3 Social/culture factors
From the late 20th century to this century, people gradually accept and recognize the concept of "information society”. Consumer’s attitudes and habits of information quietly changed, this change is a reflection of the adaptation of the information society, also is a great opportunity for the further development of the telecommunications enterprises.
Population growth: China is a developing country with the biggest population in the world. And China’s population still keeps growing.
Figure 8.3 shows the population of china.
Figure 8.3 Populations in China.10
From the chart, we can see that China population in a growing trend. China has the 19.43% of world population，China's national economy has developed at a high speed, and the people's living standards greatly improved. Thus, it can be said that the Chinese market is the most potential market, which has the largest group of customers in the world.
Age and sex distribution Figure 8.3.1 shows China’s population by age and sex in 2010.11
Figure 8.3.1 Age and sex distribution in 2010.
From figure 8.3.1, the population of female and male is nearly the same in each age group in china. And from the figure, we found that the age group 40-44, 35-39 and 20-24 is the first three high. They are the biggest market for mobile. Most of the customers in age group 40-44 and 35-39, they already have a stable income, and they pursue a better quality of life, so the requirement of mobile communication service is higher. This is a good chance for mobile communication industry to improve their service to attract more customers. And age group 20-24, this age group most is students and young customers, young people pursue a new, immediate , convenient and happy lifestyle, Although the limited spending power , but as they grew older , the purchasing power is also rising , which will undoubtedly provide favorable support for the mobile increase in the future. and there are many products from China Mobile is for young customers, like M-zone, the greatest feature of it is flexible tariff and provide a variety of innovative personalized services. So young people could is China Mobile’s target market.
Change in lifestyle: Nowadays, the world is in the information age, people are seeking a method to collect the information much faster and more vastly. Thus, mobile communication becomes an indispensable part in people’s daily lives, especially in urban areas and commercial communication. In addition,
Resent years, Chinese lifestyle has changed a lot, they are more depending on the technology to make their life more convenient. Like more and more people prefer to use various methods in communication sector, such as mobile phone and Internet, because of their common advantages on speed, economy, convenience and privacy. The demand of communication has expanded quickly.
However, in countryside, rural people still prefer to choose traditional communications methods, because new methods are heavily restricted by network and equipment, which has not broadly deployed in rural areas.
Distribution of income: people’s income has a great influence of the consumption of communication product. Figure 8.3.2shows the per capita income and per capita GDP in china from 2000 to 2009.12
Figure 8.3.2 per capita income and per capita GDP in China (in dollar)
From the figure 8.3.2, we can easily see that people’s income and per capita GDP in an increasing trend. With people’s income increased, people’s life level develops, and so they may require higher quality and quantity service of mobile communication products.
Also figure8.3.3 shows the relation between GDP and inflation.13
Figure8.3.3
From figure 8.3.3, we can assume that when GDP increase, the demand also increases.
8.4 Technology factors
The mobile communication industry applies the various and complex technologies. Technology plays an import role in this industry. This paper will introduce some major technologies.
GSM:
GMS (Global System for Mobile Communications) is the most widely used mobile phone standard currently .It is the second generation mobile communications system. It has built a mature technology and the complex coverage which support the customers use mobile phone cross the world.
In 2004 more than 1 billion people use GSM phones, GSM phones has 70% of the global mobile phone market share.
GPRS
GPRS (General Packet Radio Service) which is a mobile data service available to users of GSM mobile phones. GPRS can be said that is the continuous of GMS.
GPRS is different from the past continuous channel transmission, it is based on packet type (Packet) to transmit. So the cost is counted by its transmission data unit it is not use its entire channel. In theory, it is cheaper. GPRS transfer rate can be increased to 56 or even 114Kbps. In any location, customers can quickly and easily connect the internet.
3G
3G is the shot form of 3rd generation mobile communication technology. The basic characteristics of 3G is the intelligent signal processing technology, intelligent signal processing unit will be the basic functional modules. And it support voice and multimedia data communications.3G mobile phones generally refer to wireless communications and multimedia communications such as the Internet generation mobile communication systems integration. It can handle images, music, video and other forms of media, including web sites, telephone conference e-commerce and other information services.
TD-SCDMA
TD-SCDMA (Time Division-Synchronous Code Division Multiple Access) is one of the 3rd generation communication standards. It was created by China. In China, the license plate of TD-SCDMA is belonging to China Mobile. TD-SCDMA has the unique advantages in flexibility of business support. TD-SCDMA as the third generation mobile communication international standard, is an important symbol of China's independent innovation, China will continue to support research and development, industrialization and promotion. However, compare with the other two 3G standards CDMA2000 (in China, the license plate of CDMA2000 is belonging to China Telecom) and WCDMA (in China, the license plate of WCDMA is belonging to China Unicom), because of the late start of TC-SCDMA. Its technology is not mature enough.
9. Company analysis
In order to have a deeper and better understanding China Mobile’s market, I am going to make an internal analysis of China Mobile.
9.1 Analysis of the financial account
Figure 9.1 shows the operating revenue and profit of China Mobile from year 2005 to 2011. (Data see appendix 1)
Figure 9.1(RMB million)14
From the figure, we can see that this company keeps growing in revenue and profit and overall the company's development in upward trend. The Increase rate of revenue from 2005 to 2006 is 21.5%,and the increase rate of profit is 25%;from 2006 to 2007,the increase rate of revenue and profit are 20,9% and 35%；from 2007 to 2008，the increase rate of revenue and profit are
15,5%and 14.9%；from 2008 to 2009，the increase rate of revenue and profit are 9.8% and 3,2%；from 2009 to 2010，the increase rate of revenue and profit are 7.3% and 2.5%；from 2010 to 2011，the increase rate of revenue and profit are 8.8% and 0.4%. we can find that in the beginning，the revenue and profit in a fast increase，later even they are in stable and small increasing，compare with before，the increase rate is lower. Because with Chinese economic growth，further mobile penetration in China, there are more and more competitors， made for a more challenging competitive environment. But this company still focuses on its core strengths: innovation, brand equity, management and professional talent. By fully use the scale of its network, customer base and strong customer service system, the company improve its overall competitive
Positioning and achieved steady business development
9.2Marketing mix analysis
Product
Customer’s demand is the start point of market. And consumers are the end-user of the product, but also the reflector of the product value. The design of product is to meet the demand of consumers. From customer’s point，China Mobile applies several series of its product and service in this market. In the following，I will introduce some products of China Mobile.
Fetion：Fetion is the integrated communications services,it combines the voice, GPRS, SMS and other communication. Fetion users need to add a friend by phone number, so Fetion users’ friend circle s is based on the true friend relationship. And it provide users with instant messaging, SMS, MMS, voice calls and e-mail ，it fully meet users' different communication needs.
139 mail-box：139 mail-boxes provide the e-mail services for mobile customers. With conventional Internet-based mail service functions, it give full play and use the advantages of mobile phone features, let customers can easily and directly via SMS, MMS, WAP and Internet access access to manage e-mail at anytime and anywhere. 139 mail-boxes provide customers with safe , stable , fast , easy-to-use , high-quality personalized e-mail service.
Mobile Market：Mobile Market is the mobile application store which is launched by China Mobile. It is also the first mobile application store in China.
It helps China Mobile open the market in this area and laid a good foundation for the development of the mobile application industry. Mobile Market mainly provide mobile game，mobile theme and mobile software. Also meet the need of different customers.
Mobile Newspaper：Mobile Newspaper is value-added services. This survive has abundant information delivered timely and conveniently.
Provides users with timely information services（including news, sports, entertainment, culture, and lifestyle) through MMS, WAP or SMS.
International Roaming：International Roaming is a convenient mobile business for aboard customers. By the end of February 15, 2012, China Mobile has opened the Hong Kong, Macao and Taiwan GSM international roaming service with 406 operators in 237 countries and regions, and with 292 operators in 188 countries and regions opened GPRS international and Hong Kong, Macao and Taiwan roaming service.15 At the same time, China Mobile will continue to expand the scope of international roaming services.
