RESEARCH REPORT ON

PRODUCT ANALYSIS OF AIRTEL

UNITED INSTITUTE OF TECHNOLOGY NAINI, ALLAHABAD

UNDER GUIDENCE OF

SUBMITTED BY:

Mr.Prashant Shukla
(Project Coordinator)

Ritij Vikram Singh

M.B.A 4rth SEM Roll No: 1028470019

ACKNOWLEDGEMENT

As we know that research work needs hard work, keen insight and long patience with scholarly vision based on constant operations, it needs inspiration from the subject and assistance from the expert. I was really fortunate that I got every type of help l needed from the respected chain of people.

Hence, it becomes a humble of AIRTEL.He duty to express my sincere gratitude to all those people who helped me in research work. I would like to thank Mr.Reetesh Chandra Pandey for providing an opportunity to do my end semester research project. PRODUCT ANALYSIS helped me at every step, wherever I faced problem. Whatever I would say that would be less for her endeavor to do my End semester project.

RITIJ VIKRAM SINGH

PREFACE
As a student of MBA (MASTER OF BUSINESS ADMINISTRATION) one of the most reputed professional courses, I have to undergo for the RESEARCH PROJECT REPORT in the end of the second year. The attractive feature of the MBA DEGREE is that along with theory we also get to have the exposure of the practical environment.

The topic for my research project is:-

PRODUCT

ANALYSIS OF AIRTEL

The Project Report revolves around the changes occurred in consumer behavior of tiles companies and their effectiveness in getting change in consumer perception about the brand. The objectives are predefined and the task is to accomplish them.

The study was confined geographically to selected areas of Lucknow the potential respondents are the home base consumers and the industrial consumers, who have commercial use for the product. The whole process during the report is well planned, the secondary data collection is done from the respondents.

RITIJ VIKRAM SINGH

DECLARATION

I am RITIJ VIRAM SINGH a student of MBA of UNITED INSTITUTE OF TECHNOLOGY NAINI, ALLAHABAD respectively hereby declare that the Project Report on PRODUCT ANALYSIS OF AIRTEL is the outcome of my own work and the same has not been submitted to any other University/Institute for the award of any degree or any Professional diploma.

RITIJ VIKRAM SINGH

CONTENTS
Contents:

Page No:
Company Introduction History BHARTI Revenue base BHARTI Vision ,MISSION Services Understanding the product basket

About the company 06

Objective.27 Review of literature.. Consumer behavior concept ..

Research methodology

SWOT Analysis69 Suggestions..74 Scope of Project...75 Limitation of the Project..76 Conclusion....77 Bibliography.78

INTRODUCTION

ABOUT COMPANY

Bharti
Airtel comes to you from Bharti Cellular Limited a part of the biggest private integrated telecom conglomerate, Bharti Enterprises. Bharti provides a range of telecom services, which include Cellular, Basic, Internet and recently introduced National Long Distance. Bharti also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments in India, it is also the first company to export its products to the U.S. Bharti is the leading cellular service provider, with a footprint all states covering all four meteors and more than eight millions satisfied customers. Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunication with its world-class product and services. Established in 1985, Bharti has been pioneering force in the telecom sector With many first and innovation to its credit, ranging from being the first Indian company to provide comprehensive telecom service outside India (Seychelles), first multinational internet service provider and first private sector service provider to launch national long distance services in India. As on November 30,2001 Bharti had over 1,340,000 customers nearly 1,048,000 cellulars, 135,000 fixed lines and 157,000 Internet customers. Its existing service sector business include cellular operations Andhra Pradesh, Chennai, Delhi, Madhya Pradesh, Mumbai, Himanchal Pradesh, Karnataka, Uttar Pradesh and Kolkata. In addition, it also has a fixed line operation in the states Madhya Pradesh, Chattisgarh and Haryana and nation wide broadband and long distance networks. Bharti has recently entered into license agreement to operate eight cellular networks in telecom circle of Gujrat, Haryana, Kerala, Tamil Nadu and U.P. (West). Its license agreement for providing fixed line services in Delhi, TamilNadu and Karnataka. In December 2001, Bharti commenced offering data services in certain regions of India and accepts to commence providing voice services for cellular to cellular calls from 26, 2002 subjected to receipt of requisite regulatory approvals.

The company is also implementing submarine cable project connecting Chennai-Singapore for providing international bandwidth. Bharti Enterprises also manufacturers and exports telephones terminal and cordless phones. Apart from being the largest manufacturers of telephone instruments, it is also the first Telecom Company to export its product to the U.S.A.

Bharti Enterprises- History

1996 BTNLs winning bids for Madhya Pradesh services area for fixed line Telephone services. Formed cash Bharti Mobile Communication Limited a joint venture with Casio & Mitsui to manufacture and market radio pagers. Formed Bharti duraline Pvt. Ltd joint venture with Duraline Corporation U.S.A. to manufacture HDPE ducts. Formed a joint venture company Bharti Tele ventures Ltd. With telecom Italy, Italy to promote various Telecom project in India. BTNL commercial launched cellular services in Himancal Pardesh. 1997 British Telecom joined the consortium of Bharti cellular. BTNL granted lincence for Madhya Pradesh fixed line services. Bharti Global granted the license to operate comprehensive Telecom services in Seychelles as second operator. Bharti and BT formed a joint venture Bharti BT limited for a VAST project. 1998 First ever Indian Private Fixed Line service launched in Indore Madhya Pradesh on 4th June 1998 by BTNL. Bharti BT Internet formed to offer Internet & Ecollaboration with British Telecom. Commerce service in

Services launched in Seychelles on 12th December 1998. British Telecom consolidated its shareholding in Bharti cellular. 1999 Bharti BT Internet launch Mantra online Internet in May EM Warburg Pincusn, one of the largest International Private Equity Investors joined BTNL. Acquired controlled stake in J T Mobiles cellular operates in Andhra Pradesh & Karnataka (Now Bharti Mobile Limited). Intel takes Equity stake in Bharti Tele Spatial and Bharti Telesof

2000 New York International takes stake in Bharti Cellular. launch of AIRTEL and MAGIC in Karnataka and Andhra Pradesh. Bharti Telesoft opened its overseas offices in U.K.& U.S.A. Acquired controlling stake in SkyceLll,Chennai. Singapore Telecom decides to invest in Bharti and becomes Partner in BTL & BTNL.Entered in to a joint venture with Singapore Telecom Intel, for Submarine cable project between Singapore Chennai and Mumbai Singapore.

2001

Entered into a joint venture with Singapore Telecom Intnl, for Submarine capable project between Indian & Singapore and entered into a joint venture with Singapore Telecom for National Long Distance operations. Acquired cellular operation from spice in Kolkata. Acquired eight cellular licenses as fourth operator for the circles of Mumbai, Maharashtra, Gujrat, Haryana, U.P. (WEST), Kerala, Tamil Nadu and Madya Pradesh. Crossed the 1 million subscriber base mark in October 2001.

Airtel & Visual Identity

For a brand to be successful, it must build enduring relationships with its different audiences. Integral to this relationship is the visual image of the brand the consumer carries in his/her mind. The Airtel brand image is created through the consistent application of a carefully developed visual identity, which helps Airtel distinguish itself in a cluttered market. Airtels visual identity helps create instant brand recall and strengthens the relationships that its audiences have with it. The Airtel visual identity has different elements that work together to create a strong and consistent identity for the brand. The most important of these are: `The Airtel Logo

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The Airtel logo is a strong, contemporary and confident symbol for a brand that is always ahead of the rest. It is a specially drawn world mark. The Airtel Image style It incorporates two solid, red rectangular forms whose counter form creates an open doorway. The Airtel Typographical style The title case lettering with its capital A was deliberately chosen to reinforce the brands leadership position. The red dot on the letterform I cues Airtels focus on innovation.. The words Express Yourself are very much part of the brand identi. BHARTI TELE-VENTURES Bharti Tele-Ventures Limited was incorporated on July 7, 1995 for promoting investments in telecommunications services. Its subsidiaries operate telecom services across India. Bharti Tele-Ventures is Indias leading private sector provider of telecommunications services based on a strong customer base consisting of approximately 11.84 million total customers which constitute, approximately 10.98 million mobile and approximately 857,000 fixed line customers, as of March 31 , 2005

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Corporate STRUCTURE r

12

Mobile Division
Overview Bharti Tele-Ventures vision for its mobile business is To make mobile communications a way of life and be the customers first choice. The mission is to meet the mobile communication needs of the customer through 1) error free service 2) Innovative products and services and 3) cost efficiency. The Companys strategic objective is to consolidate its leadership position amongst the mobile service providers in India. The Indian mobile market, according to the COAI, has increased from approximately 1.2 million subscribers as of March 31, 1999 to approximately 41.03 million subscribers as of March 31, 2005. Despite this rapid growth, the mobile penetration rate in India, at approximately 3.9% as of March 31, 2005, is significantly lower than the average mobile penetration rate in other Asian and international markets. The number of mobile subscribers in India is expected to show rapid growth over the next four years. By 2006 it is projected at 50 million by COAI and 44 million by Gartner. Bharti Tele-Ventures believes that the demand for mobile services in India will continue to grow rapidly as a result of the following factors: Lower tariffs and handset prices over time; Growth in pre-paid customer category; Greater economic growth & continued development of Indias economy; Higher quality mobile networks and services; and Greater variety and usage of value added services. Bharti Tele-Ventures, through its subsidiary has the licenses to provide GSM services in all the twenty-three telecom circles in India. It proposes to consolidate all its subsidiaries providing mobile services under Bharti Cellular Limited. As of March 31, 2005, 100% of Indias total mobile subscriber market resided in the Companys twenty three mobile circles, which collectively 100% of Indias land mass. Accomplishments

13

The largest private sector integrated telecommunications services group in India in terms of the number of customers.

Largest

Mobile

footprint

in

India,

covering

23

circles

of

INDIA.

Proven track record of managing growth - both organic as well as by way of acquisitions. First and largest private telecommunications services company offering fixedline services in India. Existing foreign shareholders have acquired direct and indirect equity interests in the Company for a total consideration exceeding US$1 billion. First private telecommunications company to launch long distance services. First off the block to launch fixed-line services in all the four circles of Delhi, Haryana, Karnataka and Tamil Nadu. Airtel Mobile Strategy

Capture maximum telecommunications revenue potential with minimum geographical coverage to maximize its revenues and margins. Build high quality mobile networks by deploying state-of-the-art technology to offer superior services. Use the experience it has gained from operating its existing mobile networks to develop and operate other mobile networks in India and to share the expertise across all of its existing and new circles. Attract and retain high revenue generating customers by providing competitive tariffs, offering high quality customer support, proactive retention programs and roaming packages across all of its mobile circles.

Provide affordable tariff plans to suit each segment of the market with a view to expand the reach, thereby increasing the mobile customer base

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Revenue Base- Bharti

Revenue in crores 1994 2005 244.9 448.1 Revenue in Revenue in Crores Crores

2006

848.8

2007

1486.2

2008

3,049.90

15

2009-10

6,000.48

VISION

To make mobile communication a way of life and be the customers first choice. We will meet the mobile communication needs of our customer through: Error-free service delivery. Innovative products and services. Cost efficiency. Unified Messaging Solutions.

