Report on Company Overview of Aktel Bangladesh Limited

Executive Summary

Bangladesh is a developing country of southern Asia. Mobile phone is becoming a very common measure of communication in our country. The number of mobile user is increasing day by day. It is a very attractive market for the mobile connection providers. Presently there are four companies in the market. Each trying to maintain and increase their market share. Among them AKTEL is one of the leading company in this sector. TMIB is a joint venture organization with A. K. Khan & Company and Telekom Malaysia, which is a leading telecommunication provider, operating its business in Bangladesh since 15 November 1997.

AKTEL is offering 3 prepaid products in the market. They are Standard, Mobile plus and Mobile link. Among them Mobile Link prepaid is their largest selling product. In this report it has been tried to explain why the subscribers prefer using AKTEL’S prepaid connection. The main objective of the report is to give an idea about the attributes for which the customers prefer this prepaid connection offered by AKTEL.

A descriptive research has been done to find out the objective mentioned above. The target population for the study was AKTEL prepaid subscribers of Uttra, Banani, Baridhara and Gulshan.  100 AKTEL Prepaid subscribers have been interviewed through a structured questionnaire for this report. Non- probability sample procedure has been used. The sampling unit was selected through Convenience Sampling, where the selection of the sampling unit is left primarily on the interviewer. Close ended question was used to collect the data from the respondent. The respondent responded under each attributes into a five point likert scale with “Strongly agree” resulting to a higher degree of satisfaction and with “Strongly disagree” resulting to a lower degree of satisfaction. Some demographic and spending pattern was asked for more in-depth interpretation of the respondent.

The analysis found that AKTEL’s main strength is their call charge within the pulse from the first minute and an effective coverage which is better than its competitors. They provide the widest coverage in the country. They also provide some other facilities among which off-peak hour system, and therefore 60% call charge reduce option is popular with the subscribers. But subscribers are not too satisfied with their network solution and the inter – zonal call charge when they talk. They think the inter- zonal call charge is high than the other competitors.

Customers are more or less satisfied with the facilities they are offering with this product. Their main focus is to increase network coverage so that it can reach all parts of the country. But they can improve their position by offering the subscribers with more facilities especially to improve their network solution and to reduce call charge in the peak hour simultaneously.

Literature Review:

According to webster preference is grant of favor or advantage to one over another. That means some criteria that create willingness to receive any product. That may be influenced by the product’s quality, promotional activities, organizational commitment, facility, packaging, value addition etc.

Quality:

The Transcendent Approach

The transcendent definition of quality is derived from philosophy and borrows heavily from Plato’s discussion of beauty. From this viewpoint, quality is synonymous with innate excellence. The assumption is that quality is both absolute and universally recognizable. According to Pirsig (1992, p. 73), defining quality as excellence means that it is understood “ahead of definition . . . as a direct experience independent of and prior to intellectual abstractions’’. This approach to defining quality is highly subjective.

The Product Based Approach

The product-based approach has its roots in economics. Differences in the quantity of some ingredient or attribute possessed by the product are considered to reflect differences in quality (Garvin, 1984). For example, better quality linens have a higher thread count. This view of quality, based on a measurable characteristic of the product rather than on preferences, enables a more objective assessment of quality.

The User-Based Approach

In the user-based definition, quality is the extent to which a product or service meets and/or exceeds customers’ expectations. This approach is marketing based, and emerged primarily out of the services marketing literature. As the service sector grew in the US and other economies, the customer’s perspective became increasingly more important in determining quality. However, the impact of the “customer’s viewpoint’’ can be seen in several of the early definitions and discourses on quality. For example, in the first edition of his Quality Control Handbook, Juran (1951) conceptualized that quality was composed of two parts: the quality of design and the quality of conformance. The “quality of design,’’ in essence, referred to providing satisfaction to customers by designing products that met their needs. He later coined the widely used “fitness for use’’ definition of quality (Juran, 1974). Although subjective and somewhat complex, today the user-based definition is widely accepted and considered one of the key concepts of TQM.

