Acknowledgement
Bissmillahirrahmanirrahim
Alhamdulillah. Thanks to Allah SWT, who with His willing have given us the opportunity to complete this Group Project. Our group had decided to choose P1 WiMAX as our research industry. This group project report was prepared for course MGT 300 Information Technology in Management, Universiti Teknologi Mara (UiTM).
Firstly, we would like to express our deepest thanks to, Tuan Syed Mazlan b Syed Mat Dom, a lecturer at UiTM and also assign, as my supervisor who had guided be a lot of task during this assignment. We also want to thanks the lecturers and staffs of UiTM for their cooperation during us complete the project that had given valuable information, suggestions and guidance in the compilation and preparation this group project report.
Deepest thanks and appreciation to our friends for their cooperation, encouragement, constructive suggestion and full of support for the report completion, from the beginning till the end. Last but not least, our thanks to UiTM and our lecturer, Tuan Syed Mazlan b Syed Mat Dom for great commitment and cooperation during our Group Project.
1.0 Introduction
Today’s life is being changed step by step very thanks to the evolution of telecommunication industry. Internet, broadband and mobile technology has become the part of daily life that people cannot live without. The requirements of portable, mobile and high speed connectivity are increasing rapidly. Services such as wireless VOIP, IPTV, streaming media and interactive gaming need to be supported with broadband access.
3G has been serving mobile market for some years, and it is still an expensive voice service and lacks the strong capacity to support data service. At present, significant mobile operators, service providers and other actors in telecom industry are looking for the way to build up high speed but cost-effective broadband wireless access (BWA). The user demands of broadband wireless access service with high speed, low cost, and flexible mobile connectivity has been increasing dramatically. Current access mode generally includes DSL fixed access, Wi-Fi fixed wireless hotspots access and 2G/2.5G/3G wireless mobile access. The emerging of WiMAX has become another remarkable access technology which could provide both fixed and mobile connectivity through high performance system. This technology shows us a seamless communication world; at least, we are heading towards this direction.
WiMAX technology could provide “Last mile” solution, which might end the monopolization station of DSL and Cable access mode, because WiMAX could provide well fixed wireless broadband access as good as or even better than DSL and Cable mode. WiMAX has been regarded as the next milestone of BWA (broadband wireless access) technology. It does not only provide fixed access, but also provides mobile access just like 3G does. It has also been considered as the complement or even the replacement of 3G applications. WiMAX shows great advantages over the technologies in current wireless and mobile telecommunication market. In recent two or three years, WiMAX has become one of the hottest topics in telecom industry. The absorbing specification defined by IEEE802.16 has been attracting around four hundred market actors to form WiMAX forum to prompt the development of this technology.
WiMAX rises up competition with other adjacent technologies such as Wi-Fi, DSL and 3G. WiMAX and all others are more or less the same from technology and market aspects. Whether their relationship should be opposite against each other or coexisting is an interesting topic, which is worthy of a discussion. The WiMAX technology is now recognized as being a 4G technology by the International Telecommunication Union, and Malaysia’s own P1 is really happy about it. P1 is the only WiMAX operator in Southeast Asia and we can expect to see advertisements boasting that they were first with 4G technology. For the most part of 2010, there had been some debate in the industry internationally as to whether WiMAX should be referred to as 4G technology, despite many operators across the globe using the term. The ITU had previously maintained that only IMT-Advanced technologies such as 802.16m were considered to be 4G. P1 and other WiMAX licensees in Malaysia operate on 802.16e 2.3GHz WiMAX. P1 has invested approximately RM650 million on its nationwide rollout over the past two years and now covers 45% of the Malaysian population. With over 218, 000 subscribers, P1 have the largest network in the country and aims to cover 65% of the population by 2012.
2.0 Body
2.1 Marketing Objectives
The Marketing Objectives for this plan would be listed below:
a) To increase to 10% market share to subscribe the P1 WiMax Wiggy at the end of 3 month period.
-Currently, P1 has 80,000 subscribers; this plan would double the amount to 160,000 subscribers by using Wiggy.
b) To increase 30% awareness of the company’s position and brand to the mind of the consumers age 18-30.
