Marketing plan for mobile telecommunication services to attract young customers of viettel cambodia company vtc in cambodia market for the years 2018 2019

Corhot 2016-2018 MARKETING PLAN FOR MOBILE TELECOMMUNICATION SERVICES TO ATTRACT YOUNG CUSTOMERS OF VIETTEL CAMBODIA COMPANY VTC IN CAMBODIA MARKET FOR THE YEARS 2018-2019 Hanoi, June

Corhot 2016-2018

MARKETING PLAN FOR MOBILE TELECOMMUNICATION

SERVICES TO ATTRACT YOUNG CUSTOMERS

OF VIETTEL CAMBODIA COMPANY (VTC) IN CAMBODIA MARKET FOR THE YEARS 2018-2019

Hanoi, June 2018

ACKNOWLEDGEMENT

I would like to express my deepest thanks in my heart to my respected advisor Mr Do Tung, PhD for his valuable contributions in this internship graduation report I have attended this course while still having a lot of problems with my current job An unexpected long day business trip made my report completed late, but he was very enthusiastic about helping me to complete this report in only one week before the deadline

I am also grateful to respected Vice -Director of Viettel Cambodia - Mr Pham Doan Cuong and to my respected Foreign Strategy Investment Manager – Mr Phan Truong Son for permitting me to utilize all the necessary facilities and helping me a lot in doing the research and I came to know about so many new things

I am also thankful to International School and Nantes University for their kind operation and help

co-Lastly, I would like to express my deep apperception towards my classmates and my indebtness to my parents for providing me the moral support and encouragement

Hanoi, June 20th, 2018

TABLE CONTENT

CHAPTER 1: INTRODUCTION 7

1 Rationale 7

2 Subjects of project: 7

3 Mission of project 7

4 Research Methology 7

CHAPTER 2: THEORETICAL BACKGROUND 9

1 Marketing 4.0 in the digital economy: 9

2 Viral Marketing 9

3 4P mix Marketing 9

4 Analysis Model 10

CHAPTER 3: METFONE’S OVERVIEW 11

1 Viettel Cambodia (Metfone) Introduction overview 11

1.1 Metfone’s history 11

1.2 Metfone’s Mission 11

1.3 Metfone’s Core Value 12

1.4 Metfone’s Vision 12

1.5 MetFone’s business Philosophy 12

2 Metfone’s Business result 12

2.1 Revenue and Profit 12

2.2 Mobile subcribers 13

2.3 Arpu 14

2.4 Market share 15

2.5 Brandname 15

CHAPTER 4: BUSINESS ENVIRONMENT AND COMPETITOR ANALYSIS 16

1 Business environment 16

1.1 Overview 16

1.2 Market characteristic: 16

1.3 PESTEL Analysis 16

1.4 SWOT analysis 17

1.5 Competitor analysis 18

CHAPTER 5: REAL SITUATION AND MARKETING PROBLEM OF METFONE 21

1 Real Situation of Metfone 21

1.1 Network and product quality 21

1.2 Price: 21

1.3 Channel system 22

1.4 Communication 22

2 Marketing Problem of Metfone : 23

CHAPTER 6: MARKETING STRATEGY 24

1 Objective 24

2 Strategy 24

2.1 Brand positioning strategy 24

CHAPTER 7: RESEARCH METHODS, DATA ANALYSIS AND RESULTS 26

1 Research overview 26

1.1 Research problem 26

1.2 General objective of research 26

1.3 Research subject 26

2 Qualitative study 26

2.1 Specific objectives 26

2.2 Research method 26

2.3 Analysis results 27

2.3.1 General characteristics 27

2.3.2 Mobile phone usage behavior of youth 29

2.3.3 Cambodia young customers’ perceptions on 3 existing MNOs (compare between Metfone and 2 competitors: Smart and Cellcard) 38

