- The Branch possesses the largest telecommunications network infrastructure in Hai Phong city and trades in the authorized telecommunications services in Hai Phong.. - The Viettel Hai P
Trang 1“The marketing strategy
to hold steady the number 1 position of Viettel Hai Phong Branch”
I. INTRODUCTION ABOUT VIETTEL HAI PHONG BRANCH:
- Date of establishment: October 15th,
2001
- Directly under: Viettel
Telecommunications Group, Military
Telecommunications Group
- Headquarter: Le Hong Phong street,
Thanh To, Hai An, Hai Phong
- The Branch possesses the largest telecommunications network infrastructure in Hai Phong city and trades in the authorized telecommunications services in Hai Phong The major services include: Landline phone, Internet, and Mobile phone In 2011, the branch achieved 890 billion VND of turnover, the highest level among all other telecom businesses operating in this region
- Organizational structure: Board of Directors; 7 Departments; 15 District Centers; 300 employees
- The Viettel Hai Phong’s telecom services: 2G and 3G Mobile telecommunications services include prepaid subscribers and postpaid subscribers which accounting for 40.6% mobile phone market share in Hai Phong The mobile phone services’ turnover represents more than 90% Viettel Hai Phong’s total amount
II INTRODUCTION ABOUT THE TARGET MARKET:
1 Macro environment:
The natural conditions, population, and cultural characteristics of Hai Phong:
- Total area: 1,512 km2, accounting for 0.45% of the nation’s natural area Hai Phong is a first – ranking city at national level which operates sea and island tourism
Trang 2- The total population in 2012 are expected to reach 1,952,153 people (of which, people within work age: 1,511,936, representing 75,2% of the total population)
- Administrative border line: 07 urban districts, 8 suburban districts with a total of 228 wards and communes
- 29 schools includes: 04 universities & 25 colleges and intermediate schools, and 742 schools ranging from preschools to high schools
- At the end of 2011, there are 13,826 enterprises to pay taxes in Hai Phong – and it is predicted that more 2,051 enterprises shall enter this market in 2012
GDP and the economic structure:
- GDP in 2012 is predicted to increase by 11% to 12.5% compared with the preceding year
- Per capita income: 1,550 USD per capita per year
- Telecom services expenses represents nearly 4.7% of per capita income which give advantage for telecom services suppliers in Hai Phong.
- GDP structure:
+ Agriculture, forestry, aquaculture: 9%
+ Industries and constructions: 37%
+ Services: 54%
- The economic structure has rapidly transformed toward industries and services
Hai Phong’s socioeconomic development orientation:
- Hai Phong’s first objective is to build an information infrastructure at national level with a modern technology network, big capacity and high speed The city gives first priority to information technology development in its departments, branches
- Some large industrial projects which will be put into operation such as: Dinh Vu Polyester Fines Factory, Kyocera Mita factory, Hanoi Beer Factory which is at stage 2 in An Lao suburban district
Trang 3- In 2012, the city has attracted more foreign direct investment, especially from Japan
- The urban area has undergone an evolution: There are new districts of Hai An and Duong Kinh, Ho Sen – Cau Rao 2 new urban area etc; speeding up the ongoing urban area development projects like VSIP urban-industrial zone, new town and new 100m road located in Lach
Tray-Ho Dong, etc
- Invest in social infrastructures, pay attention to some key projects for example: the Second establishment of Vietnam-Czechoslovakia Hospital, Hai Phong University, Specialized High School of Tran Phu, The city’s palace of culture…
The telecom business opportunities provided by the macro environment:
growing rate of 11% – 12.5% in 2012, Hai Phong’s telecom growing rate is expected to double the GDP rate, which is equivalent to 22% - 25%
- The telecom consumption density per GDP per capita income tends to increase strongly The average expense for telecom services only represents 4.7 % of their total income
- The transformation of industrial and service structures with a series of investment projects which have been put into operation will attract a large number of workers from the adjacent provinces
2 Micro environment:
2.1 To evaluate the local telecommunications market:
The market share of telecom services suppliers in Hai Phong until December
31, 2011.
