Vodafone Case Study

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Vodafone Introduction

Business analysis plays a crucial role for an organisation to gather information about both internal as well as external environment. Based on position in the target market, tactical and technical skills are enhanced such that financial strength can be gathered. SWOT analysis enables determination of core competencies along with threats and challenges that might hinder successful execution of the business. Contrarily, PESTLE analysis encompasses around macro factors. In this study, the case of Vodafone UK, which is currently the third largest telecommunication network, has been considered.

Company Name

 Vodafone

Type of industry

 Telecommunication

Headquarters

 Berkshire, United Kingdom

Sales/Revenue

 € 43.666 billion

Area served

 25 different countries

Number of stores

 480 and above stores, solely in UK

Competition

Telstra, Telecom Italia, Reliance Communications, BT Group, Airtel, Idea and Deutsche Telekom AG

USP

 VOXI SIM-only plans with unlimited minutes, text and data

Target Group

 Organisations along with customers of all age

Products

  • SIM cards
  • Broadband
  • Smart phones

Website

 https://www.vodafone.co.uk/

Vodafone Swot Analysis

Strengths

  • A wide range of affordable SIM Only deals starting from a price of £32 a month (Vodafone.co.uk, 2019)
  • Two different “superfast” broadband plans with use of optic fibre
  • These in turn led Vodafone to be awarded with “uSwitch Broadband Provider” and “uSwitch Best Value Broadband Provider” for the year 2019
  • As opined by Kumar (2019), launching of VoLTE for Android users in 2018 received huge response thereby reaching to a customer base of 9.9 million

Weaknesses

  • Average speed of “Superfast 1” broadband plan of Vodafone is 19 Mbps lesser in comparison to that of Virgin
  • The new 14-day-Service-Guarantee scheme failed to adhere to the existing law of “Accepting returns and giving refunds”

Opportunities

  • This internet service provider has exempted its customers from upfront cost and line rental
  • The 5G network is comparatively faster and almost thrice than that of a 4G SIM
  • Collaboration of Vodafone and Samsung is likely to fuel up sales and revenue of these two companies
  • There are high chances of Vodafone Smart V10 to receive popularity with Parental Control features

Threats

  • Some of the top most competitors of Vodafone UK are Airtel, Telstra, Telecom Italia, Reliance Communications, BT, Idea, StarHub and Deutsche Telekom AG
  • 5G connection of EE (Everything Everywhere) is giving a tough competition to Vodafone’s 5G network

Vodafone Analysis

As per the case study of Vodafone, its SIM Only deals offer multiple unlimited plans all across UK. One of the most popular plans for instance, is the all-rounder plan with entertainment that offers unlimited data, UK texts and minutes at a nominal price of £32 per month. Additionally, this plan includes free trial of Secure Net for 3 months, 100 international minutes all across EU besides 48 roam free destinations (Vodafone.co.uk, 2019). This internet service provider has further, succeeded in offering best fibre home broadband plan, especially with the Superfast 2 plan. This plan offers an average speed of 63 Mbps, unlimited usage and free F-Secure SAFE anti-virus software for 6 months at a monthly cost of £29 only. The Vodafone case study revealed that its 30-day-Service-Guarantee scheme has been reduced to 14-day in 2019 as majority of customers are confirming their satisfaction in first 14 days.

At the same time, it is the fact that this change does not comply with the above-mentioned law. As per Accepting Returns and Giving Refunds law, a company is liable to repair or replace items purchased by customers within 6 months, with the refund to be made within 14 days of receiving the item (Gov.uk, 2019). The latest smart phone, Vodafone Smart V10 offers Parental Control thereby enabling parents to manage apps and setting to be used by children. Moreover, the innovative face unlock feature is likely to make scope in the target market (Shinohara et al. 2015).

