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Blackberry Market Segmentation Case Study

CHAPTER ONE

1.1. INTRODUCTION

Telecommunications Services of Trinidad and Tobago Limited (TSTT), founded in 1991, is the biggest telephone and internet based service provider in Trinidad and Tobago. Headquartered in Port of Spain, the company was the result of a merger between the Trinidad and Tobago Telephone Company Limited (Telco) and Trinidad and Tobago External Telecommunications Company Limited (Textel). Now it is jointly owned by the Trinidad and Tobago Government and the Cable & Wireless Company. TSTT/bmobile and Research in Motion (RIM) launched the BlackBerry Pearl in Trinidad and Tobago in December 2006. The device was manufactured by RIM and was incorporated with a series of applications including the phone, e-mail facility, texting, web-browser and the personal organizer. Its digital camera with 1.3 megapixels and three zoom-levels had a built-in flasher and a media player.

At the time the BlackBerry Pearl was considered one of the best buys in the market. However with new developments in mobile telephony technology and the markets, competition has grown severe and TSTT has been faced with a strategic marketing dilemma. The first blow to TSTT came when its monopoly power in fixed lines was challenged with the Flow’s launching of a fixed line service a long time ago. Similarly its cellular telephone monopoly was challenged in 2005 when Digicel and Laqtel were given licenses to operate a mobile network. This study investigates the nature and scope of marketing promotion strategies available to TSTT in promoting the BlackBerry Phone in Trinidad and Tobago. The strategic marketing promotion approach of TSTT has to be studied with particular emphasis on the company’s current market leadership status in the mobile telephony segment (Crane, 1993).

When making an effort to identify the characteristics of the target market demographics such as age, age group, gender, marital status, location of the business, incomes of consumers and their preferences matters. Next psychographics such as cultural values, mores, lifestyles, tendencies, propensities, choices and personal concerns matters. In the same way the kind of industry and typical market structure matter. In this instance the industry is the mobile phone company and the market structure is oligopolistic in nature. The latter means there are only a few sellers or rather brand names.

In today’s competitive environment, mobile phone market has become more customer oriented and product driven. Thus with the changing trends in behavior and shopping patterns by the consumers, mobile phone service providers and manufacturers need to focused on multi channel marketing approach to target the market to enhance their shopping experience and to increase sales.  The target market of the TSTT’s mobile phones is the people who are fed up with popular brands, their new technology tactics and those who are interested in customized mobile phones. Thus company can categorized their existing customers as their store visitors and online shoppers (KotlerPhilip Kotler (Author)

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& Armstrong, 2009). However recent research shows that the most of the shoppers would tend to search the products, features, prices and offers through the online and prefer to buy through offline. In fact TSTT’s service objective is to provide customized mobile phone services for its customers over the internet and drive customers to make a purchase over the physical stores. The potential customer’s profile in the TSTT’s mobile phone market includes such characteristics as price variabilities and income variabilities. Price related differences in the average customer profile are determined by the fact that the underlying customer preferences for customized mobile phones are based on the technology and its price. New technologies are in demand in this industry but the price plays a pivotal role. High price attracts some customers on the premise that the technology is far superior. Low price attracts some customers on the basis of affordability. Any market research plan must be able to identify these two sub categories.

1.2. RESEARCH AIMS

  • To ascertain the extent of the existing marketing promotion strategies of TSTT in promoting Blackberry phones in Trinidad and Tobago.
  • To focus attention on the wider perspectives of promotion strategies being adopted by rivals of TSTT in Trinidad and Tobago.
  • To identify and analyze the strength and weakness framework of TSTT with reference to its promotion campaign on BlackBerry.
  • To identify and investigate the customer demographics and market segmentation strategies to promote TSTT’s current marketing campaign on BlackBerry phones.
  • To carry out a strategic audit of the current TSTT’s marketing and promotion strategies.
  • To examine the extent to which TSTT might be able to adopt a mixture of promotion strategies to achieve long term marketing goals in selling BlackBerry in Trinidad and Tobago.

1.3.   RESEARCH QUESTIONS

  • Have the current marketing strategies adopted by TSTT in seeking to capture greater market share for BlackBerry in the Trinidad and Tobago markets helped?
  • What are the structural, cost and marketing planning constraints faced by such promotion strategies?
  • Does the existing level of competition forebode well for TSTT’s strategic marketing initiatives for BlackBerry?
  • Do niche marketing segmentation related strategies have a greater probability of success for BlackBerry despite the existence of smaller competitors?
  • What is the nature and scope of competition from fixed line operators against mobile telephony in Trinidad and Tobago?
  • How best TSTT might be able to align its current marketing strategy with the BlackBerry centric promotion strategy to achieve profitability objectives?
  • Is there any possibility of changing the strategic market and customer orientation approaches of TSTT to achieve long term corporate objectives related to BlackBerry marketing campaigns?

1.4.   RESEARCH HYPOTHESIS

The research hypothesis of this study is based on the possible correlations between and among a number of variables such as demand for and supply of mobile telephone services in general and the BlackBerry in particular; customer demographics like age, employment and income and the relative effectiveness of sales promotion strategies; super brand status of BlackBerry and market growth factors; and TSTT’s market leadership and the potential relative impact of a new promotion strategy. SWOT analysis, Porter’s five forces, Porter’s Generic Value Chain, marketing mix, extended marketing mix, Ansoff’s product-market growth strategy and all related promotion strategies would be investigated with emphasis on the Trinidad and Tobago markets for mobile telephony.

CHAPTER TWO

2. Literature review

  2.1. Product and marketing strategy

Product and marketing strategy of mobile telephone services is connected with the overall orientation strategy which is classified into product orientation strategy, market or consumer orientation strategy and competitor orientation strategy. Mobile telephony industry has been noted for its product orientation strategy based on the success of critical factors or competencies and the product development strategy is highly based on the constant rapid and innovative factors.  TSTT has developed highly innovative and technology-centric products and services such as the BlackBerry (Wills, Samli & Jacobs, 1991). Corporate governance occupies a very important place here along with critical capabilities to achieve organizational goals such as market share growth, share price growth, customer satisfaction, stakeholder satisfaction and so on. Product development programs of TSTT have been successfully executed to a certain extent. For example its diversification strategy in segmental product placement efforts has paid off with a rise in revenues for the last two years. With the recent market developments a product diversification process has been initiated though such diversification activities need to be focused on the customer’s response to the ultimate product.