The Manufacturing-Based Approach

The manufacturing-based approach has its roots in operations and production management. Here quality is defined as conformance to specifications (Crosby, 1979). Quality of conformance relates to the degree to which a product meets certain design standards. This definition has an internal focus, in contrast to the external focus of the user-based approach, and quality is considered an outcome of engineering and manufacturing practices. It is the basis for statistical quality control. Deviations from design specifications result in inferior quality, and consequently increased costs due to scrap, rework or product failure. This definition allows for the precise and objective measurement of quality, although it has limited applicability for services.

The Value-Based Approach

The value-based definition equates quality with performance at an acceptable price, or alternatively conformance at an acceptable cost. This definition is derived from traditional economic models, and is based on the notion that consumers often consider quality in relation to price. In his first edition of Total Quality Control, Feigenbaum (1951) introduced this idea when he defined quality as “best for certain customer conditions . . . the conditions being the actual use and selling price of the product.’’ Here, the notion of worth is incorporated into the definition of quality, making this more subjective than objective.

Recognition:

The buying process starts with need recognition – with the buyer recognizing a problem or need. The buyer senses a difference between his or her actual state and some desired state. The need can be triggered by internal stimuli when one of the person’s normal needs – hunger, thirst, and sex- rises to a level high enough to become a drive. A need also be triggered by external stimuli (Principle of Marketing, Philip Kotler & Gary Armstrong, 13^th edition).

 Promotion:

Promotion defines as any short term incentive to encourage the purchaser or sale of the product or service (Principle of Marketing, Philip Kotler, 13th edition). Promotion means communications that facilitates exchange by influencing the audience to accept a product (Marketing Concepts and Strategies, Williams M. Pride, ninth edition). Promotion is an element in an organizations marketing mix that serves to inform, persuade and remind the market of a product and/or the organization selling it, in hopes of influencing the recipients feelings, believes or behavior. There are five forms of promotion: personal selling, advertising, pricing, sales promotion, public relations, and publicity (Fundaments of Marketing, William J. Stanton, tenth edition).

 Advertising:

Any paid from of nonprofessional presentation and promotion of ideas, goods and services by identified sponsors (Principle of Marketing, Philip Kotler, 13th edition). Advertising is a paid nonpersonal communication about an organization transmitted to target audience through mass media (Marketing Concepts and Strategies, Williams M. Pride, ninth edition). Advertising is impersonal mass communication that the sponsor has paid for and in which the sponsor is clearly identified (Fundaments of Marketing, William J. Stanton, tenth edition).

Public Relation:

Public relations is building good relations with the company’s various publics by obtaining favorable publicity, building up a good “corporate image”, and handling or heading off unfavorable rumors, stories and events. Public relation offer several unique qualities. It is very believable- new stories, features and events seem more real and believable on readers than ads do. Public relations can also reach many prospects who avoid salespeople and advertisements – the message gets to the buyers as “news” rather than as a sales-directed communication. As with advertising, public relations can dramatize a company or product. (Principle of Marketing, Philip Kotler, 13th edition).

Customer satisfaction:

The extent to which a product’s perceived performance matches a buyer’s expectations. If the product’s performance falls short of expectations, the buyer is dissatisfied. It the performance matches or exceeds expectations, the buyer is satisfied or delighted (Principles of Marketing 13^th edition, Philip Kotlar & Gary Armstrong).

Introduction

TM International (Bangladesh) Limited (TMIB), a joint venture company of Telekom Malaysia Sdn. Bhd., of Malaysia and A. K. Khan & Company Ltd. of Bangladesh has started its commercial operation in Dhaka, the capital city of Bangladesh as a GSM 900 cellular phone operator on 15th November, 1997 the tremendous success in Dhaka TMIB has started its operation in Chittagong in March 26, 1998. TMIB uses the Global System for Mobile (GSM) communications as the digital cellular system, which is fully featured with services like Basic Telephony, Data and Value Added Services, (VAS). TMIB has an integrated and fully computerized Customer Care Billing System (CCBS), which supports virtually all subscriber-related functions.