2.3.4 Factors influencing using services 42

3 Quantitative study 43

3.1 Specific objectives 43

3.2 Research method 43

3.3 Analysis results 44

3.3.1 Bivariate correlation test results 44

3.3.2 Testing for Hypothesis 1 45

3.3.3 Testing for Hypothesis 2: 46

CHAPTER 8: RECOMMENDATIONS ON MARKETING PLAN 47

1 Plan overview 47

1.1 Marketing objective 47

1.2 Target Customer 47

1.3 4P Mix 47

2 Product & Price 47

3 Channel system 48

4 Communication 49

4.1 General means of communication 49

4.2 Viral Marketing campaign 49

4.2.1 Name: AmazingMe 50

4.2.2 Message: 50

4.2.3 Objectives: 50

4.2.4 Target customer: 50

4.2.5 Communication Channel 50

4.2.6 Key topics and milestones 50

4.2.7 Program details 50

5 Marketing expense 52

6 KPI evaluation 52

7 Overall implementation timeline 53

CHAPTER 9: CAVEAT FOR THE YEAR 2019 54

REFERENCES 56

ABBREVIATION 57

LIST OF FIGURES 58

LIST OF TABLES 58

LIST OF DIAGRAMS 58

Appendix 01: Interview Guideline for Qualitative research 59

Appendix 02: Online Survey Questionnaire 62

PREFACE

Young customers, potential customers of many firms, especially in the field of

telecommunications, the role of young people is more and more important

Global telecommunication in general and Telecomunication in Cambodia in particular

is facing many challenges as technology evolves, the shift in consumer behavior is evident: the demand for voice and sms is decreasing, demand for data booms and young consumers lead the trend of using data and applying technology on the data platform

Cambodian telecom market is also experiencing fierce competition to entice young customers to lead the market and boost sales as Cambodia's mobile penetration is high at 70%

Therefore, "Marketing plan for mobile telecommunication services to attract to young customers" is considered the priority of Telcos in Cambodia

CHAPTER 1: INTRODUCTION

1 Rationale

Marketing Plan plays an important role in realizing strategies to achieve business goals of business Practical experience shows that if the strategy is good, in the right direction but without a well-planned marketing plan, the business is unlikely to succeed Especially in the telecom industry, marketing planning is even more important because telecom products change day by day according to the change of technology world and are the owners of large customer data

Viettel Cambodia PTE (VTC) with the brand name Metfone is the first foreign

market Viettel Goup - the top 30 largest subscriber base in the world - invested VTC

launched service in 2009 and quickly became the largest operator in terms of subscriptions and revenue in Cambodia after three years of business (2012-2013) However, with the rapid technological change, competition in many aspects of rival networks from within and outside Cambodia, Metfone has lost market share for three consecutive years (2014 -2016) and growing again in 2017 has gradually regained the trust of customers

On the road to regaining consumer confidence, Metfone is struggling, not only requiring a sound, long-term strategy, but also a good enforcement capability

Therefore, I chose the project "Marketing plan for mobile telecommunication services

to attract young customers of Viettel Cambodia company (VTC) in Cambodia market for the years 2018-2019" with the desire to put a further action option to help Metfone

return home Market leader and target is the billion dollar company - Metfone's big challenge in the future

2 Subjects of project:

Young customers using mobile services in Cambodia market

3 Mission of project

Propose a marketing plan, an option for Metfone to implement to achieve strategic goals

in the short and long term

4 Research Methology

Since telecommunication is a business field ranked in technology group, the telecom industry research method uses big data, data mining and available internal data sources and selects the use of secondary data purchased from the Global telecoms consultancy However in some case, we use primary data to verify again research info we get in other

sources So in the report I will use methology as below:

(1) Qualitative and quantitative research (primary data)

(2) Secondary data analysis included: Available in-depth research report/ case study in Telecomunication of reputable organization/consultant company / specific websites

(3) Internal data in BI ( Billing Inteligence system) of Viettel Group

CHAPTER 2: THEORETICAL BACKGROUND

1 Marketing 4.0 in the digital economy:

Viettel Group is a business operating in the field of telecommunications and information technology so that the marketing activities of Viettel closely related to the 4th industrial revolution which is going on around the world It’s simply because Telecom Operator

is an ISP - Internet-Service Provider And moreover, telecom operators must be pioneers

of application in the 4.0 era

According to “Marketing 4.0 Moving from Traditional to Digital” (Philip Kolter,

Hermawan Kartajaya, Iwan Setiawan), “Marketing 4.0 is a marketing approach that

combines online and offline interaction between companies and customers In the digital economy, only digital interaction is not sufficient Infact, in an increasingly online world, offline touch represents a strong differentiation Marketing 4.0 also blends style with substance While it is imperative for brands to be more flexible and adaptive due

to rapid technological trends, their authentic characters are more important than ever In

an increasingly transparent world, authenticity is the most valuable asset.”

