Marketing Report On U Mobile

Introduction

Communication is the key essential in exchanging information all over the world. Now days, people can communicate with one another anywhere with the help of modern technology in telecommunication (Nayab. N, 2014). U Mobile is one of the telecommunication services company in Malaysia. U Mobile Sdn Bhd officially launched on 18 September 2007, under the Berjaya Corporation Berhad by Tan Sri Vincent Tan (Berjaya Corporation, 2007). U Mobile is a 3G mobile operator which provides voice and data services. It first started with more than 1900 mobile base stations installed covering Klang Valley, Seremban, Ipoh, Penang and Johor Bahru. However, in March 2010, Singapore Technologies Telemedia Company made a deal with U Television Sdn Bhd which is the major shareholder of U-Mobile at that time for the acquisition of a 33% stake in U Mobile (Berjaya Corporation, 2007). The partnership of Singapore Technologies Telemedia Company made U Mobile at an advantage which allowed them to tap into Technologies Telemedia Company’s specialty in 3G experience connection during that time.

Therefore, making U Mobile the first telecommunications company to deploy the fastest Internet connection in Malaysia. This success made U Mobile to be the youngest challenger in the market (U Mobile, 2018)Their fast business growth was possible with their unique network strategy now covering 95% of the population in Malaysia with 6693 places which provide their services which includes U Mobile at Aeon Bukit Indah, Johor, Malaysia which we will be focusing in this study.

Research Methodology

In this report, both the primary and secondary research had been used to gather data to help analyse U-Mobile’s marketing strategies. Primary research is defined as collecting information that originates from the source itself (Entrepreneur, 2018). But in this report, primary research is done only through observation of a U-Mobile shop lot in the third floor of AEON Bukit Indah Shopping Centre in Bukit Indah, Iskandar Puteri. The primary research was conducted in three sessions. The sessions were done by the following dates, 4th of February 19th of February and lastly 23rd of February. The dates were chosen deliberately as it would show the difference of customer activity between weekdays and weekend. Each session lasted for 2 hours, in which the customers’ status, estimated age, gender, and race was recorded down. The results can be seen in charts at the Appendix B of the report. Secondary research is a type of research that involves usage of previously existing data (Mbaskool, n. d. ).

In this report, most of the secondary research on the internet was from the official website of U-Mobile and some related sites that provides analysis on U-Mobile. The U-Mobile official website provides this report all the necessary information to know about the marketing strategies of U-Mobile, for example, their range of product, their rewards and offerings, their awards, and many more. The other relevant sites provide comparison to other competitors of U-Mobile to justify U-Mobile as being more beneficial than other telecommunication providers. Convenience sampling was used to choose which U-Mobile store was to be analysed. This method is used because it is the most convenient and suitable choice for this report.

Market Segmentation

Market segmentation is a process of subdividing the business’s market in different groups by characteristics, needs, wants and behaviour of the consumers. The objective of doing this is to create a marketing mix which the business can identify a customer’s needs and wants in different groupings. (Hunt and Arnett, 2004 as cited in Bose T. K. , 2012). This is why market segmentation is important and significant for the business. Market segmentations can be divided into four elements which are demographic, geographic, psychographic and behavioural segmentation.

Demographic

This segment is based on age, gender, social class, race, religion, family size, income, occupation and income (Sun S. , 2009). For example, U-mobile targets the lower and middle income consumers with its affordable prepaid and post-paid data plans. Based on the data collected shown in Figure 1-4 from Appendix B, it showed that most of the consumers who are interested in the product and services that U-mobile has to offer were teenagers, families and the working society. This is due to the fact that most of their data plans are at a cheap and reasonable price which benefits both lower and upper middle-income class.

Geographic

Geographical segmentation is mainly based on dividing the entire market into separate geographical sections like states, countries, towns, streets (Sun S. ,2009). The location of most U-mobile stores and its retailers are located near residential areas. (U Mobile, 2018). This makes it accessible and convenient for the consumers to visit the store and buy their products. Similarly, U-mobile has a consistent and stable data coverage throughout urban areas of Malaysia, especially highly populated areas such as Kuala Lumpur (U-Mobile, 2018).

Psychographic

Psychographic segmentation is mostly focused on the consumer’s lifestyle, personality, social class, motives, interest and opinions (Sun S. , 2009). U-Mobile targets customers with a specific way of lifestyle. For example, U-Mobile provides a data plan known as “P97”, this data plan specifically targets customers who uses social media heavily. This plan offers their customer an unlimited amount high-speed data, unlimited calls, and free music-streaming from Spotify. (U Mobile, 2018). This plan caters perfectly well for them, so it will attract these types of customer specifically.

Behavioural

This segment is mainly based on the consumer’s loyalty, usage rate, benefit and purchase occasion (Sun. S. ,2009). U-Mobile has targeted customers with different loyalty status. U-Mobile has done this by providing a loyalty card for customers, known as U card. Customers will get points as they purchase more of U-Mobile’s product, and these points can be used to redeem prizes (U Mobile, 2018). This will encourage loyal customers to maintain their loyalty with U-Mobile, and at the same time, encourages non-loyal customers to increase their loyalty.

