Etisalat : Strategic Analysis

                                      Fig 1: Etisalat Logo ( source : PTCL worker.com)

                                                   

 The given blog is exclusively dedicated to the telecomm giant from Middle East, UAE based Etisalat. Etisalat is among, one of the non oil sector based success stories from the Gulf and the given blog will do a detailed analysis for it. This will consist of the basic introduction followed by the overall telecomm market in UAE. In the next part the growth and expansion of various businesses of Etisalat over the last decade will be studied,  followed by some of the major international subsidies of Etisalat. In the concluding part the future strategies of Etisalat will be analyzed. Once the blog will be done, another blog, dealing with the financials of Etisalat will be rolled out soon.

Introduction

Emirates Telecommunication Corporation, branded as Etisalat is one of the major telecommunication companies in the world, operating across Middle East, Asia and Africa. It provides mobile and fixed line data and voice services to individuals, enterprises, telecomm companies etc. It also provides a wide range of high tech and complimentary services to telecomm companies including SIM card manufacturing, payment solutions, staff training, peering, voice and data transit, sub marine and land cable services. (Etisalat.ae, 2011)

The company was founded in 1976 as a joint venture between International Aeradio limited, a British company and local partners. Later on in 1983, the govt. of UAE had a 60% stake in the company and rest was publicly traded. From 36,000 exchange lines in 1976, it was having around 7, 47,000 lines in 1998. Today Etisalat is considered as one of the biggest success sagas in Middle East and is one of the biggest contributors to the UAE government after the traditional oil sector. Currently operating in 18 nations world wide, it enjoys around 135 Million aggregate subscribers and annual revenue of US $ 8.7 billion. (Etisalat Annual report, 2010)

Table 1:  various companies of the overall Etisalat group

Fig 2: shows breakdown of revenue (as on Dec, 2010) (Source: Etisalat annual report 2010)

Fig 3: shows the breakdown of Etisalat group as on Dec, 2009 (source: Etisalat annual report 2009)

Telecommunication sector in UAE:-



The growth of telecommunication sector at UAE had been synonymous with the growth of Etisalat, its major telecommunication company. The telecom sector in UAE had been highly regulated with Etisalat having monopoly in the market for most of the time. In spite of having monopoly like many of its other Emirati counterparts, Etisalat had always been upfront in coming up with newer technologies and value based innovation in the market. By 2005 mobile penetration was more than 100 % where as internet and broad band penetration was more than 60 %. The market dynamics changed in 2006 with the emergence of Du, another telecomm company in the market. (2dayDubai.com, 2009) Du is owned- 40 % by Dubai government, 20% by Mubadala, 20% by TECOM (Dubai technology and commerce free zone) and rest 20 % is owned through publicly listed shares in Dubai financial market. Presently due to saturation as well as competition the top line of the Etisalat, the major telecomm company seems to be affected in UAE, but it is growing rapidly through international expansion and acquisitions of other players. Moreover the overall ICT sector of UAE (consisting of IT along with telecom) is poised for a strong growth in the coming time. Both the major Emirates of UAE- Dubai as well as Abu Dhabi have ambitious growth plans in the form of Dubai 2015 and Abu Dhabi 2030 respectively and they realize the fact that strong ICT sector is a precondition for achieving these ambitious plans. The ICT sector is expected to get strong boost due to multibillion dollar infrastructure development plans, economic diversification and an exuberant SME segment, in the nearby future.


Growth of Etisalat over the last ten years


From a humble beginning in 1976, Etisalat has grown into a giant organization. According to financial times it holds 140^th position among the top 500 companies, in terms of market capitalization. By the mid of 2000 Etisalat had evolved  from a local player that provided basic wire line and data services to an international player providing a wide range of sophisticated services. The given section will discuss the growth track of Etisalat

           
Fig 8: showing the revenue and net profit of Etisalat, over the last eight years, Source: (Annual Reports 2002, 2005 and 2010)

                      Fig 5: Annual Etisalat mobile subscriber in UAE, over the last ten years (Source: Annual Report 2002, 2004 and 2010)


Key Insights from fig 4:-


• The CAGR (compound annual growth rate) for mobile subscribers , for the  period of last 10 years  is 18.5%

• The CAGR for 2000-05 is 26.1%, whereas for 2005-10 is 11.4%.

