Reasons for failure of Virgin Mobiles

Through

Renovation

Harshita Srivatava Charu Sharma Karishma Singh

Present before you Detailed Analysis of failure of and strategies to bring it back to race.

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Virgin mobile is a wireless communication brand used by eight independent brand-licensees worldwide. Virgin Mobile wireless entity is typically a partnership between Richard Branson's Virgin Group and an existing mobile network operator. It launched its brand in India in March 2008. It is primarily a MVNO company, and retail distribution is only a part of the overall strategy.

Virgin, a leading branded venture capital organization, is one of the

world’s most recognized and respected brands. Conceived in 1970 by Sir Richard Branson, the virgin group has gone on to grow very successful businesses in sectors ranging from mobile telephony, to transportation ,travel, financial services,leisure,music,holidays , publishing and retailing. Virgin has created more than 200 branded companies worldwide employing approximately 50000 people in 29 countries. TTSL which is the second largest CDMA operator with 22 million customers,will sell the youth based mobile service under the brand name of virgin mobile.

The basic reason for the failure of Virgin Mobile was that it chose wrong operator -it made entry into India partnering TTSL in March, 2008.That time TTSL was offering mobile services only on CDMA as Tata Indicom . Tata Indicom has no circles where it is positioned 1st or 2nd or 3rd as per subscriber base.

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Virgin Mobile chose wrong technology – CDMA while it targets youth population.

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CDMA is not a preferred technology for youth as to be a Virgin one need to get a CDMA handset. Virgin did not introduce any great CDMA handset which can attract youths.

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Virgin Mobile Internet plans are not really cheap, often hidden with daily rentals.

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Virgin’s foray into data card market never works because TTSL never wanted to give competition to its own Photon+. No cheap tariff for youth certainly gives a thumbs down!

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Interestingly Virgin strategy is followed by Tata Docomo which is GSM wing of TTSL, Tata Docomo with its catchy TVC, presence on social sites and exceptional 1p/sec tariff made a overwhelmed entry.  Smartpaid concept of Virgin is now placed in Tata Indicom as Smart Postpaid.

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Following Virgin GSM launch on Tata Docomo’s network Ranbeer Kapoor and Genelia were roped as Brand Ambassador – Now he is on the TVC for Tata Docomo.

And…. Do you feel there’s any chance that Virgin 3G can ever roll out Tata Docomo 3G network ???!!!!!

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Some of the flaws which we have witnessed practically with virgin is that it has a very poor network provider… Even the customer care service is not sufficient enough to meet the demands of people. Often we get to hear the “busy ” or “not reachable” tone... Tarrifs and data packs were too costly for an average customer to afford it.

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Firstly it should give up its hope to flourish in the CDMA Industry.  The question still remains that How come CDMA reliance established its empire? So, the answer to this is that Reliance is already a well settled and renowed name in itself. For virgin to compete with any of these , the first and foremost thing it will have to do is establish an independent industry , gaining attention of common masses and prove itself trustworthy.

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Instead of collabrating with TTSL or any other company , it should establish its independent network system in India also as is the case in other countries.  The advertisements should be made user friendly. Random and vague advertisements should be avoided. Most of them go above rhe head of a common man.

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“As style is need of Today” .. Virgin should make more durable as well as attractive and stylish phones. As in India , potential customers are youngsters . So , phones must be attractive and have smart features.  These qualities are necessary to cope up with the leading companies like samsung , Nokia , Apple.

More to come in coming slides….