“A customer would pay for the branded product or service compared to am identical unbranded version of the same product/service”.16 In addition，base on China Mobile’s products，the company also created 3 major brands for different groups of customers by their economic power and purchasing custom.
(1) GoTone
GoTone is the core brand of China Mobile，and it is designed for middle and high class customers（VIP club customers），it has many high-end customers. Since the inception of Gotone，GoTone always pursuit the improvement and upgrade of customer service and pay more attention on the personalized needs of customers. In GoTone VIP club，they provide considered services like VIP airport service, account manager service, and golf club service etc. These personalized value-added services bring happiness and relaxation to the members.
(2)M-Zone
M-Zone is designed for young and fashion customers Novelty, fashion, fun, and explores its main brand attributes. M-Zone create a new, immediate, convenient, happy lifestyle for the young family. The new customer brand uses new form of text messaging monthly payment, while also providing a variety of fashion and fun customized services. For example, the customers could play online games through “Game treasure box”, they could chart with friends with “mobile MSN”, and they could also download their personalized ring tones and pictures for their specific preference. Its biggest selling point is that the SMS packages, only pay 20 Yuan a month can send 300 text messages or to pay 30 Yuan a month can send 500 text messages .
(3)Easy Own
“Easy owned” is designed for general customer, which takes “quick and tangible benefit” as its principle. The number of customers in this brand accounts for more than 75% of the totally customers in China Mobile company. It plays an import role in China Mobile’s customer brands. Even though, Easy Own has a wide range of coverage and high quality of reception as “GoTone”, it provides different fee package for different customer group. And compare with other brands, Easy Own is easier to be used. It can satisfy the basic demand from customers by its lower and popular fee.
Price
Price is one of the important factors that influence customer purchasing behavior. It plays an import role in market.
There are some factors will influence mobile communication industry price.
1. Cost factor. The marginal cost of telecommunication services is approximately zero. Communication network construction requires a one-time investment in a lot of money once network completed, most of the costs become a sunk cost. However the marginal cost of the telecommunications business is very low and almost negligible. Therefore, the greater the volume of business, the unit fixed costs will be lower.
2. Market factor. Business and competitive strategy of each enterprise will have a major impact on several other enterprises. After the baptism of several years of competition, the telecom market is gradually moving towards a reasonable mode of competition. The competition will influence the price. The operators’ service level is gradually improved the service concept and awareness has sink deep into the heart of the people. From the starting point of customer’s demand, the operators make business development and innovation, breakdown of user groups and market segments.
3. Customer factor. Customer is the centre part of a company. Customer’s perceptions and customer’s income influence the price. When customers choose a telecommunications business, they will accord their own income, occupation, age, personality and interest in hobbies. Therefore, operators in the business pricing should focus on to consider the extent of consumer demand for the product also customer’s ability to pay.
China Mobile has set a different price for different target customers. For the GoTone users, China Mobile mainly provide the preferential treatment of package but also develop at different rates based on the contribution of size; for Easy Own users, China Mobile main use of the family number of ways to cut local price; for the user of the " M-Zone “, China Mobile use the implementation of new business bundling strategy to enhance customer using value
Also customers can pay the bills by many kinds of ways like auto pay, bank, online to pay, the terminal business hall, etc. and China Mobile encourage customer store
Facing China Unicom's low pricing strategy, based on competitive prices, China Mobile set the mobile price packages which is for different user groups actually is a disguised form of lower call prices. This completely changed the mobile phone’s single charging way, and provides users with a richer variety of fees options and makes users more freedom.
Place
Distribution channels play a very important role in the market. It is the bridge between producers and final customers. The functions of the mobile communications business channels is that make the company profitable service can be lasting used by users, improve customers satisfaction through good service. In the following, I will introduce China Mobile’s distribution channels.
China Mobile Business Hall
China Mobile business hall still is the most important business place. Pay attention to the image of the sales staff in order to improve the volume of services. Customers in business hall can have a better understand of the products and service by asking the stuff to satisfy their need.
Customer Service Hotline
10086 customer service hotline provider customer mobile communications business consulting, business acceptance and complaints advice and other professional service through automated voice, text messaging, fax, E-mail and so on. If customers have any problem of the bills or mobile phone or internet problem, they can call 10086 for help. In addition, you can not only familiar with the current rates and promotions, but also grasp the latest business news. It is very convenient for customers.
Online Business Hall
Online Business Hall is online self-service platform that China Mobile provide customers with business acceptance, sale promotion, information consulting. By logging in the Online Business Hall, customers can do trading operations like query operations list, check business records, get the latest news and complain.
Customers not need to go to Business Hall, just stay at home can enjoy the same service that provide by Business Hall.
SMS Business Hall
Customers can check the bill and do business operations by sent SMS; it is very easy to use. Customers can use it at anytime and anywhere.
Retailers
Retailers are import channel of mobile operators. China Mobile pay attention to the management of social channels, and gradually increase the quantity and quality, focus on the circulation characteristics of retailer, use the differences in regional products to stimulate the final market. Good relationship between retailer and customer will bring more profit to the company.
Promotion
A good promotion can help the company attract more customers and gain more profit. As the leader of Chinese mobile communication industry, China Mobile uses the funds advantage to do many promotions to attract customers.
At the present time, the main promotion strategy for China Mobile is adverting.
And spent a lot on money on newspaper, internet, TV and many Medias to advertise company’s new product and new service. For high-end business customer, fashion young users as well as low-end mass users (including rural markets), there are different focused advertise for these customers. For example, high-end customers usually have more contact with the trade journals, or outdoor advertising, car radio; fashion users have more contact with the Internet and television and other media; low-end mass consumer have more contact with the outdoor advertising business hall publicity or advertising flyers.
For every new product, especially like 3G new technology value-added service, many customers are not very familiar, and they need a time to accept the new product. So when promote new products, at the same time, customer can use the products for free in fixed time or pre-store the call expense to get free products. This promotion activity is wildly welcomed by customers.
On the other hand, China Mobile also sale the products by telephone selling,
The telephone selling staffs always are very friendly, patient and polite to customers. If there is any new service or products, they will make a phone call to users and introduce to them.
9.3 SWOT
In this part, I will use SWOT to analysis China Mobile, in order to understand the strength and weakness of this company also base on the opportunity and threat of market to find the direction of development and business strategy.
9.3.1 Strength
Regardless of the mobile network coverage or quality, China Mobile network system is far ahead of the other industry, it has stable network coverage and network operator. Until 2003, June, China Mobile’s average coverage rate has been 99.86% in 36 major cities and the average network connection rate has been 98.24% 17.And is constantly improving, make the company more competitive.
China Mobile has larger market share than China Unicom and China Telecom, and own the largest subscribers group in China, which has more than 661.4 million until 2011.18 China Mobile has always played a leading role in the development process of Chinese mobile communications
Wide range of business. China Mobile mainly runs mobile voice, data, IP telephony and multimedia services. Besides providing basic voice services, also provide fax, data, IP telephony and a variety of value-added services. The brand advantage of China Mobile is very strong in the market. It has well-known service brands like the "GoTone" , "EasyOwn" and " M-Zone”
And these brands cover middle-end and high-end customer group.
China Mobile has very strong finance performance and its operational capacity, profitability is powerful.
9.3.2 Weakness
Compare with China Unicom, the price of China Mobile is higher. That is the reason why many customers would like to choose China Unicom.
Technology TD-SCDMA started late, compared with China Unicom’s WCDMA and China Telecom’s CDMA2000, TD-SCDMA is not mature enough. It still needs to take time to improve.
9.3.3 Opportunities
The entry of 3G technologies brings a lot of market chances for China Mobile operator and manufacture. It also brings potential increased-rate of the revenue.
At present, the Chinese market is changing the direction from the traditional voice market to the value - added non-voice, Internet communication and information resources will be greatly enriched. Mobile applications are widely involved in the entertainment, financial, WLA areas, online games and other interactive development business, and it becomes an essential part of mobile communication. The number of mobile Internet consumers becomes more and more. That is a good chance for China Mobile develops its business.