• There has not been any substantial growth in the last three years.

Fig 6: Annual Etisalat fixed line subscriber in UAE, over the last ten years (Source : Annual Report 2002, 2005, 2010)

Key Insights from fig 5:


• The CAGR for number of fixed line subscribers over the  period of last 10 years is very modest at 1.97 %.

• The CAGR for the period 2000-05 is 4 % whereas for 2005-10, there had not been any substantial growth

• The overall fixed line market for Etisalat UAE had reduced in the last two years.

              Fig 7: shows the total number of internet subscribers in UAE over the last 10 years, Source( Annual Report 2002, 2005 and 2010)

Key Insights:Etihad Etisalat:


• The CAGR of internet subscribers for Etisalat UAE, over the period of last 10 years is 20.2 %

• The CAGR for 2000-05 is 20.3%, whereas for 2005-10 is 20 %.

• After showing substantial year on year growth for the 1st nine years, the market has taken a dip in the last year.

Fig 8: shows the national as well as international calls in billion minutes, over the last ten years, Source ( Annual Report 2002, 2005, 2010)  

Key Insights:


• The CAGR for, national calls is 10.5 %, international calls is 11.9 %, over the last 10 years.

• The CAGR during 2000-05, for national calls is 18.2% and for international calls is 25.31 %. The CAGR during 2005-10, for national calls is 3.3 % and for international calls is 0 %.

• Both national as well as international calls have taken dip in the last two years.

General Insights:

After studying all the above graphs two important trends are emerging:-

• Etisalat has shown strong growth in all the sections during 2000-05, compared to 2005-10.

• In every section, the market is reducing down for Etisalat in UAE in the last couple of years, owing to saturation (In 2008 penetration in the mobile market had already reached 190 %, hence providing less scope for further expansion), competition by DU and global economic slowdown.

Global Expansion:


Etisalat operates across 18 nations in the Middle East, Africa and Asia. It is one of the fastest emerging global telecomm brands, primarily identifying underserved markets and targeting them with high quality, value based innovative services. The international expansion strategy for Etisalat consists of both, having fully owned subsidies as well as having majority and minority stake in various existing local telecom companies. In its tryst with inorganic growth and expansion, Etisalat had so far got commendable success. It is known for entering aggressivley into new markets and expanding the subscriber base very quickly. The following part will  discuss some of the Geographical success stories of Etisalat.


Etisalat Misr


Etisalat entered into Egypt (also called Misr in Arabic) in 2006, as 3rd mobile service provider in the country. Within 50 days of its launch it captured a base of one million subscribers, which had increased to around 10 million by today. Etisalat’s 2G network covers around 98 % of population while 3G network covers around 73 % of the population. (Etisalat.ae, 2011)
Atlantique Telecom, Moov

Atlantique Telecom (AT) operates in seven countries across West Africa. Etisalat initially had a 50 % stake in AT, which  increased over a period of time and eventually by February 2010, it has  full ownership of AT. Though all the seven nations are different in their socio economic cum political outlook but Moov, the common brand name for AT across the region, enjoys a very strong brand value. The region which is underserved with a low penetration presents a very strong potential for future growth. AT has a coverage of 54 % in the region.

Etisalat Nigeria

Nigeria, the most populous African state with 22 % mobile penetration is high up on Etisalat’s agenda of international expansion. Etisalat entered into the Nigerian market in October 2008 and known for its aggressive early movements, captured one million subscribers by June. By September 2011 it was having a subscriber base of 5 million. Etisalat is known in Nigeria for its top quality service and within year of its launch had been credited with the best service provider by the national telecom regulatory authority, Nigerian Communication Commission (NCC). Currently Etisalat is active across all the 36 states in Nigeria and has coverage of 73 %.

                  Fig 9: Growth of subscriber base of Etisalat Nigeria, source: (www.itp.net)

Etihad Etisalat (also branded as Mobily) is the second mobile service provider in the kingdom of Saudi Arabia after Saudi Telecom. It entered into Saudi Arabia in May 2005, after winning the bid for second GSM license. Mobily was one of the fastest growing GSM service providers in Middle East and North Africa and captured 3.8 Million subscribers, just within a year of its launch. Presently it has more than 17 million subscribers. Etisalat’s GSM service covers almost 97 % of the populated areas where as the 3.75 G service covers 80 % of the populated areas in Saudi Arabia. Etisalat has a 27 % share in Mobily where as 45 % are with six local partners, rest are publicly traded. (Etisalat.ae, 2011)



Pakistan Telecommunication Public Limited (PTCL)

Founded in 1947, Pakistan Telecommunication Public limited or PTCL is the largest telecomm service provider in Pakistan. In 2006, the Pakistan govt. sold 26% stake to Etisalat. 62 % is retained by the govt. whereas the rest 12 % is publicly traded.


