strategic marketing plan for slt megaline for the year 2015 - 2nd editing
TRANSCRIPT
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Strategic Marketing Planning
December 2014 Examination
Post Graduate Diploma in Marketing
Sri Lanka Institute of Marketing
Assignment
Topic
Formulating a Strategic Marketing Planning
Student name
A. Mohamed Azhar
Reg. No.
0000016630
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Acknowledgement
I would like to express thanks to the Sri Lanka Institute of Marketing for giving this task
which I always consider as a great opportunity to enhance my knowledge and improve
my planning ability.
I would like to thank Mr. Mahasena Senanayake, who is our lecturer for this Strategic
Marketing Planning subject. It is really helping me to make the success of this marketing
planning with his guidance and knowledge in completing this assignment.
I express my sincere thankfulness for my all friends; they provided me additional
knowledge to complete this assignment. As well as my thankfulness to my family
members who encouraged me at all time when preparing this assignment.
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Subject : Strategic Marketing Planning (SMP)
Company: Sri Lanka Telecom PLC
Product : Megaline (Wireline connection)
Name : A. Mohamed Azhar
Reg. No. : 0000016630
Examination Month: December 2014
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Tables of contents
Acknowledgment page i
1. Executive Summary 07
A. Summary of situational analysis 07
B. Summary of Marketing Objectives. 08
C. Summary of Marketing Strategies. 09
D. Summary of Financial projections. 10
2. Vision and Mission 11
3. The Company 12
3.1 Brief History, Current size, Branch if any, etc… 12
3.2 Internal Environment 14
a. Staff Relation 14
b. Resource constrains 15
c. Corporate structure and Culture 16
4. The Product 19
4.1 General product story of the product 19
a. Development, introduction and history 19
b. Product category and characteristic 20
c. Stage of the product life cycle 20
d. Any other important characteristic 20
5. The overall Market (customers) 22
5.1 Description of the characteristic of target customers 22
a. Need and benefit sought 22
b. Product usage 22
c. Attitudes of the customers 23
I. As to the product category 23
II. As to the company product 23
III. Why they like our product or not 23
IV. Any unique character of customers 24
5.2 Description of the characteristic of target customers 24
a. Buying decision making process 24
b. What source of information is sought 25
c. Who makes the purchase 26
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d. Is purchase the consumer 26
e. Who or what may influence the purchase 26
6. Competition and Market share 27
6.1 Identification of the competitors 27
a. List of primary competitors 27
b. Secondary competitors 27
c. Possible new competitors 28
6.2 Market share 28
a. Total current industry sales by market 28
b. Comparative analysis of market share 29
c. Trend and future growth 30
d. Expected total market (demand estimates) 30
6.2 Describe following details of two players in the market and any other 31-38
7. External environment factors 39
1. Political 39
2. Economical 39
3. Social 39
4. Technological 40
5. Ecological 40
6. Environmental 41
7. Legal 41
8. SWOT analysis 42
3. G.1. Strengths 42
3. G.2 Weaknesses 42
3. G.3 Opportunities 42
3. G.4 Threats 42
9. Sales objectives 42
10. Marketing objectives 42
11. Market Segmenting, Targeting and Positioning 46
11.1 Market segment 46
a. Geographic 46
b. Demographic 46
c. Psychographic 46
d. Behavioral 47
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11.2 Targeting 47
11.3 Positioning 48
12. Tactical marketing mix strategy development (7 ps) 49
12.1 Product strategy 49
12.2 Pricing strategy 51
12.3 Promotion strategy 51
12.4 Distribution strategy 54
12.5 Physical strategy 55
12.6 Process strategy 55
12.7 People strategy 56
13. Budget and financial analysis 58
14. Marketing strategy implementation 61
15. Monitoring and evaluation 63
List of References 65
Appendix 66
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1. Executive summary
A. Summary of Situation Analysis
The strategic marketing planning has analysed about Megaline service of the Sri Lanka
Telecom PLC for the financial year 2015. The Sri Lanka Telecom PLC will achieve the
specific goal and objectives in the year 2015.
Sri Lanka Telecom PLC has a proper plan according to the vision and mission, which is a
guideline for practical approaches to reach its success in the telecommunication industry.
The Sri Lanka telecommunication industry has aimed new innovations for country
infrastructure facility and people‟s communication requirement. Generally, SLT is a
backbone of Sri Lanka‟s telecommunications industry.
SLT is a public limited company which is established in 1858. It gained over 150 years of
goodwill and trust from their valuable customers. The main targets of SLT PLC are
providing quality, uniform, steady and reliable services to their customers. SLT offers
various telecommunication services such as Megaline, Citylink, Peo TV and Broadband.
Those are sold island wide through the 34 regional branches, 36 teleshops, 22
maintenance centres and 7 contact centres. SLT PLC has a strong financial growth
because it is attained revenue about Rs. 36.78 billion, which was increased by 5.93% in
2013 and asset value was Rs.83.09 billion and total employees were 7861 in 2013.
Ownerships of SLT hold two primary partners of Sri Lankan government, which holds
49.50% and global telecommunication holdings N.V of Netherland, which owned 44.98%
where the remaining balances own with the general public.
SLT PLC staffs are very friendly among them and they get various benefits and
motivation from SLT. The current resources are backbone to SLT which has financial
resources, human resources, technological resources and physical resources. However,
the sales team is a limited one in the personal selling. The formal and informal structures
successfully works, which corporate structure was strongly organized by SLT that
ensured every rule and responsibility of employees.
SLT Megaline provides three types of telecommunication services as voice, data and
entertainment via Megaline connection which valuable packages reached at maturity
stage in the product life cycle with maximum profit and which increasing market shares.
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SLT divided their target consumers as individual consumers and corporate consumers
who like an effective and efficient of this three way service through one connection. The
customers have a good attitude about this Megline service which provides a lot of benefits
to their target customers.
There is no direct competition to Megaline connection, because SLT is a monopoly
business and it is an only wire-line telephone connection in Sri Lanka, but most of the
other competitors are wireless local telephone connections. SLT PLC has identified
primary competitors, secondary competitors and possible new competitors for Megaline.
SLT is a market leader in total fixed connection which has a 57 % market share, which
has contributed two fixed services, which are Megaline connection holds 38.86% and
Citylink holds 18.14%. Competitor of Lanka Bell CDMA holds 30% market share and
Dialog (Dialog CDMA and Suntel CDMA) holds 13% market share. The identified
competitors have discussed within the background, current product strategy, current
distribution strategy, current pricing strategy and current promotional strategy.
PESTEEL factors have analyzed about the political environment, economic environment,
social environment, technological environment, ethical environment, ecological
environment and legal environment.
The SWOT analyzed strengths, weaknesses, opportunities and threats which are strong
point of SLT‟s Megaline which has major strongest services due to multiple packages,
which weaknesses will be transformed into strengths, threats will transformed into
opportunities, finally, its strengths transformed into business opportunities in the
telecommunication industry.
B. Summary of the Marketing objectives
Both marketing and sales objectives are preferred in the SMART approach. The
Megline‟s sales objective is “The revenue of the Magaline will be increased by 12.5% at
all islands widest in the end of the December 2015”
Marketing objectives include five key tools which are most important target goals of
Megaline sales objectives. The sales objective leads to set marketing objectives, that will
be accomplished through the marketing activities which are increasing the net worth
growth by 10%, convention by 15% from existing competitors, increase consumers by
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20% carry out to remind of the Sri Lanka project, enhance the brand awareness, capture
revenue up to 50%.
C. Summary of marketing strategies
The Megaline‟s segment described about geographic, demographic, psychographic and
behavioral segmentation. SLT is separated their target audience as individual consumers
and corporate consumers. Also, the target segmentation is positioned by lower price and
high quality of services. That was properly indicated the Megaline‟s future position in the
perceptual map.
Product strategies are differentiated according to business objectives to capture the more
consumers. SLT promotes the Megaline as general product to overall customers that has
three types of services as voice, data and entertainment services according to their
Megaline connection. Though, their core services is voice.
The penetration price strategy appropriates to Megaline connection, because they attract
more consumer among vast competitions also it enhances the market shares, increase
sales volume, increase revenue, boost competitive advantage to current competitors and
etc.
The current promotional campaign of Megaline mainly focuses on quality of innovative
services. Promotion strategy includes radio, TV, outdoor, newspapers, special offers, free
gift, public relationship, sponsorship, social media and websites. The percentage of the
marketing budget is allocated to media advertising, but it is less cost when comparing
with sales promotion.
