Paper type: Analysis Pages: 21 (5158 words)
Vodafone is one of the world’s leading company, which deals with telecommunication networking. The company provides its services all over the world with association and joint ventures with company’s subsidy (information from the company website). While talking about Vodafone in Australia, it has been made as joint venture with Hutchison and created a brand in telecommunication aspect like Vodafone Hutchison Australia (VHA). VHA deals with almost 7 million customers over in Australia. The company mainly focuses in partnering with the local Mobile Virtual Network Operators (MVNO’s) to deal with the wholesale solutions.
In telecommunication industry Vodafone faces more number of competitors, which are trying to establish their own path. But the company always use some tactics to expand the business and make some efficient innovation with offers and deals to attract customers. The main purpose of merger of two companies is to create an entity and compete with the competitors.
This paper provides the clear evaluation about the situational analysis of the Vodafone telecommunication market.
Here this analysis deals with external and internal environments. The major issues faced by the Vodafone, firstly network issue national wide due to failed of transmission link. Secondly its faces problem in damaging data security breaches by the irritated customers.
2. MARKET SITUATION:
Vodafone created and entity as Australia’s third big mobile telecommunication network provider. The joint venture makes a partnership between Huctisona and Vodafone in 50-50 basis and made a brand called Vodafone Hutchison Australia (VHA). In the year 2010 due to the plan of three and Vodafone networks in competing with the other telecommunication brands the growth of customers is literally high in Australia (9.3 million) (colley, 22 october 2010). At the time when the new customers are to be registered the three brand gone to pass away and finally shut downed in 2013 august. It has taken a good path for the new technology.
The services provided by the company are prepaid mobile, mobile internet, broadband services, telephone answering services and mobile phones. It has almost 170 stores across the nation. Vodafone launches a website named vodafile.com. It is the place where the customers can provide the issues if the services. There are main issues faced by the customers that creates down step to the company. They are network issues like not reeving calls from the other individuals (Bingemann, 15th jan 2011). The other main issues is damaging of the data security of the individuals (news, JUNE 19TH 2014).
Vodafone has decided to build a focussed carrier in making the Australia’s mobile service as trusted towards the customers. As Mr. Morrow (Chief executive of Vodafone Australia) stated that “Vodafone is going to try to market to those customers that live in or need that coverage area that we don’t support” (vodafone), april 8th 2013). The main target of the company is to earn the hearts of the Australian people by providing a good services. Vodafone trying to study different strategies to rise the reputation in a target market. The Australian services reveals results that Vodafone revenue has declined by 16 percent due to weakness in brand service and declining consumers base and decided to strengthen the business by network improvements (palmer, 2013).
Vodafone announced it’s going to swap with regards to its 4G location by June, features included 2, 000 mobile phone podiums to enhance protection as well as released some type of “network guarantee” opt-out in relation to sad customers within the drive in order to remedy their particular damaged maker (Peter Trute, 2013).
2.3. SIZE, GROWTH AND MARKET SHARE:
Vodafone created its own way in the worldwide telecommunication services. Its world’s third largest telecommunication service provider. Where as in Australia its mixes its service and market with Hutchison and established its path in Australia in the third place named Vodafone Hutchison Australia (VHA). Located in different parts of the nation almost nearly in 170 stores around. Relevant marketing strategies are used by the team of Vodafone to develop the telecom brand across the nation which can be more efficient with their competitors. Their customer foundation shrank by means of 179, 000 within six months to November, compared together with gains regarding 313, 000 in Optus and 958, 000 in Telstra in the same period of time.
Fig.1: produced by vodafile.com (release date: 21st January 2011).
Vodafone began 2013 amid a fair slide within market discuss, which tucked from 7. 4% using the first one fourth of 2013 so as to just 20. 4% using the third one fourth (Sadauskas, 2014). Vodafone’s recapture linked to share within the past few quarter linked to 2013 coincides making use of heavy method of at a faster rate download price ranges, suggesting this series is resonating acquiring consumers. The mobile connections starting from the year 1999 to 2010 gradually increases than the telecom industry (Hess, 2006).
Fig.2: source: Telecom, Vodafone, 2degree, commerce commission.
Vodafone Hutchison Australia increases their market share to 17.5% from previous years. Where comparing the other two competitors like Telstra market share is 46.6% and Optus share is 27.3%. Mobile carriers obtain increased their market indicate over born carriers becoming the noticeable industry on the Telecommunications Providers subdivision. The easily transportable market provides benefited through the changing methods and inclinations linked with consumers because they have moved consumption on account of wired to help mobile style (J5800, 2014).