“Marketing 4.0 leverages machine-to-machine connectivity and artificial intelligence

to improve marketing productivity while leveraging human-to-human connectivity to strengthen customer engagement.”

Every customer owns a mobile phone, just online they can buy everything they want through their websites, platform apps, social networks, and their behaviors are recorded

by the system to lead customers

2 Viral Marketing

“Viral Marketing is that which is able to generate interest and the potential sale of a brand or product through messages that spread like a virus, in other words, quickly, and from person to person The idea is for it to be the users themselves that choose to share the content

Due to their speed and ease to shar e, social networks are the natural habitat of this kind

of marketing The most widespread example in recent times is the creation of moving, surprising or spectacular videos on YouTube, which are then shared on Facebook, Twitter and other channels.” (https://www.cyberclick.es/numericalblogen/what-is-viral-marketing-advantages-and-examples )

3 4P mix Marketing

Source: https://managementmania.com/en/marketing-mix-4p

Marketing Mix 4P is a method for determining product strategy and product portfolio Father of this thought was Neil H Borden and E Jerome McCarthy continued on these thoughts McCarthy conceived the mix as we know it today According to him, the marketing mix of the enterprise (or product) consists of four components:

 Product - the product and its features from the customer perspective - quality, reliability, design, brand, warranty, service and other services, etc

 Price - the price of the product and total pricing policy

 Place - the way of distribution the product from the manufacturer to the final customer

 Promotion - the ways of product promotion

4 Analysis Model

 SWOT (Strength, Weakness, Opportunity, Threats) matrix to analyze the factors that effect to business operation and identify the company’s internal strengths and weaknesses

 PESTEL (Political, Economy, Social- Culture, Technological, Environment, Legal) model to analyze and evaluate comprehensively the elements of macro environment affecting to the mobile telecommunication market in Cambodia in general and Viettel Cambodia in particular

CHAPTER 3: METFONE’S OVERVIEW

1 Viettel Cambodia (Metfone) Introduction overview

(Source: Official Website of Metfone)

1.1 Metfone’s history

“MetFone is the leading mobile operator in Cambodia, with the most extensive, reliable and trusted network It is the brand name of Viettel (Cambodia) PTE LTD., a member of one of the world’s fastest-growing telecom operators, Viettel Group

The name “Met” was selected for Cambodia because it means “friend” in Khmer, and conveys our desire to build a truly Cambodian company to serve Cambodians

When MetFone launched its service nationwide in February 2009 there were seven mobile operators in Cambodia Three ― Mobitel, Mfone and TMIC ― had been operating

in Cambodia for around 10 years and were the dominant players

Mobitel (a joint venture between Cambodia’s Royal Group and international partner Millicom) led the market with a share of more than 50% However, the market at that time was concentrated primarily in major urban centers Most rural areas ― where 80% of Cambodia's population lives ― had no network coverage

MetFone began expanding along national roads to rural areas, expanding coverage

to those who had previously been isolated

At that time, most operators used microwave transmission technology for their networks As a result, Cambodia’s telecom infrastructure, which was already in a fragile state after decades of conflict, was limited to less than 2,000 kilometers of fiber optic cable and around 1,700 base transceiver stations Cambodia lagged the region, with a mobile penetration rate of about 20% Moreover, due to an overreliance on developing mobile networks, fixed lines had been neglected

For years, the total number of fixed-line subscribers was almost unchanged at about 40,000 Internet services, mostly dial-up, were available in some major urban centers, but the costs were among the highest in the world The penetration rates for both fixed phone lines and the Internet were below 0.5%.”

1.2 Metfone’s Mission

“Our company continually strives to innovate and personalize information technology, telecommunications and digital content services to deliver the highest value possible to our customers

Our aim is to deeply embed sustainability in our culture, values, decision-making, products and services in order to ensure MetFone is a sustainable business positioned for long-term growth by leading and shaping positive change.”