SLT has competitive advantage in distribution strategy. Because, It distributes through
the 36 Teleshops, 34 Regional offices, 22 Maintenance centres and 07 Contact centres.
The physical evidence strategy of SLT is their labels, pennants, and other printed
information, all SLT outlets and vehicles place SLT Logo, colours, staff uniform and
website design and etc.
Process strategy changes to online process such as bill payments and purchasing process
which is easier for consumers and organization.
People strategy include about the staff and their capabilities and qualifications.
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D. Summary of financial projection
Megaline is contributed approximately 20 billion (54%) of their total revenue in 2013. I
assume, the revenue will increase by 12.5% in 2015.
SLT PLC will achieve their revenue through their Megaline budget plan. Anyway, after
allocating budgets for the Megaline connection will get 12.5% revenue.
Description Amount (Rs)
Revenue 22,500,000,000
Expenditure
Operating cost 12,250,000,000
Distribution expense 3,350,500,000
Financial cost 2,116,900,000
Total expenditure 17,717,400,000
Profit before tax 4,782,600,000
Income tax expense 956,520,000
Net profit 3,826,080,000
Figure 01: Budget and Financial analysis of Megaline connection in 2015.
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2. Vision and Mission
Vision
All Sri Lankans seamlessly connected with world class information, communication and
entertainment services.
Mission
You're trusted and proven partner for innovative and exciting communication experience
delivered with passion, quality and commitment.
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3. The company
3.1 Brief history, Current Size, branches if any, the product and services that the company
is offering, growth and profitability etc.
Sri Lanka Telecom (SLT) has built over 150 years of goodwill and trust with its valued
customers. It has established their operations since 1858 where the first Telegraphic
Circuit established between Galle and Colombo.
In 1911, SLT established as a Central telegraph office where the installation of Automatic
Telephone Exchange established at Kahawatta in Ratnapura District in 1931. In 1935 it
was a golden era where International Telephone Service inaugurated.
The journey in 1991 the first Sri Lanka telecom corporation formed and they have
introduced a packet switching service (1993), internet, email service (1996) and also in
the same year SLT corporation has been converted into a public company.
SLT had been incorporated in Sri Lanka in September 1996 under the Conversion of
Public Corporations or Government Owned Business Undertakings into Public Limited
Companies Act No.23 of 1987 and quoted on the Colombo Stock Exchange in January
2003.
The year of 1997 Sri Lanka Telecom has been privatized with the collaboration of Nippon
Telegraph & Telephone Corporation of Japan and listed in the Colombo Stock
Exchange's Milanka Price Index.
SLT is one of Sri Lanka's most valuable blue chip companies with an annual turnover of
around Rs 60.14 billion. SLT received the distinction of being ranked No.1 in Sri
Lanka‟s telecommunication industry. The national telecommunications service won
silver, which is the first time SLT has been recognized at the HRM Awards in 2012 and
also in recently it was awarded ISO 9001:2008 certification for its quality management
system.
Current size
The total employees are around 7861 in SLT that has estimated the total revenue of Rs.
36.78 billion and also the asset value is Rs.83 billion.
Branches
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The SLT distribution network includes 34 regional branches, 36 dealerships, 22
maintenance centres and 7 contact centres.
Products and services;
The SLT offers a various telecommunication services. Those are Megaline, Citylink, PEO
TV and Broadband.
Growth and profitability;
When considering about the last three years of the company sales, it is continuously
growing in every year when the last year revenue has increased by 5.93% (Rs. 34.72
billion to Rs. 36.78 billion) from 2012 to 2013. Following last three year chart
Figure 02: Total Sales of Sri Lanka Telecom PLC
Ownership
The two major ownerships of SLT are, one is Sri Lankan government hold 49.50% and
another one is the global telecommunication holdings N.V of Netherland holds 44.98%
that the remaining balance is owned by the general public.
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34
35
36
37
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2011 2012 2013
VA
LU
ES
IN
(L
KR
) B
ILL
ION
YEAR
TOTAL SALES OF SLT PLC
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3.2. Internal environments:
a. Staff relations
Employees of the SLT are considered as a valuable and vital asset. Only well-motivated
employees can deliver better service according to this, SLT possess a better environment
for the employees to maintain a good staff relationship where they have the freedom to
get mentor also with cultural freedom.
The Sri Lanka Telecom has a close friendly relationship with their staff through the staff
relation, motivating intercom petition programs, internal and external training programs,
health safety workshop and staff meetings. Also the employees are motivated by the job
security, job enrichment and salary increments and promotions.
At the same time, SLT has ensured their staff‟s accommodation with standardizing higher
than their competitors. They consider their staff as the main driving force of the
organization where they do have a better understanding, mutual trust and good
relationship among all parties.
SLT is a kind of bearding organization where it encourages its staff to learn through their
experience as well they also provided infrastructure facilities such as libraries and
playground facilities mainly in the capital city.
SLT conduct annual tour over and digital Life magazines and also paper articles in
Sinhala, English and Tamil languages its updates are available for internal and external
parties on SLT.
Staff relation within SLT is such an amazing one where they behave as a family for their
sustainability. Motorbike Loan facilities at lower interest rates, annual sport meets, trips,
cultural programs, quiz competitions are some of the activities and events organized by
SLT in order to build good relationship between companies and employees as well as
with their valued customers.
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b. Resource and Limitation
Resource
The effective management system is a strong indicator of the organization's success. SLT
is a company which efficiently uses all of its different business resources where it
performs at a higher level and makes more money than other companies.
Financial Resources
The Financial Resources have noted that isn‟t enough considerable by Sri Lanka
Telecom.
SLT's total financial
strengths
December 2013 December 2012
Turnover Rs. 36,781 million Rs. 34,719 million
Gross Profit Rs. 9,960 million Rs. 9,286 million
Operating cost Rs. 3,156 million Rs. 2,582 million
Profits Before Tax Rs. 5,014 million Rs. 4,567 million
Profit after tax Rs. 3,635 million Rs. 3,246 million
Figure 02: Total Finacial resources of Sri Lanka Telecom PLC
Human Resources
Human resource is a valuable asset to SLT which is currently have 7861 employees who
very strength to SLT. The majority of employees serves long time and management,
creating the efficiency of work by providing training and workshop.
Technology resource
The SLT's IT systems awarded by ISO/IEM 27001:2005 security management standard
and SLT have moved 72nd
to (2012) to 69th
place (2013) in global network readiness. The
company believes that IT is potential in their every success and sustainability. The
improving IT technology systems satisfy the consumers. The SLT has island wide IT
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Operational support systems with System developments, network and end user support.
Network operator such as SLT NOC and Island wide broadband network operators,
including IPVPN/MPLS/Data service and internet services, internet data centres, broad
band services and etc.
Physical Resources
Physical Resources include the management process, distribution channel, maintenance
requirements and etc. The category of physical resources covers a wide range of
operational resources which capability to deliver a strategy to SLT.
Limitation
SLT„s sales are mostly based on the network resources via the branch. But, the limitation
is a direct sales team for island wide distribution network where the less focus on
personal selling
c. Corporate structure and culture
Corporate structure
The organization structures of SLT contain rapid elaborated changes; we can easily find
out some characteristics of division structure and new workplace structure. Therefore, this
combination offers a flexible structural design in order to achieve their ultimate goals and
objectives.
Sri Lanka Telecom operates under the Mr. Nimal Welgama who is director of mobility
(Pvt) Ltd and subsidiaries, who is a major decision maker of SLT and other entire
companies. He is responsible for leading the board who participates with company
meeting and company strategies. He manages the board members and the senior
management team.
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Chairman manages the board committee that includes the 5 departments, such as Audit
committee, remuneration committee, technology subcommittee, and senior render board
and nominating committee.
Lalith De Silva is a CEO of SLT; he is a responsible person to ensure under effective
training to key staff. He is responsible for company development and long term success
with shareholders. He takes session to their management level. Also, implement SLT's
short and long term plan according to the CEO, the management committee work with 09
departments. They are working to provide day to day business plan for company
operation.
Figure 03: Formal structure of Sri Lanka Telecom PLC
Chairman & Board of Directors
Group CEO
Management Committees &
composition
L.T S.G O.R.T R.A.F.M P.M.F E.R.M I.S.M.F S.C.Q.M.S S.G.B
C.F.G.S
Board Committees & composition
A.C R.C T.F.C S.T.B N.C
C.S
T.G.B P.G.B I.G.B N.G.B F.G.B E.S.G.B
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Culture
Formal culture
Culture is the sum of total learned values, beliefs, customs that are served to direct
consumer behavior in a particular country market. Although, the structure is the
arrangement of parts which is indicated previously,
SLT organization cultures reflect their mentality. The organization management
committee is handling by top level managers. The authorization and better understanding
of their culture and how to transform it, is a critical skill for leaders in SLT, they are
trying to achieve strategic outcomes. Strategic leaders have the best perspective, because
of their position in SLT, to see the dynamics of the culture, what should remain, and what
needs want to transform as well as the rules and regulation are minimized and a very
flexible approach to handle issues.
