These different types of pricing are some of the ways T-mobile manages to increase their sales. They manage to compete with other brands, target different people, and manages to convince people that they are spending less then they actually are.
Promotion
Every business in the world needs promotion, T-mobile has many different types of promotion just like their competitors and if they want to be part of the worldwide group of mobile companies they need very good promotion. T-mobile needs to inform customers about their products and try to convince the customers that they want to buy the product and not to buy it from another company.
There are four methods of promotion and T-mobile uses all four methods to promote their products. The four methods are sales promotion, public relations, sponsorship and advertising.
Sales promotion is used by T-mobile it consists of many different methods and T- mobile uses price reduction, and gifts.
Price reductions are mostly used when a new product comes out and the company wants to get rid of the old product quickly so they sell it at a low price.
It is also used after Christmas or at the start of the New Year. This is also when the company wants to get rid of last year’s product so they sell it off at a lower price.
T-mobile also uses the method of gifts; this is when the company gives something for free when the customer buys a product or spends so much. It is often used before Christmas,
Simply top up a minimum of £10 per month
Here if the customer pays ten pounds a month they get free texts as a gift. This is good promotion as they will remember that they got a good deal with T-mobile so they may recommend it to friends and may use it themselves again. The main problem with this type of promotion is that it costs the business lots of money which they have to make another way.
Public Relations are another method that T-mobile uses to promote their products. Public Relations is usually free which is a big difference from the other types of promotion, such as free gifts as they cost the business a lot of money.
Public Relations are in charge giving stories to newspapers and magazines about the company that the public may be interested in. This could be something like a famous person being involved in the company. It is a fraction of the cost as compared to the price of an advertisement.
T-mobile also uses sponsorship as a type of promotion, The company sponsors athletes, researchers, students, artists, education and healthcare institutions as well as those in need.
Sponsorship is becoming more important for businesses; this is because as more things are shown on television there is a bigger opportunity to the product name shown to a wider audience.
Advertising is the biggest type of promotion and it is the one that most people think of as being the most important. T-mobile uses advertising to help promote their products. Their internet site is their main source of advertising.
They have all of their deals and price plans on the site but also have additional information such as sport news and music.
The site has been well designed and is updated regularly, this is important as it makes it easy for customers to look for what they want. The other good thing about having a well designed site is that customers believe that it has been made for them so they will be pleased to see that it is good quality.
Also most people now have the chance to get onto the internet so this type of advertising will target many consumers.
Product
Businesses main aim is to sell their products to their customers. They want to sell enough of the product in order to make a profit. To do this they must get the price of the product right and I have talked about how price plays a major part in T mobiles marketing mix in the first section.
T mobile also uses product in their market mix. ‘Product’ covers the design and the image of the product. The design of a product is how well the product has been made, and what the product looks like. If a product has a complete different design from its competitors it will catch the attention of customers this might mean that the customers will by that product rather than others.
The image of a product depends on the public. The products are usually ‘cool’ and everybody wants to own one. The product is usually very expensive and only a limited number of people can have them. Because there are only a limited number people want to have one. This causes there to be a greater demand for the product so the business can charge a higher price.
All products have a life cycle; it is the time in which consumers want to have the product. The consumers would want different types of the product so the business selling the product would have to change it. Some products have a short life cycle, such as electronic devices. But others have long life cycles; a good example of this is coca cola
T mobile uses product as part of their marketing mix. The company spends a lot of time and money on developing new products so they always have new products on the market so they can compete with their competitors. T mobile are always bringing out new products so the company is never are any were exactly on the product life cycle.
The company makes many products and each of these is on the cycle. So if they bring out a new phone with a new technology this is at the start of the cycle but at the same time there may be a phone that is going out of date.
Place
‘Place’ is where a product is sold and is also the type of distribution that is used to get the product from the manufacturer to the consumer. If a business has an amazing product which everybody wants but nobody knows where to get it from, that business will not sell anything. So a company must choose where it is going to sell its product very carefully.