Given different demand elasticities, i.e. income, cross and price, for the internet search engines, there is always an amount of uncertainty associated with industry orientation and the level of competition. Product orientation strategy is thus focused on the development process. The company has successfully adopted such a product development strategy and outperformed its rivals in Trinidad and Tobago (Hickman, 2009). Industry revenues began to rise faster and the product loyalty began to rise among a substantial cross section of customers everywhere. However brand loyalty and its offshoot product loyalty have been less visible in the strategy implementation process.

Marketing or customer orientation strategy is marked by an intensely focused growth oriented approach. Strategic initiatives include viral marketing and promotion drives to preempt rivals’ strategic moves. Marketing drive is focused on worldwide internet users, especially the IT communication professionals’ and the youngsters’ market segments.

Extreme strategic marketing choices have been forced on TSTT by this market trend setting behavior of professionals and teenagers. While cost considerations of such marketing techniques have been uppermost at TSTT, there has been a shift in strategy from mere customer satisfaction to value creation. TSTT’s choice of strategy as outlined above and the implementation process are intertwined. For instance its advertising revenue has been growing by manifolds due to its concerted efforts at identifying gaps in the existing market arrangements. TSTT’s own strategy of product placement in the new high income buyer  and younger web surfers’ market segments has paid off with handsome returns though its current diversification strategy of enhancing online music file sharing among web surfers has met with stiff opposition from  recording companies. TSTT’s own strategy of diversifying product placement approaches to produce convergences in different market segments so that competition related outcomes become manageable within the organizational environment has been met with stiff resistance though (Hughes, 2010). It’s also essential as a product-centric approach to achieving operational cost recoveries. There is very little freedom for a search engine to differentiate products unless it’s done through a systematic process of enhancing services through value addition to the customer. In the eyes of the customer such value additions such as amazing spell checker for translating web pages from one language to another and TSTT’s built-in calculator to do the calculations with ease have a greater attraction.

The product marketing drive of TSTT, on the other hand, has been characterized by its efforts to keep the search engine market in its entirety to itself as the major market segment along with current business strategies (Enigmax, 2010). However its current product marketing drive is essentially determined by cost-cutting efforts. TSTT has designed effective viral marketing campaigns and even today it’s so effective with establishing a brand identity for the organization.

Marketing clout of TSTT is based on customer-driven value creation efforts plus cost-effective achievement of marketing synergies through an aggregation process that involves a series of customer-care policies both within and without the organization. The internet services industry demands a qualitative approach to customer care services including public relations. TSTTs success in carrying out an effective customer care campaign has invariably produced some progress in respect of its marketing campaign as well (Dunmore, 2008). While TSTT has effectively initiated a strategic focus on some customer care services in order to avoid duplication by its competitors, the real scenario of competition is characterized by a still greater percentage of budgeted expenditure by rivals.

Marketing strategy of TSTT has a very positive cornerstone, i.e. it’s focused among other things on a combined approach to marketing and enhancing customer experience, not so an unusual combination today. Marketing strategy is implemented with focus on sales volumes to achieve quantifiable transaction flows across a range of products to the internet searchers who otherwise tend to ignore the qualitative parameter, simply because it’s inconvenient if not bought (Dan, 2008).  Such marketing dynamics have placed TSTT in a well-heeled position in the market.

2.2. Segmentation strategy

TSTT’s current market leadership position in mobile telephony in Trinidad and Tobago can be regarded as one of the greatest plus factors in its marketing strategy of BlackBerry though its real impact on promotion strategies has to be examined against the evolving backdrop of completion and its severity. In this respect market segmentation strategy occupies a very significant place.  Market segment for mobile phones comes under demographic segmentation. The other most common two market segmentation strategies are the geographic segmentation and psychographic segmentation (Abratt, 1993). In the first instance demographic segmentation refers to the practice in which the firm has to focus on age, gender, marital status and similar characteristics. It’s the most popular strategy or basis for segmenting the market though its complicated nature at times necessitates fast hand information about customer behavior. Consumer demographics also involve age and lifecycle studies though lifecycle centric approach demands tracking the customer’s changing needs for customized mobile phones with new technology and accordingly mapping the future requirements. Secondly, geographic segmentation is based on identifying the market according to its geographical characteristics. The firm which is going to sell mobile phones online and offline might identify these segments where they are more likely to occur and then target those potential consumers. Finally, Psychographic segmentation is based on such characteristics as cultural values, societal mores, attitudes, interests and lifestyles. A company seeking to market a mobile phone among customers would focus its attention on one or more of these characteristics in order to successfully create a niche market capability. Psychographic segmentation is essentially connected with the evolving personality and thus the firm might target the most vulnerable character traits of the target group.

Thus any successful attempt at profiling the potential customer’s tendentious purchasing behavior requires segmenting the market according to customer preferences. TSTT’s consumer mobile phone market has the potential for further segmentation and thus consumer preference based segmentation would facilitate not only the promotion related outcomes but also performance ratio based outcomes such as net and gross revenue and sales volumes (Engle, & Fiorillo, 1972). Such an approach would enable the new entrant to articulate customer’s purchasing habits on a more realistic note than otherwise is possible. For instance point-of-sale data available at TSTT mobile phone stores show that bargain hunting consumers are on the increase. Whenever the store announces a bargain potential customers queue up outside the shop for long hours.

Globalization has not only shrunk international borders between countries but also shortened product life cycles on numerous occasions. The purchasing specialist’s functional environment requires such special skills as an understanding of the variables that impact on product lifecycles of both locally produced and imported goods (Hart-Davis, 2009). Further the initiation of skills training programs and their relevance and impact on innovation and leadership culture would definitely create a framework of reference for the purchasing specialist’s project procurement and contract management requirements. This is more so in respect of change management programs at the organizational level.

Customer relations and strategic focus on facilitating the control over internal and external relations are much more important than the activity of selling. As such the logistics team’s functional skills are augmented by both complexity and diversity of the facilitator’s role rather than putting the purchasing manager or specialist into an old fashioned functionary’s mould. TSTT has been more concerned about selling the total output rather than minimizing associated costs of maintaining stocks.