Informal culture
Informal culture is a visible element to SLT which has a good relationship with
population to exist in long day. It is a relationship with customers via the personal
relationship, social networks, religious group, co-workers, and communities of common
interest and emotional sources of motivation.
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4. The product/ service
4.1 General product story of the product
a. Development, introduction and history
The SLT Megaline connection was introduced by Sri Lanka Telecom in 2008. The
service included the voice and broadband connection only, after two years Megaline was
expanded with Peo TV connection. The Megaline strategy helps their sustainable market
shares in the fixed line sector (Megaline and Citylink), above 40% and helps to retain the
Megaline market share above 25%in 2010.
The Megaline services satisfy different customer through the three types of packages such
as voice service only (Single Play), voice and broadband services (Double Play), voice,
broadband and Pro TV (Triple Play). Especially in the case of triple play connection, it is
expected to satisfy the all the needs of customers only through Megaline service.
The Megaline customer base is increased by 24,590 in 2010 and maintain its position due
to the introduction of the triple play connection which has a major contribution attained
by broadband connection within the triple play.
Sri Lanka Telecom is a differentiated network on voice call rates, browsing internet data
and entertainment services. Previously, a single call plan was maintained for Megaline
and CDMA, now this has been separated.
SLT has recognized telephone services as their traditional business which has served
customers since inception due to the advancement of technology and varying customer
needs, SLT‟s revenue composition is shifting more towards broadband, data and
wholesale segments. Their traditional business consists of Megaline (wire-line), Citylink
(CDMA) and IDD services.
Recently, SLT focus on the multiple services which bring a major contribution to the
market shares. The current fixed line total market is heavily competitive, but the
Megaline is a strong brand name and high loyalty in the fixed communication services.
Because, last year approximately 4% market shares downed in fixed communication, but
the Megaline connection was increased by 6.91%.
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b. Product category and characteristics
SLT PLC is offering a wire-line connection through three types of packages that enables
two people who freedom to choose, especially the packages includes the broadband,
internet and voice value added services, as well as making wire Magaline connectivity
more affordable to the public.
Sri Lanka Telecom (SLT) reduced prices of wire line connection with the introduction of
SLT Megaline. SLT Megaline purchasing to use at home and offices.
Services offered Calling plan Free services Connection charges
Triple play Mega home or mega office Triple play vas bundle
10,000
Double play Mega home or mega office Double play vas bundle
Voice + broadband
without CPR* Rs 7,000 or
Voice + Peo TV RS
11,000
Single play Mega home or mega office Single paly vas bundle 12,000
Figure 04: Three types of packages of Megaline connection
(Resource:http://www.slt.lk/personal/telephone/megaline/new-connection-charges)
c. Stage of product life Cycle
Figure 05: Product life cycles of Megaline connection
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After launching the Megaline connection, Sri Lanka telecommunication industry has
rapidly grown, Also the Megaline is a valuable contribution to the Sri Lankan
telecommunication industry.
At present, SLT Megaline across at the maturity level in the product life cycle. According
to my analysis, The SLT Megaline connection is still keeping its maturity levels. Because
Following reasons are mentioning the reasons;
SLT is a monopoly business by lager investment resources.
Existing competitor has less market share and still not entering a new competitor,
because they still need a huge investment.
SLT Megaline provides high standard multiple services to existing customers.
The industry‟s capacity utilization is at high level.
d. Any other important characteristic of Megaline
Crystal clear voice
Offer of voice, broadband and Peo TV services through a single line
Single number for generation
Island wide network coverage
Safe to use – more less radiation
A line that is always connected - No utility, powder requirement for telephone user
Business customers are benefited when making longer call because of call charges are
reduced after 3rd minute.
Extended off-peak time band for home users
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5. The overall market (Customers)
5.1Description of the characteristics of target customers
a. Need and the benefit sought
The Megaline‟s target segments are individual customers (home) and the corporate
consumer (business organization) who enjoy multiple connections its target market
segments look a reasonably effective and efficient service at these 3 ways service in a
one connection.
SLT Megaline makes a lot of benefits in a believable manner. Because, consumers
favaour to increase their packages from single packages to triple and multiple
packages.
Megaline primarily use for communicating with other via voice call also, the service
extension provides internet access and television service and entertainment services.
In this era the multiple packs become a more important to consumers to communicate
and entertainment activities.
b. Product usage
The SLT Megaline connection is used by two types of consumers such as House
(Individual) consumers and Office (Corporate) consumers.
Who is using – SLT Megaline connection is mostly used by upper & middle class
families, Multinational & enterprise customers, public sector institutions, other
operators / wholesale customers, SME, retail customers and domestic user.
Why they use –Megaline is a clear connection with acceptable price. Also, it
provides a Peo TV and broadband services via the one connection.
When do they use – The individual consumers or corporate consumer needs or
likely to communicate with others. They spend their valuable time on
entertainment of Television channel and internet access.
How it is used – to call, internet access and television watch.
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c. Attitudes of the consumers
i. As to Product category
The Magaline is a major fixed line connection in Sri Lanka, where it is enjoyed by the
Sri Lankan consumers in the multiple product categories. The existing consumers are
most valuable resource to SLT because of the good brand image of Mgaline
connection.
The current buyers have a good attitude about the Magaline connection. Because, the
multiple and triple services available at a cheaper price than single packages, the
Triple connection satisfies via call, entertainment and Peo TV services. Also, the
voice connection can move on to multiple connection and triple connection.
ii. As to company‟s product
SLT has more than 150 year reputation with consumers. The consumers know the
Megaline connection which has a very strong relationship with their existing
consumers. SLT Megaline customers have a positive attitude about its services which
is good quality and clear services in the telecommunication industry
The SLT Megaline connection is a brand of the Sri Lanka that was first licensed in the
telecommunication industry. The consumer associates the quality of services, safety
and excellent customer services.
iii. Why they like our products or not
The Megaline‟s customer enjoys its services, because the Megaline connection is
clear voice services and available other two services of broadband and Peo Tv, it is
the lowest call rate compare with the wire-line connection and mobile phone
connections, it is demanded by the latest technology development with the delight
customer service. These three are in one facility which is mostly used in banks, hotels,
shops, private and government institutions, house and etc.
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iv. Any unique character of customers
The customer‟s character changes by their lifestyle and mobile market competition.
When looking a history of customers, they are switching to mobile phone connection.
The Megaline consumers‟ characteristics are:
More price concern in call rate
Expecting quality of services
Focusing the product rank because the more than connection reduces the
monthly rental and connection charges
Expecting valuable and additional services because telecommunication
industry is more competitive.
Ideal customer
Most consumers don‟t know the quality of services however purchased.
Repeat buyer
5.2 descriptions of the purchasing process
a. Buying decision making process
Megaline is a telecommunication brand which has a very competitive advantage in Sri
Lanka, because the SLT selects an effective advertising and promotion campaign and
over 150 market reputations. Also, the consumers have to seek the effective services
which are appropriate for communicating with others.
According to consumer need, they will purchase best services which process created
ideal condition.
Figure 06: consumer buying decision making process of Megaline connection
Post Purchase
Purchase Decision
Evaluation of Alternative
Information Search
Problem Recognition
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SLT identified the consumer‟s decision making process that includes five steps.
Problem recognition - In this step, consumers desire to communicate with others.
Information search - The person collects information about the best
telecommunication connection according to two methods. Those are:
Internal: - The consumers may ask their relations and friends who are using fixed
line connection.
External: - The consumers find the information about fixed connection via.
Evaluate of alternative - After information gathered, Person selects a better option
among various alternative services.
Purchase Decision - according to the above steps, consumers purchase a Megline
service.
Post purchase - In the final step, the consumer analysis about quality of Megaline
services which is satisfying or not, it is a quality one or not. If, it satisfied the
consumers who will recommend to others to use Megaline and they will
continuously enjoy the services. If it doesn't satisfy the consumers who will not
continue the services and will not recommend to others.
b. What sources of information is sought?
The required source of information has analyzed below for the Megaline connection.
Public sources – consumers obtain information through the mass media,
newspapers, magazines, radio and etc.
