U-fone: A Branding Perspective

Abstract

Cellular Mobile communication is the fastest growing area in the telecom sector. It has attracted almost 11% of the total investment in the telecom sector and the growth rate can be measured by the estimate that the number of mobile phone subscribers rose to 3.4 million by December 2003 from 0.2 million subscribers all across the country in 1999. Number of licensed operators for mobile networks has increased exponentially and they are running successful business with attractive returns in most of the developing as well as developed countries. The purpose of the research thesis was to conduct a thorough market research and find out what is U-fone’s brand image in customers’ minds. How people describe its personality in terms of the identified characteristics. And how they compare its services’ performance with the competitors thus, identifying its customer satisfaction level. The research findings are as follows.  Currently there are six mobile operators doing business in the Pakistani market. I.e. Mobilink, Instaphone, Paktel, U-fone, Warid and Telenor. U-fone is termed to be the only competitor of mobile industry leader Mobilink in Pakistan. U-fone is a mobile service named after the people, it is meant to serve, YOU. U-fone is designed to target the general public of Pakistan, who can’t afford the expensive mobile communication.  Pakistan has a significant population base. But because of the fact that economy is weak and per capita income of people very low, it has failed to provide the required market base for the operators of telecomm services. Although, globally mobile business has been a great success and most of the operators who have invested in this business have earned good returns on their investments.  PTA has played a vital role in the promotion and support of mobile industry by adopting CPP (calling party pays) Regime from MPP (mobile party pays) in 2000 giving a tremendous boost to the market, which grew in that particular year by 142% as the affordability for mobile reaches the public at large. The mobile market is iv slowly moving from duopoly and oligopoly to near competition though there remain only two (2) GSM operators Mobilink and Ufone respectively.  The current competition among the companies is of neck to neck that are 1) Mobilink 57% market share 2) Instaphone 11% market share. 3) Paktel 7% market share. 4) UFone 25% market share.  U-fone is offering both prepaid and post paid packages under different names. Also it is offering variety of services with attractive attributes and benefits. U-fone has direct competition with Mobilink, Instaphone and Paktel whereas an indirect competition with fixed line services, card payphone services and prepaid calling cards.  SWOT analysis was carried out both for U-fone and its competitors to evaluate the company in terms of its external and internal environment as well as to find out the positive and negative aspects of the company in a better way.  U-Fone’s general pricing strategy is to offer high quality at competitive prices. Pricing also is customer segment specific. The prices offered depends upon: 1) Spending level of the customer. 2) Customer needs for services. 3) Usage pattern of the customer  Company is utilizing following distribution channels for its services. The keydifferentiating factor is developing better distribution channels to the market. 1) Customer Services Centers. 2) Branch offices. 3) Sales force. 4) Countrywide Dealership networks. 4) Subscription through company’s website.  Talking about its lifecycle, U-Fone is at early growth stage, its cost is average at the moment and profits are rising due to rapid growth in sales. Competition is growing with increase in public awareness and usage of mobile phones. Customers have now experienced the services provided by mobile communication industry.  U-fone is using all marketing tools including, media vehicles, print media, out door sources and sponsorships to advertise and promote its product.  U-fone has positioned itself in the market as most friendly people oriented service by differentiating its product from competitors in technology, wide range of services and affordable prices. It has out scored its competitors in terms of affordability, after sales services, coverage, voice reception, customer services and packages. v Research recommendations are as follows:  First, they need to change and reinvent their business mission, vision and objectives as per emerging scenarios.  Second, Ufone have to keep on reorienting technological innovations in its products and services by establishing and inculcating the hard-core research and development departments in its core business functions.  Third, they have to employ and educate themselves with enterprise relationship management strategies, techniques and technologies.  Fourth, Ufone need to read the environment thoroughly and correctly to identify the elements that are prone to change. In certain cultures and or under certain circumstances a firm’s ability to readily adapt to these elements of change becomes a fundamental criterion for its success or the failure in its particular industry. These firms need to carefully analyze technologies and business concepts that may become either a compliment to their competition or substitute to their own offerings.