The logistics team would have to place emphasis on the supplier’s credentials rather than the price itself. In the first instance a competitive tendering processes involve not only specification and evaluation criteria but also the painful task of selecting the best team for the task in hand. This requires not only a knowledge of tendering skills but also particularly strong evaluation techniques.  This is due to the fact that value parameters attached to the determination process of suitability criteria are fundamentally based on the logistics team’s dynamic role. The entire process of procurement of supplies has to be specified in conformance with the cost involved in the prolonged lifecycle of the product. The logistics team has to plan for the appropriate evaluation criteria, that would otherwise be ignored and delivery schedules dragged without much consideration of the promotion strategy. This might affect both the functional parameters and the technical specifications, thus hindering the aesthetic and qualitative outcomes of the process.

Finally the supply chain team needs to focus attention on the objective of controlling the entire supply chain evaluation process in a manner that non price factors receive a fair share of attention throughout the supply process, thus leaving little room for any marked variance or divergence away from the predefined criteria. Similarly the team’s success or failure is determined by how best they are able to reconcile those divergent parameters of the process. Hence there is the need for some debriefing procedural applications to be adopted.

2.3. Marketing mix

When the marketing mix – price, product, place, promotion and by extension people, process and physical evidence – is considered against the current level of market concentration ratios there are a lot of opportunities on the marketing front available to the average mobile telephone service provider in Trinidad and Tobago (Freeman, 2006).  However the existing brand loyalties might curtail the degree of freedom enjoyed by each seller because super market chains stock a variety of products with identical labels from different sellers. This development has a very significant impact on the organization’s marketing goals too. A conceptual framework for a uniquely propositioned marketing strategy depends on the viability and logicality of these outcomes. Assuming that a good  marketing plan once put in place would take care of the 7 Ps above, there is very little else to accomplish in order to maintain a good cash flow and ensure positive and constant returns over the life cycle of each product – launch, growth, maturity and decline (KotlerPhilip Kotler (Author)

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& Armstrong, 2009).

Price of the product is essentially a reference to the larger context of the company’s pricing strategy and especially in the current competitive environment there is very little liberty if any available to the firm to adopt a pricing policy of its choice. In fact market penetration would seem to be the most ideal pricing strategy for BlackBerry.

Product characteristics include those tangible and intangible benefits for the customer. A typical cross section of youth and professionals would be inclined to buy BlackBerry since its promotion strategy places emphasis on BlackBerry’s super brand image.  In other words the seventh P “Physical evidence” of the product carries much weight as in sensory marketing (Miser, 2006).

Place again imposes some limitations on the firm’s ability to exploit broader marketing principles. Market segmentation strategy of TSTT is exclusively intended for the creation of brand dependency and therefore there is a drawback associated with its geography. For example TSTT which markets BlackBerry, has a huge network of stores in almost every nook and corner in Trinidad and Tobago.

Along with a proper promotion policy, an ideal people-oriented marketing strategy ought to be put in place. Customer-centric product promotion is nothing new in the industry though product promotion campaigns are less likely to be determined by any other factors than the strengths of the product. While the emphasis might be placed on the overall promotion strategy to attract as many potential customers as possible there won’t be any strategic advantage in the long term if the company concentrates too much on its strengths only. This is a strategic shortcoming in the continual development process (Lovelock, 1999).

CHAPTER THREE

3. Research methodology

3.1. Phenomenological Approach

According to phenomenological approach the reality is a social construct. In other words people tend to focus on their experiences as coming from the world reality. The fundamental principle which drives phenomenological approach can be distinguished from positivistic approach as a qualitative paradigm which identifies the existence of reality in a quantum dimension. The world reality has to be interpreted by humans in relation to this perception (Lester, 1999).

3.2. Research Philosophy

Research philosophy explains how theoretical constructs of research methodology have been evolving in a particular field of study through a series of assumptions. The researcher thinks of the practical nature of the research effort rather than the outcome. Thus it is all about the correlations between the knowledge and its applications. Research philosophy has three branches – epistemology, ontology and deontology (sometimes referred to as axiology).

Epistemology refers to the nature of acceptability of the kind of knowledge concerning a certain discipline. Epistemology in turn has three sub branches – positivism, realism and interpretivism. Positivism is related to philosophy while realism refers to reality of knowledge. Interpretivism on the other hand is concerned with researcher’s own opinion about knowledge (Saunders, et al, 2007).

3.3. Positivistic approach

Positivism is concerned with the derivation of laws that have natural characteristics. For instance, in natural sciences positive laws are defined as those relations that can be proved through tests to exist in the positive realm of natural phenomena. However it must be noted that emphasis on facts and figures as proof of existence of phenomena can be at times misleading though. Quantification of relations is central to the positivist approach.

3.4. Triangulation

Triangulation is a technique used in research to make it doubly or triply sure that the results arrived at by the researcher are reliable. If a particular researcher uses two methods or techniques the subsequent results might diverge. Therefore it’s desirable to use three methods. Triangulation has been known for a number of advantages in arriving at conclusions. For instance conclusions based on correlations can be tricky due to variances occurring at successive phases of progress. Therefore it’s necessary to test the results by using a third method.

3.5. Deductive and inductive reasoning

Deductive research refers to a process in which a more general approach leads to a more particular approach. For example the researcher may start off with a theory on the subject and then build up a series of hypotheses to arrive at specific details of the research topic. Deductive reasoning is sometimes known as top-down approach. On the other hand inductive reasoning refers to the opposite process or approach. In inductive research the researcher starts from more specific hypotheses and then go on to generalized areas of study. This is sometimes known as bottom-up approach.

3.6. Research approach

This Methodology gives both a theoretical and conceptual outline first. Next it dwells on the practical aspects of the research methodology utilised to analyse the research data and describes the various methods used in this study. This paper is based on a structured approach that makes it variable-independent in respect of learning outcomes. Thus the deductive research methodology approach adopted here would specifically delineate correlations variances and regressions based on premises.Exploratory research approach is characterised by three elements.