Personal sources - consumers obtain information through the family, working
partners and friends.
Commercial - Consumers recognize the information through the sales peoples and
display of the Megaline connection.
Experimentally – Consumers obtain a information via a previous experience such
as handling, examining and using the Megaline connection.
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c. Who makes the purchase?
People purchase the Megaline connection to home (individual consumers)
multinational & enterprise customers, Public sector institution, another operation/
wholesaler customers, SME & retail customers, domestic users (co-operate
consumers), because they also know the services and benefit of this connection. The
head of the organization approves to purchase the Megaline
d. Is purchaser the consumer?
We discussed the target consumers are home and corporate consumers. In this
situation all the purchaser is not the real consumer, because home consumers pay their
own money, but privet officers purchase for their offices that payment comes from
corporate owners and the government offices purchase money that comes from
government.
e. Who or what may influence the purchase?
We identified two types of influence when purchase a Megaline connection. Those
are identified under the heading of man and promotional campaign.
Who may influence
Family member
Corporate owners
What may Influences
Advertising and promotion
Web site
Leaflet
Past experience
Quality of services
Multiple connection
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6. Competition and market share
6.1 Identification of competitors
a. List of Primary competitors
SLT PLC does not have any direct competitors for Megaline connection. It is a
pioneer and a monopoly service provider in fixed wire telephone line. But, other
competitors do not arrive at all segments that they are unable to achieve their targets
due to SLT‟s huge cost.
Also, telecommunication regulatory commission of Sri Lanka has divided into two
types of fixed connection as wire-line telephones and wireless local loop telephones.
The Megaline is only wire-line telephone and Citylink and other competitors are
wireless local loop telephones. We recognized, the Suntel was jointed with Dialog
fixed telecommunication services.
Megaline has recognized as their primary competitors (wireless local loop
telephones).
Lanka Bell CDMA
Dialog CDMA
Suntel CDMA
Citylink CDMA
(Resource: Central bank report 2013)
b. Secondary competitors
Secondary competitors offer mobile phone services in the telecommunication industry
that does not directly related with a Megaline connection but related to the
telecommunication industry.
Secondary competitors are mobile communication service providers.
Dialog
Etisalat
Mobitel
Airtel
Hutch
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c. Possible new competitors
Tritel Services (Pvt) Ltd
I identified the Tritel services (Pvt) Ltd which incorporated since 1997. It is a public
phone terminal service (payphone services) provider in the rural areas in Sri Lanka.
Tritel has more than 4 million regular consumers and 5000 Tritel phones are located
in Sri Lanka. It is mostly contribute to the rural community in Sri Lanka.
(Source: http://www.tritelnet.com/)
6.2 Market share
a. Total current industry sales by market
According to TRCSL, approximately 2.70 million (2013) Fixed line and wire-line
connection are used in Sri Lankan where total market worth was Rs 459 billion. The
total Megaline (wire-line telephones) connection has increased from 999,354 (2012)
to 1,062,065 (2013). But, the total wireless local loop telephone (total fixed
connection without Megaline) connection was decreased from 2.45 million (2012) to
1.64 million (2013). So, total connection (fixed and wire-line) down from 3.45 million
to 2.70 million.
(Resource:
http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/English/7_Cha
pter_03.pdf)
Sri Lanka Telecom‟s fixed connection (Megaline & Citylink) has 57% market share
(1.5million), Megaline has contributed 38.86% (approximately 1 million
connections). Megaline‟s market share has increased by 6.91%, increased the revenue
by 2,150 million compared with 2012.
(Source: SLT Annual report – 2013)
The changing lifestyles in the innovative mobile phone connection which reduced the
total fixed line connection. The Megaline connection continuously increasing and it
has increased its shares in 2013.
29
b. Comparative analysis of market share held by the company and competitors
The Fixed line (Megaline and Cityline) has contributed 57% market share, but,
Megaline connection only holds 38.86% market share and Citylink only holds 18.14%
market share.
Lanka Bell holds 38% market shares, Dialog (Dialog CDMA and Suntel) holds 13%
market shares. According to dialog‟s annual report, The Suntel was incorporated with
the dialog's fixed telecommunication services in 2012.
Figure 07: Comparative analysis of market share held by the company and
competitors.
(Resource: SLT annual report – 2013 and
http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/English/7_Cha
pter_03)
Figure 08: Market share of total fixed connection of company and competitors
Sri Lanka Telecom
57%
Lanka Bell 30%
Dialog Axiata 13%
Market Share of Fixed connection
companies
Company Product
No of
subscribers
(2012)
No of
subscribers
(2013)
Market Share of
Fixed connection
(2013)
Sri Lanka Telecom Megaline,
Citylink CDMA 1,511,163 1,571,309 57%
Lanka Bell Limited Lanka Bell
CDMA 1,410,727 786,454 30%
Dialog Axiata PLC Dialog CDMA,
Suntel CDMA 527,000 349,837 13%
Total 3,448,890 2,707,600 100%
30
c. Trend and future growth
Megaline is a market dominator in fixed line connections. The innovative service was
increased by excellent brand image among all consumers.
According to SLT, The Megaline connection‟s market share has increased by 6.1%
(2012) and 6.3% (2013). The future growth of Megaline is ensured by Sri Lanka
Telecom, which is estimated that, in the financial year 2015 that growth will increase
by 12.5%. The Megaline connection is growing continuously when the total fixed
connections increase or decrease in Sri Lanka.
d. Expected total market
The Megaline consumers have a benefit from multiple services Magaline connection
has a standard image by providing new innovation and good quality for their
consumers. The Megaline connection will reach more consumers in 2015 by its high
competitive advantage.
We have plans to increase the awareness level of consumers and increase the
contribution of the Megaline connection in 2015. Also, we planned all appropriate
strategy to Megaline connection. So, The strategic plan estimated the market share up
to 12.5 % in 2015 and 2,250 million sales growth.
31
6.2
a. Background of competitors
I. Company and its size/ type
Lanka Bell Limited
Lanka Bell is a world class telecommunication
operator that provides a full range of
telecommunication service to business and
residential customers.
Lanka Bell established in 1997 as the single
BOI company in Sri Lanka with an investment
over US $ 150 million.
It is introduced the innovative services as a 4G
connection since 2014.
It has estimated revenue Rs. 3,997 million,
which was increased by 0.93% in the year
2013.
Dialog Axiata PLC
Dialog Pvt (Ltd) established in 1993 then,
converted to a PLC in 2005. Dialog Axita
PLC is subsidiary Axita Group Berhad
Axiata.
It is larger and faster mobile phone network
in Sri Lanka. It has advanced Mobile phone
and broadband service of 3G/3.5G and 4G
network, which subscribers over 8 million.
The Dialog has estimated the revenue Rs.
63.3billion and its growth increased by 12%
in December 2013.
II. Reputation
Lanka Bell is awarded ISO 9001:2008 quality
management system certificates for providing
standard of customer services.
Lanka Bell is awarded the National quality
software award from the British computer
society also.
Dialog good reputed and superior services
company in telecommunication industry, it‟s
providing worldwide roaming service to
more than 200 countries.
They are awarded with ISO 900 certificate,
local and international National quality
award, three successive GSM world award
and SLIM-Nielsen People choice award
2014.
Currently, Dialog is a main sponsor of the
Sri Lanka cricket team.
III. Sales force and their expertise
32
Lanka Bell has an expertise sales team of 5
regional managers and 45 sales representatives.
Amali Nanayakara is the leader of the
marketing department. The Dialog is
operating all over the country where the
sales force is consisted with 8 regional sales
manager, 25 district manager and
salespeople.
IV. Financial strength
Total revenue was Rs. 3,997 million in 2013,
which is increased by lower rate of 0.9%.
Because, this company invested a large amount
to improving 4G-LTE services.
Dialog‟s financial stability is strong, because
the revenue increased by 11.34% in 2013,
which value was 55.44 billion and total asset
is 103.98 billion in 2013.
V. Technology used
Lanka Bell has 4G connection which has
improved since 2014.
Dialog has a 4G connection over the Island
wide.
VI. Any other important aspect
Lanka Bell attempts to increase the fixed line
connection via the lowest call rate.
The Dialog provides roaming services in
more than 200 countries.
Strong infrastructure and customer loyalty
in the mobile telecommunication services.
Also, the Suntel was incorporated with
Dialog which contributes to fixed line the
connection.