2.2 Marketing Strategies
2.2.1 Untapped Segment & Brand Awareness
As a new company, adopting a head on strategy with giant competitors will create price war. The best strategy to adopt is by using a blue ocean strategy that is to make the competitor irrelevant and to create an uncontested market place. This can be done by value creation to the Wiggy by targeting segments which is not yet being focused by others. Firstly the target market that can be captured is the college and universities students. However, it is important to have a specific student package that dedicates to serve the needs and wants of student and most importantly to create value for money. Secondly, is by introducing the first internet service provider by to adopt the prepaid payment system. A prepaid system can ensure higher return because people will constantly reload their Wiggy. This will compliment the first strategy because we know that students often reload their hand phone. To create brand awareness, this will require mass media. The use of newspaper, television advertisements are important to remind the consumers on P1 latest package. Road shows are the best way to reach the students. The road show will reach areas such as universities/colleges and exhibition in shopping malls and other attractions across peninsular Malaysia. The road shows will explain on the student primarily on the student package.
However, not many students will subscribe to P1’s Wiggy on a road show basis because they will to think and ask their parents for approval etc. Thus when they decided to subscribe, they will have to find the P1 booth and this might be hard. As we know, P1does not have a physical outlet like Maxis, Celcom and DiGi. Thus the strategy to overcome the issue is by selling the Wiggy start up package in selected 7elevens. This also will compliment the prepaid system strategy. Overall, these strategies are interconnected and will complement each other to achieve the target objective stated above.
2.3 Segmentations and Positioning
Segmentation is a process of separating customers into groups with different characteristics, behavior and needs. There are many types of buyers with different needs and wants thus it’s easier to build a profile by segmenting them. Some of the bases for segmentations for consumer markets are geographic, psychological, socio-cultural, user related, psychographic, benefit and hybrid segmentations.
The Wiggy, has three main segmentation bases will be used. Firstly, demographic factors is the most popular bases for segmenting customer groups because it helps locate the target market and customers needs and wants. The second base is the user situation segmentation that is to understand the objectives, surf location and duration (time) of using the internet. This segment is relevant to the benefits sought for product because the usage of the product is affected by the time and location that it is going to be applied. P1 can use this indicator influence the consumers to use Wiggy to match to their usage. They can instill the notion the suitability of Wiggy in certain situation. Finally the third segmentation base is psychographic/lifestyle segmentation is basically dividing market into the basis of lifestyle and personality. An individual consumer’s lifestyle and personality is different however based on their demographic profile, they sometimes resemble similar taste on brands or product.
Positioning is all about how a company wants to be different in the market place.P1 has to position themselves in the mind of consumer as a high speed broadband service. In this case P1 has positioned to make broadband a right for all Malaysians, to deliver the commitment, the rapid and quality deployment of the P1 WiMAX network is crucial.
It’s quite difficult to change the impression after it is formed thus the easiest way to get into the consumers mind is to be the first. As for P1, they the first to introduce WiMAX technology are the first but in terms of other broadband providers they are relatively new. In an over communicated environment, the message that P1 should focus on is to present a simplified message and make them consistent with what consumer really believe. Consumers will simply shut out any inconsistent with their knowledge and experience. Consumers preferred on two criteria; service quality (speed & stability) and price (value for money).
Effective WiMAX Positioning
P1 positions WiMAX as a 4G technology that is superior to current 3G technology, specifically pointing to its WIGGY portable WiMAX on the go as an example. Good, convenient broadband service at a competitive price makes the choice for consumers easy. In fact, Malaysia is known as a WiMAX country thanks in large part to government education on the technology to the point that other mobile broadband technologies are very seldom talked about in the media. P1 believes that this is an affirmation of its aggressive positioning of WiMAX as it builds out coverage positioning that is so successful that consumers are demanding to know when the service will be available in their area.
2.4 P1 Marketing Tactics
2.4.1 Promotion
Promotion is communicating with the public in an attempt to influence them toward buying your products or services. Promotion are refers to the set of planned activities used to communicate a product or services merits and persuade the target market to purchase it. This basically refers to the activities of P1 WiMAX will use to inform the publican the Wiggy’s values as well as persuade the target audience to try or purchase the Wiggy portable modem USB broadband.
2.4.2 Place
In order to increase availability and distribution, the distribution and convenience of 7 to 11 outlets will be capitalized on. The prepaid cards will be made available at the 7 to 11 convenience stores that are within coverage. Only 100 outlets in major cities and towns under coverage will participate as a trial run to see if this plan will help achieve the goals and objectives of increasing awareness and usage. Not only will the outlets be a form of promotion, letting the public know where P1WiMAX has coverage, but it is also increase the convenience of the product. Users will easily have access to easy reloads and be able to use the service whenever and wherever they need it.