MISSION

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We will meet global standards for telecom services that delight customers through: Customer Service Focus Empowered Employees Innovative Services Cost Efficiency

SERVICES
Airtel Pre-paid.
Airtel Prepaid, the Ready Cellular Card from Airtel comes to you from Bharti Enterprises, Indias leading integrated tele-services provider. Going mobile with Airtel Prepaid is a new of life. With a host of great features, a simple to use, Airtel Prepaid makes everything that you dreamt and believed, possible.

Airtel Postpaid
Airtel welcomes you to a vibrant world of unlimited opportunities. More exciting, innovative yet simple new ways to communicate, just when you want to, not just trough words but through ideas, emotions and feelings. It gives you unlimited freedom to reach out to your special in a special way

Airtel MTV Card

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The best offers and the coolest of bargains on the hippest stuff in the market, download the hippest tunes from the new tracks and dress up your phone with the latest wallpapers, ring tones, picture messages, screensavers and backgrounds . All this and lots more, only with the MTV Airtel SIM.

Airtel Roaming
Airtels Roaming service allows you to use your mobile phone to make or receive calls from almost anywhere in India and abroad. Airtel Roaming gives you two great options: Airtel National Enjoy roaming in India across 42 partners Networks and over 750 cities. Airtel International Roam across international destinations, in nearly 119 countries including U.S.A., Canada, etc. with 284 partner networks.

Long Distance
Now experience complete freedom like never before with Airtel, our National Long Distance facility allows you to make distance calls in India and Overseas from cellular phone. This service is applicable to both Postpaid and Prepaid customers.

UNDERSTANDING THE PRODUCT BASKET

PREPAID: Customer pays first & then uses the mobile. - Hot Billing. POST PAID: Customer uses the service first & pays later.

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Cold Billing.

- PRE-PAID CONNECTION
Under Prepaid connection, the mobile user first makes payment for recharge coupon, which contains a number of 16 digits which when fed in the mobile, activates the pre-paid SIM. The user can use the services rendered as per denomination of the Recharge coupon. The billing done in case of Prepaid connection is termed as Cold Billing.

BENEFITS OF PRE-PAID CONNECTION: Convenience:

This is very convenient. All it requires is just acquiring a Recharge coupon.

Availability:
The prepaid SIM Airtel can be easily had from any outlet of Airtel. This is a non-refundable one time investment made in order to get enrolled.

Cost Control:
The pre-paid connection prevents a user from over billing.

Easy Recharge:
The recharge coupon of Airtel can be easily had from any outlet of Airtel.

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CONTITUENTS OF PEP CONNECTION

PEP PACKAGE

S.U.K.

Recharge Coupons

1. 2. 3. 4.

Sim Pack. May have stored talk value. Talk value validity period SIM Expiry

A paper/paperless Recharge with various denomination for recharging the prepaid SIM.

LIFE CYCLE OF SIM

Active

Grace

Forfeiture

De-active

Time out

POST PAID CONNECTION

Under postpaid connection, the mobile user is allowed to use the mobile services being provided and makes payment of the charges thus subjected to at the end of the billing period. The billing done under postpaid connection is termed as Hot Billing. Some more details about this are as following:

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BENEFITS OF POSTPAID CONNECTION:

The benefits of possessing post-paid connection may be given as following:

Always connected.
Unlike pre-paid connection the mobile phone does not get disconnected with the de-activated of SIM card. Here the mobile users can the phone as much as he wants and then make payment of Bill at the end of the billing period.

More economical for high users.

For those who are high of users of mobile phone, it is wise to postpaid connection, because, in case of pre-paid connection the user will incur certain additional expenses every time he/she acquires a recharge coupon. The post-paid connection holders get an itemized monthly bill mentioning, nominal charges, mobile originating and terminating charges, SMS originating & exterminating charges etc.

Different plans to suit individual needs.

As we know, different high users expect different services from the mobile phone. Thus, Airtel has designed different plans to suit individual needs of high users possessing POP connection.

Advantage of unique V.A.S.

Airtel is bringing in a wide range of V.A.S., which has been discussed later in the project.

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CHANNELS OF DISTRIBUTION:
For post paid connections there are basically two channels of distribution, viz. Connect & Retail. These two are discussed as under:

A. CONNECT:
Under this the user gets connected to the Airtel POP Services after AV/CV. Generally the customers with high rentals and more usage are targeted.

B. RETAIL:
This includes OTC plans, pre-activated SIM & low Rental Plans. This is more suitable for regular local area users.

CHARGES IN POP CONNECTION:

These are classified under three heads

1- Security Deposit:
This varies between Rs. 500/- to Rs.1000/- for POP Connection. Rs.500/- is charge on a pre-activated instant card. The credit limit is generally equal to the amount of security deposit, which is refundable on surrender, after adjustment of pending dues.

2- Activation Charges:
The activation charges vary from plan to plan for high rental plans. This is a nonrefundable amount.

3- Plan Enrolments:
This is a non-refundable one time investment made in order to get enrolled into a plan.

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BILLING IN CASE OF POP-CONNECTION:

This billing in case of POP connection constitute of three Components, viz. 1) Monthly Rentals. 2) CLIP Charges. 3) Itemized Billing. This consists of the following: a) b) c) d) e) f) Nominal charge-Helps to track the usage pattern. Mobile originating- this refers to the calls being made by the user. Mobile Terminating- this refers to the incoming calls being received by the users. SMS originating- this refers to the SMS sent by the user. SMS terminating- this refers to the SMS received by the user. Other than this the itemized bill also gives a break up of the calls made/ received, SMS made/ received while on roaming.

VALUE ADDED SERVICES: DEFINITION:

Stay connected and updated where as you are. Traveling & waiting time no longer a bore. Your Mobile your best friend.

V.A.S. CONSTITUENTS:
I- CALL MGT. SERVICES: 1. CLIP- Calling Line Identification Presentation. Displays the incoming Call number or name on Mobile screen. 2. Call Wait: During conservation, alerts the user about another incoming call. 3. Call Divert: Diverts incoming calls to the specified L/L, mobile VMQ. 4. Conference Call: Teleconferencing up to five people at a time. 5. Call Barring: Call is barred if bill goes above the credit limit.

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II- GENERAL PACKET RADIO SERVICE (G.P.R.S.):

It is a non-voice application for enhanced user connectivity. It enables. a) Internet on mobile b) Wireless Surfing c) MMS

BENEFITS:
a) Always connected. b) No modem required for internet connectivity. III- MESSAGING SERVICES: 1- Short Messaging Service (SMS) - It facilitates sending & receiving of text messages. It is possible to type a text up to 100 characters. 2- Multimedia messaging services (MMS): - It is a total communication experience. It includes transmission of following media types: a) b) c) d) e) Text Picture Audio Video Combination of all the above.

IV- ROAMING:
1. National Roaming (STD) - It enables the subscriber to make and receive calls which traveling outside the home network within the country. 2. International Roaming (ISD) - It enables the subscriber to make & receive calls which traveling outside the home network outside the country.

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OBJECTIVES OF THE RESEARCH

1. To understand the concept of consumer behavior. 2. To identify the factor governing consumer behavior. 3. To study consumer are various Telecom companies in Allahabad providing responsiveness on telecom services. 4. To detect, how satisfied the cellular phone owners of Allahabad are, with the Telecom companies. 5. To measure the willingness of the Allahabad customers to possess Airtel connection. To provide internet access to all district head quarters. To provide high speed data and multimedia capability using technologies including ISDN (Integrated Digital Services Network) Provision of world class services at reasonable rates. Emergence of India as a major manufacturing and exporting base of equipment.

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REVIEW OF LITERATURE

26

REVIEW OF LITERATURE
A literature of review is a body of text that aims to review the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to a particular topic Literature reviews are secondary sources, and as such, do not report any new or original experimental work. Girija (1998), in its article Socioeconomic Implications of Telecommunications Liberalization: India in the International Context says that Telecommunications restructuring have evolved differently in Asia and Latin America. While Asian governments have moved cautiously in bringing changes to the sector, Latin American nations have implemented radical ownership and market transformations. The Indian telecommunications reform falls in between these two general regional trends. The choice of a high component of competition, increased private participation, and no privatization of the national carrier set conditions that will trigger unique socioeconomic effects. This article identifies and highlights the likely implications of the Indian reform on key economic and social issues, such as the cost of services, cross-subsidies, network interconnection, private investments, universal services, employment, and the possible rise of an information-intensive economy. It does so by comparing and contrasting the Indian experience with dominant reform strategies elsewhere in the developing world. T.H. Chowdary (1999) discusses how Telecom reform, or demonopolization, in India has been bungled. Shaped by legislation dating back to the colonial era and post Second World War socialist policies, by the mid-1980s India realized that its poor telecommunications infrastructure and service needed reform. At the heart of the problem lay the monopoly by the governments Department of Telecommunications (DOT) in equipment, networks and services. The National Telecom Policy 1994 spelt out decent objectives for reform but tragically its implementation was entrusted to the DOT. This created an untenable situation in which the DOT became policymaker, licenser, regulator, operator and also arbitrator in disputes between itself and licensed competitors. He discusses the question: Why did India get it so wrong? and What India should do now? Anand (1999), in his article named India's economic policy reforms says that India was embarked on economic reforms in July 1991, in the wake of a balance of payments crisis. In this article, an attempt is made to review two books and a set of World Bank reports concerning the progress of these reforms. Issues concerning economic policy, impact of the

27

reforms on poverty, sectoral issues relating to agriculture, industry and infrastructure are briefly discussed. As reforms enter a more difficult phase, several challenges remain. Some of this fall under the economic agenda'' of measures needed to maintain economic growth; others can be termed the development agenda'' - of improving human development. Progress with regard to the former is not sufficient to produce results concerning the latter. Bhattacharya (2000) constructs a vision of the Indian telecommunication sector for the year 2020. The paper aims at isolating agents of change based on international experiences and situates India in the development continuum. The agents of change have been broadly categorized into economic structure, competition policy and technology. Das (2000), in her paper described the Liberalisation of the Indian telecommunications services which started in mid nineties with no change in the existing public monopoly structure, entirely controlled by Department of Telecommunications (DoT). In order to evaluate any proposed industry structure, it is essential to analyse the production technology of DoT so as to determine the rationale of liberalisation and sustainability of competition. Accordingly, the researcher estimates a frontier multi-product cost function for DoT, where the cost function has been duly modified to account for the production technology of a public monopoly. The study finds that although DoT displays high allocation inefficiency, it is still a natural monopoly with very high degree of sub additively of cost of production. This study implies that the choice of any reform policy should consider the trade-off between the loss of scale and scope economies and cost saving from the reduction in inefficiency of the incumbent monopoly in the event of competition. Rao (2000), in her article named Internet service providers in India, provides a broad view of the role of an Internet service provider (ISP) and the factors to be considered before entering the ISP market. Describes the Internet/ISP scene within India and discusses the configuration of local, regional and national level ISPs, and the supporting infrastructure. She also identifies the various success factors. The global Internet scenario is discussed regarding the phases of the Internet in India, i.e. pre and post commercialization. The main players are described: ERNET, NICNET, STPI, VSNL, MTNL, Satyam Infoway and Bharti-BT. The financial and legal implications are highlighted in the Indian context. Many companies entered the nascent ISP business in India due to deregulation. Building local content, foreknowledge of new Internet technologies, connecting issues, competitiveness, etc. would help in their sustainability. She concludes that though many companies entered the nascent ISP businesses in India due to deregulation, many of them are unlikely to survive in the longer term. Vrmani (2000) estimates the contribution of telecommunication (or telecom) services to aggregate economic growth in India. Estimated contribution is distinguished between public and private sectors to highlight the impact of telecom privatization on economic