a Regster 2G Mobile phone subscribers:
N0 SUPPLIERS
Growing Rate
Res 2G’s subscribers
Res 2G’s market share
Res 2G’s progressive subscribers
Res 2G’s market share
Res 2G’s additional subscribers
Trang 44 Beeline 19.550 1,2% 53.520 2,8% 33.970 274%
Total 1.664.624 100% 1.932.183 100% 267.559 116%
Until the end of 2011, Viettel has still represented the leading market share in Hai Phong with the density of 40.6% market share (of which Viettel’s
prepaid subscribers is the largest of 46,367, accounting for 45% prepaid
subscriber market share – However, the Average Revenue per User (APRU)
of Viettel’s postpaid subscribers has been 250,000 per subscriber, much lower
than the APRU of MobiFone which has reached 480,000 per subscriber In
2012, Viettel shall pay attention to this challenge)
b 3G Mobile phone subscribers:
The subscribers have been unhabituated
to the 3G technology to contact leading to the low number of 3G users Other
reasons should be their doubt about the unstable phone call quality and the
percentage of 2G users using cheap input and output devices accounting for
70% of the total mobile phone subscribers results in limited percentage of 3G
subscribers in 2011
c Real turnover: (The Inspection Department is the only resource to collect the
turnover data)
No Content VND Viettel VNPT Mobi Beeline VN Others Total 2011/2010
2 Market
3G mobile phone subscribers
Subscribers Market
share
Trang 5d The distribution network until December 31 st, 2011:
No
Content Unit Viettel Mobi VNPT Beeline VN Others Total
1 Store/
2 Authorized
4 Point of sales Location 2.879 2.870 2.870 2.870 2.870 2.870
5 Location
A diversified distribution network in large number which cover all over the Hai Phong cities has supplied its product to individual customers The distinctive difference between Viettel and its rivals is Viettel’s local distribution employee network in every ward and commune
h Mobile phone network in 2011
No Content Unit Viettel Mobi Vina Beeline VN Others Total
Trang 6Market
Evaluation: In 2011, Viettel was still regarded as the leading telecom
infrastructure supplier in Hai Phong, including 2G and 3G network However, due to the city’s relatively even and flat terrain, Viettel’s existing advantages of modern infrastructure and bigger capacity are not the long term strengths, especially when its rivals launch their ultimate services
2.2 Competitor analysis:
a Mobifone
- Strengths :
MobiFone operates at highly professional level of management thanks to the overseas joint-venture period MobiFone Hai Phong has been given comprehensive and direct assistance from VNPT’s the Center at the Area 5
Roaming with Vinaphone network and other 80 countries worldwide
Significant investment in point of sales and after-sales authorized agents, good image development and quick implementation
Huge potential investment capital
The network quality regarded as a stable and reliable one
Prequent and regular customer care services which have been highly appreciated as the best among other mobile phone suppliers in Hai Phong
Highly flexible promotion campaigns – mobile sale
Frequent public relation events which attract alot of attention such as : Rock Storm – Sing with the autumn, Road show, ect
- Weaknesses :
Shallow distribution networks, lack of customer care and sales agents at commune and village levels
Thin direct shops and no transactions on Sunday and other national holidays
Trang 7 Temporary employees resulted in lack of strategic and sustainable attachment among the group staff
Slow implementation of additional infrastructure and network, heavily depending on the human resorces of Vinaphone and VNPT Hai Phong ; poor network quality on some islands like Cat Hai, Cat Ba, Thuy Nguyen
b.Vinaphone:
- Strengths:
Good relationships establishment with local authorities and having given favourable conditions
Extensive distribution network and high commission
The cable network covers the whole city with distinct sale and management units – VNPT Hai Phong
Huge experienced human resources in telecom services supply
Value added services usage and supply including: 1080, 1088, 19001570… MyTV service and VIP Tivi
Ability to quickly launch services supply, providing prompt and enthusiastic services of maintainment and repair to customers
Some formal and important positions in the city have been put underground
Customers are provided with qualified products which have been highly appreciated by customers
Develop service packages for various user groups with favourable discount (create the biggest difference among other telecom suppliers in Hai Phong)
- Weaknesses:
Narrow postpaid subscribe distribution networks which are mainly carried out
by post offices at district and city level The VinaPhone image has not been expanded in the city
Initial installation cost remains at high level and their services are inflexible
Lack of direct marketing programs or communications, thin promotion campaigns and undetailed discount prices
High employee average age of 38 which results in heavily slow development