As convenience increases, so does the attractiveness. Outlets that carry the prepaid cards will have a large bright purple sticker bearing the words P1WiMAX available here (name of place). As the P1 WiMAX coverage increases, so does the number of 7 to 11 outlets carrying the reloads. This will help build the brand as it will reinforce the message of convenience and Anytime, Anywhere´ as explained below because there are so many 7 to 11 outlets and they are opened 24 hours daily. As this message sinks in, the public will begin to know about Wiggy as well as consider it when they want to choose a portable broadband service provider.
2.4.3 Events
Event marketing will be carried out in order to boost awareness, trial and purchase of the Wiggy. Events refer to entertainment occasions performed in front of a live audience that displays a unique picture of how a product or service can be promoted through different mediums. Events carried out are road shows in different areas. These events expose the target audience and provide direct contact with the sales staff as well as experience the service. The Wiggy road show will hit middle class malls such as 1 Utama and Mid Valley Megamall shopping centre and private education institutions such as Sunway University College. This is only held in universities between Mondays to Thursdays while the weekends will be reserved for malls. It will progress from zone to zone, such as Kuala Lumpur and Gurney Drive. Two teams simultaneously hit two different spots each in each zone a day during the weekdays and one team for the weekend.
When they leave the area, a kiosk and several promoters will be set up if there is none nearby for potential customers to enquire for more information or subscribe to the service. The road show will be held in states where P1WiMAX has coverage. The current locations can be referred under the implementation section. Each weekend team has a 10 person staff while the weekday team consists of 5 members and a large Wiggy mobile transport them from place to place. The ‘Wiggy mobile´ are painted with the P1WiMAX colors and logo. In order to attract more attention to the event and service, the staff will wear purple or green polo shirts bearing the P1WiMAX logo with coordinating facemasks bearing a large picture of the Wiggy device and announcements made by an emcee and the mall’s announcer.
For further Promotion and advertising, large banners and posters will be used on site with several smaller posters of Wiggy devices on bright purple or green backgrounds will be posted up in the surrounding area to direct the flow to the event. The road show events cover a speed test and stability challenge. In the speed test, potential customers are challenged to test out the Wiggy service by surfing the net, downloading a song or streaming a video on the 3 laptops set up, each plugged in with the Wiggy USB modem, manned by one promoter each. In the stability test, several potential customers are given half an hour to play an online game from local and international servers. At the same time, the other promoters will hand out brochures, attend to enquiries and handle on-the-spot subscriptions. Lastly, a lucky draw contest is held for those who subscribe on-the-spot. They are given a chance to win one out of three 3-month rebates for normal package subscriptions weekly. The serial number of the purchased set will be used for the computer to generate the lucky draw winner.
2.4.4 Advertising
An advertising campaign based using a unique selling proposition (USP) message is how this product will be conveyed. The unique proposition will be based around the portability attribute of our product. Portability is clearly the aspect of P1WiMax that differentiates it from the competition, and as it has been identified P1WiMax are in a process to build Invest stage, our campaign should emphasize our strengths. An advertising campaign based using a unique selling proposition (USP) message is how this product will be conveyed.
The unique proposition will be based around the portability attribute of our product. Portability is clearly the aspect of P1WiMax that differentiates it from the competition, and as it has been identified P1WiMax are in a process to build Invest stage, our campaign should emphasizes our strengths. The advertising campaign will feature three conventional forms of media, Television, Newspapers and Magazines. The print advertisements will feature in Newspapers such as The Star, News Strait Times, Berita Harian and Sin Chew Jit Poh. The television advertisements will be shown on free-to-air television channels as to gain maximum exposure. The advertisements will use both rational and emotional techniques, with rational being the dominant technique. The main execution will be a demonstration type feel, showing the product working indifferent areas.
Utilizing demonstration on a television ad is hugely beneficial as demonstration is the strongest technique for television. The passive tone in the advertisement will be humor, lightening the ad, making it more appealing to the target market. The advertisements that will be shown on television will carry over to the print advertisements, keeping a cohesive message throughout the campaign. Screenshots from the television ads will form the basis of the print advertisements, with the print advertisements containing more specific information to set them apart. The mediums are chosen because they have large reach and the target audience is aligned with the chosen target market for this promotion, students and young working adults.
2.4.4.1 Television
The television advertisement will be heavily focused on visuals, with only slight inaudible audio tunes ringing in the background. There will be no words spoken until the end message. The visuals in the commercial will show Malaysians enjoying wireless broadband internet access indifferent areas around Malaysia where P1WiMax enjoy coverage. Six places have been singled out for the purpose of this commercial; The Petronas Towers, Petaling Street (Chinatown), Bangsar, Butterworth, Batu Caves and Sunway Pyramid. The rationale behind this is clear, anywhere, anytime. By showing places in and around the city centre appeals greatly to the target market because they see coverage is wide. The shot in Butterworth shows the expansion P1WiMax are making into more regional centers.