28

growth. Knowledge of policy determinants of demand of telecom services is shown to be essential to enhance growth contribution of telecom services. Using a recent sample survey data from Karnataka State in South India, price and income determinants of demand for telecom services are estimated by capacity of telephone exchanges Estimation results offer evidence for significant negative own price elasticity and positive income elasticity of demand for telecom services. Narinder (2004), in his article Enhancing Developmental Opportunities by Promoting ICT Use: Vision for Rural India talks about the foremost benefits of Information and Communication Technologies (ICTs) in developing countries that can be helpful in improving governance including public safety and eradication of illiteracy. The benefits of ICTs have not reached the masses in India due to lack of ICT infrastructure, particularly in rural areas, where two-third of the population of the country lives. Even in cities and suburban areas, use of ICTs is not popular due to lack of awareness to its use, computer illiteracy, and absence of practical applications. India is the largest country in South Asia, with a population of over one billion people and its telecom sector is presently experiencing fast growth phases. However telephony penetration in villages is less than two percent of the rural population and about 15 percent of the villages are still without any telephony service. Universal access to ICTs in rural areas has been planned and is being implemented through Public Tele Info Centers having voice data and video, as majority of villagers in India cannot afford a separate home connection. Illiteracy in rural areas is as high as 40 percent and in some tribal belts hardly about 20 percent people are literate. There are 35 million children in age group of 611 years, who are out of school and one out of four drops out during primary classes. Education and training, therefore, must be given the top priority if advantages of ICTs are to be harnessed. Indian economy is agriculture based and employs maximum workforce. Improvement in agriculture productivity can help in reducing rural poverty. Adoption of ICT in agriculture will play an increasingly important role in crop production and natural resource management. The other critical factor is technological challenges for universal access to ICTs to bring down the network access cost. Nikam, Ganesh, Tamizhchelvan (2004), analyses that changing face of India in bridging the digital device. He reiterated - India lives in villages said the Father of the Nation, Mahatma Gandhi. With 1,000 million people and 180 million households, India is one of the biggest growing economies in the world. With the advent of the Information, Communication and Technology (ICT) revolution, India and its villages are slowly but steadily getting connected to the cities of the nation and the world beyond. Owing to the late Rajiv Gandhi, India is now a powerful knowledge economy, and though India may have been slow to start, it certainly has caught up with the West and is ahead in important respects. The Government, the corporate sector, NGOs and educational institutions have supported rural development by encouraging digital libraries, e-business, e-learning and egovernance. The aim of this paper is to touch upon and highlight some of the areas where,

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by using ICT, the masses have been reached in this way. A follow-up paper will outline collections of significant cultural material which, once national IT strategies are fully achieved, could form part of a digitally preserved national heritage collection. Dey (2004), in her article talks about the discussions between the Federal Communications Commission (FCC) and communications policy makers and regulators in other countries and how they have gleaned several clusters of issues where further research would directly benefit them. Recently, there have been two notable shifts. First, as the acceptance of the competition model over the monopoly model for telecommunications markets takes deep effect in regulators all over the world, questions regarding process and procedure for regulation are becoming ever more urgent. This paper discusses current questions regarding decision making, enforcement, and understanding consumer issues that arise often in the FCC's discussions with other regulators. Second, technological change is potentially shifting market definitions. In the FCC's discussion with other regulators over the last two years, the overlap of wire line telecom, wireless telecom and cable television has become more pronounced.

Singh (2005), in his article The role of technology in the emergence of the information society in India describes the role that information and communication technologies are playing for Indian society to educate them formally or informally which is ultimately helping India to emerge as an information society. Though India has a huge population, the illiteracy rate is also huge in this country. The paper has taken an approach to find the historical situation and present the prevailing scenario as well as the change that are taking place with the application of ICT to the advantage of the society in different areas including daily life. India is making all out efforts to be counted among the developed nations of the world. The article also describes the considerable attention India is taking for application of technology, development of infrastructure and human resource for meeting national needs. Basically India is building an information society. Technology has helped society to cut across the traditional boundaries for getting converted into an emerging information society. The study concludes that The Indian software and services industry has significantly helped to boost the Indian economy. In IT-enabled services too, India has been clearly perceived to be the dominant hub. The Indian software sector is being recognized as the single largest contributor to incremental market capitalization in India but the sector is still small in terms of contribution to GDP, especially when compared to other large sectors in the economy like agriculture and manufacturing. Similarly, the telecommunication sector has contributed a lot but still has a considerable way to go. The paper also enforces that comparisons of Indias telecommunication statistics with those of developed and other emerging economies show that the country is still far behind its contemporaries.

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Mr. Banka (2006) gives an overview of the mergers and acquisitions in the telecommunication industry. According to him Governments decision to raise the foreign investment limit to 74% is expected to spur fresh rounds of mergers and takeovers in India. He foresees a sector that represents humongous opportunity waiting to be tapped by Indian and foreign conglomerates. Thomas (2007), in his article describes the contribution made by telecommunications in India by the state and civil society to public service, this article aims to identify the states initial reluctance to recognize telecommunications provision as a basic need as against the robust tradition of public service aligned to the postal services and finds hope in the renewal of public service telecommunications via the Right to Information movement. The article follows the methodology of studying the history of telecommunications approach that is conversant with the political economy tradition. It uses archival sources, personal correspondence, and published information as its research material. The findings of the paper suggests that public service in telecommunication is a relatively new concept in the annals of Indian telecommunications and that a deregulated environment along with the Right to Information movement holds significant hope for making public service telecommunications a real alternative. The article provides a reflexive, critical account of public service telecommunications in India and suggests that it can be strengthened by learning gained from the continual renewal of public service ideals and action by the postal services and a people-based demand model linked to the Right to Information Movement. All studies done by the researcher suggests that the right to information movement has contributed to the revitalization of participatory democracy in India and to a strengthening of public service telecommunications. Cygnus Business Consulting & Research Pvt. Ltd. (2008), in its Quarterly Performance Analysis of Companies (April-June 2008) has analysed the Indian telecom industry in the awake of recent global recession and its overall impact on the Indian economy. The analysis is done in the background of wake of global recession and rising inflation. Cygnus estimates, the Indian telecom industry is expected to maintain the growth trajectory in the next quarter as well. With almost 5-6m subscribers are being added every month, and the country is witnessing wild momentum in the telecom industry. Maheshwari (July-September 2008), in her report analysed the Indian telecom industry and ascertain that Indian telecommunications has been zooming up the growth curve at an mounting pace, and India is has surpassed US to become the second largest wireless network in the world. This growing subscriber base is basically created by tapping into rural India, which is an emerging market for the industry. The estimate for the next five to ten years is that the rural market will form 40 % of the subscriber base. The study has analysed the human resource management process of the industry, and specially the latest trends of recruitment of this massively growing industry.

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Anderson (2008), in his single executive interview titled Developing a route to market strategy for mobile communications in rural India An interview with Gurdeep Singh, Operations Director, Uttar Pradesh, Hutch India suggests that managers need to go beyond traditional approaches to serving the poor, and innovate by taking into account the unique institutional context of developing markets. His practical implication says that the experience of Hutchison Essar in India provides some important lessons for mobile network operators (MNOs) and other firms in other developing markets who are hoping to serve the rural poor: Hutchison has recognized the value of corporate and non corporate partners. The company has proactively established relationships with individual entrepreneurs, and has provided has provided development support to other partners such as distributors. The company has recognized the value of leveraging existing local institutions, and has seen gaps in local infrastructure or missing services as potential opportunities rather than barriers to growth. The company has seen the rural market as an opportunity not just an obligation to be served because of universal service obligations. Also this article demonstrates that MNOs can deliver availability and affordability to achieve increased individual or household penetration through business model innovation. Mani (2008) addresses a number of issues arising from the growth of telecom services in India since the mid-1990s. It also discusses a number of spillover effects for the rest of the economy and one of the more important effects is the potential to develop a major manufacturing hub in the country for telecom equipment and for downstream industries such as semiconductor devices. The telecom industry in India could slowly become an example of the service sector acting as a fillip to the growth of the manufacturing sector. A beginning towards this has been made. The formation of a Telecom Equipment Export Forum and the announcement of the Indian Semiconductor Policy 2007 are steps in this direction. Success crucially depends on the response of the private sector to these incentives. Given the importance that a regulatory agency can play in this crafting, no effort should be lost in strengthening the powers of the TRAI. The benefits to the Indian economy from having both a strong services and manufacturing segments in the telecom sector cannot be undermined. Narayana (2008) estimates the contribution of telecommunication (or telecom) services to aggregate economic growth in India. Estimated contribution is distinguished between public and private sectors to highlight the impact of telecom privatization on economic growth. Knowledge of policy determinants of demand of telecom services is shown to be essential to enhance growth contribution of telecom services. Using a recent sample survey data from Karnataka State in South India, price and income determinants of demand for telecom services are estimated by capacity of telephone exchanges. Estimation results offer evidence for significant negative own price elasticity and positive income elasticity of demand for telecom services.

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Sharma (2009) deals with the major challenges faced by Indias telecom equipment manufacturing sector, which lags behind telecom services. Only 35% of the total demand for telecom equipment in the country is met by domestic production. This is not favourable to long-term sustained growth of the telecom sector. The country is also far behind in R&D spending when compared to other leading countries. India needs to see an increase in R&D investment, industry-academia-government partnership, better quality doctoral education and incentives to entrepreneurs for start-ups in telecom equipment manufacturing. In 200607, 65% of the total consumption of equipment was met through imports. This trend has far-reaching implications for the economy and should not be allowed to continue for long. In a country like India which has a problem of massive unemployment, the manufacturing sector should be promoted to create more employment opportunities. Shah (February, 2009), has analysed Indian telecom industry and studied the sector keeping in mind three companies; namely Bharti, R.Comm and idea in the background of recent global meltdown. The study suggests that though there is no sign of slowdown in this sector, but surely a strong turmoil is going on in the industry. The study states that the sector is fairly immune from the current economic downturn & does provide a good defensive bet in medium term. With the help of newer technologies, wireless penetration is expected to increase in the near future, which is basically fuelling the growth of the sector. While the 3G / Broadband adoption would ensure long term growth momentum, the article has thoroughly investigated about the intense competitive scenario, pricing pressure, high capital intensity & substantial regulatory uncertainties currently faced by the industry. The article has also described the cause of being relatively safe of this industry. The causes described by Shah are increasing rural coverage, rising affordability, declining handset/subscription costs, substantially low tariffs & established brand/distribution. However, the study also cautions the telecom industry that a steeper economic slowdown could start impacting the subscriber usage patterns as well as operator capital investments & thereby could substantially restrict revenue growth rates going forward.

