Channel relationship in mobile sector: a case study of BSNL Jaipur

Abstract

India has become one of the fastest growing mobile markets in the world. This spectacular growth of mobile telephony is attributed mainly to various govt. initiatives, innovations in the wireless technologies, reduction in the cost of the equipment and reduction in tariff. The nodal agency for regulating the telecom environment Telecom Regulatory Authority of India(TRAI) has also actively played its role in-cubing strong competition in cellular service sector. As it is a general tendency of the customer not to change his mobile number, the operator s primary focus has been to acquire new customers. This has lead to fierce price war, and subsequently to innovativeness in the product offerings to differentiate the product in the highly competitive market. With the advancement in technology this has become feasible and the operator s are now primarily focusing on the new product design to allure new customers segments. As the product is easily replicable by other operators it is required to be penetrated soon after the launch in the masses so that the operator gets the early benefit of the mass sentiments. In the current mobile market 90% of the sale takes place through the private channel partners(retailers).The operator now has to depend heavily upon their channel partners to achieve higher figure in connections as they are the primary point of contact for the customers. Moreover with so many new product and schemes the customer has become fully dependent on these channel partners (retailers) for their purchase decision. Apart from the customer the channel partner too have so many equal options to offer to the customer. Now it is retailers prerogative to promote a particular product and services if he feels to do so. This market dynamics drives the cellular operators to identify the factors affecting the channel partner satisfaction that shapes their behavioral intention for repurchase likelihood of products for future business. Although, various research have been taken place for benchmarking, comparing and enhancing channel partner satisfaction across organizations, industries and countries, no specific research have been in place in India so far which covers the main business drivers of a specific industry like cellular mobiles in India. Therefore this research attempts to develop a model which will identify the major factors affecting the satisfaction level of mobile channel partners(retailers), which are the primary point of contact for customers. Results of the study suggest that all the model constructs are having positive relation among themselves as hypothesized. These results demonstrate the relative importance of various factors which affects the behavior of the channel partner. BSNL which is a state run organization entered into mobile telephony late, remained heavily unionized and reluctant to come out of its monopolistic behavior in the beginning of the services. Slowly with the time and feeling the heat of this fierce competition it too started analyzing the mobile market and tuning itself to the current market dynamics. BSNL in consultation with BCG restructured its complete marketing wing and launched Project Vijay1 which mainly focused on the monitoring performance of channel partners ,acquiring their feedback and meeting their business needs. In this exercise huge expenses have been incurred but results have not been so impressive vis-a-vis what other operators are reflecting in the balance sheet. The result of this study shows that channel partners satisfaction is most influenced by the product offering/quality , then by the internal business processes and then by the commission structure. If we look at the field reality closely the results fall in tune with the present market conditions scenario which indicates that now commission structure for the products have been stabilized, with technological advancement the business processes has become transparent and effective and the main driver for the channel partner satisfaction remains the product innovativeness and design. It has been seen that channel partner always seek forward for new product launch so that they can do bulk business in the shortest span. These results can be effective for BSNL and also for other operators for prioritizing their marketing efforts to boost their bottom line growth in the present competitive market of mobile telephony.