1.3 Metfone’s Core Value

“Value innovation: Innovation is thinking about an old issue in new ways

Change is the norm: Competitive strength is based on rapid adaptability Being

open to alternatives to ensure adaptability is the norm

Discipline is the norm: Strict discipline, solidarity and acceptance of hardship

while remaining devoted to our jobs allows us to work decisively, quickly and thoroughly

The company is a second family: Every employee has a role to play in developing

this family Coworkers must be respected regardless of the type of job they perform Teamwork promotes individual responsibility and engagement Each employee is regarded

as an indispensable part of the organisation

System thinking: Possessing a strategic vision and knowledge to master the

organisation’s systems Fully understanding the roots of all issues and simplifying complicated problems Professionalising every stage of work to ensure rapid development

and sustainability.”

1.4 Metfone’s Vision

“Always be a pioneer and an innovator Always listen to and care for our customers.”

1.5 MetFone’s business Philosophy

“Customers are cared as separate individuals

Metfone listen to and try to understand each customer so as to provide tailored services that most come up to their demands

Business development goes with social responsibility

As the development of society is the foundation for business growth, companies should take action to improve and develop the society in which they operate in

Human resources are the key to development

Each employee should be happy and play a creative role; therefore, a good working environment is essential.”

2 Metfone’s Business result

2.1 Revenue and Profit

- Both revenue and profit before tax of Metfone have decreased from 2014 to 2016,

recently back to increase in 2017

o Growth rate of services revenue is very bad: 2015: (-9%), 2016 (-7%)

o Profit before tax started decreasing from 2015 to 2016 and in 2017 keeps the same number

Diagram 3 1 Profit before tax and % growth of services revenue

- Revenue structure have changed very clearly according to the mobile trend of the

region and the world: voice revenue decreased very strongly from 77% in 2013 down

to 52.9% in 2017 and data revenue increased dramatically from 5.3% in 2013 up to 41% in 2017 It is estimated that the trend will be kept in the next years

Diagram 3 2: Service revenue structure of Metfone

2.2 Mobile subcribers

- The same trend with the revenue, mobile subs decreased strongly in 2 years ( 2015

& 2016), but data subs continue having a sharp spike (occupy 60% of all subs)

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0

Diagram 3 3: Mobile subs & Data subs from 2013-2017

- If reviewing by areas, majority of Metfone mobile subs is in rural area, especially in

rural area (capital PNP where 12.7% residents lives) In 2 years 2015 & 2016 urban mobile subs decreased from 16.7% (in 2013) down to 13.8% in 2016

Diagram 3 4: Metfone Subcribers divided by area 2013-2017

6.5 7.0 7.5 8.0 8.5 9.0 9.5

Diagram 3 5: Metfone subs’ Arpu and Market subs’ Arpu 2013-2017

CHAPTER 4: BUSINESS ENVIRONMENT AND COMPETITOR ANALYSIS

1 Business environment

1.1 Overview

- Cambodia has seven operators, including: Metfone, Smart, Cellcard, Cootel, QB and Kingtel, Seatel In particular, Smart, Metfone and Cellcard are three carriers, holding almost all of the mobile market share in Cambodia

- In 2017, the total market size is estimated at 11.5 million subscribers; the penetration

of the total population is 72%, is expected to increase 85% Service revenue is estimated at $ 700 million /year ~ 3% contribution to Cambodia (Vietnam: 5%) It is expected that in 2018 and 2019, total telecom revenues will continue to grow due to the development of the economy as well as the stabilization of the political situation

- Major trends in the field of telecommunications and e-commerce in the coming time:

o Strong shift to data: subscriber rate data / total subscriber accounts for 70%

o Diverse content services based on data

- High Arpu class = 10 $ => demand for quality assurance services

- Low ARP <3 $ is not satisfactory due to lack of demand of time (Due to the market is mainly SIM limited use date by value card $ 1 = 1 week)

- The free handset market, smartphones accounted for 70% of new sales

- 2 SIM cards due to the high net-rate of 8 times on-net, loyalty is not high (50% after

1 year)

- Growth continues to be subscrible even though the market is in a saturated phase

1.3 PESTEL Analysis

P (POLITICAL):

o The Cambodian People’s Party (CPP) continues to be trusted and supported

by the people, has won the election at the local level (5/2017) and the upper house (1/2018) Expected CPP party will win the general election on 8/2018; Forecasting the political situation in the coming time will not have many big changes affecting the production and business of Metfone