Consumer Behavior Concept

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Introduction
The study of consumers helps firms and organizations improve their marketing strategies by understanding issues such as how

The psychology of how consumers think, feel, reason, and select between different alternatives (e.g., brands, products); The psychology of how the consumer is influenced by his or her environment (e.g., culture, family, signs, media); The behavior of consumers while shopping or making other marketing decisions; Limitations in consumer knowledge or information processing abilities influence decisions and marketing outcome; How consumer motivation and decision strategies differ between products that differ in their level of importance or interest that they entail for the consumer; and How marketers can adapt and improve their marketing campaigns and marketing strategies to more effectively reach the consumer.

One "official" definition of consumer behavior is "The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society." Although it is not necessary to memorize this definition, it brings up some useful points:

Behavior occurs either for the individual, or in the context of a group (e.g., friends influence what kinds of clothes a person wears) or an organization (people on the job make decisions as to which products the firm should use). Consumer behavior involves the use and disposal of products as well as the study of how they are purchased. Product use is often of great interest to the marketer, because this may influence how a product is best positioned or how we can encourage increased consumption. Since many environmental problems result from product disposal (e.g., motor oil being sent into sewage systems to save the recycling fee, or garbage piling up at landfills) this is also an area of interest. Consumer behavior involves services and ideas as well as tangible products. The impact of consumer behavior on society is also of relevance. For example, aggressive marketing of high fat foods, or aggressive marketing of easy credit, may have serious repercussions for the national health and economy.

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There are four main applications of consumer behavior:

The most obvious is for marketing strategyi.e., for making better marketing campaigns. For example, by understanding that consumers are more receptive to food advertising when they are hungry, we learn to schedule snack advertisements late in the afternoon. By understanding that new products are usually initially adopted by a few consumers and only spread later, and then only gradually, to the rest of the population, we learn that (1) companies that introduce new products must be well financed so that they can stay afloat until their products become a commercial success and (2) it is important to please initial customers, since they will in turn influence many subsequent customers brand choices. A second application is public policy. In the 1980s, Accutane, a near miracle cure for acne, was introduced. Unfortunately, Accutane resulted in severe birth defects if taken by pregnant women. Although physicians were instructed to warn their female patients of this, a number still became pregnant while taking the drug. To get consumers attention, the Federal Drug Administration (FDA) took the step of requiring that very graphic pictures of deformed babies be shown on the medicine containers. Social marketing involves getting ideas across to consumers rather than selling something. Marty Fishbein, a marketing professor, went on sabbatical to work for the Centers for Disease Control trying to reduce the incidence of transmission of diseases through illegal drug use. The best solution, obviously, would be if we could get illegal drug users to stop. This, however, was deemed to be infeasible. It was also determined that the practice of sharing needles was too ingrained in the drug culture to be stopped. As a result, using knowledge of consumer attitudes, Dr. Fishbein created a campaign that encouraged the cleaning of needles in bleach before sharing them, a goal that was believed to be more realistic. As a final benefit, studying consumer behavior should make us better consumers. Common sense suggests, for example, that if you buy a 64 liquid ounce bottle of laundry detergent, you should pay less per ounce than if you bought two 32 ounce bottles. In practice, however, you often pay a size premium by buying the larger quantity. In other words, in this case, knowing this fact will sensitize you to the need to check the unit cost labels to determine if you are really getting a bargain.

There are several units in the market that can be analyzed. Our main thrust in this course is the consumer. However, we will also need to analyze our own firms strengths and weaknesses and those of competing firms. Suppose, for example, that we make a product aimed at older consumers, a growing segment. A competing firm that targets babies, a shrinking market, is likely to consider repositioning toward our market. To assess a

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competing firms potential threat, we need to examine its assets (e.g., technology, patents, market knowledge, awareness of its brands) against pressures it faces from the market. Finally, we need to assess conditions (the marketing environment). For example, although we may have developed a product that offers great appeal for consumers, a recession may cut demand dramatically.

Culture and Subculture

Culture is part of the external influences that impact the consumer. That is, culture represents influences that are imposed on the consumer by other individuals. The definition of culture offered in one textbook is That complex whole which includes knowledge, belief, art, morals, custom, and any other capabilities and habits acquired by man person as a member of society. From this definition, we make the following observations:

Culture, as a complex whole, is a system of interdependent components. Knowledge and beliefs are important parts. In the U.S., we know and believe that a person who is skilled and works hard will get ahead. In other countries, it may be believed that differences in outcome result more from luck. Chunking, the name for China in Chinese, literally means The Middle Kingdom. The belief among ancient Chinese that they were in the center of the universe greatly influenced their thinking. Other issues are relevant. Art, for example, may be reflected in the rather arbitrary practice of wearing ties in some countries and wearing turbans in others. Morality may be exhibited in the view in the United States that one should not be naked in public. In Japan, on the other hand, groups of men and women may take steam baths together without perceived as improper. On the other extreme, women in some Arab countries are not even allowed to reveal their faces. Notice, by the way, that what at least some countries view as moral may in fact be highly immoral by the standards of another country. For example, the law that once banned interracial marriages in South Africa was named the Immorality Act, even though in most civilized countries this law, and any degree of explicit racial prejudice, would itself be considered highly immoral.

Culture has several important characteristics: (1) Culture is comprehensive. This means that all parts must fit together in some logical fashion. For example, bowing and a strong desire to avoid the loss of face are unified in their manifestation of the importance of respect. (2) Culture is learned rather than being something we are born with. We will

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consider the mechanics of learning later in the course. (3) Culture is manifested within boundaries of acceptable behavior. For example, in American society, one cannot show up to class naked, but wearing anything from a suit and tie to shorts and a T-shirt would usually be acceptable. Failure to behave within the prescribed norms may lead to sanctions, ranging from being hauled off by the police for indecent exposure to being laughed at by others for wearing a suit at the beach. (4) Conscious awareness of cultural standards is limited. One American spy was intercepted by the Germans during World War II simply because of the way he held his knife and fork while eating. (5) Cultures fall somewhere on a continuum between static and dynamic depending on how quickly they accept change. For example, American culture has changed a great deal since the 1950s, while the culture of Saudi Arabia has changed much less.

Dealing with culture. Culture is a problematic issue for many marketers since it is inherently nebulous and often difficult to understand. One may violate the cultural norms of another country without being informed of this, and people from different cultures may feel uncomfortable in each others presence without knowing exactly why (for example, two speakers may unconsciously continue to attempt to adjust to reach an incompatible preferred interpersonal distance).

Warning about stereotyping. When observing a culture, one must be careful not to overgeneralize about traits that one sees. Research in social psychology has suggested a strong tendency for people to perceive an outgroup as more homogenous than an ingroup, even when they knew what members had been assigned to each group purely by chance. When there is often a grain of truth to some of the perceived differences, the temptation to over-generalize is often strong. Note that there are often significant individual differences within cultures.

Cultural lessons. We considered several cultural lessons in class; the important thing here is the big picture. For example, within the Muslim tradition, the dog is considered a dirty animal, so portraying it as mans best friend in an advertisement is counter-productive. Packaging, seen as a reflection of the quality of the real product, is considerably more important in Asia than in the U.S., where there is a tendency to focus on the contents which really count. Many cultures observe significantly greater levels of formality than that typical in the U.S., and Japanese negotiator tend to observe long silent pauses as a speakers point is considered. Cultural characteristics as a continuum. There is a tendency to stereotype cultures as being one way or another (e.g., individualistic rather than collectivistic). Note, however,

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countries fall on a continuum of cultural traits. Hofstedes research demonstrates a wide range between the most individualistic and collectivistic countries, for examplesome fall in the middle.

Hofstedes Dimensions. Gert Hofstede, a Dutch researcher, was able to interview a large number of IBM executives in various countries, and found that cultural differences tended to center around four key dimensions:

Individualism vs. collectivism: To what extent do people believe in individual responsibility and reward rather than having these measures aimed at the larger group? Contrary to the stereotype, Japan actually ranks in the middle of this dimension, while Indonesia and West Africa rank toward the collectivistic side. The U.S., Britain, and the Netherlands rate toward individualism. Power distance: To what extent is there a strong separation of individuals based on rank? Power distance tends to be particularly high in Arab countries and some Latin American ones, while it is more modest in Northern Europe and the U.S. Masculinity vs. femininity involves a somewhat more nebulous concept. Masculine values involve competition and conquering nature by means such as large construction projects, while feminine values involve harmony and environmental protection. Japan is one of the more masculine countries, while the Netherlands rank relatively low. The U.S. is close to the middle, slightly toward the masculine side. ( The fact that these values are thought of as masculine or feminine does not mean that they are consistently held by members of each respective genderthere are very large within-group differences. There is, however, often a large correlation of these cultural values with the status of women.) Uncertainty avoidance involves the extent to which a structured situation with clear rules is preferred to a more ambiguous one; in general, countries with lower uncertainty avoidance tend to be more tolerant of risk. Japan ranks very high. Few countries are very low in any absolute sense, but relatively speaking, Britain and Hong Kong are lower, and the U.S. is in the lower range of the distribution.

Although Hofstedes original work did not address this, a fifth dimension of long term vs. short term orientation has been proposed. In the U.S., managers like to see quick results, while Japanese managers are known for take a long term view, often accepting long periods before profitability is obtained. High vs. low context cultures: In some cultures, what you see is what you getthe speaker is expected to make his or her points clear and limit ambiguity. This is the case in the U.S.if you have something on your mind, you are expected to say it directly, subject to some reasonable standards of diplomacy. In Japan, in contrast, facial expressions and what is not said may be an important clue to understanding a speakers meaning. Thus, it may be very difficult for Japanese speakers to understand anothers written

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communication. The nature of languages may exacerbate this phenomenonwhile the German language is very precise, Chinese lacks many grammatical features, and the meaning of words may be somewhat less precise. English ranks somewhere in the middle of this continuum.

Ethnocentrism and the self-reference criterion. The self-reference criterion refers to the tendency of individuals, often unconsciously, to use the standards of ones own culture to evaluate others. For example, Americans may perceive more traditional societies to be backward and unmotivated because they fail to adopt new technologies or social customs, seeking instead to preserve traditional values. In the 1960s, a supposedly well read American psychology professor referred to Indias culture of sick because, despite severe food shortages, the Hindu religion did not allow the eating of cows. The psychologist expressed disgust that the cows were allowed to roam free in villages, although it turns out that they provided valuable functions by offering milk and fertilizing fields. Ethnocentrism is the tendency to view ones culture to be superior to others. The important thing here is to consider how these biases may come in the way in dealing with members of other cultures. It should be noted that there is a tendency of outsiders to a culture to overstate the similarity of members of that culture to each other. In the United States, we are well aware that there is a great deal of heterogeneity within our culture; however, we often underestimate the diversity within other cultures. For example, in Latin America, there are great differences between people who live in coastal and mountainous areas; there are also great differences between social classes.