The Vision

To be the most preferred GSM cellular service provider in Bangladesh.

The Mission

To provide total customer satisfaction the company strives to become the most

preferred GSM cellular service provider in Bangladesh. TMIB will achieve this through developing people, products, and services of the highest quality and meeting the needs of its customers, employees, shareholders and the nation.

Theme:  “Customer First”.

TMIB Operation, Management, and Corporate offices

TMIB’s Chairman is Mr. M. Zahiruddin Khan and the Managing Director is Dato Ezanee Ab Aziz. TMIB officially got its license to operate in Bangladesh in November 1996, and started functioning in the market from 15^th November 1997.

TMIB provides standard mobile connections with NWD and IDD facilities. They also provide mobile-to-mobile services. It has fully covered the Capital city Dhaka, and started functioning in the Port city from 26^th March 1998. In the same year they expanded their coverage in Narayanganj the Business City and an important one closer to the capital city Dhaka. They have also reached the city with biggest beach of the world Cox’s Bazar. Now AKTEL is covering 26 districts of Bangladesh.

TMIB is a full-fledged business enterprise with a corporate head office, Finance ivision, Human resource Division, Technical Division and Marketing Division, Information Technology (IT) Division; all are functioning under efficient and highly qualified persons.

TMIB Corporate Offices

Head Office: BRAC Center, 9^th Floor, Mohakhali Commercial Area, Dhaka-1212.

They have a separate Marketing Office, with a customer service section at Land Mark Building (1st floor and 8^th floor) 12-14 Gulshan North C/A, Gulshan-2, Dhaka-1212. This office is responsible for all marketing oriented jobs.

Technical Office: House No.-2; Road No.-9; Block-G; Banani-1213, Dhaka.

Chittagong Office: Faruk Chamber (1^st Floor); 1403 Sk. Mujib Road; Agrabad C/A, Chittagong.

Marketing policy

Customer Segmentation

Individual businessman, entrepreneur professionals and established organizations are the main customers of TMIB. They have also a target to take students and low-income groups with their introduction of Mobile-to-Mobile and Pre-Paid services. To serve the market more accurately their target market will be further segmented based on psychographics and business size.

Marketing Strategies

TMIB always wants to achieve desired sales growth and customer base. TMIB wants to encourage existing customers to use more and more of their services.

Their newly introduced package named “Eid Double Bonus” is one of their successful initiatives for the exiting customer It has a concept of “Customer gets Customer”

Product Positioning

Initially their target was to reach the top. But others are targeting to the grass root level, and increasing their customer. TMIB wants to be the leader with good quality and is designing products for the middle class range also.

TMIB should keep enough flexibility to design other components of marketing mixes as well.

Marketing product mix planning

 Product—

• Continuous improvement of quality.

• Reposition of slow moving products to different target markets.

• Always branding AKTEL with all packages with a GSM service

 Price—

     • Necessary changes in tariff structure, and changes in terms and conditions.

      • Penetration pricing in the face of competition.

      • Skimming policy where possible.

Place—

• Make effective use of distribution.

     • Make product and service delivery system more effective and less time

       consuming.

• Wider distributing network to make service more accessible.

Promotion—

     • Brochures with all necessary information, press advertisements, Television

       Commercials in future, and Billboards.

Market Development

AKTEL GSM are trying to convert non-users to mobile phone users, stressing the

benefit of GSM services, and with the service benefit of AKTEL that will make their life easier. To serve the market more accurately their target market will be further segmented based on psychographics and business size.

Product Development

The strive to develop a better product will be a continuous process. Conducting of Market research will be in every three months. They will use the input to develop new product based on data they will get from survey. Thus the product will be designed to meet the customers’ need.