Growth of the company is based on the network performance by satisfying the customers with the good services. The growth and market is based on the high tech innovations by the telecommunication services. Due to the competitive aspects also the growth depends to make themselves better than the other. The national competitiveness is nothing but the growth which is like setting up the train (Kaldor, 1981). High innovative aspects creates a competitive forces and leads to the growth in the organisation (Schumpeter, 1934).
Here in the telecommunication industry the growth is to be increased with the merges of two inter-organisations, Vodafone and Hutchison got an alliances and made a changes to stand strong from the competitors and create a brand. In the present scenario, inter-organisational alliances is known as giving up way for the approaches to move from simple assumptions about complex firms structure and process (Elizabeth More, 1999).
The growth has to made to the company in three ways one with customers, other with technology and finally using some of the marketing strategies to make the product reach the customer. In the present scenario the growth of customers has been increased overall around the nation. Which is just following the two telecom networks Telstra and Optus that are in leading. The next aspect to be followed for the growth is improving the technology by the network services. So that the customers may be increased for the best service. Finally, the important thing to develop the growth by enhancing marketing strategies in various forms to attract more customers.
3. MARKETING MIX:
Marketing mix can be determines about the company where to compete and how to compete, so that can maintain the sustainable correctly competitive position which could maximizes shareholders resilient value. This process begins using brand positioning inside the elected industry segment, coupled with product, cost, and area decisions which make an attempt to further boost corporate price. The aspects like product, price, promotion and distribution analyse the situation and clear view of the company in the present competitive environment.
Vodafone is the Australia’s best provider of mobile communication network with the wast network based system of operation service providing the easiest way to get communicated with the customer satisfaction, the business range of tele communication deals with the network operations and here we are about to concentrate on the communication aspects and the products related to the business methods of the company (Halinen, 2005).
Here for this particular Vodafone company the next operation of business is for the products offered from the Vodafone service, (Viardot, 2004) the detailed explanation with the service and the product included here are briefly explained, the most of the customers in the Vodafone company are basically from the product based attracted customers where they are grabbed as a product buyers, instead of making the customers to fly away and make them to be attracted by the different service providers, so here if the best strategy and plan of operations are maintained by the company.
When the customer is in need of a new electronic products they can easily be grabbed towards the provider as they give different specific options when compared to the general service provider outside when the service is selected individually. When the customer is in need of a good the company will attract them with the different service options and offers which benefits the customer much better than the general individual service of communication. (Thoben, 2001).
Price if the main aspect for any kind of business in this world so as to maintain the better customer crowd with our company we need to target on the price instead of other factors, that doesn’t mean that they have not much importance but this is the important aspect to maintain the good relationship with the customers.
Vodafone succeed in this division of providing the better price than the other service providers as there is lot of attraction towards the offers provided in addition to the product (Methlie, 2006), as we have discussed the aspect of products in the companywide the main aim of the company is to attract the customers to make use of their service whatever may be the aspect the ultimate goal of the company is to make the customer is to make use the network of Vodafone (Doyle, 2000), Australia Vodafone much better and standing in the front line for the provision of better price than the other service providers of Australia.
Vodafone is collaborated with the electronic products brands which is when got the products in the whole sale from the brands who are supplying these products which is allowed to maintain the service with the Vodafone Company. Here the advantage of customers is they can avail the service of both product and the network provided to it by the same company. (Christopher, 2013).
Vodafone is the best ever served network in Australia, the company has various strategies followed to increase the sales and service to the customers Vodafone is known for its best customer satisfaction, the company promotes their low prices across mainstream network and the product sales with including their service, promotional strategies for the Vodafone company is mainly depends on their advertising (Safko, 2010).
The main advantage of the company strategy is done with the collaboration with the companies. For example when the network is to be sold to the particular customer he must be provided individually or he must be attracted with something like when he is attracted to buy the mobile phone here the products brand is also providing the advertising about the service provider here it’s about Vodafone (Lewis, 2001).
When the product is n the market and there is a collaboration with the electronic brand here both the companies are mutually benefited from this kind of promotional offers. But when we are discussing the promotional aspects Vodafone stands top in the digital promoting such as advertisement, and organising different kind of programs during the festivals and by attracting the regional people which suits them. Vodafone Zozoos are famous with their visual advertising media, the milestone was generated in the advertising world. (Lambert, 2008).