Future Strategy


Etisalat is truly a global brand, with operations spread across 18 nations all over the globe. The future of Etisalat depends how well it expands in to various new geographies and technologies along with the kind of value based innovation it brings into the existing portfolios of geographies and product. Though a considerable part of revenue will come from the UAE, but due to intensifying competition and saturation of the market, maintaining a healthy top line from UAE will not be very easy. Following factors can play important role in deciding the future strategy for Etisalat: -


• New Markets: - newer markets like India and Sri Lanka will play a crucial role in influencing future strategy of Etisalat. Many of the existing markets like Pakistan, Sudan Tanzania and Waste Africa are still underserved and have huge future growth potential. Take for instance Sudan where fixed line penetration is just 1-2 %, and hence offers a great growth potential for telecom majors like Etisalat. Similarly India a nation with a population 115 Million and a penetration of 43 % provides strong growth opportunities. Though competition is quite intense in India with 12 players fighting for their share of pie, the sheer size of Indian market can deliver profitability to many of the competent players at the same time. Similarly in Africa, where many  nations are expected to achieve strong economic growth , the mobile, internet and fixed line penetrations are expected to shoot up, thereby providing a strong growth potential. Along with the existing markets, Etisalat needs , continue searching for newer underserved markets, and devise strategies for them.

Table 2 : calculates the future market potential for Etisalat

• Future Growth of UAE: - UAE has strong future growth plans in the form of Dubai 2015 and Abu Dhabi 2029. UAE no more wants to be solely dependent on petroleum for its revenue and aims at diversify into various alternate industries such as ICT, High tech, defense, tourism, trade, media, SME segment etc. Currently these sectors are seeking huge capital investment and the expected future growth will influence Etisalat’s business in a positive way.


• Innovative products for local markets:- Like any other globalized company, Etisalat needs to understand the dynamics of the local market and  come up with innovative solutions, customized for the local markets. One very good example can be the partnership between Etisalat Afghanistan and PTCL, which offered attractive rates between the two countries, resulting in quadrupling of traffic since the launch in 2010.  Etisalat needs to roll out such  innovative customized packages to lure more customers.


• Content generation and monetization of mobile content: is an area, which can have future growth potential for Etisalat. (Comm.com, 2011)


• Newer technologies: - The top management at Etisalat believes “Cloud Computing” as a deeply transformational trend worldwide, and  is planning to launch a wide range of service in this field in the near time. Another area that provides a great future potential is M2M (Machine to Machine) technologies. Etisalat is attempting to develop industry specific solutions in the given field. M2M technology holds a great future potential. According to research done by Research Infonetics in 2009 there were 87 million mobile embedded M2M connections, which are forecast to rise to 428 million by 2014, a compound annual growth rate (CAGR) of 38 %. (Comm.com, 2011)




# Un Served present market size= population * Coverage * (100 – Penetration) * Etisalat’s stake

Reference  

1> Etisalat.ae, 2011, company website, about us: corporate profile,



2> Etisalat annual report, 2010, p-3,


3> 2dayDubai.com, 2009, United Arab Emirates ICT sector and Dubai’s knowledge economy, available at < http://www.2daydubai.com/pages/dubai-ict-sector.php>


4> Etisalat.ae, 2011, Etisalat Misr, Etisalat.ae, 2011, Etisalat Etihad ‘ Mobily’ Saudi Arabia,


5> Comm.com, 2011, Seizing the moment, available at< C:\Documents and Settings\Administrator\Desktop\etisalat vs Du\Seizing the moment Comm_ Decisive coverage of telecommunications strategy.mht >


6> Comm.com, 2011, Seizing the moment, available at < C:\Documents and Settings\Administrator\Desktop\etisalat vs Du\Seizing the moment Comm_ Decisive coverage of telecommunications strategy.mht >

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The martial art of marketing

As someone who has always been passionate for "marketing as an art”, author attempts to describe the martial art of marketing, the hidden skills and art which good marketers should have. Having said this the blog does not attempt to write the obvious ones like good communication skills, better negotiation power blah,blah,blah(these are the fundamental requirements & no one can be a good marketer without them)

• A marketer has to be a great "Mind Reader": A marketer has to be great in reading mind of other's. Marketing is such a profession where one is exposed to end no. of people ranging from customers, suppliers, clients, channel members etc. He is never independent in making decisions which depend heavily on the other factor mentioned above; hence he has to read the mind of others beforehand to craft his game plan.