E (ECONOMIC):

o Cambodia's annual GDP growth rate will remain at 7% in the coming years Time to 2018-2020, with the commitment of foreign investment, especially by the Chinese government to Cambodia ($ 7 billion in 2018), plus the shift in economic structure from agriculture to industry and Services that contribute to improving people's lives, most clearly expressed in per capita GDP, are estimated to increase by USD 1,484 in 2017 and USD 1,760 in 2020 (equivalent to Vietnam in 2013) This is a great incentive for people to spend more on telecommunications services

S (SOCIOCULTURAL):

o There is a strong shift of labor resources from rural (agricultural) to urban (service sector: 500K people, industry: apparel factories and footwear ~ 700k workers)

o The market entered data boom (55% to 70%), e-commerce payment

T (TECHNOLOGY):

o 4G technology has grown rapidly and initially put 5G technology into the test

in 2020

o Fiber optic technology replaces 100% copper cable and grows sharply

o The form of electronic payment initially developed in urban areas

E (ENVIRONMENT):

o Cambodia is divided into two distinct seasons, the rainy season lasting 6 months will affect business Especially the shutdown behavior does not consume the service whenever it rains in rural areas

L (LEGAL):

o The Government continues to improve and enforce law enforcement: The Telecommunication Law of 2017 regulates new subscribers and levies annual fees (3% / revenue)

o Metfone should actively learn and implement in accordance with new regulations

o Frequency management may shift to bidding in the coming years

1.4 SWOT analysis

STRENGTH:

o Network infrastructure and service quality are better than the competition

o Large market share in rural areas (~ 50%)

o Leverage the power of information technology to take the lead in providing and deploying IT systems for government and business customers

THREATS:

o The government tightens the management of prepaid subscriber information and applies new tax and fee regulations: Top 5cents / number; 2% of total revenues are collected from the service fund and 2% of the total revenue is collected from the research and development fund (→ 1% of total revenues)

→ causing difficulties for operators in general and Metfone in particular Metfone's expected cost will increase by $ 3.84tr

o Continue the trend of price competition, especially data rates among operators, makes it difficult to raise the Arpu market

1.5 Competitor analysis

1.5.1 SMART- the main competitor

- Strategic objectives: Leadership in market share and technology

- Current strategy: Continue to follow the cheapest tariff strategy + add new

technologies (4.5G, HD Voice) + focus on young customers

- SWOT analysis:

(1) Maintaining the cheapest rates for 4

consecutive years should create a large

spillover community (youth, distribution

channel)

(2) Strongly invested in 4G infrastructure and

is leading the market in terms of

technology trends as a brand: deploying

VoLTE, 4.5G

(1) Network infrastructure is congested in metropolitan areas:

+ 191 3G stations ~ 42% of stations have>

1500 subs, while Metfone has only 1 station (PNP573)

+ Real experience and customer survey: 3G / 4G Metfone than Smart

STRENGTH WEAKNESS

(3) Using the strategy of pulling customers

through strong investment in media

advertising (~ 4.5% of service revenue) in

the direction of pioneering, modern,

youthful on mass media channels

(television, great.)

(4) Large 3G / 4G frequency resources

should save extra station costs while still

ensuring storage capacity

(2) Smart's lack of transparency in service fees due to maintenance of registration policy and the deduction of VAS collection fees (VAS's share of VAS revenue is 10%, equivalent to Metfone at the time of deduction collection)

1) Expanding coverage to attract rural

subscribers based on youth community

advantage

1) Profit tends to decrease due to: decrease in price, increase of investment to expand the coverage area, increase of revenue sharing fee from 4% to 7% (Metfone: 7%)

1.5.2 CELLCARD

- Strategic objectives: Retain high Arpu subscribers and revenue to ensure

profitability

- Current Strategy: Continue to add 4G network coverage and focus on high-end

customer care programs

- SWOT analysis:

(1) As the oldest business network, Cellcard

should maintain a high customer base

and Arpu core Good market share in the

capital

1) Poor 3G data coverage (less than Metfone

1191 stations), while neglecting the 3G consolidation phase, which directly invested 2,250 4Gs, led to the growth of the worst data subscribers