Organizational Structure

The organization is headed by its Chief Executive designated as the Managing Director entrusted with overall responsibilities of business direction of the organization and leading dynamically towards the attainment of its Vision, Mission, and Goal. In attaining the above mission, the Managing Director is assisted by 4 General Managers & 1 Director, Co-ordination. TMIB has established a strong and formidable sales channel, which consists of direct dealers and its own sales force.

Business Definition

TMIB is in the GSM Telephony business. With the technological development in future, TMIB will adopt cost- effective and more efficient technology to provide a state of the art and comprehensive service to its customers. TMIB’s vision is to continuously monitor its customers’ needs, wants and to plan accordingly. It will monitor the development of the technology and update itself to meet customer demand.

AKTEL GSM Provider

•   The technology trusted around the world.
•   Wide coverage with digital clarity.
•   Digital security with peace-of-mind.
•   Various choices of value-added-features.
•   Better customer care-not just promised, but delivered.
•   Competitive rate and better billing.

Product and Services of AKTEL

AKTEL has the following categories of product:

Post-Paid—

Standard – Both ways PSTN Connectivity

Mobile Plus – PSTN Incoming Connectivity only

Mobile To Mobile – Pure

• Pre-Paid – Under the brand name of “ONE”

Mobile To Mobile – Pure

Mobile To Mobile (PSTN Incoming)

 Other Services of AKTEL

• Standard -Bothwav PSTN Connectivity

This service allows both-way BTTB Outgoing and Incoming facilities other than only mobile connectivity facility. This is a Zonal-Subscription with National Roaming facility i.e. the subscriber can enjoy his/her available services other than the Home-zone.

• Mobile Plus-PSTN Incoming Connectivity Only

  Mobile Plus is another addition of post-paid products of AKTEL. This phone can connect all mobiles within the home zone and all mobiles throughout AKTEL’s      coverage area. It has National Roaming facility and a flat rate airtime charge of   Tk. 6 (+VAT) per minute for all calls to anywhere within AKTEL’s coverage. It   also provides BTTB incoming facilities with first minute free and Tk. 1.00 per 30   sec. for subsequent period.

• Mobile To Mobile- Pure

 M2M connects to all AKTEL mobiles and to other mobiles, subject to interconnection agreement with other mobile operators, within AKTEL’s coverage area. This product has a credit limit of Tk. 1000 on airtime usage with Tk. 1000 security deposit. There is no incoming charge.

• Mobile To Mobile -Pure

Introduction of AKTEL’s One Pre-Paid Service (OPPS) is another development of mobile telephony in Bangladesh. OPPS have National Roaming facility and a flat airtime charge of Tk. 6.90 per minute. There is no incoming charge. This service helps the subscriber to control costs. It keeps free from the hassles of paying bills, security deposits and line rents to the subscriber. At the beginning, a customer has to buy the “One” Starter Kit and a handset. The Starter kit contains a pre-activated SIM card and a One Pre-Paid card.

• Mobile to Mobile (PSTN Incoming)

Another AKTEL’s new One Pre-Paid Service (OPPS) is latest version of mobile

telephony in Bangladesh. OPPS have National Roaming facility and a flat airtime

charge ofTk. 6.00 (+VAT) per minute. There is no incoming charge from Mobile but a charge of Tk. 1.50 per 30 sec. for incoming from BTTB.

AKTEL Standard Service

Under standard service AKTEL has three products. They are as follows:

• LOCAL

 This service allows receiving call or message from any phone service from anywhere of the world within AKTEL coverage area. He also can make a call to BTTB number and all other mobile phones within specific zone.

• NWD

Under this service one may receive call or message from any phone service from anywhere of the world within AKTEL coverage area. He can also make a call to BTTB number and all other mobile phones in Bangladesh.

• ISD

This service enjoys every facilities of NWD. Besides this, one can make a call to the foreign countries with which AKTEL has international roaming agreements.