• A marketer has to be a good actor: As discussed in the above point he has to communicate with a lot of people. Many a times his job includes a lot of negotiations, communications & other related stuffs, has to don many hats at the same time, many a times has to pretend things. For all such a good acting skill is a prerequisite.(May be that’s why all the great marketers in India such as Bharat dabholkar, Alyque Padamsee, Sohail seth etc have background in theatre)

• A marketer should be creative with his computer skills: Marketers are suppose to give lot of presentations, many a times in front of people who might not have much of the subject related knowledge. Under such situation what does matter is not content but the creative aspects of the presentation.

• Knowledge of music is an add on: Marketing requires a lot of networking with people. It had been seen that music (includes all the three parts, dancing, singing and instruments) is a great tool in helping people do networking with others.

• An indulgence with various forms of art helps one understand and evaluate alternatives: Marketing is such a profession where one needs to have the hunch of understanding and evaluating available alternatives, needs to have the insight to think beyond the obvious. Having an interest in various forms of art such as acting, music, and writing can help you hone these required skills. (Because the world of art is something that attempts to look at the world in its alternative form)

Though marketing has its own analytical and mathematical sides but the author believes primarily it’s an "ART" or rather a "Martial Art" where one needs to don many hats at the same time, use the best of the available techniques, the realm of human psychology has a very important role to play and creativity is the best weapon to attract and stimulate someone. Due to all these things marketing requires individuals to be well aware (and if possible well equipped) with different facets of art.

Pricing strategy:What differentiates leaders from folllowers

When it comes to pricing it's product or service there are few parameters that differentiate the leaders from the followers leaders from the followers, where as a follower designs it's pricing strategy on guts feeling a leader thinks of various factors and does a fair amount of mathematical calculations before coming up with a price. The various parameters are:-


• Face to face research

• Survey based research

• Telephonic research

• Competitor’s analysis

• Price sensitivity measurement When it comes to design a pricing strategy there are few parameters that differentiates the

• Activity based costing

• Break even analysis

• Economic value analysis

Similarity between second punic war and the onslaught by japanese automakers

Competitive strategies in business and wars have always shown resemblance; if closely looked most of the business warfares take its inspiration from wars.

Here in this post i will like to bring one such resemblance between the attacks made by great war tactician HANNIBAL BARCA against the ROMANS in the PUNIC WAR and the attack made by the Japanese auto makers like TOYATA ,NISSAN AND HONDA against the big three ie GM,CHRYSLER AND FORD.

For those who do not know regarding punic war i will like to explain, punic war is a set of three wars fought between the romans and the north african empire of carthage which finally ended up in the culmination of carthage.Out of the three wars our concern here is with the first part of the second war where the carthagian general hannibal barca took a military of around 50,000 soldiers,crossed the alps and attacked the romans in their own land. A similar kind of strategy was adopted by the Japanese automakers in the early 70's when they attacked the american auto industry in their own market.

in 218 bc Hannibal left new carthage(spain) and left for rome,the basic strategy of Hannibal was very clear, there were two major ideas involved-

• Romans always considered themselves as a very superior force,the smug romans could never prognosticate that the army of carthage whom they considered as an inferior stock can ever dare to attack the romans,this sudden attack will completely confuse them and since the Romans are unprepared they will find it tough to respond.

• The second part of the strategy was to fight the war in the roman soil, this can create chaos in Rome and carthage can leverage it.

