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Virgin Mobile Australia Marketing Strategies Report (Assessment)

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Updated: Mar 17th, 2022

In a study by Beulen, et al (2006), Virgin Mobile is an upcoming first growing company that runs mobile telephone services within the telecommunication industry. It was founded in 1999 and is presently a fully Virgin Group’s subsidiary.

The company prides in having its customers being able to both shop in about 6000 retail outlets in the UK and purchase the company’s services through the internet and cell phones. The company has already penetrated the Australian and American markets and plans are underway to get into Canada. In addition, its aim is to provide full fledged services at affordable prices.

Virgin Mobile allows its customers to only pay for the actual use of their services and does not provide them with subscription services. It does not only focus on wider markets, but is also customer oriented.

Rather than introducing new services in the market, the company aims at improving on what is already being provided. With such strategies in place, the company has managed to reach millions of subscribers in the UK apart from being the fastest growing mobile provider globally.

A strategy that is keep the company in the changing and ever growing market is outsourcing business processes that can well handled by partners and outside suppliers. Presence of numerous contractors enables the company to respond accordingly to changes in market and hence enabling it to locate and hire required employees.

It is headquartered at Trowbridge and has its marketing departments in London. Between 2003 and 2006, the company was ranked the best provider of both prepaid and customer care services. Orange, Vodafone, 02 and T- Mobile are Virgin Mobile Australia’s key rivals (Virgin Mobile Australia, 2010).

Virgin Mobile Australia’s Marketing Strategies

In a study by Jaray (2006), Virgin Mobile Australia has devised the following marketing tactics for its products:

Product Collateral (Brochures)

Through this strategy, the company is able to put a list of its available services on brochures. Explanations of how those services operate are made in an elaborate and simple manner. This enables customers to read them on their own at their own time. Through this, they can be reminded of the products, make choices and change where necessary.

Advertising

Virgin Mobile Australia engages in different forms of advertising such as through both print and electronic media to either remind customers of the existing services or to introduce a new service.

The website

Given that most of its customers are up keeping with the advancement in technology, the company uses the website to reach out to both potential and existing clients to keep them informed about the features of its services and any changes.

In a study by Informa Healthcare (2005), Virgin Mobile has launched the following additional strategies to increase marketability of its services:

Simplicity

Virgin Mobile’s success in the US has been attributed to its simplistic approach. The company begins by taking note of areas of customer strain as outlined by the operator. The company then realizes that simplicity is the only marketing strategy that can make it distinctive. Simplicity has been implemented through the prepaid service where an easy non-contract one-rate charging option has been adopted together with a narrow choice of handsets.

Customer Relationship Management (CRM) strategy

Its elaborate customer experience is one of the aspects that have placed the company above its rivals. This is one of the approaches that have been very successful with studies showing that a bigger percentage of the United States customers will tell a friend about Virgin Mobile due to provision of its high quality customer related services.

3 G strategy

This is a high investment plan required in provision of services such as content and operator partnerships, and network infrastructure. Through 3 G, the company provides a mobile television service that has a provision for program recording that can then be watched later on, making it an effective marketing aspect.

Content strategy

To penetrate most of its markets, Virgin Mobile’s services have based on texts, wallpapers and ringtons. After an agreement with T-Mobiles, the company introduced another content service under its brand virgin extras. Through this, the company’s brand strength was boosted through enabling its clients download digital music.

Use of Incentives

In a study by Beulen et al (2006), Virgin Mobile has employed the use of incentives in an effort to retain its customers. First there is the use of 3p texts between virgin to virgin. Secondly, the company has introduced lowest denomination airtime vouchers (£ 5). Thirdly, there is the glue incentive where customers are rewarded with some airtime for every person they connect. Additionally, there is the flash it incentive where clients are awarded some airtime for the much they spent at the Virgin Megastores.

Impacts of marketing strategies on customer and business base

In a study by Manning, Salter and Tuinzing (2005), the marketing mix is used to ascertain the blend of product, price, place and promotion to be used together with the marketing strategy.

Strategy Impact on customer / business base
1. Brochures Saves time and costs that would have been used by the company to explain to customers. Is a reminder to the customer and can reach more customers at reduced costs.
2. Advertising Reaches a wide audience at reduced costs thus increasing the company’s market share.
3. Website Encourages feedback from customers hence giving information on relevant service modifications. Also increases customer interaction with the brand.
4. Simplicity Increases usability of the service among customers resulting to more revenue.
5. CRM strategy Company is able to track individual customers’ performance, monitor and retain them. Enhances good customer relations that increases usability hence more revenue for the company.
6. Content strategy Increased usability among clients. Boosts the company’s brand making it distinct from its rivals.
Use of incentives Retains customers by encouraging them to stick to one network. Airtime awards encourage usage and maximize profits. Customer network grows
3 G strategy High technology improves product quality, attracts many customers leading to increased sales.

Levels of customer services provided by Virgin Mobile Australia

In a book by Grant and Neupert (2003), first, the company offers flat call rates to its customers. Unlike other mobile providers, it has no peak rate calls. Secondly, the company offers its customers a simple call tariff that enables them to pay less after the first five minutes of each day. Additionally, the company has daily discounting rates and provides phones with integrated mp3 tones.

As listed in virgin mobile, at the time, the following are products and their respective prices:

Pre – paid and post – paid plans

Product Price ($) Details
Pre paid internet data: 19 5 MB
29 & 35 20MB
45, 75 & 95 50MB
Post paid internet data: 456 50MB
696 100MB
936 300MB

Iphone plans

Product Price ($) Details
Apple iphone 5 Per month on smart cap 49
25 Per month on smart cap 39
6 Per month on smart cap 39

Ways of promoting and distributing products.