33
b. Current product strategy of competitors
Comparative analysis of competitor‟s product strategy
i. Product mix
Lanka Bell Limited
Lanka Bell fixed line
Lanka Bell broadband
Dialog Axiata PLC
Dialog Fixed line (CDMA)
Dialog Mobile
Dialog Broadband (ISP)
Dialog TV (pay TV)
ii. Branding and packaging
Lanka Bell CDMA has two types of package.
Postpaid packages
Its features are lower call charge, IDD call,
superior voice quality with per second rates
and bill payments for postpaid package is
available in bank, food city and etc.
Prepaid packages
Its features include superior voice quality,
lower IDD calls charged with per minute and
also recharged via reload & card.
There are 4 packages available.
Post-paid
Its features include lower call charge,
superior voice quality with per second
Prepaid
Its features include Superior voice quality,
Lower IDD calls charged with per minute
Reload & Recharge
Easy reload and recharge in every phone
shop.
IDD Rates
It‟s features are Lower IDD rate, superior
voice quality with per second with lower
money rate.
iii. Positioning
Lanka Bell position by lower price and
innovative service quality.
Positioned by best level customer services
and innovative technology. Also the
34
Dialog‟a call rate is very low when call with
another Dialog CDMA, Suntel CDMA and
Dialog mobile phone services.
iv. Image and reputation of brand
The Lanka bell‟s call rate is cheaper than other
fixed connection which increase brand
reputation among home segments and SME.
Sponsor of national cricket team and rugby
team of Sri Lanka and over 10 years partner
with a national volleyball federation.
v. Product strength and weakness
Strength
Advance Technology (SMS, Email via
SMS, BMS, FMS, voice, SMS, Tune,
internet services, IDD services
4Gconnection)
For two purposes - residence (domestic
need) and enterprise (corporate need)
Brand Reputation high among home
consumes.
Competitive lower call rate.
Continue services without termination.
Weakness
Not provide Wi-Fi services
Late delivery due to less sales channel.
Late repairing service with few branches.
Strength
Advance Technology (Ringing Tone,
Flunkey message, Missed call alerts,
call holding, call waiting, call
forwarding, fax, internet/data, calls Line
identification, voice mail,
4Gconnection)
High brand reputation
Stable Brand Equity
Extended range of services in
telecommunication industry
Island wide perfect coverage
Roaming services over 20 countries.
Weakness
A similar number of users
Sales continually decrease
CDMA connection termination
continuously increases.
35
c. Current distribution strategy of competitors
Comparative analysis about the competitor‟s distribution strategy
i. Type of distribution network used
Lanka Bell
Branch and teleshops
Lanka bell outlets (Sub agents)
Agents and Dealers
Dialog CDMA
Dialog outlets (Sub agents)
Other agents and Dealers
Selected Retail and phone Shops
ii. Evaluation of how distribution targets accomplished
The target evaluates via the sales of branch and
distribution accounts.
Target evaluate via a number of CDMA sales
of branch and distributor sales record.
iii. Relationship with channel members
Lanka Bell has a close relationship with the
external distribution network.
Friendly relationship with channel partner
and they gives more offers like, promoting
their individual distributors by rating them as
4star and 5star and appreciating them by
giving prizes and some priceless offers and
inviting them to participate in dialog
business meetings.
iv. Strength of the channel members
They have a sufficient capacity to facilitate the
market. Their distributors are committed to do
the sales and distributes.
The larger distribution channel opportunity
for sales lager volume. The Dialog has a
enough financial resource which supports
the new distributors and offer credit for few
distributors.
36
d. Current price strategy
Comparative analysis of competitors prices
i. Pricing objectives
Lanka Bell Limited
The pricing objectives are increasing profits,
service quality leadership, market penetration,
increase sales volumes, increase competitive
advantage and avoid the termination of
existing services.
Dialog Axiata PLC
The pricing objectives are Market
penetration, increase sales volumes, market
leadership, increase company image and
avoid the termination of existing services.
ii. Pricing strategy
Lanka Bell set a price as promotional pricing
strategy and market penetration pricing
strategy.
Dialog uses a promotional pricing strategy
and market penetration pricing strategy.
iii. Buyers attitude about the company prices
The buyers favorable attitude about Lanka
bell‟s pricing due to lower call charge.
The price is accepted by the consumer due
to service quality and lager coverage
network.
iv. Channel attitude of about the company‟ price
Channel member accepted a price due lager
competitive advantage in CDMA connection.
Price is accepted by a channel member due
to a variety of services and providing
benefits.
37
e. Current promotional strategy
Comparative analysis of competitor promo tool and campaign
i. Promotional objectives
Lanka Bell
The primary promotion objectives include
increasing brand awareness, increasing sales,
providing information and increase purchase
strength.
Dialog CDMA
The primary promotion objectives include
increasing market shares, brand loyalty,
market penetration and creating more brand
awareness.
ii. Strategies and themes used
The strategic theme is
“The truly Sri Lankan Company‟‟
The “Future Today” strategic themes mostly
uses with Dialog logo and Other strategic
them use such as “Get ahead and joint the
SMART generation Today” “Star Friends
and Smarthunt”.
iii. Promotional tools used
a. Advertising – the company use
advertisement tool such as Television
advertisement, Social media (Facebook,
Twitter), magazine and company web site.
b. Sales promotion – seasonal offers and
lower call rate in New Year and festival
periods.
c. Public relation – use tool are intranet,
websites, annual report, meeting,
conference, press releases and corporate
websites.
a. Advertising - the company uses an
advertisement tool such as Electronic
Media (TV and Radio), Print Media
(Newspapers, Magazine), Internet and
websites Media (Social Networks on
Facebook, twitter and YouTube),
Outdoor Advertising (Banner and
posters)
b. Sales promotion – used tools are
seasonal offers, lower call rate in the
New Year, festival seasons and loyalty
marketing.
38
d. Direct marketing– face to face sales by
effective sales peoples.
e. Personal selling – it uses very minimum
level to increase a new customer.
c. Public relation – Sponsor of Sri Lanka
cricket team, rugby, CRS, meeting and
conference, press releases, websites and
annual report.
d. Direct marketing – face to face sales by
effective sales peoples.
e. Personal selling – personal selling
handling by strong sales team.
iv. Success and failures of promo campaigns
The promotional campaign is successful which
increase the new connection and avoid
termination of the existing connection. The
company has successful result with TV
advertisement and magazine advertisement.
The promotional campaign is successful
because brand image increase among
consumers. The company has good
experience by promoting a Television
advertisement, internet, social media and
personal selling.
39
7. External Environmental factors
1. Political
Political factor is influenced by the Telecommunications Regulatory Commission of
Sri Lanka (TRCSL).
Government controls the business operations by taxation and rules & regulation of
telecommunication industry.
The Political environment orders to protect customers by implementing price
discrimination and to protect society from irresponsible organization behaviors.
SLT operates without a substantial impact from politics the reasons that the industry
is under control without any harmful effects. Also, government ensures the quality of
the customer‟s services, protection from monthly rental and call charges.
2. Economical
In the years of 2012/2013 the GDP had a positive growth and the beginning of this
first quarter growth by 8.2%, but in the end last two quarters of the year it declined
(7.6%, 7.8%) significantly.
Developing telecommunication industry contributes to Sri Lankan GDP and
Employment.
Megaline connection sales growth rate decreased in the 2013. Because the consumer
switching to mobile phone connection. But, The Megaline‟s revenue continuously
increases, which contributes revenue to Sri Lankan economy.
3. Social
The different religion people live in Sri Lanka, where the Telecom very close
relationship with all people and SLT participates with tradition and norms.
Changing consumers‟ lifestyles have decreased the Megaline growth rate from last
two years.
40
Megaline connection provides three diffident types of services within the one
connection which favorable to the entire segment because most parents and youngest
likes voice call services, youth segment mostly likes broadband and the child mostly
likes Peo TV connection.
SLT has donated the books to educate institutes. SLT finally donated approximately
one million books to universities, vocational training centers and island school in
2013.
According to the theme of “Preserving heritage for tomorrow”, Over many years SLT
encouraged the protection of Sri Lanka‟s rich heritage for the future generations.
The SLT concern different social activity such as the employees create awareness,
educate the impact of child abuse in 300 islands wide awareness program in 2013 and
technology donated to Deyata Kirula, CHOGM, and Techno.
4. Technological
Sri Lanka Telecom is the desirable position of being the National Telecommunication
Solutions Provider which responsibility SLT takes very seriously. We also recognize
that access to world class ICT is a right of all Sri Lankans and must be efficiently and
effectively delivered to derive maximum social, business and economic benefits for
the country. It is with this at the forefront of our long range and strategic planning,
that we are constantly evolving our company across multiple stages of technology,
service delivery, marketing and innovative new services.
