Case Details: |
Price: |
| Case Code |
: |
BSTR300 |
For delivery in electronic format: Rs.
400;
For delivery through courier (within India): Rs. 400 + Rs. 25 for Shipping & Handling ChargesThemes
Growth
Strategy |
Globalization |
| Case Length |
: |
21 Pages |
| Period |
: |
2005-2008 |
| Pub Date |
: |
2009 |
| Teaching Note |
: |
Available |
| Organization |
: |
Bharti Airtel
Ltd. |
| Industry |
: |
Telecom and
Broadband
|
| Countries
|
: |
India; Global |
Abstract:
|
In the 2000s, telecommunications (telecom) company Bharti
Airtel Limited (BAL) was the market leader in the Indian telecom market. It had
established itself as the leader in the market by differentiating itself with
its focus on building a strong brand through innovation in sales, marketing, and
customer service, and an innovative cost effective business model. Analysts also
credited BAL with negotiating the regulatory hurdles in this emerging market and
competition very effectively. This enabled it to become profitable despite the
Indian telecom market having the lowest tariffs in the world.
|
|
Some analysts opined that BAL's unique business model had
become the benchmark for emerging markets. Mobile telephony in India was
experiencing the fastest growth in the world and India was already one of the
leading markets in terms of mobile subscriber base. Despite Average Revenue per
User (ARPU) figures in the country being quite low compared to many other
markets, it was viewed as an attractive market as mobile penetration of the
market, particularly in the huge rural areas in India, was still low. With the
developing market in the West reaching high levels of saturation (70% in US and
100% in some European markets), many global telecom operators were looking at
emerging markets for their growth and this made India a prime target market for
these firms. The market in India was also expected to witness many changes with
the introduction of new technologies and mobile number portability.
Since 2007, BAL had been facing serious threats to its leadership position. On
the one hand, there was the onslaught from global players such as Vodafone and
Virgin Mobile, and on the other, the threat from established Indian companies
such as Reliance Communications Ltd., Tata Teleservices Ltd., and the
state-owned Bharat Sanchar Nigam Ltd (BSNL). Moreover, the market was expected
to witness the entry of some more Indian and foreign companies. BAL had
responded to investing heavily in expanding its network, technology, and
marketing. It was trying to cover all segments of the population -from the
tech-savvy youth population who coveted the latest value-added services (VAS) to
the Bottom of the Pyramid (BoP) segment who would be satisfied with a low-cost
offering.
In early 2008, BAL, which still dominated the Indian telecom market and was the
world's tenth largest telecom company, was also readying itself to replicate its
success story in some other emerging markets.
Issues:
» Understand how Bharti Airtel Ltd. tapped the opportunities in the Indian
telecom sector and established itself as the market leader.
» Analyze the booming telecom sector in India that was experiencing high growth
rates, with special emphasis on the competitive landscape in the sector.
» Understand the opportunities that emerging markets such as India offer to
global business enterprises.
» Understand the issues and challenges faced by organizations operating in
emerging markets.
Contents:
Keywords:
Industry analysis, Competition, Growth strategy, Market
leader strategy, Business model innovation, Globalization, Emerging market, Base
of the pyramid, Promotion, Airtel , Vodafone, India, Telecom
Emerging Market Champion
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