Virgin mobile is a unique player in the Indian mobile market.

It is the only service provider

which does not hold any bandwidth and mobile setup infrastructure but uses Tata Teleservices
spectrum and has attempted to penetrate market totally on its branding and marketing strategy.
Creating a niche brand and promoting it to specific customer segment with proper marketing has
been the key success factor for virgin mobile across the globe. Virgin has promoted itself as the
brand for young India, keeping the Indian youth as its target customer segment. The idea behind
targeting this segment can be found inherited in virgin’s business model.

SEEKING YOUNGISTAN:

The Virgin Mobile Brand, targets Indian school and college going youth aged between 14 and 25
years. There are 215 million people in this age group. Why is this segment so important? Young
subscribers may account for less than 30 per cent of the total, but they contributed over 50 per
cent of the telecom industry's Rs 50,000cr (Rs 500 billion) revenues in 2007-08. By 2010, this
group is expected to earn the industry over Rs 35,000cr (Rs 350 billion). By 2010 this group is
expected to contribute 60-70 percent of total revenues. People are replacing handsets every 18-24
months. Replacement sales account for as much as 60%. And Virgin mobile has an opportunity
to explore this area as well.
 Virgin decided it need not be
everything to everybody, and chase volumes like the bigger players. "We are not pursuing scale
for scale's sake," Richard Branson declared.

This segment offers some distinct advantage:

a) The distinct mobile phone usage habits of the young users provide a huge advantage to
Virgin Mobile as they make more and longer out-bound voice calls, which means huge
billing potential for service providers.
b) Young users have a shorter handset up gradation cycle - under 12 months as compared to
two years for people above 25 years of age – which suits Virgin mobile business of handset
with mobile services.

c) They have large circles of friends for both making and receiving calls - which offers a
revenue opportunity not just from the entire group switching to a common service provider
but also from customised services like closed user groups and so on.
d) The usage of SMS, data services in the form of mobile internet, mobile shopping and other
value added services like ring tones, caller tunes, wallpapers, etc are very high in this group
which again provides a huge opportunity to be tapped.
With their targeted youth segment Virgin Mobile has attempted a long term strategy. They have
tried to break into a segment not specifically targeted by any of the existing players. Virgin also
has realized that this section would in few years would go out to be working professionals with
independent income and hence attempted to catch them early.

COMMUNICATION OBJECTIVES

Two major objectives behind every communication campaign of Virgin mobile has been to
spread brand awareness and create a foothold in this market segment for itself and satisfy some
unmet customer needs. As the Indian telecom sector already had many well established players,
Virgin mobile had to communicate its brand in a way such that the customers notice it and
perceive it as being a bit different. The average Virgin Mobile customers are still in their teens.
For them the cell phone isn't for calling the office or checking schedule; it's for connecting with
friends, making plans and exchanging stories. It is for staying in touch with culture, a youth
culture that is always on the move. They want to communicate quickly and cheaply, not only
through phones, but in every way possible - email, text messaging, note-passing, conversation.
This segment is characterized by the fashionable and the trustworthy, the edgy and the reliable.
Virgin found that its users cared more about community than utility, and knew it was time to
change its image from a pay-as-you-go telecommunications provider to a youth wireless
network, a culture that thrived on music and art, media, and above all each other. From its
analysis of the Indian mobile market it has determined several unmet needs.

Virgin’s strategy has been to deliver a more tailored, more relevant offering for a single, distinct
segment. With its target customer clearly defined, Virgin had to ensure its offerings were tailored
to suit this group's preferences.
There has been a potential problem. Frequent handset changes fits in better with GSM
technology. In CDMA technology (which Tata Teleservices and, therefore, Virgin offers), the
SIM card is usually embedded in the phone. Which means a handset upgrade involves an entirely
new connection, complete with new number. Virgin Mobile worked around it by introducing
CDMA phones with RUIM (removable user identity module) technology, similar to GSM
phones, offering users the convenience of upgrading their phones without having to change their
number or re-entering their address book.

Then, it was important to be economic - young customers aren't likely to have huge disposable
incomes, although they will demand cutting-edge technology and style i.e., a combination of
looks, features and more affordable handsets as the youth need style but also value. Virgin's
handsets are therefore named and priced to appeal to its target audience -- vKewl retails at Rs
3,999, while vBling sells for Rs 2,500, which is about half the price at which competitors will
sell similar handsets.