The commercial opens with a shot of two people, a boy and a girl in their late teens holding hands. The setting in this first shot is Bangsar. The boy has a negative body position and looks unhappy, whilst the girl is dragging him into what appears to be another Bangsar clothing boutique. As the girl goes into the boutique, the boy finds a place to sit, takes his computer out and starts using the internet, at this point his body position relaxes and a smile spreads over his face. This scene is meant to be taken lightly, and is the humorous opening of the advertisement.
2.4.4.2 Magazines/Newspaper
As stated previously, the printed advertisement will keep in cohesion with the television commercials. There will be six varieties of printed advertisement, comprising one screenshot taken from each of the six scenes in the television commercial. The ability to convey the same message as the television commercials is a luxury not often afforded. The message being wherever you are, if you’re with Wiggy you will be able to connect to the internet. By showing the six various characters with their respective backgrounds the message still reaches the audience. To give each character a personal feel, and enable the audience to gain more of a connection with the characters, a tagline on each ad will feature the; name, age, profession and location. For example:
David, 18. Student. Bangsar
These print advertisement, in combination with the television commercials are intended to form a connection with the audience. The three mediums of media working in tandem are able to realize different advantages. The magazine print advertisements are at a higher quality, and can feature more information; it also has a greater sense of longevity. The Newspaper print advertisements are low cost, high coverage and can be placed in appropriate places like the technology section. Finally the television commercial enjoys mass coverage, with greater impact and high reach.
2.5 Porter’s 5 Forces Model
In this evaluation, we have also discovered a near environmental analysis which the company is highlighting the Porter’s 5 Forces Model in order to verify its industry’s attractiveness factors. The diagram below shows the Porter’s 5 Forces Model that were used:
2.5.1 Rivalry among Existing Competitors
One of the forces is rivalry among existing competitors or firms. The competition within industry is high and fierce in the market. Rivalry comes into action when there are close substitute products offered by firms in the same industry. P1 WiMAX’s close competitors are basically Maxis Broadband, Celcom Broadband and DiGi Broadband. These broadband companies in Malaysia offer various attractive packages and internet speed that are always in demand by customers. Nevertheless of these competitive rivalries, P1 WiMAX’s able to gain higher revenue in 2009. This shows that P1 WiMAX can remain competitive, further grow or perhaps be the market leader in future with the WiMAX technology if it takes continuous action to improve. The company needs to come up with better products, packages and improve on its internet speed as well as customer services in order to compete against rising competitors.
2.5.2 Threat of New Entrants
The threat of new entrants is high when it is easy for new competitors to enter a market and low when there are significant entry barriers to entering a market. Entry barrier means a product or service feature that customers have come to expect from organizations in a particular industry and must be offered by an entering organization to compete and survive.
The threat of new entrants in the broadband industry can be relatively low mainly because it requires high investment cost in coming up with the appropriate technology that fits the products and network system in Malaysia. Next, it is found that there are limited numbers of suppliers that support broadband services in Malaysia. However, there is a very high growing demand for broadband services among consumers, hence it is possible for some new entrants to venture into the broadband industry in near future.
2.5.3 Threat from Substitute Products or Services
The threat of substitute products is high when there are many alternatives to a product or service and low when there are few alternatives to choose from. Switching cost is involved in this threat which it is a cost that can make customers reluctant to switch to another product or services.
It is studied that when a product or service is not easily substituted, it gains a strong market position. There are quite a number of substitute products for P1 WiMAX. For example, customers can always choose to go for wireless internet service such as Streamyx or simply go to cafes such as Starbucks and McDonald’s that has Wi-Fi services for internet connection. To overcome this threat, P1 WiMAX must ensure the best quality of internet connection, speed and service are offered to its customers. At the same time, offering affordable or reasonable price to its customer’s as compared to the alternative products is also important. P1 WiMAX who is relatively new in the market constantly hold promotions and currently set its products at a moderate price level so that most customers can afford and able to enjoy the broadband service at a reasonable price. However, in long term, it seems that P1 WiMAX may be able to eliminate these substitutes as its threat.
2.5.4 Bargaining Power of Suppliers
The supplier power is high when buyers have few choices of whom to buy from and low when their choices are many. In this case, P1 WiMAX have low bargaining power with suppliers mainly because there are not many suppliers that provide materials or telecommunications equipments such as the software, networks and communication towers in Malaysia. Finding for suppliers that provide the appropriate technologies for P1 WiMAX could be challenging in Malaysia and the switching cost of suppliers is expected to be very high.