2) Change of the original brand positioning: From the network for the rich and good quality customers to the cheap network (Join the price war) leading to reduced network quality

STRENGTH WEAKNESS

3) Point-of-sale channels are paralyzed in rural areas due to a long period of inadequate care

1) Continue to implement policies to

attract data subscribers in urban areas

where network infrastructure is

comparable to Metfone

1) Turnover and profits are drastically reduced resulting in insufficient cash flow to continue investing in new technology and expanding infrastructure

 So the main competitor of Metfone in Cambodia is SMART

Total point

CHAPTER 5: REAL SITUATION AND MARKETING PROBLEM OF METFONE

1 Real Situation of Metfone

1.1 Network and product quality

Infrastructure

Ranked No 1 on network infrastructure (3,772 station locations) but ranked No 3

on 4G infrastructure (1,919 stations) It is expected that

by the end of the year there will be 2,319 stations, equivalent to 2 competitors

Ranked third in network infrastructure (2,326 stations) and second in 4G infrastructure (2001 stations - more than 282 stations in comparision with Metfone)

Ranked second for network infrastructure (2,383 station sites) and 1 for 4G infrastructure (2,250 station locations)

Subs & market

share

Nation: second in terms of

subscribers and market share;

In urban areas (at Prombenh) No 3 with 26%

PNP-market share ~ 600k subs

Nation: ranked first in

Metfone has the advantage

of good service quality, wide coverage, healthy network, especially in rural area

Smart is a network for young people, Customers use because

of the influence of urban movement, sometimes the waves / internet is not good

Cellcard for longtime customers using mobile service from the beginning Poor wave in rural areas

1.2 Price:

- The price war lasted for years, pushing the price of voice and data to the lowest

+ The number of packages is

comparable to that of

competitors, but Metfone

always follow the value of

promotions in the program

+ Lead the price war on money change (from 2012) lasts for 4 years

+ Use the program to change the money to attract customers

+ From T1.2017 leading the market on the policy of money exchange, promoting the media package Biglove ($ 1 = $ 500)

Metfone Smart Cellcard

+ In addition to basic DV, media

focus for Unlimited Youtube

Package ($ 1 / week)

+ In addition to basic services, media focus for value added services (iFlix, SmartTunes )

- Price war in Cambodia among 3 MNOs: Cellcard is the cheapest price operator

Table 5 1: The Price of Exchange package 2012-2017

The channel is broader and deeper than the competition

to the district and commune but the image is less

competitive than the competition in the city and the

center

92 showroom + 46 Agents +30k POS + 500

Collaborators

Smart:

Distribution channels are centrally located in the city /

province, professional channel images

22 showroom + 6 Agents + 20k POS

Cellcard:

Mainly concentrated in the city center, province

There is almost no canal image at the district, commune

level

26 showroom + 22 Agents + 18k POS

MNO Communication evaluation

Metfone Discrete message, almost no advertising Mass Media

SOV accounts for 5% of the market

Smart Throughout, enduring advertising messages express the

cheap-young-technology message Continuous and innovative advertising on Mass Media

SOV accounted for 49% of the market

Cellcard Unfavorable, high-frequency commercials on Mass Media

SOV accounted for 46% of the market

2 Marketing Problem of Metfone :

 Network and product quality:

- Metfone’s network is strong in the country so the customer has the impression that Metfone is attached to the strong wave image - good network - good quality

CHAPTER 6: MARKETING STRATEGY

1 Objective

- Regain lost market share for 4 consecutive years

- To become No 1 on Top of Mind - equivalent to 40% of telecommunication services

in Cambodia in the mind of customers by the end of 2018 (30% in urban areas only)

2 Strategy

- Repositioning the Metfone brand in the direction of that is not only cheap, quality network but also helping Cambodian young people more advanced to change their life and their beloveds ( message is totally different from Smart)

- Consider young customers as the main competitive segment to regain urban focus with new positioning to refresh the brand and promote first-rate brand recognition Top of mind, help recapture segmentation young customer

2.1 Brand positioning strategy

Strong basic

point

The largest telecommunications network infrastructure, No 1 Cambodia, provides multi-service The business model is active, highly enforceable

Mass: 15-54+ Nationwide scale

Foccus: 15-30, urban area

Implicit Truth "I want the telecommunication

network with not only cheap price but good quality to make the door in order that I could connect with the world for a better life for me and my beloveds."

