Case of Cell -C Stratrgic Marketing

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Introduction

For years South Africans didn't have access to mobile phones and since mobile telephony was launched in South Africa in 1994, mobile phones have become an integral part of people's lives. It doesn't matter what your age, race, religion, literacy and occupation is, mobile phones are owned by a large variety of people. The technological developments within the mobile phone industry have drastically changed over time as well as the reasons why people buy mobile phones. The reasons range from safety need to always be in touch, status, business as well as entertainment. With the technological developments mobile phones can be used for emailing, listening to music, banking, taking photos as well as accessing Internet to mention a few.

Background

According to the Telecommunications Act of 1994, the mobile telephony industry was first launched in South Africa in 1994. Vodacom (Pty) Ltd and MTN (Mobile Telephone Networks (Pty) Ltd were incorporated in terms of the Companies Act, 1973 (Act 61 of 1973), and awarded licences to provide mobile cellular telecommunications services in accordance with the terms and conditions of the telecommunication licence and multiparty implementation agreement published under General Notice 1078 of 29 October 1993. Furthermore a third licence was offered in June 2001 to the Cell C Consortium, whose mobile services were launched on 17 November 2001 as the third mobile operator in South Africa.

South Africa has a vibrant mobile market that has seen rapid uptake of mobile services since competition was introduced to the sector more than 10 years ago. BMI-T (2004) stated that "subscribers to the three networks operated by Vodacom, MTN and Cell C exceeded 20 million during 2004, compared with less than 5 million fixed-line connections" (BMI-T 2004:15). The market has mainly been driven by the prepaid sector, which accounts for around 85% of all mobile phone users. The entry of a third operator, Cell C, in November 2001 and introduction of mobile-based Internet and data services have greatly contributed to growth in this sector. Third generation (3G) services were introduced in December 2004.

When the mobile industry was launched in 1994, the only service that was available was the voice service. More than ten years later consumers are faced with a variety of products and services to choose from within the market place. The mobile operators have added data services in the form of mobile banking, short message service (SMS), wireless access protocol (WAP), email, multimedia message service (MMS), mobile content and 3G, giving access to the downloading of video clips as well as access to the Internet. Text based adult content has been in existence for sometime but the launch of MMS and 3G has raised issues around the availability of adult content on mobile phones.

The constant evolving and changing mobile industry has always made the mobile network operators to keep revisiting their business and marketing strategies.

2.2 Marketing and business strategy

According to the South African Pocket Oxford Dictionary (2003:898) strategy is defined as the plan designed to achieve a particular long term aim, art of planning and directing military activity in a war or battle often contrasted with tactics. "Technology affects marketing in two basic ways with new products and with new processes (ways of doing things), the world has moved from an industrial society to an information society" (Perreault and McCarthy 2005:106). The technological change opens up new opportunities but also poses challenges for marketers. The success of some companies highly depends on how quickly new ideas can be brought to the marketplace but at the same time marketers need to help decide what technological developments are ethically acceptable.

Market segmentation and target marketing

Market segmentation and target marketing are critical factors within a marketing strategy. Mullins et al (2005)...
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