This carthagian strategy really paid off.They defeated the Romans continuously in three consecutive battles and got a major part of the roman empire (though it should be noted over here is that finally it was not rome but carthage that tasted defeat ,thanks to the retaliatory moves by the romans who used the strategy of hannibal against him only, details on this on some other blog)


These very same tactics were used by the Japanese auto companies against their american counterparts. Japans companies entered in the American market in the early 1970's with their small cars which were better in quality but lesser in price than the cars produced by the American auto majors. American automakers were not prepared for this attack, they perceived these japanese makers as manufactured of inferior quality and instead of fighting them they relegated the segment of small car market to them and started focusing on big car segment, they were sure that Japanese companies were not capable enough to fight them on this segment, but unfortunately they were wrong ,after holding their ground in the small car segment the Japanese attacked the us auto makers in the segment of big cars also and on account of their idea like TQM IE TOTAL QUALITY MANAGEMENT they defeated the us in this segment also ,Finally the American automakers tried to take shelter in the segment of light truck manufacturing but here also the Japanese did not spare them ,as per the present data gm is bankrupt, Chrysler has been taken over and ford is on the verge of bankruptcy. Well, large part of Japanese victory can be attributed to various reasons such as better product, cheap labor in contrast to their American counterparts, better culture in their companies but a very important part that worked in their favor was there strategy of attacking the American on their own profit sanctuaries ,it repeatedly attacked the Americans on all those domains which have been their major source of making profit and thus created a great chaos in there structure, one important point to be noted over here is that while American auto makers were under great pressure of loosing there revenue from their core market the Japanese makers were not only winning ground in the usa but they were making good deal of money from there japanese business also, in fact there safe base at Japan give them the opportunity to take risk against their American counter part by attacking on their territories. This was very much in line with the Hannibal’s strategy of restricting the warfare in the roman land and keeping a safe base at carthage.


Thus we can see that there has been a great similarity between the attack by Hannibal barca and the Japanese automakers. (Baring one difference, though the Japanese have almost won the battle , Hannibal finally lost it to the Romans who learned slowly from Hannibal and used the same strategy against him.)

REFERENCE:- HARDBALL: GEORGE STALK AND ROB LACHENAUER

The puppy dog ploy:a must read for start ups.

The puppy dog ploy is a life saving strategy that any start up needs to follow in its initial days,As illustrated by the name this strategy suggests that during initial days of it's growth when any start up company suffers from lack of resources and doesnt have deep pockets as it's competitor's the company should mantain a low profile and should try to reamain unnoticed in the competitive arena.puppy dog ploy helps the start ups to avoid onslaughts from established players of the market thus ensuring uninterupted growth for the start up .The logic for this is very simple ,suppose you run a start up company and if you want to compete against well established players in the market you need to come up with some inovation,because thats the only way you can make a niche for your product ,now the problem is that if your idea clicks and you grab a lot attention for it then surely and certainly the well established players in the market which have got deep pockets will be attracted towards investing in this new idea and with the kind of pocket they have and the kind of brand value they enjoy the chances are very high that will beat you very easily on your own game.

So these new start ups should alawys resist the temptation of making big claims in the begining of there growth,one very good lesson can be learned by" NETSCAPE" ,the company came up with a web brouser navigator in 94 and with in 8 months the company captured 90% of the web brouser market,from day one the company was challenging microsoft heads on,The cofounder of the company MARK ANDREESSON AND JIM CLARKE never missed any oppurtunity in debasing microsoft,they claimed microsoft as the deadstar and declared that very soon the the MS window will become obsolete,though it helped the strat up in gaining publicity but at the same time it also made BILL GATES very cautious of netscape,he made internet his top priority and and used all of his resources to beat netscape,MS used both soft as well as hard power to beat netscape,not only did it strated delivering it's web brouser interenet explorer free but also it paid heavily to companies like KPMG AND AOL to switch from navigator to internet explorer,as a result of this netscape started losing it's market share and finally lost the battle to micro soft,in the end it was taken over by AOL in 10 billion us dollars.While netscape made the blunder TRANSMETA adopted this puppy dog ploy very perfectly,this micrioproccessor manufacturing firm was founded in 1995 but from the very begining it kept a low profile,very little was known regarding it's business,by 2000 it came up with a new version of microproccessor that can run both window as well linux operations by utilizing a fraction power used by INTEL micropocessors,the company got a lot of media attention after the launch of the product and finally when it went public in 2000 it got a market capitalization of some 6 billion us dollars(though the company was not very successful in the near future),transmeta knew that in case they would have created lot of hoopla in the begining Intel a large company would have used a great part of it's resources and expertise in developing a better product than transmeta in the similar segment.