9.3.4Threats
China Telecom and China Netcom, the two potential entrants are the greatest threat to China Mobile. The space for Fixed-line development has been very small, and it will enter the stage of decline soon, to solve this problem, fixed network operators must rely on the pull of the NGN (next-generation network), 3G and other new business. Fixed network operators have started to proceed with the deployment of 3G, in order to reverse the profit declining year after year.
The high-end mobiles threat that from China Unicom and China Telecom, such as I phone. They have attracted many customers. However China Mobile doesn't have this kind of high-end mobiles.
The government allows China Unicom reduce its charge fee 10%-20% lower than China Mobile. Therefore, the price war is unavoidable in this market.
Changes of customers’ preferences. With the passage of time and continuous strong of competitors, it is hard to guarantee that customers will use China Mobile this brand permanently
10. Strategy for China Mobile
After analyzing the industry environment, the characteristics of each competitors and China Mobile’s internal situation, I would like to give some strategic suggestions for China Mobile .
As I mentioned above, the price of China Mobile is the highest among China Unicom and China Telecom, so the optimum strategy should be taken in the future is reducing the service price and maintain its network service quality. in the promotion of 3G business promotion, pricing strategy should be an important weapon. China Mobile can not only provide paid services, but also provide prepaid services in order to attract a large number of customers.
Use the differentiation strategy to gain a competitive advantage with our network, services advantages and characteristics of services and products. In addition, company should firmly establish the concept of service and enhance knowledge of marketing, improve better service quality, and provide satisfactory services to the user.
In technology strategy part, it should continue to consolidate and expand the original network advantages. While developing and improving the existing GSM network, closely monitor the development of 3G mobile communication systems, and actively making development of new technology introduction and research.
Business innovation, China Mobile new business should not just concentrated in the entertainment, but also towards the media, business to further expand. Like can help customers use mobile phone to handle emails or some commercial activities.
11. Conclusion
With the rapid growth of mobile communication industry in China, there are more and more competitors and competitors become stronger. The competition intensity between each mobile communication company is very high. Even though, at present China Mobile is in the leading position, facing the main two competitors-China Unicom and China Telecom’s threats and challenges. How should China Mobile in the future strengthens its market position in China? In this dissertation I analyze the external economic environment and internal environment of this company, in order to get a deeper understanding of the company and then I try to develop a better strategy.
The internal analysis of China Mobile reveals the company’s advantage and disadvantage and discovers the opportunities and threats that the company is facing. The advantage of China Mobile is that China Mobile has a very strong financial performance and brand dominance, and provides the high quality network and service, playing a leading role in china mobile communication industry. However, compared with the other two major competitors, China Mobile’s prices are higher. In the 3G technology segment, China Mobile is in a rather weaker position, TD-SCDMA technology and commercial level is not mature enough.
The external environment analysis shows that competitors’ strengths influenced China Mobile. The strengths of competitors as following
Both China Unicom and China Telecom cooperate with Apple company，contracted with I-phone help them to gain more customers
China Unicom got the government policy’s support, it is allowed to reduce its charge fee 10% ~20%, product pricing can be 20% cheaper than China Mobile, and many customers may want to buy products because of the low price.
For 3G technology，China Unicom and China Telecom have more mature technology than China Mobile.
Facing the threats and challenges, and the fierce competition in the future, it’s very important for China Mobile to make some competitive strategies to improve its marketing position in the future. China Mobile should lower its price to gain more customers and in the other hand, enhance its service quality. Based on current brand advantage in the market, expand business scope and continue to develop the3G technology.
By analyzing all aspects of China Mobile and these suggestions, it will help China Mobile strengthen its marketing position in the future and have a better development and higher profit.
12. Reference
Websites:
1. http://www.10086.cn/aboutus/culture/
2. http://www.learnmarketing.net/porters.htm
3. http://it.sohu.com/20081126/n260849018.shtml
4. http://baike.baidu.com/view/3214.htm
5. http://www.cnii.com.cn/20020808/ca90280.htm
6. http://www.gsei.com.cn/html/wjygh_749_20523.html
7. http://wk.baidu.com/view/88B363f9aef8941ea76e05b0?pn=2&ssid=&from=&bd
8. http://www.tradingeconomics.com/china/gdp
9. http://www.tradingeconomics.com/china/unemployment-rate
10. http://www.tradingeconomics.com/china/population
11. http://wenku.baidu.com/view/235fb6d73186bceb19e8bb9e.html
12. http://www.chinamobileltd.com
13. http://www.10086.cn/newbusiness/basic/201103/t20110315_25622.htm
14. http://it.sohu.com/20040713/n220977561.shtml
15. http://labs.chinamobile.com/news/67987
Books:
1. GLOBA MARKETING, Svend Hollensen, fifth edition
2. International marketing and sales, POIL K.FAARUP AND JACOB AABROR (editor)
3. Economic for Business David Begg and Damian Ward 3ed edition
13. Appendix
Appendix 1
Part of financial data of China Mobile in 2011
Executive summary
The objective of this report is according to the knowledge of marketing management learning and base on the theory and collected information, help China Mobile to analysis the external macro-economic environment around them and internal company situation then give some strategies for them, which is suitable for China Mobile today’s situation and current competitive environment.
There are 2 main parts of this dissertation, include external analysis and internal analysis.
External analysis: in this part, I will use 2 important models as Porter’s 5 force model and PEST model to analyze and find out what opportunity and threats will bring to China Mobile. Five Force Model which identifies 5 important forces in microenvironment, as: the new entrance; the industry competitors; the bargaining power of Suppliers: the bargaining power of buyers and the threat of substitutes. And PEST model is used to scan the macro-environment, which considers the Political environment, economic environment, social / cultural environment, technological environment. This sector will focus on discussing how these key factors impact China Mobile’s position in the market. Further more. I will also analyze the two main competitors in Chinese telecom communication China Unicom and China Telecom in order to find out the competitive advantages of China Mobile.
Internal analysis: in this part, will from this company’s financial part to analyze, to know this company’s profitability, China Mobile is still the leader of mobile communication industry in china, this company keeps growing in revenue and profit, but because of the intense competition, China Mobile’s profit increase rate decreased. For market mix analysis which includes 4Ps- product, price, place and promotion. China Mobile applies several series of its product and service in this market which meet customers’ demand, like Fetion, 139 mail-box, mobile market, mobile newspaper, international roaming etc. China Mobile has set a different price for different target customers, and facing the competitors’ lower price, China Mobile also set the mobile price packages. In the distribution channel part, China Mobile has many kinds of channels ,and China Mobile made the very good promotion, the main promotion strategy for China Mobile is adverting. The objective of using SWOT analysis in this dissertation is providing a list of “strength, weaknesses, opportunities, and threats” of China Mobile. After analyzing SWOT, it will help how to deal with the weakness and threats, use China Mobile’s advantages and seize the opportunity to develop and gain more profit.
Take the advantage of China Mobile’s brand to expand its business scope and make better service quality, and continue to improve its 3G technology will greatly help China Mobile maintain and strengthen its market position in the future.
1. Introduction
The full name of China Mobile is China Mobile Communications Corporation, officially established on April 20th, 2000. It is a mobile operator, which is based on GSM (global system for mobile communications) and TD-SCDMA network. China Mobile fully holds the Shares of China Mobile (HK) Group Limited. China Mobile is the largest mobile operator in the World.
China mobile is not only just basic voice services but also value-added Services like data transmission, IP telephone and multimedia and so on. And it is known for its brands like GoTone, Easy-Own, and M-Zone. China Mobile has been playing a leading role in the development of the mobile communications industry in China and it is committed to achieve the comprehensive, coordinated and sustainable development in social, economic and environmental aspects. And continue to create a wealth value to achieve the harmonious development. China Mobile aims at building the best service quality.
With the rapid development of communication industry and telecom technology, and in today’s society, mobile telecommunications has become an inseparable part of people’s live, as the use of mobile phones expand and become a very common tool for reading, listening music and internet or other service, the competition between many telecommunication companies is very fierce. And as we know, APPLE I-phone is very popular all over the world now, it has so many customers. Many people are attracted by I-phone. In china, APPLE co-operate with China Telecom and China Unicom, which will bring a lot of profit for the both companies. And I-phone definitely attracts many young users to China Unicom. Also many competitors have developed many preferential policies, like put a telephone bill to sent a mobile phone. Some small communication companies rise up, to attract some potential consumers. So China Mobile has faced threats and challenges.