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Vodafone Pestle Analysis

Political

  • Brexit exempted UK from EU regulations and directives
  • Brexit made the Communications Act 2003 a mandate within the UK telecommunication industry
  • As per the UK Communications Act 2003, OFCOM can impose a penalty of up to £10,000 on telecommunication service providers in cases of contravention

Economic

  • Revenue of the UK communication sector increased to £54.9 billion as of 2017 at the rate of 0.4% (Chalaby, 2018)
  • This sector is on the verge of contributing to 8.2% GDP to the economy by 2020

Social

  • Case study of Vodafone added that 88% of households have an active internet connection
  • This depicts fixed broadband connection availed by 25.3 individuals, out of which, 10.8 million have superfast connection

Technological

  • There is a huge trend of using AR and VR technology for enhancing experience of users
  • Establishment of telecommunication call centres are in demand to support digitalisation, especially to enable users to retain benefits of 5G

Legal

  • Companies who are associated with telecom and internet sector are required to comply with Wireless Telegraphy Act 2006 and Data Protection Act 2018
  • No additional authorisation would be imposed to operate electronic communication services or networks (Nardotto et al. 2015)

Environmental

  • Several telecommunication companies like BT are taking innovative initiatives toward carbon emission reduction
  • Additionally, they are switching to 100% renewable energy

Vodafone Analysis

In context to the political factors affecting the UK telecommunication industry, the case study of Vodafone revealed that Brexit resulted in exempting every UK-based telecommunications company from the European Electronic Communications Code. Findings of Ang (2016) depicted that OFCOM would no longer be required to notify the Telecommunication Commission for the UK telecommunication market. As per the Economic Survey 2018-19, contribution of the telecom industry is likely to 8.2% by 2020 with widespread of 5G. The present scenario of individuals availing fast internet connection is such that 10.8 million have already opted for superfast connection with an average speed of 36.2 mbps. Considering Vodafone case study, Virtual Reality and Augmented Reality technologies are contributing towards better user experience with face filters like Snapchat and Instagram (Ahmadi et al. 2017). Unless an organisation makes use of the radio frequency spectrum or access any private or public land, no license of authorisation would be required for installing electronic communication networks. Otherwise, the company is liable to seek permission and licenses under WTA. Analysis of Vodafone case study has revealed that BT has aimed at reducing carbon emissions, resulting in 80% reduction by 2016 thereby imposing pressure on other telecom companies to do so.

Reference List

Ahmadi, H.B., Petrudi, S.H.H. and Wang, X., (2017). Integrating sustainability into supplier selection with analytical hierarchy process and improved grey relational analysis: a case of telecom industry. The International Journal of Advanced Manufacturing Technology90(9-12), pp.2413-2427.

Ang, R., (2016). Vodafone Global Telecommunications: Optimizing Operations. IUP Journal of Operations Management15(4), p.46.

Chalaby, J.K., (2018). Outsourcing in the UK television industry: A global value chain analysis. Communication Theory, 29(2), pp.169-190.

Gov.uk. (2019). Accepting returns and giving refunds: the law. Available at: https://www.gov.uk/accepting-returns-and-giving-refunds [Accessed on 3 August 2019]

Kumar, B.R., (2019). Vodafone Acquisition of Mannesmann. In Wealth Creation in the World’s Largest Mergers and Acquisitions (pp. 17-29). Springer, Cham.

Nardotto, M., Valletti, T. and Verboven, F., (2015). Unbundling the incumbent: Evidence from UK broadband. Journal of the European Economic Association13(2), pp.330-362.

Shinohara, S., Morikawa, H. and Tsuji, M., (2015). Panel Data Analysis of the Factors of Mobile Broadband Adoption in Selected Countries: Focusing on Smartphones. In Proceedings of Pacific Telecommunications Council.

Vodafone.co.uk. (2019). Our best SIM Only deals, with unlimited options. Available at: https://www.vodafone.co.uk/mobile/best-sim-only-deals?icmp=HeaderLink [Accessed on 3 August 2019]

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