2.5.5 Bargaining Power of Buyers
Bargaining efforts of buyers are based on buyer profitability and switching cost. It is high when buyers have many choices of whom to buy from and low when their choices are few. There are a number of broadband companies in Malaysia as mentioned above, which easily allows P1 WiMAX’s customers to switch to other broadband at anytime with a low switching cost. This shows that P1WiMAX’s buyers have high bargaining power. Therefore, product differentiation in terms of technology used as compared to other players plays a major role in retaining its customers and attracting potential customers. However, bargaining power of buyers basically depends on the supply and demand of products. When there are more buyers, the buyers tend to have more power to influence the sellers in setting up lower prices. It has been said that P1 plans to provide WiMAX coverage to 40% of the population by the end of 2010. It expects to provide WiMAX coverage to 60% of the nation's population including urban, suburban and rural areas within five years. The increasing area coverage may attract more buyers in future, leading the buyers to a higher bargaining power.
3.0 Conclusion
WiMAX could provide high speed, broad coverage and cost-effective fixed and mobile broadband access solution. VoIP, IPTV, backhaul, last mile and rural connectivity are the main usages of WiMAX service. The targeted users include residential, business, and mobile users. Our analysis of technology comparison indicates that it surely have some a restive advantages compare to Wi-Fi, 3G/4G, DSL and Cable technology. But from short-term angle of view, WiMAX would not replace any of these services, since they are defined for different use than WiMAX and already have market-based groundwork in certain degree. The WiMAX ecosystem is a common platform created by all industry players in the WiMAX value chain. WiMAX has well-developed standardization process, through which can also help to gain trust from customers, promote the competition of various vendors, thus lower down the price of product. Both bands have advantages and disadvantages to run WiMAX service upon. To get license spectrum for WiMAX is very costly. The former one brings more benefit for the new innovation technology, in our case, WiMAX. But the cost is reduction of interoperability and compatibility for international roaming. In developed countries, 3G/4G mobile networks are widely deployed There are quite limited market opportunities for WiMAX. It can be adopted as a complementary technology for 3G/4G network, and a cost-effective wireless backhaul solution for sub-urban area. The value proposition of WiMAX in these markets mainly concentrates on extending the coverage of WLAN network to metropolitan area connectivity. Mobile operators should actively deploy licensed mobile WiMAX as complement service of cellular network. Also, service providers can provide WiMAX service for enterprises and high-end users, since WiMAX could offer high transmission speed connectivity at business level, with high flexibility, and low deployment cost. Even though, fixed WiMAX network could not be fully compatible with mobile.
4.0 Recommendation
In this case of P1 WiMAX, the road shows or promotion that they might face is when the allocated destination for the day happens to have unstable connection or even connection down. If this occurs, the road show will not be able to carry out and it will also portray a negative image on P1 Wimax to the prospects. In situation like above, the road show will be move to other destinations that has good coverage. During every road show, the crew will be given a set of destinations as a backup destination. In order to avoid allowing the prospect to know of the situation, as soon as crew members are alerted unstable connection in that area, one Wiggy mobile will leave with the laptops to check out the connection of other destinations that was provided. If this kind of situation really occurred, then the rest of the crew must continue the road show only with the flyers and brochures to attract prospected to learn more about P1 Wimax. The prospects will only perceived that P1 crew is there only to give out flyers and brochures, thus minimizing the negative impression of the people towards P1. As soon as the crews in the Wiggy mobile are able to allocate a destination that has stable connection, the rest of the crew will than migrate and join together to run the full road show with all the programs align.
5.0 Appendices
6.0 References
1. www.p1.com.my/common/pdf/pi_case_study_wimax.pdf
2. P1 P1Tstop Johor Bahru
43A,Jln Molek 1/29,
Taman Molek,
Johor Bahru,Johor,Malaysia.
3. www.docstoc.com/docs/23543016/PIWimax-Marketing-Plan-for-Wiggy-Strategy-Plan-and-Implementation
4. Thestar.com.my/news/story.asp?file=/2009/7/30/nation/20090730144154&sec=nation
5. www.investopedia.com/articles/fundamental/03/050603.asp
6. En.wikipedia.org/wiki/Packet_One_Networks
7. Wwwen.zte.com.cn/en/solutions/wireless/wimax/200912/t20091217_178727.html
8. www.p1.com.my/aboutus/aboutus_whoweare.aspx
9. www.valuebasedmanagement.net/methods_roic.html