China Mobile needs to make more improvement to strength its marketing position in the future, although China Mobile has very good reputation in china even in the world.
So in this dissertation, facing such competition situation, I would like to according to the results from analysis of the company and competitors, then to develop a feasibility strategy for China Mobile. I will use company’s advantage to improve its completive strength.
2. Problem Statement
Main problem
Facing the threats and challenges, how should China Mobile in the future strengthens its market position in China?
To answer this problem formulation, the following sub- problems will be analyzed.
Sub problem
1.1What is the advantage and disadvantage of China Mobile?
1.2 How are the competitive environment in China and how could China Mobile improving its market position in current market?
3. Delimitation
I will focus on China Mobile’s advantage and disadvantage also competitive environment to analyze how China Mobile strengthen its market position in the future.
4. Method
In my dissertation, I will have external analysis and internal analysis of China Mobile, so I use the following method to analyze the company.
Model
Purpose
Porter’s 5 forces
Used for analysis of the competitive strategy and it can effectively to the customer’s competitive environment.
PEST
In order to have a board and coherent understanding of the macro –environment in China.
Marketing mix analysis
To have a better understanding of the company's internal structure
SWOT
We can know the strength, weakness, opportunity and threat of this company and then make a good plan for China Mobile to develop.
5. Company description
5.1 mission and goal
Mission
“Creating unlimited communication world, becoming pillars for information society” 1this is China Mobile‘s historical mission. With the progress of social civilization, with the improvement of life level, the people demand of communication also become higher and higher. China Mobile regards customers as the centre of the company, to create a new way of life and provide rich life content.
Creating unlimited communication world means China Mobile will always stand in front of the technology development and changes in market demand create new communication world. Let tired, busy modern people at the no communication restriction and barriers world enjoy unlimited joy in anytime and anywhere.
Becoming pillars for information society means China Mobile be the industry leader but not the follower. It is a must for China Mobile to keep innovating the operation and institution. So it can lead the society to the information-oriented direction, and become a pioneer and a leading force of the information society. Also, China Mobile continues increasing the network technology and capacity, to become an import foundation and bridge of information.
Goal
The goal of China Mobile is to become the creator of excellent quality. Becoming the creator of excellent quality means the company needs to deeply know and understand the customer’s demand, and make a better product and high quality service to create a classic and permanent trust brand for customers.
6. Porter’s 5 force
Porter 5 force was suggested by Michal Porter in 1980s, it has a global impact to a company’s strategy development. Here, I use Porter’s 5 forces to give the whole picture of the communication industry competition situation. And effectively analyze China Mobile’s competition environment. The 5 force is the new entrance, industry’s competition, the bargaining power of suppliers, the bargaining power of buyer and the substitutes. (See figure 6.0)
Figure6.0. Porter’s Five-Force Model2
6.1 The new entrance
The new entrants to the mobile communication industry will bring new product capacity and new resources, but it also will bring the competition into the same industry. China is a populous country, and it has the largest mobile communications customer group. With China and the world more integrated, the threat of foreign entrant increase, China’s mobile communication industry has opened to many countries, and many foreign mobile communication operators aim at Chinese market. With the development of 3G, many foreign operator will entrant to Chinese market and compete with mobile communication industry. Also, in China, the mobile communication has a very broad prospects and huge potential market and mobile communication is the most profitable business in the current telecommunications industry, so many operators want to be the new operator of the mobile communications market in China.
With the diversification of customer needs, a simple mobile business cannot meet customer needs, with the development of 3G in the future, there would be more and more operators enter the Chinese mobile communications industry.
6.2 Industry competitors
At the present time, there are three operators in China’s mobile communications market: China Mobile, China Unicom and China Telecom. China Mobile has the business for a long time, in market share, technical reserves, capital accumulation and the network coverage has a leading edge. And China Unicom as the biggest competitor, although it has the advantage of the operating mechanism and policies, the fundamentals are relatively weak. For China Telecom, it relay on its strong fixed net base also its strong customer base , Vigorously explore the development of mobile telecommunications .The three mobile operators in the Chinese mobile communications market constantly applying new technology to increase their own users and improve service levels and to seize new market high - end users. But currently, China Mobile still is the leader of mobile communication industry. In short time, China Mobile won’t be catch up, but China Mobile need to be aware of the threat. And strengthen its marketing position in the market.
6.3 The bargaining power of suppliers
The supplier of China Mobile is communications equipment manufactures, and nowadays the competition in the market is insensitive, the profit of the entire market become average. Also customer’s demand become more diversification, it requires the mobile communication operator offer excellent quality, advanced technology and perfect after –sales service. So the product technology of equipment manufactures need to improve and the technology upgrade fast. All of this will make the operator cost increase. So the supplier will force buyers to accept high price. In addition, for the new mobile operators, because the technological advances too fast, the third generations mobile communication system is a new technology, equipment suppliers need to recover the huge investment in research and development within a short period of time, the price of the equipment will be much higher than the cost.
6.4The bargaining power of buyers
With the mobile communication terminal price and mobile communication tariffs continue to decline, mobile communications has already begun to enter ordinary people live, and gradually from a luxury become a necessity of life
As the mobile communications market is a competitive market, consumers have more choices, the consumer's bargaining power is still the rising. Operators will face more and more critical and rational consumers in the future.
Network quality and service levels have increasingly become a key factor of consumer concern. According to the survey3: users intent to switch to other networks more 60% ,and the main factor for China Mobile users to switch the network is the high price, poor service while the main reason for China Unicom users to switch the network is poor network quality and the coverage is not wide. So the bargaining power of buyer in this area is still increasing.
6.5The threat of substituted
In communication industry, for mobile communications business, the main alternative business could be the telecommunication business. The main alternative is fixed line telecommunication. From the current point of view, the development trend of the communication is wireless and mobile. And future mobile communication will be mainly used for people in the mobile personal communications; fixed communications may be more used for work and family communication and entertainment. With the mobile communication charge rates continue to drop, as a way of communication, mobile communication will not be too much substituted by fixed telephone.
However, PHS (personal handy-phone system) is the relative mobility of the quasi-mobile services. It meets people's basic mobile needs, because it is inexpensive and convenient. Though the service quality provided by PHS is not as good as the service providing by China Mobile and China Unicom due to the immature technology - such as bad signal even lose signal or noisy, but it is still welcomed by the Chinese customers because of its lower price. PHS has great market space.
7. Competitor analysis
In this part, I am going to analyze the competitors of China Mobile in China to find out the competitive advantage of China Mobile, and then analyze how to improve this.
In China, there are three main operators in the mobile communications market: China Mobile, China Unicom and China Telecom.
7.1Analysis of China Telecom
China Telecom is a large state-owned communications enterprise in China. As a principal telecom enterprise and the largest infrastructure network operator, China Telecom owns the world's largest fixed telephone network; it covers both urban and rural area. It provides fixed telephone, mobile communications, date, internet access and application of integrated information services.
China Telecom in the fixed-network field has greater advantages, and also showed a strong marketing capability. In 1st, October 2008, China telecom acquire China Unicom’s CDMA network4, this helped China Telecom quickly enter the mobile market. After China Telecom got the mobile business ,with the help of multiple services bundled mobile development as well as existing fixed-line business opportunity, improve its overall competitiveness and brand image become China Telecom’s business core.
China Telecom network infrastructure has improved. 20 years of reform and opening up, China Telecom has built a nationwide coverage, it has the advanced technology and basic transmission network, access network, switching network and data communications networks and intelligent network. All of these increased its capacity. The advantage of the network of China Telecom has become the core competencies of its enterprise development.
Although China Telecom has a rich client resource, network facilities, as well as a large number of reserve personnel, but it lack of a necessary strategic concept for the development of the modern enterprise, like the concept of innovation.China Telecom's existing infrastructure can’t provide users with special services. China Telecom has a relatively complete network infrastructure; most are not based on the actual needs of the market, but in order to meet the needs of the universal service.