Nearly 95 per cent of young users are pre-paid subscribers, who typically run out of both
talktime and recharging money by the month-end. Thus Virgin came up with the “Get paid to
receive calls” offer where its customers are offered a 10-paise credit for every minute of
incoming call, regardless of the originating network. Thus making it a viable proposition for both
customers and the business. 

COMMUNICATING THE VIRGIN BRAND:

With its audience identified, Virgin mobile devised messages that by itself communicated with
youth’s heart. They are:

a) “Think Hatke” advertisement campaign targeting youth:

To communicate its brand Virgin Mobile tried to make youth notice it ads. Their initial
communications talked of the role of the mobile phone in the lives of young. Instead of using
Informational appeal which elaborate on service attributes and benefits, company focuses on
transformational appeal which explains what kind of person is going to use this service. They
came up with a Hinglish punch line to market their services. “THINK HATKE” which would
mean think different in English. Almost all the existing cellular operators in India have English
punchline. TATA Indicom has “experience the difference” while Vodafone has “make the most
of now”, Idea has “what an idea”.

In the two-week launch campaign, Virgin aired two commercials where youngsters find ways to
win approval in sticky situations. In one ad, a girl shocks her parents saying she is not interested
in men. And in a volte face, parents taken by surprise insist she goes on the trip -- which,
obviously, is what the girl was aiming for, all along. In the second TVC, a young man who has
broken traffic rules wins the sympathy of the policeman when his angry father asks for him to be
shown no mercy. The 'father' is later shown to be his college mate.

In both ads, the cell phone plays a cameo role. No tariff plans are mentioned, although Virgin
Mobile's tagline "Think hatke" is prominently displayed. They have clearly picturized the kind of
personal conversation happens between two young people, that includes the suggestive humor,
pranks, crude jokes and different ways of doing the things which is usually not acceptable for
matured generation. They have clearly segmented their targets and their on-screen presentation
shows that. This helped them to directly connect with the target consumer and seek their
attention. They primarily focused of seeking attention first and then talk about their offerings.

b) Red and vibrant

The brand had to convey the vibrant image consistently being promoted by to be cool enough
for its users, but professional enough for their parents. The site has a young, sleek new look,
deepening Virgin's trademark red and replacing bright pictures with a darker color scheme. The
site's combined emphasis on product information and culture encourages young customers to
check it out, making it both easier to browse and easier to buy.

c) Tailor made plans for young segment

Virgin mobile has been providing services which were not offered so far. Specially customeized
for the young segment. Like getting paid for incoming calls and 50 paisa for all calls across the
country. It is a brand truly meant for the young India which is reflected at each & every touch
point. Virgin has extensive data service offers in the form of vbytes (Virgin Mobile’s data
portal). Various excellent value added plans being launched. Customers can use online facility
for enquiry, purchasing phone, recharging and everything.

d) Publicity

Outrageous, flamboyant, unconventional maverick entrepreneur Richard Branson is all that, and
more. So it really wasn't too surprising when the billionaire chairman and founder of the Virgin
group decided to fling himself down from the roof of a Mumbai five-star hotel to mark the
launch of Virgin Mobiles. This was one of the strategies Virgin has followed over the years to
keep itself in news.

e) Events and Experiences

Virgin invited students to be brand ambassadors and request them to sell Virgin merchandise
such as T-shirts. In return, it invites groups of students for counseling sessions. Virgin has also
installed television sets in college canteens to encourage students to produce content on any
subject which is then aired. Virgin Festival: Virgin Mobile organizes Virgin Music Festivals
allowing customers to "Book The Band" by voting for who they want to see in an open show.

f) Getting paid for incoming calls: a source of recharge option for youth.
g) Online viral campaign

Virgin Mobile has launched an online viral campaign to promote its new ‘SMS Free After First
Three’ tariff plan under which Virgin Mobile customers can send upto 200 SMSs -- 100 National
and 100 Local -daily to any network by paying for the first 3 SMSs on each level (National and
Local respectively). The microsite highlights a web video that chronicles a faux medical
condition of living a parallel life on one’s Virgin Mobile Phone through the use of Short
Message Service or SMS and subsequent diagnosis of a girl who is afflicted with the SMS Life
Syndrome.