Vodafone 3G services will distributed to major destinations across Australia and allocated through Vodafone suppliers. Constraining the supply of 3G tough services to Vodafone Vendors and selected recognised dealers only (Crazy Gary and FoneZone) is usually to ensure potential individuals are assisted by just experienced in-store staff which have been trained of which to highlight the huge benefits and selection of functions easily obtainable through this type of service. That can also be consistent with our tactic of increased light this specific exclusivity within this product inside initial stage (Guiltinan, 1999). Subsequently, when 3G tough services are accessible and that’s available from our substantial competitors, the syndication regarding 3G tough services inevitably be being broadened accordingly.
4. COMPETITOR ANALYSIS:
Vodafone Hutchison Australia (VHA) competes with major telecom services providers, they are; Telstra mobile communications and Optus mobile communications. As stated in the above analysis, Telstra and Optus are major network providers in the nation, where Vodafone comes in third place.
Fig.3: market share of telecom industry in Australia
Fig.3 shows that in the present scenario of Australia’s telecommunication industry mainly taken under the hands of three companies, they are: Telstra, SingTel Optus, and Vodafone Hutchison. In the current analysis of 2013 the Telstra leads with 45.2% of market share and Optus takes 19.3% of market share and Vodafone Hutchison takes 9.5% of market share as per the report of (IBIS world, 2013).
4.1. TELSTRA TELECOMMUNICATION SERVICES:
Telstra is one of the Australia’s possessing telecommunications as well as information company’s provider using a vast offering of goods and services that are usually marketed around the private, enterprise as well as federal sectors in community and worldwide. The target market of Telstra are segmented in low usage customer and technology or big spender customers (Bullis, 1997). The low usage customers are the Consumers who will be sensitive towards the expense connected with mobile answers but including security in addition to convenience this kind of service reveals. Hence, they normally are infrequent users and so are also typically consumer’s person’s prepaid mobile services in addition to high TEXT usage shoppers.
The technology and big spenders are recognized as who are likely to spend a more money involving disposable profits with mobile products and services make use it frequently with their usage. The potential growth increases by the Telstra’s 3G objectives which built the internal competencies that are the beneficiary factor for the customers. Telstra creates its entity in mobile telecommunication industry by providing a value added services with a good internet access and communication network services. Telstra holding the customers by providing good coverage and speed for the competitor networks with the reasonable price (LeMay, 2014). As per the future aspect stated that that Australian Telco industry is adopted by the Telstra by adding more number of customers in converting them to 3G to 4G.
4.2. SINGTEL OPTUS:
SingTel Optus is other leading telecommunication industry in Australia in providing good service and products by developing the technology in day to day life. It is placed in a second position in the nation which is followed by the Telstra. Optus improved their services by make some changes in the following factors; in satisfying customers with enquiries, satisfying with billing to customers, satisfying customers in resolving the service issues and connecting and provisioning the products to the customers. Optus mainly focus on five aspects, they are; technology (converting customers to adopt to latest technology), customer satisfaction, competitors, regulation and economy. As the CEO of the company stated recently, the battle ground is not about attracting the customers but developing the quality in services and identifying the revenue in the data revenue (Russell, 15th november 2013).
The above study analyse the difference in marketing strategies that are used to compete with each other in creating a separate entity in the nation. We found there is a 9% of quality difference between Vodafone and Telstra (Lawrence, 2006). Based on the findings of 2012-13 study, states that network services among wireless carriers is relatively low in 2013 than in 2012. Finally, the gap in between the rankings of the carriers for the telecom industry is decreased in 2013 than in 2012.
By analysing the competitors, identifies the competitor’s strategy and the threats occurred in the following up with the company operations. The two competitors of the VHA improves their services and marketing strategy accordingly based on the area and users.
Fig.4: shows the cellular spectrum based on the area wise and customers.
In the recent survey, fig.4 shows that Telstra develops its service and provide a good product to the customers by evaluating with the target markets. Optus provides its services to both metro and no metro areas equally by its services. Whereas VHA mainly concentrated on the metro area in the providing good services and developing the latest technology. Vodafone is also put to step in the growth of non-metro users, and provide clear network technologies across all over the place. VHA had developed the 4G technology for high speed users, but it should mainly focus on the network issues faced by the customers. Maintaining key aspects like network services, technology , target markets like low budget users and big spender users, and dealing mainly with customer satisfaction in both metro and non-metro areas equally improves the market share of Vodafone in coming years.