5. Environmental
Sri Lanka Telecom more responsible to protect the environment via best practices to
all employees through training, education and development also employees work with
a friendly attitude.
The Sri Lanka Telecommunication‟s sustainability included the reduction in the
carbon footprint, energy efficiency, water management and water reduction.
41
SLT conducted the energy awareness programs for all the employees in island wide
how to protect the environment through many forums as possible.
6. Ethical
Sri Lanka is a collectivism country where more emphasis should be given to ethics
because it is established more than 150 years, which are giving more emphasis on
maintaining standards of corporate governance.
The SLT‟s sales and advertisement activities do not affect the customers and
competitors and also the environment pollution were reduced by business activities.
The SLT is awarded for standard of security management of ISO/IEO 27001:2005.
SLT conducts its business with eco-friendly manner.
7. Legal
Legal factors include discrimination law, employment law and health and safety law.
The SLT has a comprehensive legal system. Also the business does not follow in
agreement with applicable laws.
The challenge faced in 2011, the need for renewal of SLT‟s 20 year operating license,
which expires on 07 August 2011. The company is in the process of requesting its
renewal from the Telecom Regulatory Commission. However, the regulator is in the
process of formulating a Next Generation Network (NGN) policy for Sri Lanka
through which a new licensing regime will be introduced and SLT firsts operator to
face the newly introduced changes to license conditions.
42
8. SWOT analysis
3. G.1 Strengths
Strong infrastructure and high-performing cable equipment.
SLT Megaline has brand loyalty and excellent brand image.
Strong financial stability and fixed investment.
Strong public relations over 150 years.
Strong island wide distribution network.
Have an excellent management process
Strong corporate leadership.
Innovative technology service (4G connection)
3. G.3 Weaknesses
Fewer sales team to initiate personal selling
Communication tools ineffective.
Corroded cable lines
Lower Sales growth rate
Strong finance needs to introduce or improve the technology
Lower knowledge and training when comparing with competitive organizations.
3. G.3 Opportunities
The external structures are outside the company‟s control that could potentially
benefit the company growth.
The government develops technological infrastructures.
The competitors do not trust by SLT that in the long run.
Outside events that SLT can use to enhance its existing strengths.
Increasing the consumer awareness level.
3. G.4 Threats
Consumers most favorable to purchase and use a mobile Subscriber Identity
Module (SIM)
43
Introducing new technology of mobile phone services reduces the fixed
connection.
The threat of a telecommunications involves the external structures outside the
industries.
Government interference
The new competitors offer fast service and cutting-edge technology to their
customers.
Global economic instability & recession
44
9. Sales Objectives
Marketing plan of Megaline connection is in orders to achieve the expected sales
objective.
“The revenue of the Magaline will be increased by 12.5% at all islands widest in
end of December 2015”
The Megaline depends on the achievement of these objectives and this is the
profitability of the company. This expected sales revenue, making it challenging for
the company to achieve its corporate objectives.
The entire marketing plan will be developed based on the above mentioned sales
objectives.
45
10. Marketing Objectives
Marketing objectives include five main parts which are contributing to sales
objectives of Megaline connection.
Increase the net growth of Megaline connection MOM 10% at Island wide in 2015
(increasing new connections and decreasing the disconnections)
Their target will be achieved by improving greater quality of the services in voice,
broadband and Peo TV, donations to corporate social responsibility, Enhance
customer experience by being more responsive to customer needs, reduce the monthly
rental amount to triple and double connection than a single connection and delivering
high quality services faster with increased value aligned to market requirements.
15% Conversions from the competitor to Megaline connection at Island wide in
2015
The target will be achieved by identifying Megaline consumer‟s preferences,
introducing effective promotion activity, enhance brand awareness and enhance the
brand penetration in rural areas.
Increases the Megaline customer by 20% to carry out the remain Sri Lankan
project at island wide in 2015.
We improved 4G connection in town areas, but this year we have planned to develop
the 4G connection in all the rural areas including eastern and north region.
To enhance the awareness level of the consumers by 75% for the Megaline
connection at island wide in 2015.
Capture 50% market share from the Megaline about 30 Billion quantitative total
sales through market penetration at island wide in 2015.
46
11. Segmenting, Targeting and Positioning
a. Geographic
The geographic segment covers the entire area of Sri Lanka but, it has divided into
four areas in the island wide and which is divided according to the total customers and
service facility. For an Example the total number of fixed line consumers is 574,390
in Colombo district (Metro), but the total number of consumers are 134,493 in
Northern, Eastern province (Region 3). SLT‟s geographic segmentations are given
below.
Metro – Colombo
Region 1 - Central province, North central & North Western
Region 2 - Western province without Colombo, Uva province, Sabaragamuwa
province & Southern province
Region 3 - Northern, Eastern province
(Source: Annual report 2013)
b. Demographic
Demographic variables essentially refer to personal statistics such as income, age,
gender, education level, and amount of family members. The demographic is the traits
a human population, demographic segment consists of education qualification,
monthly income level and resistance palaces.
The Sri Lankan geographic segmentations are:
Organization size
Family members
Monthly income
c. Psychographic
The target market has built long term faith towards to the SLT. Consumers believe the
organization and its facility which contributing to fixed income to SLT, Government
47
servants and people stabilize their life with most of the time psychologically. This is
all about the psychological traits of customers. That including attributes such as;
Personality
Beliefs
Lifestyle
d. Behavioural
Behavioral role is an important factor of the telecommunication industry. The
Megaline consumer has following behavioral attitudes.
Customer service excellence
Quality of voice
Innovative technology
Benefits sought
Brand loyalty
Produce user rate
Speed
11.2 Targeting
Target market is a group of individual consumer/corporate consumers with a set of
common characteristics. Target market agrees to form a concentration of effect
against a share of the universe with similar descriptors, product needs and buying
habits. A targeting total determination depends on several factors of SLT Magaline
connection. Target market consumers are:
Individual consumer (upper, middle class families)
Corporate customers (Multinational & enterprise customers, public sector
institutions, other operators/ wholesale customers, SME, retail customers and
domestic user)
48
11.3 Positioning
Positioning is the act of designing the company‟s offer and image to occupy a
distinctive lace in the mind of the target market. The end result of positioning is to
win the current position of consumer mind in the future. In marketing positioning is
all about creating an image or identity in the minds of their target market for its
product, brand or organization. The Megaline has positioned services by technology,
clear voice, low-cost and entertainment.
Our Megaline services positioned among rational consumers who has loyalty of this
Megaline connection.Our plan is to position Megaline connection to attract individual
and corporate consumer.
I have planned to increase the high quality customer technology solutions to its
customers and meet their expectations in all aspects of packaging with a high quality
service and deciding lower prices to maintaining customer satisfaction, integrity and
corporate social responsibility. It is competitive advantages to the characteristics of
the needs and the wants of the target market. So, we can capture new consumer and
can avoid a termination existing Megaline connection.
Figure 09: Perceptual map for Megaline connection between competitive brands
High monthy
rental Low monty
rental
High Quality
Technology Solutions
Low quality
Technology Solutions
Megaline
Cityling CDMA
Dialog CDMA
CDMA
Lanka Bell
CDMA
Suntel CDMA
49
12. Tactical marketing mix strategy development (7ps)
12.1 Product strategy
SLT is a telecommunication company which provides different innovative
telecommunication services for individual consumers and corporate customers. The
Megaline is an intangible innovative service which currently is in majority level and it
provides services under the modern technology and high quality to the customers.
The Megaline connection includes the three packages of voice, broadband and
television. The core benefit of Megaline connection addressed the consumer's basic
need for voice. The actual product that includes two packages of broadband and Peo
Tv connection.
SLT Megaline is a famous brand in telecommunication industry. The innovative
technology is a major strength of the Megaline connection, because SLT is the only
technology provides a 4G technology services to all the urban and suburban areas. But
in some rural areas its not providing these facilities..
Megaline connection has various product features according to multiple services.
Those are:
Crystal clear voice
Offer of voice, broadband and Peo TV services through a single line
Single number for generation
Island wide network coverage
Lower call charge for IDD call
Corporate consumer is benefitted when calling for more than three minutes.
Safe to use with very rare radiation
A line that is always connected - No utility, powder requirement for telephone
user
Corporate customers are satisfied when making longer call due to reducing call
charges after the third minute.