Language issues. Language is an important element of culture. It should be realized that regional differences may be subtle. For example, one word may mean one thing in one Latin American country, but something off-color in another. It should also be kept in mind that much information is carried in non-verbal communication. In some cultures, we nod to signify yes and shake our heads to signify no; in other cultures, the practice is reversed. Within the context of language:

There are often large variations in regional dialects of a given language. The differences between U.S., Australian, and British English are actually modest compared to differences between dialects of Spanish and German. Idioms involve figures of speech that may not be used, literally translated, in other languages. For example, baseball is a predominantly North and South American sport, so the notion of in the ball park makes sense here, but the term does not carry the same meaning in cultures where the sport is less popular.

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Neologisms involve terms that have come into language relatively recently as technology or society involved. With the proliferation of computer technology, for example, the idea of an add-on became widely known. It may take longer for such terms to diffuse into other regions of the world. In parts of the World where English is heavily studied in schools, the emphasis is often on grammar and traditional language rather than on current terminology, so neologisms have a wide potential not to be understood. Slang exists within most languages. Again, regional variations are common and not all people in a region where slang is used will necessarily understand this. There are often significant generation gaps in the use of slang.

Writing patterns, or the socially accepted ways of writing, will differs significantly between cultures.

In English and Northern European languages, there is an emphasis on organization and conciseness. Here, a point is made by building up to it through background. An introduction will often foreshadow what is to be said. In Romance languages such as Spanish, French, and Portuguese, this style is often considered boring and inelegant. Detours are expected and are considered a sign of class, not of poor organization. In Asian languages, there is often a great deal of circularity. Because of concerns about potential loss of face, opinions may not be expressed directly. Instead, speakers may hint at ideas or indicate what others have said, waiting for feedback from the other speaker before committing to a point of view. Because of differences in values, assumptions, and language structure, it is not possible to meaningfully translate word-for-word from one language to another. A translator must keep unspoken understandings and assumptions in mind in translating. The intended meaning of a word may also differ from its literal translation. For example, the Japanese word hai is literally translated as yes. To Americans, that would imply Yes, I agree. To the Japanese speaker, however, the word may mean Yes, I hear what you are saying

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(without any agreement expressed) or even Yes, I hear you are saying something even though I am not sure exactly what you are saying. Differences in cultural values result in different preferred methods of speech. In American English, where the individual is assumed to be more in control of his or her destiny than is the case in many other cultures, there is a preference for the active tense (e.g., I wrote the marketing plan) as opposed to the passive (e.g., The marketing plan was written by me.) Because of the potential for misunderstandings in translations, it is dangerous to rely on a translation from one language to another made by one person. In the decentering method, multiple translators are used.

The text is first translated by one translatorsay, from German to Mandarin Chinese. A second translator, who does not know what the original German text said, will then translate back to German from Mandarin Chinese translation. The text is then compared. If the meaning is not similar, a third translator, keeping in mind this feedback, will then translate from German to Mandarin. The process is continued until the translated meaning appears to be satisfactory. Different perspectives exist in different cultures on several issues; e.g.:

Monochronic cultures tend to value precise scheduling and doing one thing at a time; in polychronic cultures, in contrast, promptness is valued less, and multiple tasks may be performed simultaneously. (See text for more detail). Space is perceived differently. Americans will feel crowded where people from more densely populated countries will be comfortable. Symbols differ in meaning. For example, while white symbols purity in the U.S., it is a symbol of death in China. Colors that are considered masculine and feminine also differ by culture. Americans have a lot of quite shallow friends toward whom little obligation is felt; people in European and some Asian cultures have fewer, but more significant friends. For example, one Ph.D. student from India, with limited income, felt obligated to try buy an airline ticket for a friend to go back to India when a relative had died.

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In the U.S. and much of Europe, agreements are typically rather precise and contractual in nature; in Asia, there is a greater tendency to settle issues as they come up. As a result, building a relationship of trust is more important in Asia, since you must be able to count on your partner being reasonable. In terms of etiquette, some cultures have more rigid procedures than others. In some countries, for example, there are explicit standards as to how a gift should be presented. In some cultures, gifts should be presented in private to avoid embarrassing the recipient; in others, the gift should be made publicly to ensure that no perception of secret bribery could be made.

Demographics

Demographics are clearly tied to subculture and segmentation. Here, however, we shift our focus from analyzing specific subcultures to trying to understand the implications for an entire population of its makeup. Several issues are useful in the structure of a population. For example, in some rapidly growing countries, a large percentage of the population is concentrated among younger generations. In countries such as Korea, China, and Taiwan, this has helped stimulate economic growth, while in certain poorer countries, it puts pressures on society to accommodate an increasing number of people on a fixed amount of land. Other countries such as Japan and Germany, in contrast, experience problems with a "graying" society, where fewer non-retired people are around to support an increasing number of aging seniors. Because Germany actually hovers around negative population growth, the German government has issued large financial incentives, in the forms of subsidies, for women who have children. In the United States, population growth occurs both through births and immigration. Since the number of births is not growing, problems occur for firms that are dependent on population growth (e.g., Gerber, a manufacturer of baby food). Social class is a somewhat nebulous subject that involves stratifying people into groups with various amounts of prestige, power, and privilege. In part because of the pioneering influence in American history, status differentiations here are quite vague. We cannot, for example, associate social class with income, because a traditionally low status job as a plumber may today come with as much income as a traditionally more prestigious job as a school teacher. In certain other cultures, however, stratification is more clear-cut. Although the caste system in India is now illegal, it still maintains a tremendous influence on that society. While some mobility exists today, social class awareness is also somewhat greater in Britain, where social status is in part reinforced by the class connotations of the accent with which one speaks.

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Textbooks speak of several indices that have been used to "compute" social class in the United States, weighing factors such as income, the nature of ones employment, and level of education. Taken too literally, these indices are not very meaningful; more broadly speaking, they illustrate the reality that social status is a complex variable that is determined, not always with consensus among observers, by several different variables.

Segmentation, Targeting, and Positioning

Segmentation, targeting, and positioning together comprise a three stage process. We first (1) determine which kinds of customers exist, then (2) select which ones we are best off trying to serve and, finally, (3) implement our segmentation by optimizing our products/services for that segment and communicating that we have made the choice to distinguish ourselves that way.

Segmentation involves finding out what kinds of consumers with different needs exist. In the auto market, for example, some consumers demand speed and performance, while others are much more concerned about roominess and safety. In general, it holds true that You cant be all things to all people, and experience has demonstrated that firms that specialize in meeting the needs of one group of consumers over another tend to be more profitable. Generically, there are three approaches to marketing. In the undifferentiated strategy, all consumers are treated as the same, with firms not making any specific efforts to satisfy particular groups. This may work when the product is a standard one where one competitor really cant offer much that another one cant. Usually, this is the case only for

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commodities. In the concentrated strategy, one firm chooses to focus on one of several segments that exist while leaving other segments to competitors. For example, Southwest Airlines focuses on price sensitive consumers who will forego meals and assigned seating for low prices. In contrast, most airlines follow the differentiated strategy: They offer high priced tickets to those who are inflexible in that they cannot tell in advance when they need to fly and find it impractical to stay over a Saturday. These travelersusually business travelerspay high fares but can only fill the planes up partially. The same airlines then sell some of the remaining seats to more price sensitive customers who can buy two weeks in advance and stay over. Note that segmentation calls for some tough choices. There may be a large number of variables that can be used to differentiate consumers of a given product category; yet, in practice, it becomes impossibly cumbersome to work with more than a few at a time. Thus, we need to determine which variables will be most useful in distinguishing different groups of consumers. We might thus decide, for example, that the variables that are most relevant in separating different kinds of soft drink consumers are (1) preference for taste vs. low calories, (2) preference for Cola vs. non-cola taste, (3) price sensitivitywillingness to pay for brand names; and (4) heavy vs. light consumers. We now put these variables together to arrive at various combinations. Several different kinds of variables can be used for segmentation.

Demographic variables essentially refer to personal statistics such as income, gender, education, location (rural vs. urban, East vs. West), ethnicity, and family size. Campbells soup, for instance, has found that Western U.S. consumers on the average prefer spicier soupsthus, you get a different product in the same cans at the East and West coasts. Facing flat sales of guns in the traditional male dominated market, a manufacturer came out with the Lady Remmington, a more compact, handier gun more attractive to women. Taking this a step farther, it is also possible to segment on lifestyle and values. Some consumers want to be seen as similar to others, while a different segment wants to stand apart from the crowd. Another basis for segmentation is behavior. Some consumers are brand loyal i.e., they tend to stick with their preferred brands even when a competing one is on sale. Some consumers are heavy users while others are light users. For example, research conducted by the wine industry shows that some 80% of the product is consumed by 20% of the consumerspresumably a rather intoxicated group. One can also segment on benefits sought, essentially bypassing demographic explanatory variables. Some consumers, for example, like scented soap (a segment likely to be attracted to brands such as Irish Spring), while others prefer the clean feeling of unscented soap (the Ivory segment). Some consumers use toothpaste primarily to promote oral health, while another segment is more interested in breath freshening.

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In the next step, we decide to target one or more segments. Our choice should generally depend on several factors. First, how well are existing segments served by other manufacturers? It will be more difficult to appeal to a segment that is already well served than to one whose needs are not currently being served well. Secondly, how large is the segment, and how can we expect it to grow? (Note that a downside to a large, rapidly growing segment is that it tends to attract competition). Thirdly, do we have strengths as a company that will help us appeal particularly to one group of consumers? Firms may already have an established reputation. While McDonalds has a great reputation for fast, consistent quality, family friendly food, it would be difficult to convince consumers that McDonalds now offers gourmet food. Thus, McDs would probably be better off targeting families in search of consistent quality food in nice, clean restaurants.

Positioning involves implementing our targeting. For example, Apple Computer has chosen to position itself as a maker of user-friendly computers. Thus, Apple has done a lot through its advertising to promote itself, through its unintimidating icons, as a computer for non-geeks. The Visual C software programming language, in contrast, is aimed a techies.

Michael Treacy and Fred Wiersema suggested in their 1993 book The Discipline of Market Leaders that most successful firms fall into one of three categories:

Operationally excellent firms, which maintain a strong competitive advantage by maintaining exceptional efficiency, thus enabling the firm to provide reliable service to the customer at a significantly lower cost than those of less well organized and well run competitors. The emphasis here is mostly on low cost, subject to reliable performance, and less value is put on customizing the offering

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for the specific customer. Wal-Mart is an example of this discipline. Elaborate logistical designs allow goods to be moved at the lowest cost, with extensive systems predicting when specific quantities of supplies will be needed. Customer intimate firms, which excel in serving the specific needs of the individual customer well. There is less emphasis on efficiency, which is sacrificed for providing more precisely what is wanted by the customer. Reliability is also stressed. Nordstroms and IBM are examples of this discipline. Technologically excellent firms, which produce the most advanced products currently available with the latest technology, constantly maintaining leadership in innovation. These firms, because they work with costly technology that need constant refinement, cannot be as efficient as the operationally excellent firms and often cannot adapt their products as well to the needs of the individual customer. Intel is an example of this discipline.