Thus it is advisable for a new start up to play the puppy dog ploy and maintain a low profile as long as it can,it not only averrts strong competition but also helps the sart up in concentarting on it's product.

REFERENCE:-a)JUDO STRATEGY:-DAVID B.YOFFIE AND MARY KWAK

b)HARDBALL :-GEORGE STALK AND ROB LACHENAUER

Judo Strategy:Book Review

Judo strategy is written by David b. yoffie and Mary kwak and is published by Harvard business school press. The book basically talks of the resemblance between judo and the strategies that have been taken by various newly emerging business to fight against established players. In judo weight and physical strength doesn’t matter what does matter is your strategy and with the help of right strategy and right move you can use the strength of your opponents for your own benefit, the same principles are valid in the ambit of business where no matter how strong your competitor might be but with the application right moves and strategies you can bring him to ground.

The book is diveded into three sections with the first two sections having three subsections each and the last one having two. The first section deals with the fundamentals of judo strategy in business, like in real judo where you have three steps that is movement,balance and leverage ,in real world business also players adopting judo strategy against their strong competitors need to make use of these three steps. In the movement step one needs to maintain a low profile so that while his business is under growing stage he can avoid attacks from well established players, at the same stage of time he needs to define competitive space where the company can apply its core competencies and once the competitive arena is decided the company should escalate fast so that the firm could emancipate its strength and can enjoy some substantial advantage over its established rivals.After making proper movement the company needs to balance itself from the opponent’s attack,this balance cannot be achieved by fighting neck to neck with your competitor but by griping your competition with the help of various means such as striking deal with your own competitor or striking deal with your competitor's partner or by designing your strategy in such a way so that you can use the moves of your competitor for your own advantage as in case of fight between Wal-Mart and Kmart back in 1980's ,at that time the average price of retail item was slightly lower in Wal-Mart in comparison to Kmart, but Kmart was investing a lot in advertisement ,Wal-Mart was reluctant in spending so much into advertisement ,what it deed was that it posted Kmart's weekly circular in front of it's stores and challenged that walmart will match or beat any of the deal thus converting the strong advertising campaign by kmart in it's own favor .After movement and balance the third part of the game calls for leverage ,this part is the most important part in designing your attack here you use the strength of well established player and use it against them only,the best example can be the case of dell and compaq,back in 80's compaq was a well established brand in the pc segment and it's selling network relied on a very strong network of retailers and wholesellers ,it was difficult for dell a newcomer in that time to afford such a strong network,dell adopted a fairly different plan,it took orders directly from there customers,gave them customized solution for there need and finally delivered it directly to the customers there by slashing any need for middle man ,this new model of distribution called as "DIRECT FROM DELL" was very successful and it helped dell to increase its market share drastically, Compaq on the other hand was very worried on account of its loosing market share,it was having two option either to continue with its earlier model of selling or to switch over to the dell's model of direct delivery, but it went went for the third one where it adopted both the strategies which simply was a dud,not only did it lose it's good relationship with the vast network of retailers and wholesalers which had so far helped Compaq to be one of the dominant player in pc segment but also it was not in a position to adopt the direct delivery system properly which was somehow an alien idea for the company.Compaq's market share kept on decreasing year by year and finally the company was taken over HP.The penultimate part of the books gives us the example of various successful individuals such as Jeff Hawkins,Donna Dubinsky(Palm ),Rob Glaser(Real Player) ,Halsey Minor and Shelby Bonnie(Cnet Networks)  who have used judo strategy very perfectly against there competitors.The last part gives some strategy to beat a judo player by adopting the game of sumo where the big players needs to adopt strategies such as intimidation, use of strength ,propagandas and outspending your weaker competitors on account of your deep pockets and rich assets, additionally it also contains a user manual for using "JUDO STRATEGY".