However, for brand, China Mobile’s branding in consumers’ mind has formed a very good psychological effect. On the product, China Mobile’s mobile network quality, coverage, stability is still strong support. TD-SCDMA as the highlights of the national innovation strategy, naturally at the product level has a policy resource. In contrast, telecommunications is relatively weak in these areas. Consumers’ mainly impression of telecommunications is fixed-network and broadband. This is greatly differing from the mobile phone business. Even telecommunications has a dominant position in the fixed network, in recent years the number of fixed-network users is declining.
7.2 Analysis of China Unicom
China Unicom is one of the most influencing mobile communication companies in China. China Unicom's main business scope include: fixed communication services; mobile communications business; domestic and international communication infrastructure services ; satellite international private line services , data communication services , network access services ,IP telephony and various types of value-added services and so on.
China Unicom is the biggest competitor for China Mobile in China. As the biggest competitor in China, China Unicom has a very strong advantage in the current funding, etc., for many years in the field of mobile communications it already has the extensive capital and experience, as well as the strong customer base. The competitive strategy of China Unicom is relative to its unique network operation (CDMA), lower service price, and value-added services.
China Unicom’s main customer group is low-end customer, China Unicom's customer base is very close to PHS’s customer base, and its position is between China Mobile’s high-end and PHS’s low-end. Thus it is a dilemma in a price war for China Unicom. In order to respond quickly to market war, China Unicom reduces the price to to further attract more clients and expand the market. Because of the decision of China Unicom, make the reduction war spread from the low-end market to high-end customers. In addition, China Unicom cooperate with Apple Company, it is a good strength to China Unicom. Nowadays, the trend of mobile market is I phone. Because of the brand of I phone, China Unicom get more new customers. China Mobile faces the threat of a gradual loss of its target customers; they are forced to cut prices to protect themselves.
The WCDMA networks that China Unicom used is the most widely used in three 3G standards, its the most mature 3G technology, 3G technology also the mobile terminal is quite abundant and cheap. Combined with the needs of domestic customer and it can form unique competitive core. However, China Mobile‘s 3G technology was lagging behind China Unicom and China Telecom. The speed of China Mobile‘s 3G internet is slow and its network doesn’t achieve the full coverage. And when users use the 3G network of China Mobile, customer often face the problem that is get through, break or bad quality of sound. China Mobile should improve its 3G technology to gain more customers.
8. PEST analysis
Before analyzing Company’s internal situation, it is necessary to know the background of the current macro-environment of this company, so here I will use PEST to analyze the macro-environment of China Mobile. PEST analysis considers the Political environment, economic environment, social / cultural environment, technological environment.
8.1 Political factors
In recent years, China’s mobile communication market grows fast, and the mobile phone has entered working-customer class, the customers are very sensitive about the increasing charge. Before, China Mobile’s charge way is like “Less than a half month according to a half month charge, surpasses a half month according to one month charge”. Many customers think his charge way is very unreasonable. In 2002, Chinese government required China Mobile’s charge way in the monthly charge.5 It required that China Mobile charge the fee based on how many days customers use. The adjusted policy shows a new idea of telecommunications charges and it helps company improve its service quality.
On the one hand, the Chinese government supports the development of the communications industry, and encourages competition; on the other hand, they increase macro - monitoring efforts. In 2007, Government issued No. 75 files and No.453 files 6to enforce the regulation of mobile communication operators and the scope of regulation, involving agents, charges, partners, services, business processes, technology and equipment standards etc. It enables operators to relatively standardize the operating behavior.
In order to improve the competition in China’s mobile communication industry, Chinese government allows China Unicom could reduce their service charge 10-20% lower than China Mobile. 7This policy helped China Unicom to enhance its products competitiveness.
8.2 Economic factors
Since the reform and opening up, China’s economic develop rapidly, the phone users and mobile phone users are also substantial growth year after year
8.2.1 GDP
Since China implemented an ‘open door’ policy in 1978, China’s economy has expanded a lot. China has still kept dynamic economic growth (see figure 8.2.1)
Figure 8.2.1 the development of the Chinese GDP8
From the figure8.2.1, it is obvious that from 1978s, China GDP keep growing. The average GDP annual growth rate is 9.1%, the proportion of communication industry in the national economy keep rising. It also means that people’s social consumption ability increase. The demand of communication service increase as well. So this is a good chance for communication industries develops and expand business in china.
8.2.2 Unemployment
About the unemployment, in China, this is still a big problem. Even Chinese economic grow; the unemployment rate is still high. Figure 8.2.2 shows China unemployment rate.
Figure 8.2.2Unemployment rate in China9
From the figure8.2.2, we can see that from 2008 to 2012, the unemployment rate from 4% in 2008 raised to 4.3% in 2010，and reached the highest 4.3 percent. In the end of 2011, the unemployment rate reached the highest 4.3 percent again, which means more people, lost their jobs. From the figure we can see that, nowadays there are still many people who don't find their jobs or lose their jobs. In other words, China Mobile might lose some these people’s market.
8.3 Social/culture factors
From the late 20th century to this century, people gradually accept and recognize the concept of "information society”. Consumer’s attitudes and habits of information quietly changed, this change is a reflection of the adaptation of the information society, also is a great opportunity for the further development of the telecommunications enterprises.
Population growth: China is a developing country with the biggest population in the world. And China’s population still keeps growing.
Figure 8.3 shows the population of china.
Figure 8.3 Populations in China.10
From the chart, we can see that China population in a growing trend. China has the 19.43% of world population，China's national economy has developed at a high speed, and the people's living standards greatly improved. Thus, it can be said that the Chinese market is the most potential market, which has the largest group of customers in the world.
Age and sex distribution Figure 8.3.1 shows China’s population by age and sex in 2010.11
Figure 8.3.1 Age and sex distribution in 2010.
From figure 8.3.1, the population of female and male is nearly the same in each age group in china. And from the figure, we found that the age group 40-44, 35-39 and 20-24 is the first three high. They are the biggest market for mobile. Most of the customers in age group 40-44 and 35-39, they already have a stable income, and they pursue a better quality of life, so the requirement of mobile communication service is higher. This is a good chance for mobile communication industry to improve their service to attract more customers. And age group 20-24, this age group most is students and young customers, young people pursue a new, immediate , convenient and happy lifestyle, Although the limited spending power , but as they grew older , the purchasing power is also rising , which will undoubtedly provide favorable support for the mobile increase in the future. and there are many products from China Mobile is for young customers, like M-zone, the greatest feature of it is flexible tariff and provide a variety of innovative personalized services. So young people could is China Mobile’s target market.
Change in lifestyle: Nowadays, the world is in the information age, people are seeking a method to collect the information much faster and more vastly. Thus, mobile communication becomes an indispensable part in people’s daily lives, especially in urban areas and commercial communication. In addition,
Resent years, Chinese lifestyle has changed a lot, they are more depending on the technology to make their life more convenient. Like more and more people prefer to use various methods in communication sector, such as mobile phone and Internet, because of their common advantages on speed, economy, convenience and privacy. The demand of communication has expanded quickly.
However, in countryside, rural people still prefer to choose traditional communications methods, because new methods are heavily restricted by network and equipment, which has not broadly deployed in rural areas.
Distribution of income: people’s income has a great influence of the consumption of communication product. Figure 8.3.2shows the per capita income and per capita GDP in china from 2000 to 2009.12
Figure 8.3.2 per capita income and per capita GDP in China (in dollar)
From the figure 8.3.2, we can easily see that people’s income and per capita GDP in an increasing trend. With people’s income increased, people’s life level develops, and so they may require higher quality and quantity service of mobile communication products.
Also figure8.3.3 shows the relation between GDP and inflation.13
Figure8.3.3
From figure 8.3.3, we can assume that when GDP increase, the demand also increases.
8.4 Technology factors
The mobile communication industry applies the various and complex technologies. Technology plays an import role in this industry. This paper will introduce some major technologies.