Extended off-peak time brand for home users
50
12.2 Pricing strategy
Price is an important element to strategic marketing plan which determine how
success to gain revenue. The price of three types of packaging are clearly described
how it is an important determinant of the valued sales made by the company. Also,
the price is really determined by the discovery of what customers perceive is the value
of the Megaline connection.
Price has a major role in telecommunication industry. Price is considered as a
deciding factor for Megaline connection which currently uses promotion and
economic pricing strategy which is satisfying the existing consumers also its good
profit margin for the Sri Laka telecom.
But, I recommend the penetration pricing strategy which is most appropriate for SLT
Megaline connection. Because, the SLT Megaline connection is on maturity level in
the product life cycle, its growth provides larger profit to Sri Lanka Telecom. The
price charged for the Megaline ordered to gain market share and Last year total fixed
connection was reduced by increasing mobile phone connections. But, if we select a
high price, customers will switch to competitors and mobile services. Because, same
quality of services available from competitors an also we can compete by selecting
this penetration strategy. We can hold our existing customers and we can add more
potential customers according to penetration strategy.
According to the Penetration pricing strategy analysis, these benefits will be achieved
by Megaline;
Increase the market share
Increase sales volume
Increase revenue
To competitive advantage with current market competitors
Increase the quality of services and packages
Gaining customer loyalty
51
12.3 Promotional strategies
Promotion is an important marketing mix element of the company. Promotion helps to
increase consumer awareness of the organization's brand name and its packaging
products, generate sales and create brand loyalty.
The current promotional campaign of Megaline mainly focuses on innovative
services. The percentage of the marketing budget spends on media advertising that
use sales promotion.
Primary promotional objectives of Megaline connection
Increase sales and profits
Increase corporate and brand image
Provide information about Megaline connection.
Build brand awareness
Create customer loyalty
Sri Lanka Telecom coordinates effective promotional strategy to trigger purchase of
Megaline connection. SLT„s primary promotional mix elements are Television
advertisement, social media advertisement, public relations and etc. following
promotional activities is below.
Above the line media
Utilized create awareness of the product during the maturity stage of brand reposition.
It will be an effective to inform the target groups, constantly remind them about the
product to encourage repeat purchases.
Radio advertisement
Most of radio advertisement is focusing the housewife and small medium enterprise
organization consumers. The advertisements plan to provide information and
encourage to purchase the Megaline. The home and small enterprise organization
consumers hear the radio advertisement during the working time.
52
TV advertisement
SLT has selected a favorable television channel such as Rupavahini, Sirasa Tv,
channel Eye, Vasantham TV to mostly target home segments. The media channel
schedules the advertisement about the Megaline connection in weekday evenings,
weekend days, during news time and between the favorite drama programs.
Outdoor / billboards
Billboard advertisement is a very effective method because, it is very less cost media,
which reaches millions of consumers every day, continuously remaining our services,
consumers can easily identify the brand, design can attract a potential customer and
work for a guide to new customers. Bill border can be placed in the crowd areas in
main street and supermarket location.
Newspapers
The newspapers target the corporate segment and individual home segment who
passing the newspapers among them to read. Our organization mostly selects weekend
newspapers to advertise such as the Sunday observer.
Below the line media
BTL media communications are used to focus on niche markets. Which gives the
market's ability to adapt their messaging to more personal manners to the audience.
Special offers
Many promotional pricing offers are specially offered in January Thaipongal/ New
Year offer, April Aurudu offer, October short month offer and etc
Tele life insurance policy is offered by SLT in partnership with the Sri Lanka
Insurance Corporation that life insurance gives at affordable premiums to SLT
Megaline customers. The major benefits of the services are the affordability of the
premiums and convenience involved. The insurance payment can pay with customer's
monthly telephone bill.
53
The new Megaline connection consumers can get a free interest payment plan which
can pay in 3 or 6 months in a installments without interest rate through the HSBC or
Sampath bank credit card.
Free gift
Sri Lanka Telecom gives free gift for the new connection purchase in the New Year
season. The Megaline consumers got a gift those are an attractive free umbrella,
travelling beg or wall clock in every end of the year.
Also, the SLT arranges some trips to foreign countries by selecting a monthly winner
from existing customers. For an example, SLT selected some winners for the
Singapore trip in 2013.
Public relation
SLT was an ICT solution provider to the Commonwealth Heads of Government
Meeting (CHOGM) in 2013. SLT provided a comprehensive communication solution
for multiple geographic locations where key forum of such as the CHOGM opening
ceremony, main conference and government functions, business forum, the people's
forum and media center.
Online
Sri Lanka telecom‟s digital marketing campaign is so effective due to less cost.
Those are internet marketing advertising and email.
Through the line media
The specific type mass advertisement uses for the prospective customer database in
the direct marketing activities.
Social media
Sri Lanka Telecom is very effectively uses the social media campaign of Facebook,
Twitter, YouTube and Google. The advertisement is very less cost to SLT which
makes an interest about the Megaline brand, organization, offers and etc.
54
According to Facebook page in the October first week, title page liked is - 224,761by
Facebook users recommend the Facebook page of SLT- 5,852 and new likes - 3,
8842.
Web site
It provides all the information about the product features, new promotion offers to
Megaline consumers.
12.4 Distribution strategy
The distribution strategy of SLT is mostly based on the branch sales. SLT provides a
telecommunication service to island wide consumer which sales distributions are:
Teleshops - 36
Regional offices - 34
Maintenance centers – 22
Contact centers – 7
SLT focuses the regional distribution based on the service and consumer segment. For
example, the majority of consumers are in Colombo areas, so it provides a 4G
connection all the areas in Colombo. But the fewer consumers are in the North and
East areas, so it provides a 4G connection in some specific cities only.
SLT Magaline covers on different areas based on the four main strategic themes such
as services, operation, network and group. Megaline is vital connectivity in Sri Lanka,
delivering faster access to information and communication in all the key economic
sectors of the country.
The Megaline connection keeps their trust consumer by providing valuable services at
airport and flight, leisure needs and transportation
The banking and finance sectors play role key in the country's systems and
sophisticated technology platforms becomes their communication backbone its
facilities are in all of their business and banking transactions.
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12.5 Physical evidence strategy
Physical evidence refers the Megaline connection of SLT that services appear from
outsider customers and the market. However, customers tend to rely on physical cues
to help them evaluate the product before they buy it. Therefore, marketers develop
what we call physical evidence to replace these physical cues in a service.
Following examples of physical evidence
Labels, pennants, and other printed information
All SLT outlets and vehicles place SLT Logo
Colors – Use one standard color theme for all SLT offices in an island wide,
representing SLT color (Blue and White)
Staff Uniform
Website design
Layout
Packaging
Internet/web pages
Voice mails
Internet facilities
Paperwork (such as invoices, tickets and dispatch notes)
Brochures
Business cards
Mailboxes
SLT heavily depend on the physical evidence as a means of marketing
communications, for an example SLT Megaline with seasonal offers (Christmas).
This is important to their corporate image.
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2.6 Process strategy
The marketing activity process changes are very easy for consumers, the new process
Those process changes are below.
12.7 People strategy
Figure 10: Process changes of Megaline connection
12.1 People strategy
People are important assets for running a business and achieving our business goals
and objectives. SLT deals with customers, employees, government authority,
competitors and other organization. These shareholders differ as attitudes, needs and
values.
SLT is good employer which has a friendly relationship with staff. The current
employees are educated people who have got various help for higher education. SLT
evaluates the individual staff's performance to rewarding, promotion and other
benefits that marketing relies different kinds of people set up in dealing with
customers. SLT believes of arranging training schedules and development programs
for their people in the front offices and the people in head offices. The people in the
The Existing Process
New connection application form
Megaline should be filled for all
three services and handed over it to
the front officer/marketing officer
Collect the new connection charges
Then it has entered by the front
office staff.
Service is provisioning by the
technical staff
Introducing Process
The new connection application form can
fill the online application and attached
the relevant supporting documents
E-mail it to relevant regional manager.
Then the regional office staff does a
feasibility checking and inform to the
customer.
Consumers can make the online
payment.
Next service will be provided.
Follow up the service until first bill
confirmation
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front offices of the permits for intensive, training in consumer handling, customer
sensitivity and etc. Also, salary increment, medical allowance, requirements and free
trip are positively to staff regarding the employee's position.
In order to make sure that the process SLT internally in managed very well. The
competition in telecommunication services being very strong, each company ensure
their people are able to recover any kind of services loss immediately as otherwise it
is quite difficult to not only retain an existing customers but still more difficult to
enlist a new customer. Hence, the SLT has a very strong people development policy
and strategy.