The microsite is infused with several interactive elements like diagnostic test, different ways to
have fun with one’s SMS addiction, a collection of SMS lingo and abbreviations, and thumb
exercises that keep the user hooked. The microsite is also being supported by a promotional
media campaign which comprises a series of web banners that aim to shock a reaction out of
users. Since web is a medium where the young spend a huge chunk of their time, this viral
campaign is an exciting way to interact with them and get them to do interesting activities while
providing a feel of the ‘hatke’ brand. The fun and cheeky delivery of the texting addict's way of
life has helped Virgin to further build a youth connect.

h) Online/Sales Promotion

Internet portal: The official portal of Virgin gives a lively feeling and has a very jazzy look. It
clearly represents the company’s idea of targeting the youth. But such type of a look of the
website would definitely keep other age groups away.

Analysis of the various online programs launched by Virgin mobile are:-

• Online Participation: Virgin Mobile allows customers to earn free airtime by

participation in online advertisements and media. For example, you could watch a short
commercial and earn a minute of airtime.

• Free Virgin Mobile Minutes: Virgin mobile releases codes in order to encourage
customers to top up more frequently, and to reclaim old customers who have not topped
 up in a while. By offering promo codes for free minutes, Virgin Mobile gets their
customers to top up more often, or twice in one month. This is a win win situation for the
customer and Virgin Mobile.

• Online Purchase Schemes

• Virgin Mobile Insider Program: Used for research and development of new products.
Virgin Mobile Insiders may be asked to evaluate and provide feedback on a promotion or
phone before it is released to the public. Such insiders are sent free phones and other
swag.

• Tie-up with MySpace: Virgin Mobile has tied up with MySpace for providing social
networking services. Customers by provided instant access to world's largest social
networking site at no extra-cost.

i) Events/Publicity

Most of the publicity campaigns held by Virgin mobile are highly dramatized as it can be seen
from the way Virgin mobile brand was unveiled. He jumped of the 15 th storey of the hotel. Such
kind of publicity drags the attention of lot of people but at the same time can act as an
encouragement for minors to perform the same act.

Virgin invites students to be brand ambassadors and request them to sell Virgin merchandise
such as T-shirts. In return, it invites groups of students for counselling sessions. Virgin has also
installed television sets in college canteens to encourage students to produce content on any
subject which is then aired. Such type of events are held to personally involve consumers and
hence make the communication more relevant. These events are implicit in nature as they
indirectly result in ‘soft sell’.

CHALLENGES : CUSTOMER ACQUISITION AND RETENTION

The company knows that they are trying to position themselves into a very established and
competitive market. They understand the fact that they cannot start making profit from day one
neither they have plans for it; they anticipate to achieve a subscriber base of 5 million in next
three years and will make profit afterwards they will be able to break even in three year or so. To
set a strong holding in the highly competitive Indian telecom market Virgin Mobile has to
market itself as a potential brand. Brand engagement can be the only differentiator.

According to the patron, Sir Richard “We want to deliver a more tailored and relevant offering
for a single segment.” Various steps that Virgin is taking to add value to the customer are on
price, quality, technology and social front. Company targets only 10% of the above mentioned
segment and have plans to acquire and retain them by various innovative propositions, some of
them are-

 The tie up with Tata Teleservices enables it to fight competition as the network quality of
Tata Teleservices was ranked first by DOT. The quality of the network is very good.
Using the bandwidth owned by Tata Teleservices, actually helped Virgin in making its
presence in the market.
 The company is spending huge chunks of money to promote their VAS services. They
are providing Innovative, game-changing value-added services.
 The customer care personnel are always available to assist and customers were satisfied
with the kind of responses which they get form the staff. Virgin mobile has made
customer care as one of its differentiation strategy. All customers are personally
welcomed to Virgin Mobile. Schemes like try before you buy help in creating faith in
consumers. A real returns policy allows customers to exchange and replace faulty items
in their pack without any hassles.

CONCLUSION

Virgin Mobile has entered into a very competitive industry where Airtel, Vodafone and Reliance
are the dominant players. Virgin Mobile faces stiff competition from Reliance CDMA phones.
Virgin Mobile have taken a ‘hatke’ route and launched the brand in the youth segment. The tie
up with Tata Teleservices enables it to fight competition as the network quality of Tata
Teleservices was ranked first by DOT. The company is spending huge chunks of money to
promote their VAS services. Virgin should try to promote its latest plans more prominently in
their advertisements. Making customers aware about latest pricing will increase its market share
in terms of cost effectiveness. Virgin mobiles projects its image as that of a brand for youth
which may not go well with the conservative Indian consumer . Therefore they should try to
build up an image that is cool and links with youth but not offending to other segments. Getting
involved in social activities can help Virgin in projecting a serious and responsible image.
Finally, to keep up in the highly competitive market, innovation and exciting new offers will
help in devising a differentiation strategy.