As stated in Loop Mobile limited (2007), Virgin Mobile Australia distributes and distributes most of its products on a website through that can be accessed on the phone. Secondly, products are promoted through mobile advertising and Public Relations campaign. The company also promotes music through news, fan communication and gig information that are available on both mobile and Personal Computer devices. Artists’ music is also being distributed via live chat message services.

In a study by Wooton (2009), Virgin Mobile provides services such as call centre, phone service and other technical services. Apart from the internet and iphones, the company also provides its customers with handsets, ringtons, phone accessories and insurance. Additionally, credit customers are given discounts on the company’s phone services. This is normally done through mail.

New marketing strategies that should be implemented for the new products

Short message services.

As stated in Sms News Articles (2010), given the increased use of this service, Virgin Mobile Australia can capitalize on its usability to target both potential and existing customers as it seeks to market its products and penetrate deeper into the market. To make this strategy successful, a powerful and marketing message should be composed and read first.

The impact of this marketing plan reaches more people at diverse levels compared to audio visual. Also the cost of this plan is cheaper compared to other marketing strategies. What are likely to attract the attention of the clients are the simplicity, captivity and friendliness of the message. Intentions of making the product being marketed appear as if it is the best should be avoided.

A message should describing for instance the new ringtons or phone accessories should be send to the customers and then they be left to decide on what to do after reading it.

Social Network Advertising

To increase the marketability of its new products especially ringtons and insurance, Virgin Mobile Australia should consider using social networks such as Facebook, Twitter, and Myspace among others. This will enable users of these Social Networking Sites to be conversant with the product features, quality and even price. Additionally, the users’ responses and interest in the product can very easily be obtained giving the company an opportunity to make necessary changes so as to suit the demands of the customers.

Employing this strategy will also enable the company to penetrate a wider market because there is a high likelihood of users sharing the information with their friends who may in turn make a choice to purchase the product. Additionally, links to the page containing ringtons can be included in the advert giving the users a chance to decide not only to buy but also to download it.

Use of customer database

In a book by Kutty (2008), Customer data base provide helpful information about the customer such as their attributes, previous transactions, their preferences and replies to various questions. Therefore, Virgin Mobile Company should use its database and that of other players like banks. The advantage of databases is that they provide information at reduced costs. Such information can then be used to tailor make the right insurance product for the customers.

The success of the short message service strategy can be effectively monitored by the number of responses from targeted customers. Increased response should trigger a repeat of the strategy. Low responses could call for modifications in the strategy such as changing the message content.

On the other hand, the success of social network advertising can be gauged by for instance the number of users who have not only liked the product, but also made up their orders on Facebook. Moreover, the success of customer database can be monitored by collecting specific information from customers that matches insurance products and using it appropriately.

Return on Investment and Cost benefit Analysis of the strategies

In a book by Shelly and Rosenblatt (2009), Return on Investment is a technique that compares a project’s total returns with its total costs. Cost Benefit Analysis on the other hand is a technique that measures the actual social benefits of a project in monetary terms in comparison to its costs.

To begin with, the short message service approach is not only less costly but it can also target many people. Its total returns are likely to be higher than the total costs. Secondly, although advertising via social networks may target masses, its return may not be necessarily as many. It may also be costly given the many companies that are competing to advertise through it. Use of the customer database is less expensive and the insurance product to be marketed through it is likely to be more beneficial to the company.

Ranked in ascending order, the most preferred strategy should be customer database, followed by short message service and then use of social network advertising.

Resource Management and effect on current operations

To implement the three advertising strategies, Virgin Mobile Australia should first invest in Research and Development to come up with the most competitive ways of implementing the strategies so as to be above its rivals.

A market research on how their rivals are implementing their strategies is also necessarily to enable Virgin Mobile Australia know their weaknesses and thus come up with something effective. Secondly, the company may need to reduce its internet charges to allow most of the customers access some of its products from social networks easily.

Thirdly, given that these strategies require financial back up in their implementation, the company ought to allocate an equivalent amount of funds to accomplish this. Fourthly, the company may be required to empower its marketing department. This may be done by training them more on marketing strategies, hiring more competent marketing executives or raising the remuneration for the current marketing staff.

Successful implementation of these strategies will definitely affect the current operations of the company. For example as discussed earlier, implementing each of these strategies require additional budgeting.

This is to cover social network advertising costs, sending short text message services, doing research on these strategies, covering wages, among other expenses. Creating a customer database requires the company to put mechanisms in place like hiring more customer care staff and increasing its public relations.

The company may also need to lower the cost of some its products as a way of penetrating the market and flooring its rivals. Additionally, if the strategies work that will then mean that the company will have more customers and hence there may be need for more staff to handle the clients.

Reference List

Beulen, E. Ribbers, P. and Roos, J., 2006. . New York: Routledge. Web.

Informal Health Care. 2005. . Web.

Jaray, S., 2006. Marketing (Australia wide). Jones Street: Career FAQs Pty Ltd.

Kutty, S. K., 2008. Managing Life Insurance. New Delhi: Prentice Hall of India.

Loop Mobile Limited. 2007. AGM presentation. Web.

Manning, D., Salter, J. E. and Tuinzing, A., 2005. Virgin Atlantic Marketing Case Study. Web.

Shelly, G. and Rosenblatt, H., 2009. Systems Analysis and Design. Boston: Cengage Learning.

Sms News Articles. 2010. Sms my business blog. Baulkham Hills: Ail sms my business. Web.

Virgin Mobile Australia. Mobile Plans and Pricing. Web.

Wooton, C. 2009. . Web.

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