The best part of this book is that it contains a lot of examples from the business world,as a result of which it becomes easy for a reader to grasp the main ideas of the book properly, the book has given various examples of the firms such as FREESERVE,PALM,REAL,EBAY,DELL,SEGA,FRONTIER AIRLINES,INTUIT, ETC who successfully adopted judo strategy against there well established competitors and received favorable result ,at the same time the book also gives illustrative examples of firms like ETOYS,NETSCAPE, ETC which couldnot use judo strategy in a right way and had to suffer.Though book is very comprehensive and illustrative fraught with a large no. of examples one drawback which the book is having is that most of the examples and cases of which the book talks about have been taken from the IT and related industry, had there been more examples from other sectors such as FMCG,RETAIL,AUTOMOBILES, ETC the book could havce been better.As a whole this book is well written and is worth reading for MBA students, entrepreneurs, managers as well as general read

the UN COLA advertisement campaign by 7up:a master stroke to change the competitive space itself

One of the very intelligently designed as well as simple advertisement campaign that had always fascinated me is the uncola campaign by the 7 up. The campaign signifies the importance of changing the competitive space itself when you are dealing with well established players in the market.There is absolutely no intelligence in fighting with a well established competitor neck to neck. That will simply prove fatal ,the best way would be to fight them on an absolutely different plane,and this strategy was exemplified by 7up in 1967 when it came up with its very famous uncola campaign.

Back in 1967 both coca cola and pepsi were leading cola brands and the word cola was synonymous with the word beverages .Both Coca-cola and Pepsi were having strong dominance in the psyche of cold drink lovers,at that stage according to conventional thinking 7 up which was or in fact is basically a lemon drink could have been done two things either it could have introduced a cola brand of itself or it could have positioned itself as a lemon drink thus highlighting some of its salient features as lemon drink.Following the first would have been suicidal because with two leading brands already in the market it would have been really tough for 7 up to invest its resources and to come up with a 3rd brand that could  change the status quo,had they followed this course of action 7up would have definitely made huge losses. The second course of action though could have been better from the first one but solely emphasizing on the type of drink it produces would have never helped it to to configure itself accurately among the psyche of customers with respect to its competition.

An intelligent ad design is one where you position yourself with respect to competition ,the competitive space where you are waging the war should be clear to your customers,and thats what 7up did,it came up with its famous campaign “7 up the uncola” thereby at one end waging a war also with there competitors which were basically cola brands and at the same time not waging it since it is not a cola.The uncola campaign positioned 7up in a very tactful way,it made its message clear to the public "here is a drink that is not a cola,it is different and it is very proud on its difference ."It clearly gave an alternative to try for the prospective customers of that time, and this paid off.With in a very short interval of time the sales of 7 up skyrocketed. It enjoyed huge market share in the coming few years.
The campaign was really successful in changing the competitive space itself for 7up which gave 7up in getting a clean sweep for first few years.

REFERENCE: a) POSITIONING:JACK TROUT AND AL RIES.
                       b) http://www.drpeppersnapplegroup.com/.

How to manage your brand when you are dealing with commodities???

Well what do you really understand by commodities,according to wikipedia A commodity is some good for which there is demand, but which is supplied without qualitative differentiation across a market. It is a product that is the same no matter who produces it, such as petroleum, notebook paper, or milk.

As i have explained branding in the previous section branding  can be regarded as some aspect of your product or service with which a customer relate himself,in other word it is some thing which helps you to differentaite your product from rest of the competitors.definately as per the defination of commodity it becomes a very tough job to brand your product in case its a commodity,though tough its not completely impossible to brand your product.Here are some of the ways in which you can brand even a commodity-

• by providing products which are much more reliable than your existing competitors.exp-the case of acme bricks,while most of the bricks on an average gurantee a relaiblity  of some 5 years acme gurantee a relaiblity  period of 100 years.As a result of which it commands a very strong brand loyality by its customer.Such sort of branding can be done in steels,bricks,cement etc.
• after sales service,this is another aspect where one can differentaite from its customer,after sale service will ensure strong customer company relationship which will finaly lead into more business with the same customers in the near by future.
• providing some additional services at the same price,exp: suppose you are dealing in the business of milk,you might give your customers pasturized milk at the same price where your competitors are providing normal milk,one another case could be providing free home delivery to your customers in case you are dealing with steels,bricks,farm products or metals,
• by establishing the image of your company as some thing which is very ethical and which is very active in discharging its obligation towards society,though this is some thing which doesnt have a direct relationship with your product but the basic root of this idea lies in the emotional aspect of costomers,one must always believe that emotions play a vital role in making desicions,every customer will keep an ethical organization in high esteem and will always be emotionally inclined in striking a deal with such organization.