GSM:
GMS (Global System for Mobile Communications) is the most widely used mobile phone standard currently .It is the second generation mobile communications system. It has built a mature technology and the complex coverage which support the customers use mobile phone cross the world.
In 2004 more than 1 billion people use GSM phones, GSM phones has 70% of the global mobile phone market share.
GPRS
GPRS (General Packet Radio Service) which is a mobile data service available to users of GSM mobile phones. GPRS can be said that is the continuous of GMS.
GPRS is different from the past continuous channel transmission, it is based on packet type (Packet) to transmit. So the cost is counted by its transmission data unit it is not use its entire channel. In theory, it is cheaper. GPRS transfer rate can be increased to 56 or even 114Kbps. In any location, customers can quickly and easily connect the internet.
3G
3G is the shot form of 3rd generation mobile communication technology. The basic characteristics of 3G is the intelligent signal processing technology, intelligent signal processing unit will be the basic functional modules. And it support voice and multimedia data communications.3G mobile phones generally refer to wireless communications and multimedia communications such as the Internet generation mobile communication systems integration. It can handle images, music, video and other forms of media, including web sites, telephone conference e-commerce and other information services.
TD-SCDMA
TD-SCDMA (Time Division-Synchronous Code Division Multiple Access) is one of the 3rd generation communication standards. It was created by China. In China, the license plate of TD-SCDMA is belonging to China Mobile. TD-SCDMA has the unique advantages in flexibility of business support. TD-SCDMA as the third generation mobile communication international standard, is an important symbol of China's independent innovation, China will continue to support research and development, industrialization and promotion. However, compare with the other two 3G standards CDMA2000 (in China, the license plate of CDMA2000 is belonging to China Telecom) and WCDMA (in China, the license plate of WCDMA is belonging to China Unicom), because of the late start of TC-SCDMA. Its technology is not mature enough.
9. Company analysis
In order to have a deeper and better understanding China Mobile’s market, I am going to make an internal analysis of China Mobile.
9.1 Analysis of the financial account
Figure 9.1 shows the operating revenue and profit of China Mobile from year 2005 to 2011. (Data see appendix 1)
Figure 9.1(RMB million)14
From the figure, we can see that this company keeps growing in revenue and profit and overall the company's development in upward trend. The Increase rate of revenue from 2005 to 2006 is 21.5%,and the increase rate of profit is 25%;from 2006 to 2007,the increase rate of revenue and profit are 20,9% and 35%；from 2007 to 2008，the increase rate of revenue and profit are
15,5%and 14.9%；from 2008 to 2009，the increase rate of revenue and profit are 9.8% and 3,2%；from 2009 to 2010，the increase rate of revenue and profit are 7.3% and 2.5%；from 2010 to 2011，the increase rate of revenue and profit are 8.8% and 0.4%. we can find that in the beginning，the revenue and profit in a fast increase，later even they are in stable and small increasing，compare with before，the increase rate is lower. Because with Chinese economic growth，further mobile penetration in China, there are more and more competitors， made for a more challenging competitive environment. But this company still focuses on its core strengths: innovation, brand equity, management and professional talent. By fully use the scale of its network, customer base and strong customer service system, the company improve its overall competitive
Positioning and achieved steady business development
9.2Marketing mix analysis
Product
Customer’s demand is the start point of market. And consumers are the end-user of the product, but also the reflector of the product value. The design of product is to meet the demand of consumers. From customer’s point，China Mobile applies several series of its product and service in this market. In the following，I will introduce some products of China Mobile.
Fetion：Fetion is the integrated communications services,it combines the voice, GPRS, SMS and other communication. Fetion users need to add a friend by phone number, so Fetion users’ friend circle s is based on the true friend relationship. And it provide users with instant messaging, SMS, MMS, voice calls and e-mail ，it fully meet users' different communication needs.
139 mail-box：139 mail-boxes provide the e-mail services for mobile customers. With conventional Internet-based mail service functions, it give full play and use the advantages of mobile phone features, let customers can easily and directly via SMS, MMS, WAP and Internet access access to manage e-mail at anytime and anywhere. 139 mail-boxes provide customers with safe , stable , fast , easy-to-use , high-quality personalized e-mail service.
Mobile Market：Mobile Market is the mobile application store which is launched by China Mobile. It is also the first mobile application store in China.
It helps China Mobile open the market in this area and laid a good foundation for the development of the mobile application industry. Mobile Market mainly provide mobile game，mobile theme and mobile software. Also meet the need of different customers.
Mobile Newspaper：Mobile Newspaper is value-added services. This survive has abundant information delivered timely and conveniently.
Provides users with timely information services（including news, sports, entertainment, culture, and lifestyle) through MMS, WAP or SMS.
International Roaming：International Roaming is a convenient mobile business for aboard customers. By the end of February 15, 2012, China Mobile has opened the Hong Kong, Macao and Taiwan GSM international roaming service with 406 operators in 237 countries and regions, and with 292 operators in 188 countries and regions opened GPRS international and Hong Kong, Macao and Taiwan roaming service.15 At the same time, China Mobile will continue to expand the scope of international roaming services.
“A customer would pay for the branded product or service compared to am identical unbranded version of the same product/service”.16 In addition，base on China Mobile’s products，the company also created 3 major brands for different groups of customers by their economic power and purchasing custom.
(1) GoTone
GoTone is the core brand of China Mobile，and it is designed for middle and high class customers（VIP club customers），it has many high-end customers. Since the inception of Gotone，GoTone always pursuit the improvement and upgrade of customer service and pay more attention on the personalized needs of customers. In GoTone VIP club，they provide considered services like VIP airport service, account manager service, and golf club service etc. These personalized value-added services bring happiness and relaxation to the members.
(2)M-Zone
M-Zone is designed for young and fashion customers Novelty, fashion, fun, and explores its main brand attributes. M-Zone create a new, immediate, convenient, happy lifestyle for the young family. The new customer brand uses new form of text messaging monthly payment, while also providing a variety of fashion and fun customized services. For example, the customers could play online games through “Game treasure box”, they could chart with friends with “mobile MSN”, and they could also download their personalized ring tones and pictures for their specific preference. Its biggest selling point is that the SMS packages, only pay 20 Yuan a month can send 300 text messages or to pay 30 Yuan a month can send 500 text messages .
(3)Easy Own
“Easy owned” is designed for general customer, which takes “quick and tangible benefit” as its principle. The number of customers in this brand accounts for more than 75% of the totally customers in China Mobile company. It plays an import role in China Mobile’s customer brands. Even though, Easy Own has a wide range of coverage and high quality of reception as “GoTone”, it provides different fee package for different customer group. And compare with other brands, Easy Own is easier to be used. It can satisfy the basic demand from customers by its lower and popular fee.
Price
Price is one of the important factors that influence customer purchasing behavior. It plays an import role in market.
There are some factors will influence mobile communication industry price.
1. Cost factor. The marginal cost of telecommunication services is approximately zero. Communication network construction requires a one-time investment in a lot of money once network completed, most of the costs become a sunk cost. However the marginal cost of the telecommunications business is very low and almost negligible. Therefore, the greater the volume of business, the unit fixed costs will be lower.
2. Market factor. Business and competitive strategy of each enterprise will have a major impact on several other enterprises. After the baptism of several years of competition, the telecom market is gradually moving towards a reasonable mode of competition. The competition will influence the price. The operators’ service level is gradually improved the service concept and awareness has sink deep into the heart of the people. From the starting point of customer’s demand, the operators make business development and innovation, breakdown of user groups and market segments.
3. Customer factor. Customer is the centre part of a company. Customer’s perceptions and customer’s income influence the price. When customers choose a telecommunications business, they will accord their own income, occupation, age, personality and interest in hobbies. Therefore, operators in the business pricing should focus on to consider the extent of consumer demand for the product also customer’s ability to pay.