#

" I want cheap telecom networks to help me update the technology trend and confirm myself "

Contents METFONE # SMART

Benefit when

using

Strong network, cheap, Multi offer, Connection - New perception

long-Difference Kind, Be personalized to you and

the people you love # Always lead with the latest technology

Core value Caring and Innovator # Morden and updated

Because brand repositioning plan requires more intensive and time-consuming research, in this report I will only use the branding strategy I propose above as a base for making a marketing plan to attract young customers in the next chapter

CHAPTER 7: RESEARCH METHODS, DATA ANALYSIS AND RESULTS

1 Research overview

1.1 Research problem

- Customer insight of young customer or young community in Cambodia in using mobile services and technology

1.2 General objective of research

- Characteristics of young customers

- Consumer behavior of young customers

- Evaluation of young customer about 3 MNOs (Metfone and 2 competitors: Smart and Cellcard) about network coverage, network quality, brandname, services

1.3 Research subject

- Young customers in Cambodia are using telecommunication services regardless of Metfone customers and competitors in urban areas, especially customers in the capital region of PNP

2 Qualitative study and other methods

2.1 Specific objectives

o Understand consumer insights

o Find out the trends in the market

o Discover/Explore qualitative information about customers to compare with current data

2.2 Research method

o Methods: Focus group discussion + Secondary data analysis: case study about young customer of famous Telcos in the world and in-depth research about youth

o Choice of respondents for FGD: young people between 18 and 30 years of age are using smartphones in the PNP area

(1): Mobile phone usage (2): Evaluation about Metfone, Smart, Cellcard: Network coverage, network quality, brandname

(3): Decision of choosing to use package (4): Image of 3 MNOs for young customer

2.3 Analysis results

2.3.1 General characteristics of Young customer

I found 4 important characteristics represented for Youth, especially Youth in 4.0

technology era: (i) They are early adopters, (ii) They are trendsetters, (iii) They are game changers, and (iv) They are potential customer I used secondary data to research

characteristics of young customer Specific findings are presented as follows:

- The role of youth in influencing the rest of the market is immense First, they are early adopters Youth are often accused of being rebellious and

antiestablishment—that is, they love what adults hate Although some youth are behaving as accused, most of them are not The truth is that youth are just not afraid of experimentation They try new products and experience new services that older segments deem too risky

- Secondly, youth are trendsetters Youth are the Now Generation customers who

demand instant everything When it comes to trends, they are very agile They follow trends so fast that marketers often fail to keep up But the upside is that this allows marketers to quickly pinpoint trends that will influence the market in the near future

Their tribal nature means that youth are also very fragmented Thus, trends that youth follow are equally fragmented Certain sports, music, and fashion trends might have cult following among some youth tribes but might not be relevant for others Perhaps the only trend that most youth follow is the movement toward a digital lifestyle

While many youth-endorsed trends turn out to be short-lived fads due to this fragmentation, some evolving trends do manage to hit the mainstream The rise of Justin Bieber, who initially gained fame as a trending YouTube artist followed by millions of youth, is an example The entire universe of socialmedia, such as Facebook and Twitter, also started out as a trend among youth Similarly, music-streaming services such as Spotify, Apple Music, and Joox were brought to the mainstream market by young customers

- Finally, youth are game changers They are often associated with irresponsible

and selfish behaviors But recent trends show that they are maturing much earlier This is because young people respond more quickly to changes happening in the world, such as globalization and technologicaladvances Now, they are concerned about what is happening around them In fact, they are one of the primary drivers

of change in the world

These roles—early adopters, trend setters, and game changers—all lead to the conclusion that youth are the key to mind-share If brands want to influence the minds of mainstream customers, convincing youth is the important first step.”

