This blog is all about the journey of a multinational telecom company Jio. We will focus on hardwork, dedication and smart marketing tactics of Mukesh Ambani which has produced a digital revolution in India.
The terms JIO stands for Joint Implementation Opportunities.
Beginning of Revolution.
The founder of Reliance Business Empire Dhirubhai Ambani died in July 2002, then the power(authority) moved in his son’s hand. Mukesh became the Chairman and Managing Director of Reliance India and Anil holds the position of Vice Chairman.
Very soon the feud between brothers became strong enough to burst in public.
Atlast the family agrees to split business in a deal announced by home-maker.
Mukesh gets Reliance Industries with interest in petrochemical oils, refining e.t.c.
Whereas, Anil holding telecom power, entertainment and financial services and business.
There was a major de-merger of note for Mukesh Ambani. His dream project Reliance Infocom became a part of Anil Dhirubhai Ambani Group (ADAG). He lodged complain against his brother and went to court. Finally, he was successful to get the non completing clause against his brother. Although it took years of planning but legally Reliance Jio journey started off back in December 2015. Mukesh Ambani leaked the news that 4G network was running and around 1 lakh employees were using India’s first 4G LTE network as a test drive.
March 2016, Jio’s affordable and low budget LYF branded 4G phone entered the market. A month later jio.com went live with a bouquet of applications(Jio TV, Jio Music, Jio Cinema e.t.c.)
The Chairman Mukesh Ambani announced the commercial roll out of services at AGM(Annual General Meeting) on September 1 2016. Instead of charging anything, Jio started to provide free services. The term ‘free data, calls’ worked much more like a platitude that triggered mass. Jio team dispersed a right sim card on one Aadhaar card and the procedure to activate that sim card just takes 15 minutes. Jio found it indispensable to provide high speed data. Reliance Jio worked for establishing the base for high speed 4G network. Reliance build 8000 km of Fibre Optical Cabling in Bay of Bengal Gateway which is part of existing optical Fibre Cable going from Europe to Malaysia and to Singapore.
This Optical Fibre technology produces a speed of 40TB per second. Jio has claimed to provide 10 times faster speed than other network. Though Jio has no-burden of 2G/3G networks, thus it provides 4G services in all the 22 zones of country whereas Airtel, Vodafone and Idea have reached 15, 10 and 8 zones respectively.
Industry Response :
Jio acquired 100 million users in a very small span of 3 months. They are expecting to double this number before the end of 2020.
The lights of Airtel, Vodafone and Idea quickly announced massive price cut cheesy offers to retain customers. The biggest move has been made by Idea Cellular which has agreed a merge with Vodafone. Vodafone and Idea have merged to became the largest telecom in India.
Jio had fought for critical issues against it’s fellow companions. On September 2016, Reliance slammed rival operators for allegedly returning to help their mobile phone port or switch new users. TRAI suggested imposing around ₹3050 Crore penalty.
Jio had to contend with massive demands, black marketers, drop in seeds, allegations of anti-competitive practices and much more. Still Jio is third best service provider in India after Vodafone-Idea and Airtel.
What made Jio the biggest and most successful startups in Indian history? Have you thought about this till now?
Marketing Strategies: Before the launch if Jio the revenue war was going for call rates. Airtel, Idea and Vodafone we’re charging very high for data.
If Ambani had made his mind to fight in the same rat race, it would be much like throwing stones in a cave but that was not the case. Jio understood the fact that call rate was a saturated market but there was enormous scope of growth in data field. That’s the first ‘success mantra’. They were smart enough to understand the market and create monopoly in it.
Exit Price Strategy:
|Old Technologies||New Technologies(Jio)|
|2G/3G Services||4G Services|
|High Cost, Strong Government Laws||Only investment in Optical Fibre|
Vodafone, Airtel and Idea were indulged in old infrastructure. Jio was bit late in business but with modern and advanced technology, they overlapped every field of improvements. Vodafone, Airtel and Idea were helpless, so, they can’t readjust to new technologies because of their previous investments, projects and their old infrastructure was way too weak.
Here, Jio played the master move.
Loss Leading Strategy: If a product is sold in less than manufacturing cost then it is called loss leading strategy.
Reliance gave free services. If a product is available free in a place, no one will pay for the same service at any other place.
The overall plan was to enter the headroom in a lightening speed and knock out you opponent without any warning.
Steps of marketing strategy of Jio(Summary):
1) Acquisition: This step consist of acquiring users from anywhere.
2) Activation: This is the step when user decides to take action.
3) Retention: Making sure you have firm grip in the market. The New year pack of 2017(extension of free service till March 2018)
4) Referrals: Customer turns into promoter. The cheap or free service have done it successfully.
5) Revenue: This was their last step of marketing where they actually planned how to generate revenue insteaad of planning it on first step as other company’s were doing.
In a nutshell we can conclude that Jio has focused on customer’s perception and they are successful.
Anyway these types of competition leads to profitability for common people (mass population).