China Mobile has set a different price for different target customers. For the GoTone users, China Mobile mainly provide the preferential treatment of package but also develop at different rates based on the contribution of size; for Easy Own users, China Mobile main use of the family number of ways to cut local price; for the user of the " M-Zone “, China Mobile use the implementation of new business bundling strategy to enhance customer using value
Also customers can pay the bills by many kinds of ways like auto pay, bank, online to pay, the terminal business hall, etc. and China Mobile encourage customer store
Facing China Unicom's low pricing strategy, based on competitive prices, China Mobile set the mobile price packages which is for different user groups actually is a disguised form of lower call prices. This completely changed the mobile phone’s single charging way, and provides users with a richer variety of fees options and makes users more freedom.
Place
Distribution channels play a very important role in the market. It is the bridge between producers and final customers. The functions of the mobile communications business channels is that make the company profitable service can be lasting used by users, improve customers satisfaction through good service. In the following, I will introduce China Mobile’s distribution channels.
China Mobile Business Hall
China Mobile business hall still is the most important business place. Pay attention to the image of the sales staff in order to improve the volume of services. Customers in business hall can have a better understand of the products and service by asking the stuff to satisfy their need.
Customer Service Hotline
10086 customer service hotline provider customer mobile communications business consulting, business acceptance and complaints advice and other professional service through automated voice, text messaging, fax, E-mail and so on. If customers have any problem of the bills or mobile phone or internet problem, they can call 10086 for help. In addition, you can not only familiar with the current rates and promotions, but also grasp the latest business news. It is very convenient for customers.
Online Business Hall
Online Business Hall is online self-service platform that China Mobile provide customers with business acceptance, sale promotion, information consulting. By logging in the Online Business Hall, customers can do trading operations like query operations list, check business records, get the latest news and complain.
Customers not need to go to Business Hall, just stay at home can enjoy the same service that provide by Business Hall.
SMS Business Hall
Customers can check the bill and do business operations by sent SMS; it is very easy to use. Customers can use it at anytime and anywhere.
Retailers
Retailers are import channel of mobile operators. China Mobile pay attention to the management of social channels, and gradually increase the quantity and quality, focus on the circulation characteristics of retailer, use the differences in regional products to stimulate the final market. Good relationship between retailer and customer will bring more profit to the company.
Promotion
A good promotion can help the company attract more customers and gain more profit. As the leader of Chinese mobile communication industry, China Mobile uses the funds advantage to do many promotions to attract customers.
At the present time, the main promotion strategy for China Mobile is adverting.
And spent a lot on money on newspaper, internet, TV and many Medias to advertise company’s new product and new service. For high-end business customer, fashion young users as well as low-end mass users (including rural markets), there are different focused advertise for these customers. For example, high-end customers usually have more contact with the trade journals, or outdoor advertising, car radio; fashion users have more contact with the Internet and television and other media; low-end mass consumer have more contact with the outdoor advertising business hall publicity or advertising flyers.
For every new product, especially like 3G new technology value-added service, many customers are not very familiar, and they need a time to accept the new product. So when promote new products, at the same time, customer can use the products for free in fixed time or pre-store the call expense to get free products. This promotion activity is wildly welcomed by customers.
On the other hand, China Mobile also sale the products by telephone selling,
The telephone selling staffs always are very friendly, patient and polite to customers. If there is any new service or products, they will make a phone call to users and introduce to them.
9.3 SWOT
In this part, I will use SWOT to analysis China Mobile, in order to understand the strength and weakness of this company also base on the opportunity and threat of market to find the direction of development and business strategy.
9.3.1 Strength
Regardless of the mobile network coverage or quality, China Mobile network system is far ahead of the other industry, it has stable network coverage and network operator. Until 2003, June, China Mobile’s average coverage rate has been 99.86% in 36 major cities and the average network connection rate has been 98.24% 17.And is constantly improving, make the company more competitive.
China Mobile has larger market share than China Unicom and China Telecom, and own the largest subscribers group in China, which has more than 661.4 million until 2011.18 China Mobile has always played a leading role in the development process of Chinese mobile communications
Wide range of business. China Mobile mainly runs mobile voice, data, IP telephony and multimedia services. Besides providing basic voice services, also provide fax, data, IP telephony and a variety of value-added services. The brand advantage of China Mobile is very strong in the market. It has well-known service brands like the "GoTone" , "EasyOwn" and " M-Zone”
And these brands cover middle-end and high-end customer group.
China Mobile has very strong finance performance and its operational capacity, profitability is powerful.
9.3.2 Weakness
Compare with China Unicom, the price of China Mobile is higher. That is the reason why many customers would like to choose China Unicom.
Technology TD-SCDMA started late, compared with China Unicom’s WCDMA and China Telecom’s CDMA2000, TD-SCDMA is not mature enough. It still needs to take time to improve.
9.3.3 Opportunities
The entry of 3G technologies brings a lot of market chances for China Mobile operator and manufacture. It also brings potential increased-rate of the revenue.
At present, the Chinese market is changing the direction from the traditional voice market to the value - added non-voice, Internet communication and information resources will be greatly enriched. Mobile applications are widely involved in the entertainment, financial, WLA areas, online games and other interactive development business, and it becomes an essential part of mobile communication. The number of mobile Internet consumers becomes more and more. That is a good chance for China Mobile develops its business.
9.3.4Threats
China Telecom and China Netcom, the two potential entrants are the greatest threat to China Mobile. The space for Fixed-line development has been very small, and it will enter the stage of decline soon, to solve this problem, fixed network operators must rely on the pull of the NGN (next-generation network), 3G and other new business. Fixed network operators have started to proceed with the deployment of 3G, in order to reverse the profit declining year after year.
The high-end mobiles threat that from China Unicom and China Telecom, such as I phone. They have attracted many customers. However China Mobile doesn't have this kind of high-end mobiles.
The government allows China Unicom reduce its charge fee 10%-20% lower than China Mobile. Therefore, the price war is unavoidable in this market.
Changes of customers’ preferences. With the passage of time and continuous strong of competitors, it is hard to guarantee that customers will use China Mobile this brand permanently
10. Strategy for China Mobile
After analyzing the industry environment, the characteristics of each competitors and China Mobile’s internal situation, I would like to give some strategic suggestions for China Mobile .
As I mentioned above, the price of China Mobile is the highest among China Unicom and China Telecom, so the optimum strategy should be taken in the future is reducing the service price and maintain its network service quality. in the promotion of 3G business promotion, pricing strategy should be an important weapon. China Mobile can not only provide paid services, but also provide prepaid services in order to attract a large number of customers.
Use the differentiation strategy to gain a competitive advantage with our network, services advantages and characteristics of services and products. In addition, company should firmly establish the concept of service and enhance knowledge of marketing, improve better service quality, and provide satisfactory services to the user.
In technology strategy part, it should continue to consolidate and expand the original network advantages. While developing and improving the existing GSM network, closely monitor the development of 3G mobile communication systems, and actively making development of new technology introduction and research.
Business innovation, China Mobile new business should not just concentrated in the entertainment, but also towards the media, business to further expand. Like can help customers use mobile phone to handle emails or some commercial activities.
11. Conclusion
With the rapid growth of mobile communication industry in China, there are more and more competitors and competitors become stronger. The competition intensity between each mobile communication company is very high. Even though, at present China Mobile is in the leading position, facing the main two competitors-China Unicom and China Telecom’s threats and challenges. How should China Mobile in the future strengthens its market position in China? In this dissertation I analyze the external economic environment and internal environment of this company, in order to get a deeper understanding of the company and then I try to develop a better strategy.
The internal analysis of China Mobile reveals the company’s advantage and disadvantage and discovers the opportunities and threats that the company is facing. The advantage of China Mobile is that China Mobile has a very strong financial performance and brand dominance, and provides the high quality network and service, playing a leading role in china mobile communication industry. However, compared with the other two major competitors, China Mobile’s prices are higher. In the 3G technology segment, China Mobile is in a rather weaker position, TD-SCDMA technology and commercial level is not mature enough.
The external environment analysis shows that competitors’ strengths influenced China Mobile. The strengths of competitors as following
Both China Unicom and China Telecom cooperate with Apple company，contracted with I-phone help them to gain more customers
China Unicom got the government policy’s support, it is allowed to reduce its charge fee 10% ~20%, product pricing can be 20% cheaper than China Mobile, and many customers may want to buy products because of the low price.