An independent approach to research essentially presumes that the researcher has a greater degree of freedom in deciding the choice of variables and their scope of applications. Thus the researcher would adopt a free style of inquiry that seeks to establish correlations and regressions between and among variables based on available premises of facts. Deductive logic or reasoning process in this research methodology would be functionality oriented. However didactic logic would be avoided when learning outcomes are presented. In other words the deductive reasoning process would be determined by only the extent of relevance that is associated with available premises irrespective of the didactic nature of most of the research available on the subject now. This research methodology would be tantamount to a pioneering effort in respect of the development of its hypothesis for future purposes by other researchers. In other words the research hypothesis of this paper and the associated methodology are intertwined to produce some authoritative and original conclusions.

3.7. Research strategy

Secondary research data for this study would be collected through a very extensive research task conducted both online and in libraries. This researcher may mostly utilize the books currently available on the topic and also study research journals, articles, newspapers and reports including commissioned reports by federal and state authorities.  References might be adopted from most of the currently available research data on the subject. This study mainly depends on the secondary research data, because theoretical and conceptual study is much well aided by it than primary data which is basically limited to responses to the questionnaire and the survey interviews. Further reports published by TSTT and the Government Offices in Trinidad and Tobago have been used. References were taken from most of the research material available in the field.The available literature has been analyzed with specific focus on the product marketing and choices thereof in the context with particular emphasis on strategies adopted by rivals as well. This researcher has tried to show the most important aspectual overview of the research in the Literature Review. Also there is considerable reflection on the state and relevance of current research (Wind, Douglas & Perlmutter, 1973).

Data gathering process is one of the major challenges in any research project. It is perhaps the only possible interaction with the people to assess their opinion.  Data are gathered and categorised according to the aims of the research.There are many methods of collecting data and especially secondary data would provide invaluable information that is used for policy decisions, marketing strategies, and academic studies etc. At this stage it is always advantageous to think in advance what variables and tabulations would be required for later analysis.

Future research possibilities in the field are discussed in depth to show how theoretical underpinnings evolve with time and space with specific reference to product marketing. There is little or no critical literature to support the methodology of metrically determining   the feasibility, attraction and obstacles to creating a model for the BlackBerry marketing strategy in Trinidad and Tobago. This particular handicap has affected the researcher to a greater extent. However the research methodology segment of this paper places emphasis on the qualitative aspect of it rather than the quantitative aspect. As such the available empirical evidence has been greatly utilized by the researcher to delineate the current line of arguments as expounded in the Literature Review of this paper.

3.8. Data Analysis

In the secondary research segment, this study would seek to establish a series of positive and negative correlations between and among the endogenous and exogenous variables ranging from the TSTT’s price cutting strategy to the probable impact on demand for BlackBerry. These correlations would be established with specific reference to other important variables as well. For instance the positive correlation between the increasing demand for the product and the rightward shift in the supply curve would be examined with reference to the secondary research data already available on the subject.

Other effects include, the rivals reducing prices and as a result its sales might be affected. That in turn will affect its revenue and profits. All these variables point towards some serious positive and negative correlations. This study has particularly identified a set of variances and co-variances coming into existence through the host country government intervention in such related matters as space management and economic policy alterations. The impact of economic policy variations has been taken into account to produce a strong set of dynamic statistics in determining the extent and relevance of the learning outcomes.

 3.9. Case study method

Relevant case studies were attached and reports were analyzed with reference to as secondary data analysis in order to provide greater credibility to the research effort. Some marketing promotion campaigns being undertaken on Apple and BlackBerry were subject to greater analysis in the process. Based on those case analyses various aspects are highlighted such as the marketing techniques being adopted by respective companies to promote sales within particular market segments and the statistics were subject to a proper comparative analysis. While the statistical inferences were based on the published material some of the reports were not published in full by the companies concerned.  The marketing dimension in promoting BlackBerry in Trinidad and Tobago has been particularly focused on the available data thus integrating marketing mix functions with strategic customer and competitor orientation. Assuming a greater degree of divergence between published literature on the subject and this researcher’s findings, the explanation can only rest on the time scale differences and the subsequent variances in analogy.

Theoretical analysis is much well facilitated than primary material which is basically limited to responses in the questionnaire and the survey. The available literature has been analyzed with specific focus on the learning related outcomes. Also there is considerable reflection on the state and relevance of current research, the relevance of data published on web sites and official documents because Trinidad and Tobago’s mobile telephony market structure is being increasingly skewed in favor of a government dominated industry. Even in TSTT, the government’s shareholding is 51%.  This analysis seeks to provide greater credibility to the study through a set of consistent inferences.

3.10. Research Limitations

The industry-centric research methodology aspect was focused on both the quantitative and qualitative paradigms but nevertheless the qualitative aspect was hindered by a variety of shortcomings including the inability of this researcher to obtain quality testing measures at successive levels of service delivery within the mobile telephone industry.  However it must be noted here that this detailed study would pay more attention to qualitative shifts than to quantitative data shifts caused by an industry in transition.

The skewed nature of published data cannot be stressed on too much either because such bias and prejudice are only too common at each level. However for the purpose of the ascertaining of strategic marketing initiatives by TSTT and other rivals in the industry, such skewed data did not have a greater negative impact on conclusions. In fact even the published data had come to such conclusions as a near-total exemption from the global economic downturn, which according to this author could not have been the outcome for a variety of reasons.

Next the all too well known limitations, viz. cultural bias and prejudice displayed by researchers in Trinidad and Tobago hampered the efforts of this researcher to a certain extent. By following strict control mechanisms and a set of relevant guidelines the accuracy of the analysis can be made right though. This tendency apart some data sets were characterized by a degree of inaccuracy with regard to analysis. The recent developments in the mobile telephony market in Trinidad and Tobago were not adequately borne out by these analyses.  Thus the qualitative research aspect also assumes a significant dimension of right or wrong. Organizational settings could have hampered the data collection efforts of many researchers and as a result they might have been influenced by cultural attachments and biases.

The most significant data sets for any serious conclusions have been sifted to come to some conclusions that have a direct bearing on the learning outcomes of this study. For instance the TSTT’s current marketing strategy as based on targeting mass markets as against niche segments is particularly influenced by a desire that small competitors are well equipped to cut down on costs when it comes to niche marketing. This fallacy has helped many those small but well equipped competitors to achieve market share on the basis of selective marketing. This example particularly illustrates the sense of complacency that TSTT has been under.