5. EXTERNAL ENVIRONMENTAL ANALYSIS:
The external environment manly focus on the organizational strategic management. The external environment can be analyse about the company through PESTEL analysis. The factors like political, economic, social, technological, environmental, legal are included to make brief study about the company (Lancaster, 2002).
5.1. ECONOMIC FACTORS:
Adjustments in customer spending types are influenced with all the Australian economic system. The Risky economy offers remained steady inside wake in the global economic crisis. The features of fees to be able to foreign households supplies a new threat for your average home. Cost-effective things similarly effect Vodafone principal that happen to be the particular growth affecting GDP and simply how much inflation price within markets the spot that the firm works.
Moreover, world-wide monetary concerns by way of example world-wide personalized misfortune in conjunction with gloom relating to 2007-2010 are fiscal capabilities impacting on Vodafone (Dudovskiy, 2012). Typically any kind of additional monetary changes impacting on upon Vodafone may very well be labelled since additional monetary aspects.
According to the recent studies some of the companies has volatile growth and huge change in the global markets. Vodafone group is one of the company among them which is not only the expectation but it has been rapidly growing in some markets. Vodafone increases its services in emerging markets like Australia to create its own path of brand in 2009. Since from the past Vodafone identifies the problems faced and giving clear descript of the network with latest technology by that customers increases and revenue increased to 9.5% up to the present.
5.2. POLITICAL, LEGAL AND SOCIAL FACTORS:
Political factors are the important factors to design the structure according to the government and implementing the strategies which is related to legal, regulation and tax factors. Political factors comply with the company strategies in regulating the licences for the future operations. Vodafone stated that it undergoes some delay in operations and issues due to the regulating the governance and licenses. It also undergoes the various price agreements which would be helpful for the economy of the nation. The Vodafone telecom industry is under the hands of Australian competition and consumer commission (ACCC). The telecommunication industry has to report to ACC for the pricing and revenue to control the agreements (ACCC, 2013).
Australian government’s proposal provides consumers while using the confidence which their charges strategies usually are fair as well as consistent. There is a range of social factors including interpersonal factors along that influence Vodafone. Particularly, changing carryout patterns that is becoming adequately liked make people web based business increasingly counting in shifting technologies. Additionally, there tend to be issues a lot like people court docket proceeding ‘green’ in addition to ageing population in produced countries that may affect Vodafone specifically or circuitously.
5.3. TECHNOLOGICAL FACTORS:
In order to with stand from the competition Vodafone has to step into the technological advantage by developing network from 3G to 4G. The arrival associated with IPhone plus Android devices additionally has improved your chaotic environment connected with telecommunications. This reveals the danger and chance of the business, which may well define this existence inside near future. The best to publicise handsets just has evaded the organization. It right now relies tremendously on well-liked equipment including Apple’s I-phone as well as Samsung’s Galaxy. This features driven the organization towards a cutting-edge method to their payment and bundling companies.
The exact impact relating to technological details on Vodafone need to indeed be due to nature while using the telecommunications market (Preissl, 2009). A technology systems is kind of techniques within communications besides emergence regarding alternative forms of connection like on-line conversing, along with North America on-line! Messenger certainly will impact Vodafone method inside a style that this organization is quit having to be in upon either to construct arranged alliances getting earlier mentioned organizations or perhaps want to substantial amount of study besides development so that you can bring in contemporary products for this particular market.
6. SWOT ANALYSIS:
Based on the above evaluation of the company, SWOT analysis is generated. Here it is discussed about the strengths, weakness, opportunities and threats on micro level of industry (Miller, 2007).
Vodafone is ranked third about this kind of schedule as current market capitalization statistics. Vodafone functions usually applied a great extreme internationalization approach, which have been backed with the latest efforts in International as well as Australian market segments.
A strong telecommunication operations of Vodafone in all over the world with a huge geographical portfolio and with good relations as service provider with customers.
Infrastructure of the network operated.
Developing their entity in the leading markets like Australia.
Strong base and network access in cities.
The main weakness of Vodafone in Australia is facing a competition with the other telecommunication markets like Telstra and Optus. As per the saying, the competition is nothing but intensifying the light to the great charges and changes in the company named Vodafone.
Bad impression and underperforming with key competitors like Telstra and Optus.