For 3G technology，China Unicom and China Telecom have more mature technology than China Mobile.
Facing the threats and challenges, and the fierce competition in the future, it’s very important for China Mobile to make some competitive strategies to improve its marketing position in the future. China Mobile should lower its price to gain more customers and in the other hand, enhance its service quality. Based on current brand advantage in the market, expand business scope and continue to develop the3G technology.
By analyzing all aspects of China Mobile and these suggestions, it will help China Mobile strengthen its marketing position in the future and have a better development and higher profit.
12. Reference
Websites:
1. http://www.10086.cn/aboutus/culture/
2. http://www.learnmarketing.net/porters.htm
3. http://it.sohu.com/20081126/n260849018.shtml
4. http://baike.baidu.com/view/3214.htm
5. http://www.cnii.com.cn/20020808/ca90280.htm
6. http://www.gsei.com.cn/html/wjygh_749_20523.html
7. http://wk.baidu.com/view/88B363f9aef8941ea76e05b0?pn=2&ssid=&from=&bd
8. http://www.tradingeconomics.com/china/gdp
9. http://www.tradingeconomics.com/china/unemployment-rate
10. http://www.tradingeconomics.com/china/population
11. http://wenku.baidu.com/view/235fb6d73186bceb19e8bb9e.html
12. http://www.chinamobileltd.com
13. http://www.10086.cn/newbusiness/basic/201103/t20110315_25622.htm
14. http://it.sohu.com/20040713/n220977561.shtml
15. http://labs.chinamobile.com/news/67987
Books:
1. GLOBA MARKETING, Svend Hollensen, fifth edition
2. International marketing and sales, POIL K.FAARUP AND JACOB AABROR (editor)
3. Economic for Business David Begg and Damian Ward 3ed edition
13. Appendix
Appendix 1
Part of financial data of China Mobile in 2011
You May Also Find These Documents Helpful
-
AN ANALYSIS AND EVALUATION OF ENTRY STRATEGIES IN CHINA’S TELECOMS MARKET: A CASE STUDY OF BT GROUP…
- 30490 Words
- 122 Pages
Powerful Essays -
Five of the national service providers in the marketer are T-mobile, Cingular wireless, Verizon wireless, Sprint PCS and Alltel. The competition and promotions among cellular phone companies, the overall churn ratc of the industry has been about 1.6 percent, but it’s on rise. In the new product, T-mobile will provide caller tunes, pictures & video messaging, road assistance, 300 text messages, unlimited t-zones and 1000 text messages. The competition will rise when the need are rise. Also, the consumer will require the high quality service.…
- 1288 Words
- 6 Pages
Good Essays -
According to the (Plunket Research, 2013), the market value worldwide for telecommunication industry in 2013 was USD 5 trillion and the market value for United States alone was USD 1.2 trillion. Technology has been an integral part of our daily life; and it is widely used in all business organizations. 91% of adults in United States owned a cell phone (Pew Research, 2013) and the telecommunication industry may seems to be an attractive industry with the increase demand of such product and services. However, due to the rapidly technological evolution, this is a highly competitive market to sustain competiveness in the market. For example, AT&T’s business evolves around technologies, there is shift of demand in the consumer market; consumers have switch to use instant messaging services like ‘whatapps’ instead of talking over the phone or short messaging services. AT&T must be able to implement alternate strategies to meet customers’ need before competitors. Though there are four major players in the telecommunication industry, AT&T’s main competitor is Verizon; they have similar financial strength and market share while Sprint and T-mobile hold a very small…
- 2395 Words
- 8 Pages
Powerful Essays -
The external environment is analysed by looking at the PESTEL factors that affect the company in terms of political and legal aspects such as patents and lawsuits, economic aspects in terms of exchange rates fluctuations, social aspects such as changing tastes, technological aspects such as new operating systems in phone and also the environment in terms of competitor activity. It also analyses the competitors in the market along with their strengths and also the a 5 force analysis that looks at threats to the company in terms of new entrants and substitutes as well as the bargaining power of firms engaging in business transactions.…
- 3595 Words
- 15 Pages
Powerful Essays -
➢ To assess the marketing plan and various factors like marketing audits, Marketing mix and different kinds of analysis with respect to the industry in the world of mobile market.…
- 9314 Words
- 38 Pages
Powerful Essays -
Firstly, China’s telecom equipment market is the background of Huawei. China’s telecom industry achieved substantial double-digit growth in 1980s, and surpassed US to become the largest telecom market by the end of 2002. The glooming growth in Chinese market is an initial power of Huawei’s growth. Table 2 in the case shows that as early as 2005, Huawei had achieved the market leader with the share of 13.5%. And since China was the largest market, Huawei had become the largest domestic telecom equipment company. Secondly, the special company culture and foresight shown by the company make Huawei an extraordinary different company. The military-styled “Wolf-Pack” corporate culture and relationship with Chinese government are the “trump cards” of Huawei. The chairman, Zhengfei, admitted that: “If there had been no government policy to protect, Huawei would no…
- 1157 Words
- 5 Pages
Powerful Essays -
1. Identifies and analyzes the industry and competitive environment of the mobile phone industry based on information contained in the case: HTC Corp. in 2009 including key industry and environmental trends, competitive and structural characteristics of the mobile phone industry.…
- 2477 Words
- 10 Pages
Powerful Essays -
Our Company Restaurant Jaclivery Sdn Bhd creates a mobile application named Jaclivery Malaysia for iOS and Android user. Jaclivery is an official Restaurant Jaclivery Sdn Bhd’s mobile app. Customers can use this app to order and purchase food and beverage online for fast delivery to your doorsteps. Check out the full menu on the go. Plus, customers can keep track with your calories intake with the built-in calories counter. All this scale we are using PEST and Porter’s 5 Forces. PEST includes Political influence, Economic influence, Social influence and Technological influence. Risk of Substitutes, risk of new entrants, bargaining power of suppliers in addition buyers and competitive challenge are main details of Porter’s 5 Forces. (Dean A.Shepherd, 2008, p235)…
- 1912 Words
- 6 Pages
Powerful Essays -
This paper will discuss three operation decision areas, Service and product design, Location, and Human resources and job design, using Xiaomi as the case study. It will look at the current activities in the mobile company based on the three decision areas of operations management and put forward recommendations on ways the company…
- 859 Words
- 4 Pages
Good Essays -
3. What constraints do Huawei face in its internationalization? How does it deal with Them?…
- 927 Words
- 4 Pages
Good Essays -
1. Why did China Mobile feel it was necessary to issue equity in markets outside of its home base in Hong Kong? What are the advantages of such a move?…
- 384 Words
- 2 Pages
Satisfactory Essays -
After the analyzing the preferences selection among the CMCC, China Unicom, China Telecom. the so-called biggest market, China, has such kind of strength to hold it. And China’s communication marketing has some huge potential.…
- 2560 Words
- 11 Pages
Best Essays -
Huawei has become one of the largest telecom providers, and a technology plan solution company in the world. In this paper, we are going to discuss about the global giant by customer analysis and market strategy from the perspectives of Porter’s Genetic Strategy and other strategies that are concluded by ourselves, including the global strategy, customer-centric strategy and international partnership strategy. Besides, after analyzing the statistics from annual report we summary the position in the international market and market segmentations. At last, Marketing Method will be talked about, including the 4P (product, price, promotion and place)…
- 3535 Words
- 11 Pages
Powerful Essays -
I hereby declare that this project report titled “Competitor Analysis & Market Analysis for Samsung Electronics” is executed as per the course requirement for the post graduate program in management for final year project. It has not been submitted by me or any other person to any other university or institution for degree or diploma. It’s my own work done in SAMSUNG ELECTRONICS PVT Ltd, Pune.…
- 9177 Words
- 37 Pages
Good Essays -
Exploratory Research : The objective of this project is to generate new ideas. An exploratory study in generally based on the Primary data and Secondary data that is readily available. It does not have a formal and signed design as the research may have to change his focus or direction, depending on the availability of new ideas and relationship among variables.…
- 10141 Words
- 39 Pages
Better Essays