CHAPTER FOUR

4.  Data Analysis

      4.1. Primary research data analysis

      4.1.1. Questionnaire (See Appendix I)

The questionnaire was given to 60 company executives and managers working in Trinidad and Tobago telecommunication industry – including TSTT.

 Q. 1. What is the nature of your job at this firm?

Out of the 60 respondents to the questionnaire 24 are IT executives, 8 IT engineers, 20 IT marketers and 5 managers. The rest occupy various positions ranging from directors to consultants. The respective representation figures for each category show the broader perspective-based approach of this analysis.

Q.2.   How long have you been working at this firm?

Almost 55% of the respondents said that they have been working at their respective organizations for than two but less than five years. Almost 11 of them said that they were there for more than five years. 12 of the respondents said that they have been working at their respective organizations for less than one year. The rest have been working for more than 1 year but less than 2 years. The lower the period of time is, the younger the respondent, because they were fresh college and university graduates.

Q.3. Have you ever been involved in more or anyone of the following tasks?

The highest number, i.e. 38 are involved in IT management while the lowest number, 6, are involved in customer relations. 14 of the respondents are involved in marketing related work. The overall representation of involvement in different jobs shows the extent to which the surveyed companies have placed emphasis on the marketing aspect of all else. Thus the overall outcome of the questionnaire in relation to product marketing assumes such big importance.

Q.4. Given your current job, how do you rate BlackBerry’s launch by TSTT against other companies? 

Almost 65% of the respondents said that there are more benefits associated with such marketing or product launches.Almost 9 of the respondents were not sure as to what differences are there between product launches and marketing. For them benefits are intangible and therefore cannot be recorded.

Q.5. What is your company’s current marketing strategy in the face of current level of competition in the country?

44 respondents said that their companies preferred launching products that carried lower prices and a number of value added services. 14 respondents said that their companies have been marketing a variety of products and services thus ignoring the impact of competition. Fear factor could have played a very significant role in those fewer companies that were trying to evenly balance the two options.

Q.6. How do you assess the probability of success on TSTT’s BlackBerry related marketing strategy?

Almost all the respondents said in unison that risk associated with any new marketing campaign or product launch is substantial. This is due to the fact the degree of variability in price related uncertainties, is considerable. The market uncertainties are directly associated with price variations and the success of TSTT’s BlackBerry marketing strategy is determined by them.

Q.7. How do you assess the impact of the TSTT’s initial strategic BlackBerry launch success with the new effort?

31 of the respondents said that the current effort is partially successful while 25 said that the current effort has to go a long way. Others weren’t sure of its impact on the outcomes of the new marketing campaign. Invariably the respondents agreed that there was a positive impact on some of the outcomes like market share.

Q.8. How do you assess the TSTT’s strategic corporate strengths in launching BlackBerry in Trinidad and Tobago while other competitors are not far behind?

35 respondents said they believed TSTT’s strategic strength lay with the critical resources at its disposal. 21 of them believed it all came from its government connection and near monopoly power.

Q.9.  Do you think that TSTT will be able to capture market shares of rivals with         the new marketing campaign?

Only 25 respondents believed that the company would be able to capture rivals’ shares while the rest categorically said no.

Q.10. Which of the following factors have a greater impact on the current demand for mobile phones and services in Trinidad and Tobago?

Almost 56 respondents identified the income factor while the rest identified the price factor.

4.2. Secondary research

 4.2.1. Marketing Mix – Seven P’s

This paper uses an extended marketing mix with 7ps

Product- TSTT has the capacity to adopt both wireless and fiber optic networks that enable it to deliver multimedia, voice and data services to its customers. BlackBerry has been in great demand ever since it was launched.  Its software is highly sophisticated. Its service delivery platform consists of a user friendly interface and the latest features. TSTT is constantly in the process of improving and improvising its existing products to suit the needs of its customers and to stay ahead of its competitors. BlackBerry sets are of high quality thus customers are enticed to buy them even by paying a higher price (Michaluk, Mazo  & Trautschold,  2008).

Price- From a price point of view the download of the interface is free of charge. Even though the profit margin for each song was only about 10%, the iTunes aim is to be the center of a user’s digital world.

Promotion- Most of the retailers are more than glad to promote the idea of a more powerful and versatile BlackBerry because its super brand image is compatible with their brand image. Without restricting themselves to advertising on the television and radio, a mobile based marketing drive such as sending of messages can be used. Viral marketing techniques such as the sending of multiple e-mails could be used. Viral marketing techniques are more cost effective than for example advertising on the television or radio.

Place- Since BlackBerry phones are available online they are available anywhere and anytime. Distribution cost can be curtailed.

People- TSTT has to establish meaningful people’s relations such as with customers, employees and others.

Process- It refers to paraphernalia that assist in the marketing efforts of the products. Callers on mobiles might text each other and become effective promoters.

Physical environment- TSTT has a highly substantial physical environment related set of services, including technological superiority, for example on the mobile phone digital music file sharing was never so sophisticated before the launch of digital mobile telephony services.

Physical environment– This refers to comfort and facilities.

   4.2.2. The possibility of price discrimination by TSTT

The supplier sets different prices knowing very well the position of its near monopoly power to segment the market according to consumer demographics. For instance the prices were higher in the high income segment due to the higher prices charged by the network service providers for the service (Martin, 2011). In the high income segment mobile telephony service providers would have to provide some extra services in order to charge that extra price. In other words there should be a process of incremental customer value creation. This approach in placing the product at the center of the marketing campaign to capture the most economically viable consumer segment would pay off well.

This is shown by the following diagram which segments the market into three according to the supplier’s ability to price discriminate among his customers. The second segment of mobile telephony market enables the supplier to sell a varied product to those who are less able to afford it at the higher price (Sweeny, 2009).

Finally the supplier reduces the price further for the low income segment. This segment is almost catching up with much more revenue promise in the future. This aggregation of market segments and their revenues will only be successful only if the good in question cannot be resold by those who buy it at the lower price. Secondly it becomes successful only if the cost incurred in the lowest price segment is covered with gains made in other segments partially or wholly. In fact labor costs might rise too fast even in the high income segment thus leading to a loss in that segment.