Trang 8c.Vietnam mobile
- Strengths :
Highly specialization thanks to the foreign joint-venture Huge potential investment capital
The company image and the customer service manner represent its highly professional nature, bearing the ‘youthfulness’
Qualified network, wide bandwidth which limit the percentage of drop-out during conversations up to 99%
15% to 25% lower service price compared to other supplier with constant creative breakthroughs to bring out new packages
- Weaknesses:
Cope with much prevention from local authorities during its network infrastructure implementation leading to slow infrastructure development and unsatisfactory cover area
Have not been able to launch 3G service (which is a disadvantage for Vietnam mobile to develop its high-class subscribers who use Smart phone)
Small and scattered customer care operations which has left no reputation
d.Beeline:
- Strengths :
Beeline is a join-venture mobile phone network with a Russian telecom group – Vimpelcom, therefore it is highly specialized with huge potential investment capital
Its image is attached with the MU Football Club which helps make strong impression on MU fans and a highly professional customer service manners
Very qualified network with wide bandwidth which limit the percentage of drop-out during conversations up to 99%
15% - 25% lower service price compared with other suppliers with constant creative breakthroughs to bring out new packages
- Weaknesses:
Slow network infrastructure implementation resulting in unsatisfactory cover areas
Trang 9 Have not been able to launch 3G service (which is a disadvantage for Vietnam mobile to develop its high-class subscribers who use Smart phone)
Small and scattered customer care operations which has left no reputation
2.3 Viettel Hai Phong’s reputation and brand name evaluation at local level
- Viettel branch name has been elevated to a higher level and has been recognized
by the city authorities as one of the typical enterprises to make biggest contribution to the city’s budget (52 billion in 2011), it has also created jobs for over 1,500 employees (including freelance cost collectors: 460 people, Call center agents: 800 people) Viettel Hai Phong awarded and praised by the city Chairman
- Viettel Hai Phong has gained trust of and developed business cooperation with project investors, building owners, industrial zones and export processing zones managers There have been large projects at national level; Viettel Hai Phong also invested in some projects like VSip project by Japan and Singapore, etc
- After a decade of development, Viettel Hai Phong remains the single unit which has built brand head office and Call center These developments represent its strong development
2.4 Branch internal evaluation:
- Viettel Hai Phong’s strengths in 2011
Management method is heavily influenced by military principles: resoluteness and strictness
Modern tools to support management system: the television bridge system
Equal specialized knowledge with understanding of the area and the market demands
Effective distribution network (Viettel Hai Phong has transaction centers at every urban and suburban – point of sales and field agents to every ward and commune)
Having the largest 2G and 3G network infrastructure with the best quality
Diversify its products and services
- Weaknesses:
Trang 10 Low level of specialization (develop too many areas – professional deviation)
Wide but not deep distribution network (untrained field agents, ineffective after-sales authorized agents)
Slow reactions to competitors’ new operations (promotion policies behind those of the rivals – phone card recharge at the beginning of month, exchange Viettel SIM to MobiFone SIM, provide money to sale locations who agree to take down Viettel signs….)
Limited impact on the local authorities (based mainly on the suportive policies to the local community on funding, exchanges and cooperations)
General evaluation on business environment
- Advantages :
Viettel Hai Phong has always received assistance from the headquarter and the regional Board of Directors
The network infrastructure has turned to the largest after the EVN integration
The 100% commune network has television bridge which provides strong support to the management operations
- Difficulties and threates :
Larger organization – higher turnover – heavier duties : The human resources should meet new qualification requirements (experience – educationa
The Centers at commune level have been given greenlight to take initiative
in all operations while the management and supervision system is not professional : easy to rise negative problems, losing internal unity
The EVN integration is likely to cause human resources redundance which make the employees worry about becoming laid off ; lower their voice ; and avoid breakthrough ideas
Business opportunities in 2012
The first opportunity : With the GDP growing rate of 11% – 12.5% in 2012, Hai
Phong’s telecom growing rate is expected to double the GDP rate, which is