Treacy and Wiersema suggest that in addition to excelling on one of the three value dimensions, firms must meet acceptable levels on the other two. Wal-Mart, for example, does maintain some level of customer service. Nordstroms and Intel both must meet some standards of cost effectiveness. The emphasis, beyond meeting the minimum required level in the two other dimensions, is on the dimension of strength.Repositioning involves an attempt to change consumer perceptions of a brand, usually because the existing position that the brand holds has become less attractive. Sears, for example, attempted to reposition itself from a place that offered great sales but unattractive prices the rest of the time to a store that consistently offered everyday low prices. Repositioning in practice is very difficult to accomplish. A great deal of money is often needed for advertising and other promotional efforts, and in many cases, the repositioning fails.

To effectively attempt repositioning, it is important to understand how ones brand and those of competitors are perceived. One approach to identifying consumer product perceptions is multidimensional scaling. Here, we identify how products are perceived on two or more dimensions, allowing us to plot brands against each other. It may then be possible to attempt to move ones brand in a more desirable direction by selectively promoting certain points. There are two main approaches to multi-dimensional scaling. In the a priori approach, market researchers identify dimensions of interest and then ask consumers about their perceptions on each dimension for each brand. This is useful when (1) the market researcher knows which dimensions are of interest and (2) the customers perception on each dimension is relatively clear (as opposed to being made up on the spot to be able to give the researcher a desired answer). In the similarity rating approach, respondents are not asked about their perceptions of brands on any specific dimensions. Instead, subjects are asked to rate the extent of similarity of different pairs of products (e.g., How similar, on a scale of 1-7, is Snickers to Kitkat, and how similar is Toblerone to

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Three Musketeers?) Using a computer algorithms, the computer then identifies positions of each brand on a map of a given number of dimensions. The computer does not reveal what each dimension meansthat must be left to human interpretation based on what the variations in each dimension appears to reveal. This second method is more useful when no specific product dimensions have been identified as being of particular interest or when it is not clear what the variables of difference are for the product category.

Information Search and Decision Making

Problem Recognition. One model of consumer decision making involves several steps. The first one is problem recognitionyou realize that something is not as it should be. Perhaps, for example, your car is getting more difficult to start and is not accelerating well. The second step is information searchwhat are some alternative ways of solving the problem? You might buy a new car, buy a used car, take your car in for repair, ride the bus, ride a taxi, or ride a skateboard to work. The third step involves evaluation of alternatives. A skateboard is inexpensive, but may be ill-suited for long distances and for rainy days. Finally, we have the purchase stage, and sometimes a post-purchase stage (e.g., you return a product to the store because you did not find it satisfactory). In reality, people may go back and forth between the stages. For example, a person may resume alternative identification during while evaluating already known alternatives.

Consumer involvement will tend to vary dramatically depending on the type of product. In general, consumer involvement will be higher for products that are very expensive (e.g., a home, a car) or are highly significant in the consumers life in some other way (e.g., a word processing program or acne medication).

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It is important to consider the consumers motivation for buying products. To achieve this goal, we can use the Means-End chain, wherein we consider a logical progression of consequences of product use that eventually lead to desired end benefit. Thus, for example, a consumer may see that a car has a large engine, leading to fast acceleration, leading to a feeling of performance, leading to a feeling of power, which ultimately improves the consumers self-esteem. A handgun may aim bullets with precision, which enables the user to kill an intruder, which means that the intruder will not be able to harm the consumers family, which achieves the desired end-state of security. In advertising, it is important to portray the desired end-states. Focusing on the large motor will do less good than portraying a successful person driving the car.

Information search and decision making. Consumers engage in both internal and external information search.

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Internal search involves the consumer identifying alternatives from his or her memory. For certain low involvement products, it is very important that marketing programs achieve top of mind awareness. For example, few people will search the Yellow Pages for fast food restaurants; thus, the consumer must be able to retrieve ones restaurant from memory before it will be considered. For high involvement products, consumers are more likely to use an external search. Before buying a car, for example, the consumer may ask friends opinions, read reviews in Consumer Reports, consult several web sites, and visit several dealerships. Thus, firms that make products that are selected predominantly through external search must invest in having information available to the consumer in neede.g., through brochures, web sites, or news coverage. A compensatory decision involves the consumer trading off good and bad attributes of a product. For example, a car may have a low price and good gas mileage but slow acceleration. If the price is sufficiently inexpensive and gas efficient, the consumer may then select it over a car with better acceleration that costs more and uses more gas. Occasionally, a decision will involve a non-compensatory strategy. For example, a parent may reject all soft drinks that contain artificial sweeteners. Here, other good features such as taste and low calories cannot overcome this one non-negotiable attribute. The amount of effort a consumer puts into searching depends on a number of factors such as the market (how many competitors are there, and how great are differences between brands expected to be?), product characteristics (how important is this product? How complex is the product? How obvious are indications of quality?), consumer characteristics (how interested is a consumer, generally, in analyzing product characteristics and making the best possible deal?), and situational characteristics (as previously discussed). Two interesting issues in decisions are:

Variety seeking (where consumers seek to try new brands not because these brands are expected to be better in any way, but rather because the consumer wants a change of pace, and Impulse purchasesunplanned buys. This represents a somewhat fuzzy group. For example, a shopper may plan to buy vegetables but only decide in the store to actually buy broccoli and corn. Alternatively, a person may buy an item which is currently on sale, or one that he or she remembers that is needed only once inside the store.

A number of factors involve consumer choices. In some cases, consumers will be more motivated. For example, one may be more careful choosing a gift for an in-law than when buying the same thing for one self. Some consumers are also more motivated to comparison shop for the best prices, while others are more convenience oriented. Personality impacts decisions. Some like variety more than others, and some are more receptive to stimulation and excitement in trying new stores. Perception influences

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decisions. Some people, for example, can taste the difference between generic and name brand foods while many cannot. Selective perception occurs when a person is paying attention only to information of interest. For example, when looking for a new car, the consumer may pay more attention to car ads than when this is not in the horizon. Some consumers are put off by perceived risk. Thus, many marketers offer a money back guarantee. Consumers will tend to change their behavior through learninge.g., they will avoid restaurants they have found to be crowded and will settle on brands that best meet their tastes. Consumers differ in the values they hold (e.g., some people are more committed to recycling than others who will not want to go through the hassle). We will consider the issue of lifestyle under segmentation.

Families and Family Decision Making

The Family Life Cycle. Individuals and families tend to go through a "life cycle:" The simple life cycle goes from

For purposes of this discussion, a "couple" may either be married or merely involve living together. The breakup of a non-marital relationship involving cohabitation is similarly considered equivalent to a divorce.

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In real life, this situation is, of course, a bit more complicated. For example, many couples undergo divorce. Then we have one of the scenarios:

Single parenthood can result either from divorce or from the death of one parent. Divorce usually entails a significant change in the relative wealth of spouses. In some cases, the non-custodial parent (usually the father) will not pay the required child support, and even if he or she does, that still may not leave the custodial parent and children as well off as they were during the marriage. On the other hand, in some cases, some non-custodial parents will be called on to pay a large part of their income in child support. This is particularly a problem when the non-custodial parent remarries and has additional children in the second (or subsequent marriages). In any event, divorce often results in a large demand for:

Low cost furniture and household items Time-saving goods and services

Divorced parents frequently remarry, or become involved in other non-marital relationships; thus, we may see

Another variation involves

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Here, the single parent who assumes responsibility for one or more children may not form a relationship with the other parent of the child. Integrating all the possibilities discussed, we get the following depiction of the Family Life Cycle:

Generally, there are two main themes in the Family Life Cycle, subject to significant exceptions:

As a person gets older, he or she tends to advance in his or her career and tends to get greater income (exceptions: maternity leave, divorce, retirement). Unfortunately, obligations also tend to increase with time (at least until ones mortgage has been paid off). Children and paying for ones house are two of the greatest expenses.

Note that although a single person may have a lower income than a married couple, the single may be able to buy more discretionary items. Family Decision Making. Individual members of families often serve different roles in decisions that ultimately draw on shared family resources. Some individuals are information gatherers/holders, who seek out information about products of relevance. These individuals often have a great deal of power because they may selectively pass on information that favors their chosen alternatives. Influencers do not ultimately have the power decide between alternatives, but they may make their wishes known by asking for specific products or causing embarrassing situations if their demands are not met. The decision maker(s) have the power to determine issues such as:

Whether to buy; Which product to buy (pick-up or passenger car?); Which brand to buy; Where to buy it; and When to buy.

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Note, however, that the role of the decision maker is separate from that of the purchaser. From the point of view of the marketer, this introduces some problems since the purchaser can be targeted by point-of-purchase (POP) marketing efforts that cannot be aimed at the decision maker. Also note that the distinction between the purchaser and decision maker may be somewhat blurred:

The decision maker may specify what kind of product to buy, but not which brand; The purchaser may have to make a substitution if the desired brand is not in stock; The purchaser may disregard instructions (by error or deliberately).

It should be noted that family decisions are often subject to a great deal of conflict. The reality is that few families are wealthy enough to avoid a strong tension between demands on the familys resources. Conflicting pressures are especially likely in families with children and/or when only one spouse works outside the home. Note that many decisions inherently come down to values, and that there is frequently no "objective" way to arbitrate differences. One spouse may believe that it is important to save for the childrens future; the other may value spending now (on private schools and computer equipment) to help prepare the children for the future. Who is right? There is no clear answer here. The situation becomes even more complex when more partiessuch as children or other relativesare involved. Some family members may resort to various strategies to get their way. One is bargaining one member will give up something in return for someone else. For example, the wife says that her husband can take an expensive course in gourmet cooking if she can buy a new pickup truck. Alternatively, a child may promise to walk it every day if he or she can have a hippopotamus. Another strategy is reasoningtrying to get the other person(s) to accept ones view through logical argumentation. Note that even when this is done with a sincere intent, its potential is limited by legitimate differences in values illustrated above. Also note that individuals may simply try to "wear down" the other party by endless talking in the guise of reasoning (this is a case of negative reinforcement as we will see subsequently). Various manipulative strategies may also be used. One is impression management, where one tries to make ones side look good (e.g., argue that a new TV will help the children see educational TV when it is really mostly wanted to see sports programming, or argue that all "decent families make a contribution to the church"). Authority involves asserting ones "right" to make a decision (as the "man of the house," the mother of the children, or the one who makes the most money). Emotion involves making an emotional display to get ones way (e.g., a man cries if his wife will not let him buy a new rap album).

Group Influences
Humans are inherently social animals, and individuals greatly influence each other.

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A useful framework of analysis of group influence on the individual is the so called reference groupthe term comes about because an individual uses a relevant group as a standard of reference against which oneself is compared. Reference groups come in several different forms.

The aspirational reference group refers to those others against whom one would like to compare oneself. For example, many firms use athletes as spokespeople, and these represent what many people would ideally like to be. Associative reference groups include people who more realistically represent the individuals current equals or near-equalse.g., coworkers, neighbors, or members of churches, clubs, and organizations. Paco Underhill, a former anthropologist turned retail consultant and author of the book Why We Buy has performed research suggesting that among many teenagers, the process of clothes buying is a two stage process. In the first stage, the teenagers go on a "reconnaissance" mission with their friends to find out what is available and what is "cool." This is often a lengthy process. In the later phase, parentswho will need to pay for the purchasesare brought. This stage is typically much briefer. Finally, the dissociative reference group includes people that the individual would not like to be like. For example, the store literally named The Gap came about because many younger people wanted to actively dissociate from parents and other older and "uncool" people. The Quality Paperback Book Club specifically suggests in its advertising that its members are "a breed apart" from conventional readers of popular books.