Figure 4.1: Price discrimination on the basis of market segment

Price ($)                                   D

P3

P2

D

P1

Quantity

Number of factors would have to be considered by the firm in determining the market price for each segment. For example the firm had a virtually monopoly position in Trinidad and Tobago in the past though its ability to act as the ‘price maker’ was limited by a number of factors such as the ease with which competitors can enter the market and supply constraints. The absence of monopoly power of TSTT is there though it cannot be taken for granted in deciding on the price.

Thus the price determination process gives less freedom to the supplier. For instance the price is determined in the mobile telephony market by the possibility of other firms responding to the unfolding market developments there. When adequate infrastructure develops in the market newcomers would have a tendency to enter with ease and not to leave even in the face of rising costs. Further supply constraints as in the case of natural monopolies like power supply can be taken into consideration in determining the price (Heid, 2004).

Figure 4.2: Monopoly power and monopolist’s equilibrium price and output

Price ($)

P2                                X                           MC

AC

P1                                    Y

E

AR = D

Q                                                                                     Quantity

MR

As the above diagram illustrates the supplier here acts like a monopolist because of his capacity and capability in price discriminating behavior. He sells the quantity Q at the price of P2 and makes a monopoly profit equal to the amount shown by the rectangle P1, P2, X and Y. This surplus profit would not last long if competitors are able to enter the market with ease (Jimenez, 2007).

He maximizes profits at the point E where Marginal Cost (MC) is equal to Marginal Revenue (MR). Thus he is a ‘price maker’. His Average Cost (AC) and Average Revenue (AR) remain at a point higher than the equilibrium point when he maximizes profits. In fact he can sell to the right of the point E but he doesn’t. However it’s obvious that depending on the nature of demand for BlackBerry the firm is able to price discriminate and therefore at least in the short run competitors are less likely to enter the market. Thus at least in the short run this firm acts as a ‘price maker’ and not a ‘price taker’ as in perfect competition.

4.3. Service quality parameters

There are significant service quality parameters to ensure the customer satisfaction with the BlackBerry mobile phones. This would be applicable to create a quality and convenience in-store as well as website (Chumpitaz, 2004).

  • Average Customer handle time

TSTT lacks in strong customer support department which would provide solutions to the customers and take care of them in the log run. Thus there is a communication gap between the company and the customer.

  • In-store and website quality

The company needs to focus and understand in depth about online and offline shopping behaviors of the customers and develop a suitable website and in-store according their convenience (Flipo, 1986). Otherwise they might have search about competitors and intend to purchase those mobile phone products.

  • Product, process & technical knowledge

However the product technology argument mentioned above presumes that mobile phone customers have been influenced by an equal desire to keep up with changing times.   This argument is very important in Trinidad and Tobago.

Company can encourage their employees towards the high customer activity to satisfy them and increases the total spend of each customer. This can be done by encouraging customers to integrate online and offline through loyalty programs like privileged cards and redemption points. While there is no particular set of metrics to measure brand loyalty for TSTT’s Blackberry in Trinidad and Tobago there s enough empirical evidence to prove that the product is attracting a wider cross section of customers already (Tasner, 2010).

  • Evaluation of service quality

The company would adopt Six Sigma and Total Quality Management concepts and tools to make sure that both the perceived level of quality and the actual quality of the product are the same. Under the Six Sigma concept, the company would adopt those quality management methods and tools such as continuous improvement by minimizing variations in standards, unifying product specifications and removing errors systematically. Its data-based methodology of removing defects is the main criterion which underlies the process of matching the six standard deviations between mean and the limit. On the other hand the TQM concept would involve quality improvement based on continuous assessment of standards.

4.4. Service Gap Analysis

There can be identified some applications for service marketing strategies to address the Service gap (Hoffman, 2010). Service gap analysis of TSTT’s current BlackBerry marketing campaign would shed some light on its strategy though the extent to which a research study could focus attention on the strategic policy initiatives in the sphere of marketing depends on the quality and quantity of the available data.

Brand or product differentiation strategies heavily weigh on the subsequent ability of the firm to differentiate its brand on the basis of quality. A customized mobile phone service company would have the desirable impact on the customer’s expectations only when the quality standards have been satisfactorily met (Donovan  & Samler, 1994). Thus the quality option in brand differentiation for the TSTT’s new brand of mobile phone for this age group is determined by the company’s ability to drive the point home for the potential customer that quality means a lot.

On the other hand strong brand has become cliché as already pointed out above. A strong brand doesn’t mean that rivals would remain inactive. In other words the building of a strong brand depends on the already established degree of brand loyalty. For that to come about there must be some brand equity promotion activity (Macdonald & Sharp, 2000). The company must be constantly seeking to build up a strong brand on the basis of brand equity. Brand equity is a strategically significant measure of the existing customer’s response to new promotions and the potential customer’s assessment parameter to decide on the purchasing decision. Thus strong brands ultimately depend on the concept of brand value from the customer’s viewpoint.

 The product-market expansion strategy for the company customized mobile phones must be based on the following principles (Gonzalez & Quesada, 2004). These principles can be identified as a first measure or approach to overcome the existing level of competition and strategically reorient its marketing campaign to achieve positive synergies directly and indirectly related to the corporate goals of the company.

4.5.Addressing gaps related to the perception of quality at TSTT

Some authors identify five major gaps that business organizations have to narrow down in satisfying their customers. In the first place there is a perceptive distance between customer expectations and what managers think about service quality. The company is trying to reduce this gap by introducing various measures such as frequent quality circle meetings among managers and employees. In the fifth place there is the gap between the customer’s expectation and the real experience about the service. The company here is making efforts to minimize the gap by articulating a service quality improvement project (www.bmobile.tt.blackberry.com).
Sales team was more concerned of adding newer products to the existing portfolio so that diversity of products and wider choice would appeal to customers who are constantly on the lookout for newer and better products. Thus bonuses and targets were their prime concern. On the other hand the supply chain team was highly worried about out-of-stock inventory mix. When volumes and profits drop in times of economic recessions there is something really to worry about. The supply chain team was also worried about the service related challenges in order to fulfill customer demand (Porter, 2008).

Against this backdrop a more comprehensive resource use rationalization strategy would be pertinent though it’s equally imperative to know how best to avoid supply chain bottlenecks and associated costs by way of reducing inventory of no-go-products. In other words a rationalization strategy would require a number of tasks to be performed before putting into effect any program of action (Gruber, 2007).