Product U

Mobile provides three types of product for their customers. The first type of product offered by U Mobile is called “iPlans”. This is in which U Mobile sells a smartphone of any brand and any model together with one of their data-plans. The second type of product offered by U Mobile is SIM-Plans. This product has two sub-categories; pre-paid and post-paid. All these plans have offered different specialised benefits for the customers. The third type of product is broadband. U-Mobile also offers services of internet on broadband by means of pre-paid and post-paid together with extra perks like having a free modem, and extra internet usages of certain app is granted. (U Mobile, 2018)The three different type of products by U-Mobile serves the purpose of allowing their customers to have access to the basic telecommunication services, either performing calls or providing mobile internet (U Mobile, 2018). U-Mobile also uses different ways to differentiate themselves from their competitors by having various unique selling points for each of their products. For example, most of U-Mobile’s SIM-Plan offers their customers unlimited internet data (iMoney, 2018) and that they have the fastest 3G operator in Malaysia for their broadband services (Soyacincau, 2018). Lastly, U-Mobile also has the cheapest data roaming among its major competitors (iMoney, 2018). U Mobile uses branding strategy to help them stand out from their competitors. U Mobile has a logo in shape of a “U” with varying shade of orange.

This is simple and has direct connection with the company name to help consumers to easily recognise and possibly develop brand loyalty. In addition to that, U-Mobile is also recognised for its “unique services and value-added offerings found in prepaid services” as it has been given the award of “GOMOBILE INNOVATION AWARDS 2012; BEST NEW SERVICE AWARD”. (U-Mobile, 2018). The Bukit Indah Aeon U-Mobile store has a fully air-conditioned place with several counters to service the customers. Each of the counters have their own specific purposes, like billing counter, registration counter, and product repair counter. They have 9 available staff working at all times, 3 staff at each counter. The staffs are friendly and informative as they answer all the customers with a smile on their face and a brochure in their hand to provide more information (observational data).

Price

By setting the right price for their goods and services, a company would be able to generate high incomes and could help to company to maximize profits. As a telecommunications company, U mobile has many large competitors that are selling similar types of goods and services. Therefore, U mobile chooses to price its goods by using competitive pricing. Competitive pricing is when a company sets its goods and services at a price lower than its competitors (Grasset, 2015). U mobile prices its data plans and includes many different types of promotion at a low price in order to attract customers. Another pricing method that U mobile uses is bundle pricing. Bundle pricing means that a company sells multiple goods or service as a bundle or as a package at a cheaper price compared to purchasing the goods or services separately (Merrit, 2017). By selling its goods and services in a bundle at a lower price, U mobile will be able to increase its sales as more customers would be willing to pay for the good or for the service.

The third pricing strategy that U mobile uses is psychological pricing, psychological pricing is a pricing strategy that is based on the theory that prices have a psychological impact on customers when they purchase goods and services (Clark, 2017). This shows an illusion to customers that the price of the good or service is cheaper than what it is. For example, U mobile prices its goods and services at RM11. 99 instead of RM12 to showing an illusion to customers that it is cheaper than what it is.

Promotion

Promotion simply mean the activities and the communication of company’s products, brand and service to the user. It is the idea of making people to become aware, attracted an induce to purchase their product instead of others’ (The Economic Time, 2018). They are various type of promotional tools to help in promoting one’s product such as advertising, publicity, sale promotion, direct marketing and more ( Edwardlowe, n. d. ). Direct Marketing is a way of advertising that allow business and organisation to communicate with people via variety of media such as phone calls, text messaging, emails, fliers, catalogue distribution, promotional letters and targeted television campaigns (Wolfe, 20 August 2017). U-Mobile uses direct marketing to promote their promotion and brand image by using social media such as YouTube by putting advertisement before the video start and more. U Mobile also uses public relation to increase their image. Public relation is a way of promoting their image through social media. It is usually appears during sponsor of an event or acting as a source for media content. (Kullabs, 2018) U mobile sponsored quite a few events in the past.

One of the noticeable one is the Ed Sheeran Live Concert in Kuala Lumpur 2017. (U-Mobile, 2018)In the event, U mobile have included a few special features in their sponsor such as limited edition Pantun Pin for the concert, charging station for your mobile phone, giving free water to concert attendees and also U mobile set up a booth that put together some freebies and fun stuff for people. Not only that, U mobile uses sales promotion to increase branding image too. Sales promotion is the process of persuading a potential customer to buy the product. Sales promotion is being designed to be used as a short-term tactic to boost sales (Tutor2u, 2015). One of the sales promotion from U-Mobile is Top up RM30 and Win I-phone 8 weekly (U-Mobile, 2018).

Place

Place, also well known as distribution, is the process of ensuring that their product or services are assessable to their targeted consumers. (Išoraitė M. , 2016) After researching through observation at U-Mobile centre in Aeon Bukit Indah, it was learned that the main reason U-Mobile chose to open a centre there is because it is residential area. Due to the fact Bukit Indah is a well populated residential area in Johor therefore quite a number of consumer came to this U-Mobile centre. Furthermore, Aeon Bukit Indah is also a well know place among the people of Johor. Moving on to the distribution channels, U-Mobile uses two channels which is from the producer to retailer then consumers and from producer directly to the consumers.

Firstly, U-Mobile uses an indirect channel which the producer uses retailers to sell their services. For example, U-Mobile sim cards and top-ups are available at 7Eleven convenience stores around Malaysia (U-Mobile, 2018). This allows U-Mobile to have unlimited branches because it uses many retailers to provide their services to the consumers. On the other hand, direct distribution channel is also used by U-Mobile where the producer provides services directly to the consumers. This channel of distribution is being used by U-Mobile centres where all of the products and services are directly distributed to the consumers from the producer (U-Mobile, 2018).

Discussion

In summary, U mobile still managed to compete along many large telecommunications businesses in Malaysia because U-Mobile had been able to effectively target specific market segmentation and utilize its of marketing mix strategically. The recommendation for U-Mobile may include that U-Mobile could diversify their range of products. This will help U-Mobile to appeal to more customers and disturbed the risk of product failure.