Reference groups come with various degrees of influence. Primary reference groups come with a great deal of influencee.g., members of a fraternity/sorority. Secondary reference groups tend to have somewhat less influencee.g., members of a boating club that one encounters only during week-ends are likely to have their influence limited to consumption during that time period. Another typology divides reference groups into the informational kind (influence is based almost entirely on members knowledge), normative (members influence what is perceived to be "right," "proper," "responsible," or "cool"), or identification. The difference between the latter two categories involves the individuals motivation for compliance. In case of the normative reference group, the individual tends to comply largely for utilitarian reasons dressing according to company standards is likely to help your career, but there is no real motivation to dress that way outside the job. In contrast, people comply with identification groups standards for the sake of belongingfor example, a member of a religious group may wear a symbol even outside the house of worship because the religion is a part of the persons identity.

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Perception
Background. Our perception is an approximation of reality. Our brain attempts to make sense out of the stimuli to which we are exposed. This works well, for example, when we see a friend three hundred feet away at his or her correct height; however, our perception is sometimes offfor example, certain shapes of ice cream containers look like they contain more than rectangular ones with the same volume. Factors in percpetion. Several sequential factors influence our perception. Exposure involves the extent to which we encounter a stimulus. For example, we are exposed to numerous commercial messages while driving on the freeway: bill boards, radio advertisements, bumper-stickers on cars, and signs and banners placed at shopping malls that we pass. Most of this exposure is randomwe dont plan to seek it out. However, if we are shopping for a car, we may deliberately seek out advertisements and tune in when dealer advertisements come on the radio. Exposure is not enough to significantly impact the individualat least not based on a single trial (certain advertisements, or commercial exposures such as the Swoosh logo, are based on extensive repetition rather than much conscious attention). In order for stimuli to be consciously processed, attention is needed. Attention is actually a matter of degreeour attention may be quite high when we read directions for getting an income tax refund, but low when commercials come on during a television program. Note, however, that even when attention is low, it may be instantly escalatedfor example, if an advertisement for a product in which we are interested comes on. Interpretation involves making sense out of the stimulus. For example, when we see a red can, we may categorize it as a Coke. Webers Law suggests that consumers ability to detect changes in stimulus intensity appear to be strongly related to the intensity of that stimulus to begin with. That is, if you hold an object weighing one pound in your hand, you are likely to notice it when that weight is doubled to two pounds. However, if you are holding twenty pounds, you are unlikely to detect the addition of one pounda change that you easily detected when the initial weight was one pound. You may be able to eliminate one ounce from a ten ounce container, but you cannot as easily get away with reducing a three ounce container to two (instead, you must accomplish that graduallye.g., 3.0 --> 2.7 --> 2.5 --> 2.3 --> 2.15 > 2.00). Several factors influence the extent to which stimuli will be noticed. One obvious issue is relevance. Consumers, when they have a choice, are also more likely to attend to pleasant stimuli (but when the consumer cant escape, very unpleasant stimuli are also likely to get attentionthus, many very irritating advertisements are remarkably effective). One of the most important factors, however, is repetition. Consumers often do not give much

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attention to a stimuliparticularly a low priority one such as an advertisementat any one time, but if it is seen over and over again, the cumulative impact will be greater. Surprising stimuli are likely to get more attentionsurvival instinct requires us to give more attention to something unknown that may require action. A greater contrast (difference between the stimulus and its surroundings) as well as greater prominence (e.g., greater size, center placement) also tend to increase likelihood of processing. Subliminal stimuli. Back in the 1960s, it was reported that on selected evenings, movie goers in a theater had been exposed to isolated frames with the words Drink Coca Cola and Eat Popcorn imbedded into the movie. These frames went by so fast that people did not consciously notice them, but it was reported that on nights with frames present, Coke and popcorn sales were significantly higher than on days they were left off. This led Congress to ban the use of subliminal advertising. First of all, there is a question as to whether this experiment ever took place or whether this information was simply made up. Secondly, no one has been able to replicate these findings. There is research to show that people will start to giggle with embarrassment when they are briefly exposed to dirty words in an experimental machine. Here, again, the exposure is so brief that the subjects are not aware of the actual words they saw, but it is evident that something has been recognized by the embarrassment displayed.

Learning and Memory

Background. Learning involves "a change in the content or organization of long term memory and/or behavior." The first part of the definition focuses on what we know (and can thus put to use) while the second focuses on concrete behavior. For example, many people will avoid foods that they consumed shortly before becoming ill. Learning is not all knowledge based. For example, we may experience the sales people in one store being nicer to us than those in the other. We thus may develop a preference for the one store over the other; however, if pressed, we may not be able to give a conscious explanation as to the reason for our preference. Much early work on learning was actually done on rats and other animals (and much of this research was unjustifiably cruel, but that is another matter). Classical conditioning. Pavlovs early work on dogs was known as classical conditioning. Pavlov discovered that when dogs were fed meat powder they salivated. Pavlov then discovered that if a bell were rung before the dogs were fed, the dogs would begin salivating in anticipation of being fed (this was efficient, since they could then begin digesting the meat powder immediately). Pavlov then found that after the meat had been

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"paired" with the meat powder enough times, Pavlov could ring the bell without feeding the dogs and they would still salivate. Operant conditioning. Instrumental, or operant, conditioning, involves a different series of events, and this what we usually think of as learning. The general pattern is:

There are three major forms of operant learning. In positive reinforcement, an individual does something and is rewarded. He or she is then more likely to repeat the behavior. For example, you eat a candy bar (behavior), it tastes good (consequence), and you are thus more likely to eat a similar candy bar in the future (behavioral change).

Punishment is the opposite. You eat what looks like a piece of candy (behavior), only to discover that it is a piece of soap with a foul taste (consequences), and subsequently you are less likely to eat anything that looks remotely like that thing ever again (changed behavior). It should be noted that negative reinforcement is very different from punishment. An example of negative reinforcement is an obnoxious sales person who calls you up on the phone, pressuring you into buying something you dont want to do (aversive stimulus). You eventually agree to buy it (changed behavior), and the sales person leaves you alone (the aversive stimulus is terminated as a result of consequences of your behavior).

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In general, marketers usually have relatively little power to use punishment or negative reinforcement. However, parking meters are often used to discourage consumers from taking up valuable parking space, and manufacturers may void warranties if the consumers take their product to non-authorized repair facilities. Several factors influence the effectiveness of operant learning. In general, the closer in time the consequences are to the behavior, the more effective the learning. That is, electric utilities would be more likely to influence consumers to use less electricity at peak hours if the consumers actually had to pay when they used electricity (e.g., through a coin-slot) rather than at the end of the month. Learning is also more likely to occur when the individual can understand a relationship between behavior and consequences (but learning may occur even if this relationship is not understood consciously). Another issue is schedules of reinforcement and extinction. Extinction occurs when behavior stops having consequences and the behavior then eventually stops occurring. For example, if a passenger learns that yelling at check-in personnel no longer gets her upgraded to first class, she will probably stop that behavior. Sometimes, an individual is rewarded every time a behavior is performed (e.g., a consumer gets a soft drink every time coins are put into a vending machine). However, it is not necessary to reward a behavior every time for learning to occur. Even if a behavior is only rewarded some of the time, the behavior may be learned. Several different schedules of reinforcement are possible:

Fixed interval: The consumer is given a free dessert on every Tuesday when he or she eats in a particular restaurant. Fixed ratio: Behavior is rewarded (or punished) on every nth occasion that it is performed. (E.g., every tenth time a frequent shopper card is presented, a free product is provided). Variable ratio: Every time an action is performed, there is a certain percentage chance that a reward will be given. For example, every time the consumer enters the store, he or she is given a lottery ticket. With each ticket, there is a 20% chance of getting a free hamburger. The consumer may get a free hamburger twice in a row, or he or she may go ten times without getting a hamburger even once.

Variable ratio reinforcement is least vulnerable to extinction. Sometimes, shaping may be necessary to teach the consumer the desired behavior. That is, it may be impossible to teach the consumer to directly perform the desired behavior. For example, a consumer may first get a good product for free (the product itself, if good, is a reward), then buy it with a large cents off coupon, and finally buy it at full price. Thus, we reinforce approximations of the desired behavior. Rather than introducing Coca Cola directly in Indonesia, fruit flavored soft drinks were first introduced, since these were more similar to beverages already consumed.

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Vicarious learning. The consumer does not always need to go through the learning process himself or herselfsometimes it is possible to learn from observing the consequences of others. For example, stores may make a big deal out of prosecuting shop lifters not so much because they want to stop that behavior in the those caught, but rather to deter the behavior in others. Similarly, viewers may empathize with characters in advertisements who experience (usually positive) results from using a product. The Head n Shoulders advertisement, where a poor man is rejected by women until he treats his dandruff with an effective cure, is a good example of vicarious learning. Memory ranges in duration on a continuum from extremely short to very long term. Sensory memory includes storage of stimuli that one might not actually notice (e.g., the color of an advertisement some distance away). For slightly longer duration, when you see an ad on TV for a mail order product you might like to buy, you only keep the phone number in memory until you have dialed it. This is known as short term memory. In order for something to enter into long term memory, which is more permanent, you must usually rehearse it several times. For example, when you move and get a new phone number, you will probably repeat it to yourself many times. Alternatively, you get to learn your drivers license or social security numbers with time, not because you deliberately memorize them, but instead because you encounter them numerous times as you look them up. Several techniques can be used to enhance the memorability of information. Chunking involves rearranging information so that fewer parts need to be remembered. For example, consider the phone number (800) 444-1000. The eight digits can be more economically remembered as an 800 number (1 piece), four repeated 3 times (2 pieces), and 1000 (1-2 pieces). Rehearsal involves the consumer repeating the information over and over so that it can be remembered; this is often done so that a phone number can be remembered while the memoree moves to the phone to dial it. Recirculation involves repeated exposure to the same information; the information is not learned deliberately, but is gradually absorbed through repetition. Thus, it is to the advantage to a marketer to have an advertisement repeated extensivelyespecially the brand name. Elaboration involves the consumer thinking about the objecte.g., the product in an advertisementand thinking about as many related issues as possible. For example, when seeing an ad for Dole bananas, the person may think of the color yellow, going to the zoo seeing a monkey eating a banana, and her grandmothers banana-but bread. The Dole brand name may then be activated when any of those stimuli are encountered. Memories are not always easily retrievable. This could be because the information was given lower priority than something elsee.g., we have done a lot of things since last buying a replacement furnace filter and cannot remember where this was bought last. Other times, the information can be retrieved but is not readily availablee.g., we will be able to remember the location of a restaurant we tried last time we were in Paris, but it may take some thinking before the information emerges.