GSM Technology

• The Cutting-edge Technology

GSM stands for Global System Mobile communications. GSM is the world’s most advanced and extensively used mobile phone system. More than 20 million subscribers in almost 130 countries worldwide and AKTEL in Bangladesh use the latest GSM technology because AKTEL are committed to give the customer the very best.

AKTEL subscribers enjoy the following GSM features without bearing any additional costs: —

• Calling Line Identification Presentation (CLIP)

 Display of the phone number of an incoming call in subscribers’ handset before the call is answered.

• Call Waiting and Holding

 While talking to the first caller, subscribers will hear a special tone informing subscribers about the second call on the line. At that moment subscribers can put the first caller on hold and talk to the second caller.

• Call Forwarding

Call forwarding let’s subscribers’ redirect or re-route subscribers’ call to another AKTEL mobile or any other fixed (if subscriber have BTTB connectivity) or mobile phone.

• Call Barring

Enables subscribers to restrict certain types of calls to be made from subscriber’s mobile. This feature is especially important for security purposes.

• Itemized Billing

 If customers are not satisfied with his phone bill then he can collect the Itemized Bill, which describes elaborate Incoming and Outgoing call with phone number and duration.

Value Added Services

The following additional services are available upon the request from the subscriber: —

• Voice Mail Service (VMS)

1. VMS is a unique answering machine

2. It provides subscribers with a personal electronic mail box in AKTEL voice mail

center

3. It records subscribers personalized greetings as well as stores subscriber’s incoming voice messages

4. It records incoming voice messages if subscribers are;

Outside AKTEL’s coverage area, or

Busy, or

Simply switched off subscriber’s mobile

5. It provides 24-hour automatic secretarial service

6. Make subscribers available to subscriber’s calling party anytime.

• Short Message Service (SMS)

 SMS in subscriber’s mobile acts like an advanced pager.

 Subscribers can send and receive text messages of up to 160 characters, directly from one AKTEL mobile to another AKTEL mobile.

• AKTEL International Roaming Service (AIRS)

  Subscriber could reach 170 countries by using one number in one wa

Network Coverage

AKTEL Coverage 

Market Share

• Competitors’ performance

TMIB was the third entrant in the market and it possesses 13% of the cellular market of the country. The following Pie Chart depicts the operator wise market share in Bangladesh as at December 2005:

Strategic Analysis:

Now the researcher is trying to analyze the findings and these are follows:

• Among the respondents a few number of customer’s profession are house wife and businessman. The majority of prepaid subscribers are service holder and student. They mainly use this connection to keep in touch with their family and for official use. Majority subscribers’ ages are from 20 to 35 years.
• People who have high incomes do not prefer AKTEL prepaid connection that much. They prefer regular or post paid connection. Persons who have limited and low income are the main user of prepaid connection. That’s why the number of respondents of low monthly income is high.
• People uses 300 Tk scratch card the most and usually waits for the full expiry of the scratch card before refilling a new card.
• Mainly for the budget constraint customers wait for the valid date for the scratch card and this percentage is quite high. Some are buying cards monthly because they have an allowance for the mobile phone cards in that duration.
• There are many reasons for using mobile phone, the service holders use cell phone for official use, housewives and students to communicate with their family and friends. The respondent’s reason for using mobile phone varies on their profession. Although a high percentage of respondents responded that they mainly use the mobile to keep in touch with their family.

Earlier it was mentioned that the second part of the survey will give a clear picture, why the customer prefer the AKTEL Prepaid connection. To know the customer’s view about the product the researcher asked the respondents about quality, recognition, facility, commitment, promotion and packing.

First segment is quality where the researcher asked about the low startup cost and network coverage. The customers agreed with the startup cost of the connection. On the other hand the customers have an objection about the network coverage of AKTEL. They said AKTEL’s network is going to be effective in Bangladesh.

In the second part which is recognition, concedes market reputation, image of the company etc. AKTEL has a good reputation in the market after  launching the Easy prepaid connection, with their expansion of network, clear sound, attractive phone set etc, they were able to get a firm grip on the market.