Network access is not as strong as of the other network industries.
No network in non-metro areas.
Poor in resolving the network issues of customers.
The partnership with Hutchison and Vodafone leads to the main opportunity to enhance the issues with the network and improve in latest technology. Australia is aggressive emerging market in the recent years that may aligned with different core and competitive strategies. Latest technology in smart phones and tablets may also increase the opportunity in the present market revenue. The opportunities would aligned by introducing the latest technological innovations with new services and products.
Focus on the network and cost reductions for the good returns.
Implementing research and development in improving new technology.
Improving good staff that would make a great stuff in technically and networking.
Good packages for the users.
Introduction of new mobiles may lead to the major threats in partnership aspects of Vodafone. In ability in satisfying the target market may lead to reduction in market share. Lack of attention towards the quality services and price ratio when comparing with the competitors may also lead to the big threat for the company.
Heavy competition in the market.
Lack of attention towards the customer satisfaction.
Extremely with high cost and lack of deals to the customers.
None developing the network service in non-metro areas.
Extremely not providing the good packages with high speed.
7. ISSUES IDENTIFIED:
In the previous years, the technology creates in all the aspects like business and society of Australia. There cannot be any kind of long term development in the rural Australia with in the technological aspects. More over even in the metro areas the Vodafone service providers make the customer unhappy with their bad reputation in providing good services. There are two main issues faced by the Vodafone Telco services are; the internet & regional Australia and issues faced by the competition.
However the Australian economy tends to change, the regional economies may be intend for the growth of the economy. Where the country growth depends on the customers through online business structure. Unfortunately Australian business market has slowed down by the internet situation in the regional place. Vodafone condition in the regional place is very poor when compared with the other network providers. According to the recent studies, Vodafone can’t be able enrich the satisfaction of the customers in providing their services as well with good packages.
Australia is concerning with huge issues in social and economic effects by Vodafone in evaluating the problems faced by customers in broad band infrastructure (GARY MADDEN, 1996). According to the Australian-wide survey of 715 households, the customers are not willing to subscribe the Vodafone broadband services due to poor coverage of network. Vodafone faced a trouble in installing 4G network in many of the handsets. They still in awaking with the issues and cant not able to rectify the problem. Vodafone has low repentance in the non-metro areas about the network provide services.
Vodafone must think and consider about the risk faced by the customers, otherwise it will not be associated with the brand anymore by the users. The next step that has to take is to make perfect decision making process that can evaluate the issues. The bad reputation may create a problem for the company by jumping to the other network providers due to the inconvenience to the users. To reduce this kind of issues Vodafone has to follow particular steps to retain the name back and gain the hearts of the customers. As per chief executive of Vodafone stated that more number of towers to be added in the region for the better network strength (Nasit, 2011). Clears the customer’s enquiries and adopt the problems by rectifying it with a good service. Making a strong point like customer service is prime moto of the company.
Analysing about the competitive advantage and add few strategies to compete with the other networks which has good name in the society. Vodafone has to develop its target markets and make sure that its service should be enhanced in all parts with a great network coverage. Introducing various technologies and good packages for the users leads to the increase in customers for the further growth. Competition in the telecommunication industry becoming more competitive with the raise in new emerging markets and companies and existing companies. Telecommunication industry had become rival to the other companies in various areas. For example in Australia the main competitors of the Vodafone is Telstra and Optus.
Finally this papers conclude, that the analysis of internal and external environmental factors makes a certain findings in the company for the growth. Here opportunities and threats were discussed to evaluate to find the correct solution for the consumer satisfaction. Where based on the competitive strategies comparing with the other networks, the target markets are weak for making market grow. Vodafone has to maintain clear view on the customer satisfaction and resolve the issues face by them. Technological aspect has to be developed in all parts of the place and should be easily talked by the consumer. According to the political and legal views the company has step forward for the reduction of rates as per the government regulations and make a reasonable packages.
The issues are discussed to reduce the loss of customers in which use some competitive strategies to with stand in the nation as best competitor. The main issue that notifies is that poor network coverage. These issues are not resolved by the company that may leads to the dissatisfaction of the consumers and finally leads to reduction in revenue. These issues are analysed to prove that Vodafone joins with Hutchison and made it as Vodafone Hutchison Australia (VHA) is one of the strong competitor in the present scenario. VHA needs to develop few marketing and competitive strategies to create a single entity with brand in the Australia.
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