Specifically in Asia, research about young Customer behavior in telecom and technology reveals the following insights:

- Youth are confident, adaptive and Knowledgable (Source: Epinion, OMD 2015-2016)

Diagram 7 1: Influence of Purchase decision of Youth

o 83% know more about technology than their parents

o 30% know more about technology than their friends

- They are value customer: The youth are not only young customers in the current

market but also potential customer in the future when they become high income customers who bring the main source of value to the oprator Therefore, the value from young customers at the present can not calculate by some figures Naturing this group is naturing the operator’s future value

o High telecom users

o Young urban segment uses an average of 5 mobile internet services, compared

to just 3.6 among other consumer segments

o Data Arpu of Youth customer is 2 times more than other segments

2.3.2 Mobile phone usage behavior of youth

(1) Calling is essential demand to contact with your family and friends

(2) They spent almost time using mobile phone and internet

(3) They like to live in Social online world ( especially FB, Youtube, Line app) (4) They are thirst of content

(5) They like to use OTT apps platform more than traditional voice and SMS

(6) They recharge many times in month, they recharge weekly

(7) They can use multi sims at the same time

(8) They like mobile internet more than wifi

(9) They are attracted by viral compaign

In order to find these 9 behaviors, I used primary data with qualitative research, secondary data from in-depth report, real data of Metfone to describe these customer behavior, detailed result as below:

a Real data of Customer behavior in Metfone network reflected through effectiveness KPI

- 98% young customer are using smartphone

- MOU/sub of young customer: 250 minutes/month

- DOU/sub of young customer: 10GB/ month, and GB is used for FB, Youtube, Line apps and other social network

b Focus group analysis ( qualitative research analysis):

What Metfone learned What this means to Metfone

1 Mobile phone usage primarily involves calling,

accessing social media and using instant

messaging apps: Facebook messenger is the

preferred instant messaging app to use because of

its user base, no a lot use Viber

Being the more relevant activities, it is

a must that these activities should be

covered in Metfone’s planned multi services package offers

 They focus on instant messaging apps, most use Facebook because of the big user base

it has compared to other apps like viber

 Most use Facebook Messenger and Line because: Facebook and Line are popular among

your friends and Collegues Morever, both apps are more convenient to use because of it’s multiple functions such as voice call, video call and sending photos documents

 Only a few of them use viber, mostly for their work People stop using viber because

Viber is viewed to has less functions than other apps It’s can only call and message

(Facebook  Line  Whatsapps  Tango  Wechat Viber)

Most frequent High school student University student White - Collar workers

and self-employed

Social network (Facebook, Instagram.)

Social network (Facebook, Instagram.)

Social network (Facebook, Instagram.) Instant massaging

(Line, Telegram.)

Youtube ( movie,

Youtube ( movie, songs)

Instant massaging (Line, Telegram.)

Instant massaging (Line, Telegram.)

Built in SMS Google search Google search

Online games Game download app

 Most still use Mobile data because of its accessibility, though connection is more

inconsistent than Wifi

Frequency of use

They mostly connect to wifi out of home (Coffee shop for Phnom, Penh Student, university or at their

Activities

Online games Download app Sending large document

Social network (FB, IG ) Instant messaging (Line, Telegram )

Online games Youtube ( movie and songs) Google services

Hotpots

Wifi Mobile data

Over all

experience

Reliable when it comes to dowloading large document but still have issues with speed

Most students note that speed is low especially in crowded public areas

Generally prefers mobile data over wifi but they still face some problems: slow internet due to congested connection at night, intermittent connection due to bad weather

 In terms of topping up habit, most allocate only 1 USD per week for mobile phone credit

o Both Metfone and competitor subscriber usally top- up 4 times a month

o 1$ per week is the most preferable option among all

o Most respondents do not have a habit of checking their data consumption because they feel the the promotion package they subscribe to is more than enough cover their weekly usage

o Only a few of competitor subcribers (high school student have this habit)

 For people who use multitiple sims, Metfone and Cellcard are for calling family and

internet, while Smart is maily used to communicate with their friends

No of sim using Metfone subcribers Smart subscribers Cellcards subs

3

Family in the Province and contact people in rural area

Friend and internet also occasionally with family

Family

2 Call family and internet Friends

Call family and internet, maily for calling

" Metfone for calling

my family and internet, Smart is for reaching

my friends because it's internet is super slow" ( High school student)

"I use Smart since the beginning to call my friends when I was a students, then I use Cellard for internet So when I go to

hometown, I still access internet using Cellcard" ( worker)

"I use cellcard to call

my family and Smart

to reach my friends,

so that it’s easy to have free call by making sure that I don't cross network

to people, which means I don't have

to spend more" ( uni student)