In managing supply chain related activity in procurement of materials the purchasing manager or the specialist has to perform a series of tasks according to some predefined criteria. In the same way the purchasing manager or the supply chain team has to take it to consideration the number of factors that directly and indirectly impact on their performance. In the first instance skills of the supply chain team would be enhanced by the vertically integrated organizational and management structure which essentially support the design planning and implementation of supply chain strategies, especially those directly related to the purchase of raw material and components for primary operations. TSTT was just faced with this problem.

The purchasing specialist has to focus on his tasks associated with procurement and management in order to achieve a degree of functional conformance to established standards such as the core business activity related efficiencies. This means that the ever increasing practice of modern business organizations’ preference for outsourcing certain tasks that lie out of the core business functions of the organization is dictated by competitive pressures. For instance the logistics team would be able to hone their skills depending on the level of concentration on core business operations by the company. Business organizations’ increasing level of dependency on resources procured from outside enables teams to develop a special set of skills for effective practice as a supply chain team.

CHAPTER FIVE

5.1.Conclusion

From the above findings it can be safely inferred that TSTT already has been losing its monopoly power.  Since the demand for mobile telephone services is bound to increase, it can be inferred that the market for BlackBerry is bound to grow. TSTT maintains a good brand image and a loyal customer base in Trinidad and Tobago. It is vital that it continues to invest in developing new technologies as otherwise new innovations and inventions from other companies could capture the market (De Burca, Fletcher & Brown, 2004).

It’s possible for TSTT to form informal partnerships and formal legally binding partnerships with other companies in order to share knowledge and technology to help further enhance TSTT’s deliverables as efficiently as possible. TSTT is also faced with a threat from inferior quality pirated products in the market for example through mobile phones imported from countries such as China.

Product and marketing strategy of airlines as with any other firms, is connected with the overall orientation strategy which is classified into product orientation strategy, market or consumer orientation strategy and competitor orientation strategy. TSTT has been particularly noted for its product orientation strategy based on the success of critical factors or competences directly associated with BlackBerry. Product development programs of TSTT have been successfully executed to a certain extent. For example its diversification strategy in segmental product placement efforts has paid off with a rise in revenues for the last two years (Czinkota, Ronkinen & Kotabe, 2009). With the creation of an extra service platform for the users of BlackBerry a product diversification process has been initiated though such diversification activities need to be focused on the customer’s response to the ultimate product. Given different demand elasticities, i.e. income, cross and price, for mobile telephone services, there is always an amount of uncertainty associated with industry orientation and the level of competition. Product orientation strategy is thus focused on the development process. TSTT has successfully adopted such a product development strategy and outperformed many rivals. Its revenues began to rise faster and the product loyalty began to rise among a substantial cross section of customers in Trinidad and Tobago.

Its marketing or consumer orientation strategy is also marked by a similar approach. Advertising and promotions go apace with local and foreign agents being enlisted for a variety of service contracts. Right now TSTT is trying to venture into the digital music market with emphasis on music file sharing by mobile phone users on a high speed data downloading platform. Its strategic initiatives include up-market advertising and promotion drives to preempt rivals’ strategic moves. For instance in advertising its latest BlackBerry services the company has promised an uninterrupted service provision

Extreme strategic marketing choices have been forced on TSTT by this up-market trend setting behaviour though.   Rivals’ own strategy of product placement in the up-market segments has paid off with handsome returns to them though. But nevertheless it’s essential as a product-centric approach to achieving operational cost recoveries. In fact there is very little freedom for a mobile telephony service provider to differentiate products unless it’s done through a systematic process of enhancing services through value addition to the customer. In the eyes of the customer such value additions such as instant reductions in prices are the best attractions (Trinidad & Tobago Manufacturers’ Association, 2011).

However its current product marketing drive is essentially determined by cost-cutting efforts as well.   Marketing clout of TSTT is not altogether shadowed by its rivals and the latter have been increasingly going after customer-driven value creation efforts plus the cost-effective achievement of marketing synergies through an aggregation process that involves a series of customer-care points both within and without the organization.  Recently the company has adopted a marketing technique to offer more additional services such as instant messaging from and to selected friends at little or no cost.

Such customer-centric sales allow agents to achieve quantifiable transaction flows across a range of products to customers who otherwise tend to ignore the qualitative parameter, simply because it’s inconvenient. Such marketing dynamics have placed TSTT in a well-heeled position in the market. Going up-stream in a tightly competitive market to place products at a strategically advantageous level is a very difficult task. However, the proposed marketing strategy requires a degree of time related planning. 

TSTT’s operational environment is also characterized by a greater degree of involvement in promoting corporate sustainability programs outside its day to day operations. For example TSTT has been influenced by advertisers’ and bloggers’ interaction on price competition related problems such as. Its ability to price lead the market. This has been criticized by many.

The digital music industry is evolving very fast. There is always the threat of a new company introducing something totally new to the market such as wireless technology that could replace the need for a physical music player. It’s of paramount importance for TSTT to invest a lot in research, and development and marketing in order to keep up with other companies that could introduce newer products to the market (www.asseco.com).

The digital music industry is very competitive today, and since almost every mobile phone user wants to listen to music on their sets, the service providers are in a hurry to identify their tastes. TSTT is not an exception to this rule. TSTT is a successful company and equally well attracts competition. This is a potential threat. It invests a lot on research and development and marketing in order to stay ahead of other companies in the mobile phone industry. The popularity some rivals’ products is increasing (Taylor, 1992). Given the fact that the digital music industry is evolving very fast, even though iPod and MP3 are in vogue today, tomorrow’s technology might be much different. Wireless technologies could replace the need for a physical music player (Barton, 2005). TSTT is faced with the risk of employees themselves divulging secrets about its new technology.  This could cost it a lot of profits. File sharing is another threat. When one customer buys a file, if others are allowed to share this, it’s a threat. Rivals of TSTT are just aware of these possibilities.