People are the most important element of any service or experience. Services tend to
be produced and consumed at the same moment, and aspects of the customer
experience are altered to meet the individual needs of the person consuming it. Most
of us can think of a situation where the personal service offered by individuals has
made people buy from people that they like, so the attitude, skills and appearance of
all staff need to be first class. People have an important role in service delivery, they
are relied upon to deliver and maintain transaction marketing and people play an
important part in the customer relationship.
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13. Budgets and financial analysis
Description Note Amount (Rs)
Revenue 1 22,500,000,000
Expenditure
Operating cost 2 12,250,000,000
Distribution expense 3 3,350,500,000
Financial cost 4 2,116,900,000
Total expenditure
17,717,400,000
Profit before tax
4,782,600,000
Income tax expense
956,520,000
Net profit
3,826,080,000
Figure 11: Budget of SLT Megaline for the year 2015
The Megaline is already contributing approximately 20 billion (54%) of their total
revenue in 2013. I assume, that the revenue will be increased by 12.5% in 2015 year.
SLT PLC will achieve the Megaline revenue through budget plan. Anyway, after
allocating budgets for the Megaline connection will get 12.5% revenue.
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Note 1
Revenue – show the calculation of sales figure
Product District Forecasted Sales for 2015 (Rs)
SLT Megaline Colombo 2,455,464,260
SLT Megaline Kandy 1,505,060,400
SLT Megaline Gampaha 1,152,456,852
SLT Megaline Kalutara 1,005,869,002
SLT Megaline Anuradhapura 880,456,028
SLT Megaline Batticaloa 668,405,455
SLT Megaline Ampara 642,364,483
SLT Megaline Badulla 980,444,000
SLT Megaline Kegalle 963,044,400
SLT Megaline Kurunegala 968,875,000
SLT Megaline Galle 995,730,168
SLT Megaline Mannar 985,284,525
SLT Megaline Matale 930,852,456
SLT Megaline Hambanthota 947,852,563
SLT Megaline Monaragala 887,248,630
SLT Megaline Polonnaruwa 721,456,025
SLT Megaline Puttalam 852,124,505
SLT Megaline Jaffna 648,524,152
SLT Megaline Trincomalee 785,254,822
SLT Megaline Rathnapura 982,885,124
SLT Megaline Nuwara Eliya 858,456,823
SLT Megaline Vavuniya 795,254,852
SLT Megaline Matara 886,635,475
22,500,000,000
Figure 12: Revenuce calculation of SLT Megaline for the year 2015
Note 2
Operating Expense
Salaries, wages, allowances and other benefits 6,450,120,500
Payment to network operation 2,548,410,250
Repair and Maintenance expenditure 1,580,252,560
Elasticity 556,248,600
Insurance 992,040,000
Printing and stationary 122,928,090
12,250,000,000
Figure 13: Operating expense of Megaline connection for the year 2015
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Note 3
Distribution cost
Advertising and promotion 2,850,156,450
Travel Expense 500,343,550
3,350,500,000
Figure 14: Distribution expense of Megaline connection for the year 2015
Note 4
Finance cost
Interest 1,125,852,400
Bank charges 991,047,600
2,116,900,000
Figure 15: Financial Expense of Megaline connection for the year 2015
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14. Marketing strategy implementation
The action plan prepared for Megaline connection in 12 months. Marketing manager
makes sure to achieve the effective activities in this period. The action plan and the
time periods taken for implementation of different tasks and evaluation are mentioned
below. The responsibility of the marketing department should take an approval from
Sri Lanka Telecom.
We must understand the role and importance of overall effort, assign responsibilities
to making things happen, what need to be done and the feedback. There are three key
steps to be followed to implement a successful marketing plan in practical
implementation.
Having adequate resources to carrying out planning activities.
Understand the lead time, those who participate in execution element
Understand completely in detail departments and salespersons requirements to
implement each element.
No
Activity Period Authorities Remark
01 Situational analysis 3 months Research officer
02 Image analysis 3 months Research officer
03 Internal communication 3 months Marketing manager
04 Corporate magazine 6 months Marketing manager
05 Public relations -
supporting for
community health
1 month Marketing manager
06 Sponsor – Rugby 3 months Marketing manager
07 Sales promotion 2 months Marketing manager
08 TV Advertisement 4 months Marketing manager
09 Online campaigns 4 months Marketing manager
10 Outdoor 10 months Marketing manager
Figure 16: Action Plan‟s Activities and Responsible for the plan of Megaline
connection.
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The Project plan Gant chart
The Gant chart has prepared to attain the sales objective with the concern about the
payback analysis.
Activity 2015 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Situational analysis
Image analysis
Internal
communication
Promotional
activity
Corporate magazine
Public relations
Sponsor – Rugby
Sales promotion
TV Advertisement
Online campaign
Outdoor
Figure 17: Marketing strategy implementation plan of Megaline connection for the
year 2015
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15. Monitoring and evaluation
Monitoring
The monitoring is important progress which is implementing the strategic plan to
ensure that, it is aligned with the set objectives and to make sure to achieve the
specific results of the company. The Sri Lanka telecom can implement several
methods in order to carry out its monitoring process. Those three primary methods are
given below. Those are;
Sales meeting
Sri Lanka Telecom should conduct sales meetings in every month and quarterly basis
to monitor the branch sales to achieve the target. Every branch should submit the sales
report to marketing managers who evaluate about total sales, sales targets, connection
extension (from voice to broadband and Peo Tv) and connection termination of each
branch.
Quarterly review
The company group director and marketing manager review the information about
branch sales, sales targets, connection inquiries and customer feedback in the every
quarter.
Consumer inquiries analysis
The service standard is important in the telecommunication industry. The consumer
expects and likes faster and clear services in the modern world due to their changing
lifestyles. So, the organization must collect the feedbacks and inquiries from all
customers through the websites, social media, by calling customers and etc. Then, the
marketing manager and group direct must analyze about consumer inquiries to
provide an effective sales and telecommunication services to consumers.
Evaluation
The marketing activities are based on some of the key activities that follow under the
sub topics. Different analysis can be used in the monthly basis and quarterly basis to
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measure the organization‟s performance. The marketing activities are evaluated by
qualitative and quantitative evaluation techniques.
Quantitative Evaluation Techniques;
Quantitative evaluation techniques are based on the organization objectives. It
measures the actual and target performance of these activities. These are given below;
Increase market share.
To be the market leader
Retaining existing customers
Increase potential customers
Qualitative Evaluation Techniques
Qualitative evaluation techniques are based on the attitudes and perception of
company stakeholders. The formal and informal opinions receive from organizing
internal information, word of mouth, ideas and observations. The qualitative
evaluation techniques measure the implemented plan. Following the qualitative
evaluation techniques are;
The time period of each activity
Positive perception and motivation of the employees.
Organization employee‟s confidence level of implementing the action plan.
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16. References
Books
G. Collin and Wilson R. M. S. Strategic Marketing Planning, 2nd
Edition, India:
Routledge 2012
Kotler P., Armstrong G. Marketing an introduction, 7th
Edition, India: Pearson‟s
publications 2012
Schiffman L. G., Kanuk L. L., Kumar S. R. In collaboration with Wisenbilt J.
Consumer Behaviour, 10th
Edition, India: Pearson‟s publications 2011
Websites
http://www.slt.lk/data/aboutslt/profile.htm
http://www.trc.gov.lk/
http://www.cbsl.gov.lk/
www.dialog.lk/
www.lankabell.com/
www.suntel.lk/
http://www.cse.lk/cmt/upload_report_file/390_1395133548115.pdf
https://www.google.com/?gws_rd=ssl#safe=active&q=slt+annual+report+2012+p
df
http://www.dialog.lk/content/uploads/pdfs/annual_reports/2013-annual-report.pdf
http://www.dcslgroup.com/reports/dcsl/2012-2013.pdf
http://archives.dailynews.lk/2012/11/06/bus16.asp
http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/statistics/other/econ_&_ss_201
3_e.pdf
http://www.cbsl.gov.lk/pics_n_docs/10_pub/_docs/efr/annual_report/AR2013/Eng
lish/content.htm ( Chapter 3 - Economic and Social Infrastructure)
66
17. Appendix
Fixed Operator Tariffs
SriLanka Telecom PLC
LankaBell (Pvt) Ltd
Suntel Limited
Dialog Axiata PLC
Mobile Operator Tariffs
Dialog Axiata PLC
Mobitel (Pvt) Ltd
Etisalat Lanka (Private) Ltd
Hutchison Telecommunications Lanka (Pvt) Ltd
Bharti Airtel Lanka (Pvt) Ltd