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Spreading activation involves the idea of one memory triggering another one. For example, one might think of Coke every time one remembers a favorite (and very wise) professor who frequently brought one to class. Coke might also be tied a particular supermarket that always stacked a lot of these beverages by the entrance, and to baseball where this beverage was consumed after the game. It is useful for firms to have their product be activated by as many other stimuli as possible. There are numerous reasons why retrieval can fail or, in less fancy terms, how we come to forget. One is decay. Here, information that is not accessed frequently essentially rusts away. For example, we may not remember the phone number of a friend to whom we have not spoken for several months and may forget what brand of bullets an aunt prefers if we have not gone ammunition shopping with her lately. Other times, the problem may rest in interference. Proactive interference involves something we have learned interfering with what we will late later. Thus, if we remember that everyone in our family always used Tide, we may have more difficulty later remembering what other brands are available. You may be unable to remember what a new, and less important, friends last name is if that person shares a first name with an old friend. For example, if your best friend for many years has been Jennifer Smith, you may have difficulty remembering that your new friend Jennifers last name is Silverman. In retroactive interference, the problem is the reverse learning something new blocks out something old. For example, if you once used WordPerfect than then switched to Microsoft Word, you may have trouble remembering how to use WordPerfect at a friends housemore so than if you had merely not used any word processing program for some time. Memorability can be enhanced under certain conditions. One is more likely to remember favorableor likable stimuli (all other things being equal). Salienceor the extent to which something is highly emphasized or very clearly evidentfacilitates memory. Thus, a product which is very visible in an ad, and handled and given attention by the actors, will more likely be remembered. Prototypicality involves the extent to which a stimulus is a perfect example of a category. Therefore, people will more likely remember Coke or Kleenex than competing brands. Congruence involves the fit with a situation. Since memory is often reconstructed based on what seems plausible, something featured in an appropriate settinge.g., charcoal on a porch next to a grill rather than in a garage or kitchenis more likely to be remembered (unless the incongruence triggers an elaboration life is complicated!) Redundancies involve showing the stimulus several times. Thus, if a given product is shown several places in a houseand if the brand name is repeatedit is more likely to be remembered. Priming involves tying a stimulus with something so that if that something is encountered, the stimulus is more likely to be retrieved. Thus, for example, when one thinks of anniversaries, the Hallmark brand name is more likely to be activated. (This is a special case of spreading activation discussed earlier).

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A special issue in memory are so called scripts, or procedures we remember for doing things. Scripts involve a series of steps for doing various things (e.g., how to send a package). In general, it is useful for firms to have their brand names incorporated into scripts (e.g., to have the consumer reflexively ask the pharmacist for Bayer rather than an unspecified brand of aspirin). Positioning involves implementing our targeting. For example, Apple Computer has chosen to position itself as a maker of user-friendly computers. Thus, Apple has done a lot through its advertising to promote itself, through its unintimidating icons, as a computer for non-geeks. The Visual C software programming language, in contrast, is aimed a techies. Repositioning involves an attempt to change consumer perceptions of a brand, usually because the existing position that the brand holds has become less attractive. Sears, for example, attempted to reposition itself from a place that offered great sales but unattractive prices the rest of the time to a store that consistently offered everyday low prices. Repositioning in practice is very difficult to accomplish. A great deal of money is often needed for advertising and other promotional efforts, and in many cases, the repositioning fails.

PROBLEM IDENTIFICATION

ON THE PART OF THE USERS

Low ChargesThe prime demand of users, in this belt is that the existing Telecom companies should less in comparison to the charges charge the charges per call of Airtel. Low Rental Better Connectivity Better Coverage Billing Problem

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Elimination of Black Marketing Black Marketers hold back a few SIM cards, which are sold at higher price degrading companys image.

Good Quality Handset.

ON THE PART OF RETAILLERS:

Timely Commission Fair Commission Monopolistic Tendency Every Tom Dick & Harry shouldnt be made a retailer. Up to date information about scheme. Agents should keep in touch with them. Proper glow sign.

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Airtel To Other Mobile Operators

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CALL ROUTING : Airtel to P S T N

Research Methodology

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Achieving accuracy in any research requires in depth study regarding the subject. As the prime objective of the project is to compare Airtel with the existing competitors in the market and the research methodology adopted is basically based on secondary data via which the most recent and accurate piece of first hand information could research report based on descriptive research. Secondary data was collected using the following techniques Magazines Internet Books be collected. Secondary data has been used to support primary data wherever needed.the

Descriptive Research- A descriptive study may be simple or complex .it determines who,
that, when, where and of topic. It is concerned with describing the characteristics (e.g., the extent to which libraries are used) estimating the proportion of the people in a specified population who hold certain views or attitudes (e.g. how many favor the abolition of capital punishment ) predicating specifically (e.g. how many will cash their government bonds during a given period ? ) and discovering or testing whether certain variables are associated (e.g. people who spend a good deal of time for reading go to movies often with each other). Descriptive study may employ any of or all the methods of data collection such as interview questionnaire, observation tests and cumulative record cards. In the descriptive study the researcher must be careful to make a note of the bias and extravagance that may creep in at every stage of the study- formulating the objectives of the study, designing the methods of data collection, selecting the sample collecting, processing and analyzing the data, and reporting the findings. Despite the emphasis on description, it should not be concluded that such studies should be simply fact-gathering expeditions. Unfortunately, it is relatively easy to start a descriptive study with the vague thought that the data collected will be interesting. As a result, many descriptive studies are made with only hazy objectives and with inadequate planning. Much of the data collected in such studies turns out to be useless.

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Procedure of research methodology

# To conduct this research the target population was the mobile users, who are using GSM and CDMA technology. # Target geographic area was Lucknow. # Some dealers were interviewed to know their prospective. . # Finally the collected data and information was analyzed and compiled to arrive at the conclusion and recommendations given.

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SWOT ANALYSIS

AIRTEL SWOT ANALYSIS

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STRENGTHS
SIX-SIGMA AWARD AT CII NATIONAL WORLDS FIRST AUDITION ON CELL-PHONE- INDIAN IDOL MIS ASIA IT EXCELLENCEAWARD2005 K.B.C

WEAKNESS
MORE POPULAR IN METEROS ARRIVE LATELY IN U.P. (EAST) STILL TO COVER RURAL ,INTERIOR REGION OF U.P.(EAST) MARKET OF POST-PAID IS COMPARITEVELY WEAK THAN PREPAID

OPPURTUNITY
EXPAND NETWORK IN RURAL REGION LOW RENTAL NEW TARRIF PLANS

THREAT
INCREASING NO. OF COMPETITOR CUSTOMER CHURN MERGER OF BSNBL AND MTNL

BSNL SWOT ANALYSIS

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STRENGTHS
. TOTAL COVERAGE IN U.P CUSTOMER FAITH CHEAPER CALL RATES MORE TALK TIME IN LESS TIME

WEAKNESS
DISTRIBUTION OF PREPAID SIM LESS MARKETING INITIATIVE POOR CUSTOMER SERVICE

STRENGTHS
LARGE CUSTOMER SEGMENT LARGE RETAIL REACH

WEAKNESS
RESTRICTED REACH OF NETWORK DISSATISFIED CUSTOMER BASE INCREASED NUMBER OF LACK OF CUSTOMER CARE CENTRE COMPETITOR UNABLE TO PROVIDE SIM IN MARKET WITH IN TIME CUSTOMER CHURN

OPPURTINITY

THREAT

INCREASING COVERAGE AT WIDE DIFFERENTIAL TARIFFS NETWORK CUSTOMIZED CHANNEL DITRIBUTION PACKAGE MAINTAINED AT ALL LEVEL LOOKING AT VALUE ADDED OPPURTUNITY SERVICE SUCH AS GPRS, SING TONE. PRICING FREEDOM TO MERGE WITH MTNL TECHNOLOGICAL ADVANCEMENT INCREASING COVERAGE

THREAT

BRAND AIRTEL, IDEA. LESS OPERATING MARGINS FOR EXISTENCE CUSTOMER CHURN

VODAFONE SWOT ANALYSIS

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RELIANCE SWOT ANALYSIS

STRENGTHS
CUSTOMER FOCUS BUDGETRY PLANS LARGE NETWORK TRANSMISSION WITH OWN CHANNELS COST ADVANTAGEOUS

WEAKNESS
LESS TECHNICAL CAPABILITY BILLING PROBLEM POOR CUSTOMER SERVICE POL/RF CONGESTION

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OPPURTUNITY
DVELOPING NEW SECTOR INCREASING COVERAGE NEW TARRIF PLANS

THREAT
INCREASING NO. OF COMPETITOR LOOSING CUSTOMER FAITH CUSTOMER CHURN BRAND IDEA, TATA INDICOM

SUGGESTIONS
Airtel should provide Accessories along with handset. Home Delivery of bill. Free Hotline with police, Fire, Ambulance, Hospital & Monitoring Station. Airtel should provide the service of reservation through mobile. Airtel should emphasis to improve the service in the rural areas. Company should do feasible research programme to access new market. Company should environment. Company should recruit more sales field officer to provide timely services. Daily monitor the work of sales field officers to reduce expenses. improve infrastructure facilities to reduce conflicting

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 Their should free flow of communication regarding the organization policy, services, plan, features, charges and offers. Management should increase the morale of field office to achieve their target by offering They should improve their promotional activity. They should conduct training programme to inhance the knowledge of service provider for the satisfy their customer. They should have a fair grievance handling procedure to handle the complain of customer and employees.

SCOPE OF THE PROJECT

The project work is mainly concerned with the usage of Cellular Phone. There are approx. 256 retailers throughout the city who are actively dealing in SIM card recharge coupons. About 40% of population in the city use Cellular Phone out of which 80% is for common usage & 20% is for personal usage. All the value added services are offered free. These cover a regular voice-mail services, call waiting call hold, call divert, call conferencing, caller identification caller line identification restriction, dynamic STD/ISD locking and text messaging. Time-to-Time AIRTEL is invention a new system methodology to overcome

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the competitive market in comparison to other telecom services. Continuously AIRTEL challenging attitude, Discovering the Known & unknown system in vogue in foreign country not common in India thus the features of AIRTELIndia Mobile is very glorious and prospective in India in comparison of other.In my opinion AIRTEL will surpass all system in future also a day will come when these facilities will be available in hands of every citizen of India.

LIMITATIONS OF THE PROJECT

1The project work was limited only up to urban area and the

rural users were partially excluded. 2During survey only those people were taken into consideration

that is presently having cell phone. The past users were not taken into consideration. 3users. 4During survey we could call only a specified number of users The project work mainly emphasized on post paid cell phone

and rest were excluded.

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CONCLUSION
1. Consumer inclination towards BSNL. 2. Call Rate play an important role in choosing tele-service. 3. Quality of service rendered occupy momentous place in consumers choice for tele-service. 4. Mostly student (School & College going student) prefer the prepaid connection & Business group prefer the 88postpaid. 5. Most of Mobile users are interested to go for the services to be rendered by Airtel. 6. Majority of the customer is not satisfied with the services rendered presently.

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BIBLIOGRAPHY
Books:
Employees Handbook of Bharti Airtel Services Limited Participants Workbook Aagaman Kotler philips, marketing management, published by prentice hall of india pvt.ltd. Aaker kumar day, marketing research

MAGAZINES
Business India Business World India Today Outlook Time Telecome Takeover

WEBSITES:
HTTP:// WWW.COAI.COM

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 HTTP://WWW.TRAI.COM HTTP://ECONOMICSTIME.COM HTTP://KHOJ.COM HTTP://AIRTELWORLD.COM

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