CHAPTER SIX

6.1. Recommendations

A new marketing strategy for TSTT’s BlackBerry phone has to be characterized by a series of value additions to tempt the potential customer to purchase the product. A product orientation and expansion strategy based on the existing brand strength associated with the new customized mobile phone’s market leadership is desirable. Ansoff’s product-market growth strategy might be useful to a certain extent, e.g. in targeting new niche markets (new markets- new products/brands) to place the customized mobile phones for teens. However, new niche markets where there is already some stiffer competition from rivals can be expensive (Gerpott & Jakopin, 2005). Newly emerging markets might be more feasible for a sustained product-market expansion program and a sustained marketing campaign in different local market segments might be needed with new smaller competitors coming into the market almost on a daily basis with their highly distinguished brands and products. A broader and better focused strategic vision in conformance with long term marketing goals, including competitor and customer orientation strategies, might be the best alternative for TSTT right now.

Market segmentation according to consumer demographics based on key variables such as the number of visits to store during a given time period by an average customer is feasible. Above all the awareness of customer preferences matters. The existing market shares of TSTT mobile phones and its rivals show that TSTT leads with the lion’s share. The bigger the market share the greater would be the possibility of success. But nonetheless the company is highly concentrated at the top management level. This means that decision making process has to be decentralized to accommodate marketing campaigns that run on high budgets and tight time schedules (Bennett & Blythe, 2002).

The extent of available resources to launch a sustained marketing drive to promote the brand would determine the TSTT’s capacity to compete strategically. Therefore the Trinidad and Tobago market segment requires a diversified marketing strategy based on targeting a mass market and a number of niche markets. The latter are characterized by customer preference and sentiments. This is so much the case right now because digital music market segment is on a roller coaster ride in demand.

TSTT’s BlackBerry needs to be marketed by adopting a market penetration strategy. This means the introductory price must be kept to a minimum so that a sizable share of the market can be captured and maintained. The existing competitors in the mobile telephone market in Trinidad and Tobago basically rely on providing a core number of enabling services, especially to the 3G mobile phone user.  TSTT’s current strategy of concentrating on providing a broader spectrum of services across seamless applications of both technology and user friendly operational parameters is good enough but requires a much cost conscious approach.

TSTT has successfully created customer value through the expanded marketing mix rather than restricting the marketing strategy to the 4P based mix in the market. However there is a still greater possibility of increasing market share through an extensive online advertising campaign.

Rivals such as Nokia tunes and Sony Ericson tunes have noticed the reliable efficacy of sensory marketing as a potent force in appealing to youth in the digital music market in Trinidad and Tobago delivered on the mobile, e.g. visuals and audio quality. The country has a large market for mobile telephony but an innovative marketing strategy should be used to capture this market by concentrating on customer preferences and their taste (TSTT Trinidad, 2010). TSTT has not done just that.

In order to capture a large segment of the market it’s vital that initial price of the products be kept to a minimum. The price cutting war in the market is going to be particularly deadly for small competitors though. In other words a market penetration pricing strategy is almost the foregone conclusion with rivals. TSTT cannot afford to be complacent. They should continue to invest in experimenting with newer technologies in order to come up with novel inventions. Else they could be overwhelmed by other competitors (Alleyne, 2011).

TSTT could form new alliances with other companies informally and formally in order to share technology and thus further enhance the quality of their products. Technology agreements with other service providers would be desirable. The consumer demographics in the market for mobile products in the country shows that the purchasing behavior of consumers is fast changing and therefore rivals of TSTT are increasingly focused on strategic marketing reorientation programs like advertising and customer targeting in a variety of segments.

Sensory marketing has been one such specialty of the rivals. Five senses don’t essentially act as the ultimate determinants of purchasing decisions of consumers. However sight in particular is influenced by appearance. What’s seen, heard, felt, smelled and tasted matters in the immediate decision making process.  Thus the high income is the most basic factor which drives buying decisions.

The value statement as defined by service quality can be based on the company’s customer value creation strategy with versatility, low price, quality and fun. As a value statement shows the first word is versatility. This key concept has become a very big issue in the current times. The potential customer must be informed about the level of versatility in the service and the product.

Similarly quality matters because the price paid by the consumer is for the quality as much as it’s for its many uses. TSTT has not yet come to terms with this aspect because its BlackBerry unit was found to be lacking in some extraordinary features, especially seamless integration that rivals like Nokia and Sony Ericsson could provide on their platforms (Moyer, 1968).

Thus a few extensive and serious research studies have to be undertaken in order to determine the extent of influence on consumers’ decisions to buy mobile phone services and this should not be limited only to the semiotics but also extended to a study of how brand loyalties are formed even in the absence of any tendency to associate personal preferences of consumers with some product quality.  This is in conformance with the current trend in marketing adopted by Nokia and Sony Ericsson.

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APPENDIX I

Questionnaire

Q. 1. What is the nature of your job at this firm?

□ IT executive                                □ IT manager 

□ Marketer                                    □ Other

Q.2.   How long have you been working at this firm?

□ Less than one year                                □ More than one year but less than 2 years

□ More than 2 years but less than 5       □ More than five years

Q.3. Have you ever been involved in more or anyone of the following tasks?

□ IT management                       □ Marketing

□ Customer relations                □ Other

Q.4. Given your current job, how do you rate BlackBerry’s launch by TSTT against other companies? 

□ Product launch benefits                                 □ Marketing benefits

□ Benefits are not tangible                                □ Not sure

Q.5. What is your company’s current marketing strategy in the face of current level of competition in the country?

□ Launching lower priced products                           □ Price indifferent

□ Competitor oriented                                                 □ Other

Q.6. How do you assess the probability of success on TSTT’s BlackBerry related marketing strategy?

□ Risk higher than potential success                     □ Risk minimal

□ Price related uncertainties                                  □ Price related uncertainties less

Q.7. How do you assess the impact of the TSTT’s initial strategic BlackBerry launch success with the new effort?

□ Partially successful                                           □ Not successful at all

□ Positive impact on market share                     □ Not sure

Q.8. How do you assess the TSTT’s strategic corporate strengths in launching BlackBerry in Trinidad and Tobago while other competitors are not far behind?

□ Strengths related to resources                            □ Strengths related to government

□ Strengths are not substantial                              □ Other

Q.9. Do you think that TSTT will be able to capture market shares of rivals with the new marketing campaign?

□ TSTT might succeed in capturing market share of rivals

□ TSTT might not be able to capture markets shares of rivals.

Q.10. Which of the following factors have a greater impact on the current demand for mobile phones and services in Trinidad and Tobago?

□ Customer income                            □ Price

□ Technology                                      □ Versatility

□ Other

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