Also, if a company that makes mp3 players is selling them outside the factory gates, they will not sell many; the company has not got the method of distribution right, which is vital for a company which wishes to survive.
Most of T mobiles products are made in China or other countries in the Far East. This is because costs very little to make them there as the workers have a lower wage than if the products were made in the west. When the goods have been finished they are shipped to the countries where they are to be sold. They are then stored in warehouses before being distributed to the areas which need them, this is when the products get to the high street shops to be sold to the consumers.
T mobile has shops all over the country; some of these are specialist T mobile shops but they sell most of their products through phone retail companies such as the Carphone Warehouse which sell T mobile products as well as other makes. They also sell some products in large supermarkets such as Tesco. This is a very good way of selling products as it covers a wide range of customers and therefore lots of people will become aware of the products.
Place has become less important with the increased accessibility of the internet. Customers can buy products off the internet; they can choose the product and pay for it without leaving the home. Also the product is sent to the buyer directly from the company. This means that the retailing shops in the towns are not needed much more. This is good for the customers as it is so easy for them to buy the products; it is not so good for the companies because when the customer uses the internet they usually know exactly what they want. When a person goes into a high street shop they are actually seeing the product but they are also seeing other products which they may be tempted to buy.
T mobile also sells their products with the use of catalogues. The phone retailing shops such as Carphone Warehouse puts the products into the catalogue which the customers can take home and order by phone of by order form this saves the customer time and effort. It is good for the company as they are selling the product directly to the customer so they do not need to use the retailer which means that they get a greater of the profit as they do not need to pay the retailer money for selling the product.
Price Analysis
From the survey I can tell that the price for calls and texts matters the more to teenagers than it does to people over 31. I know this because the survey shows that 47% of teenagers think that the cost is quite important.
For people who are over 31, price of calls and texts do not matter as much to them. I know this because the percentage of people who think that it is very important is 31%, quite important is 33% and not very important, 35%.
This is for people of both sexes and from all areas.
I think this is because teenagers do not have much money and they use their phones more, so they want to get the best deals on calls and texts. Adults over 30 do not worry as much about prices because they do not use their mobiles as much as teenagers, also most adults have more money than teenagers so they can afford not to get the cheapest deals.
This bar chart shows that the price of calls and texts is more important to people between the ages of 14-18 than it is for people above the age of 31. The graph covers both males and females from all areas of the country.
This graph shows how the cost of texts and calls matters to different people from different parts of the country. Most people from the North of England think that the price of their calls and texts matters more than the people from the south of England. 37% of people from the North think that price is very important compared to the 27% of people from the South.
I think this is because people from the south of England have more disposable income. The jobs in the south are usually more skilled so people get paid more. This means that these people do not need to worry as much about the costs of calls and texts. People from the North have less disposable income so they have less to spend on things like phones so they have to take care on how much they spend so they find it more important to get the best deals on the costs of calls and texts.
This graph is to show how people of different genders think that the cost of calls and texts matters more to them. For 30% of females the cost is very important to them, compared to the 27% of males. I think this is because males care less about the cost of their phones as normally males use their phones less then females. This means that females will care more about the cost and will want to get a better deal on the cost of calls and texts.
The percentages change with the answers to the question, 42% of males compared to 41% of females think that the cost is quite important. This is contradicting what I have said in the first paragraph. This could mean that males and females think the same views on the price of calls and texts so it would be hard for T-mobile to change the prices on their phones depending on the gender of the customer. All of the results between the sexes are so similar that I think the results are not accurate and I can not get much information from the results.
Promotion Analysis
This bar chart shows the affect that age has on people to where they most notice different types of advertising. I have analyzed the two different age ranges to see if age affects where people see different types of advertising.
14-30 year olds notice advertising more on the TV and Radio, and people over 31 notice advertising more on billboards and in newspapers and magazines. This is what I expected because younger people tend to watch more TV and listen to more radio than people over 31. 72% of 14-30 year olds see adverts on TV and radio compared to 60% of people aged over 31.
The people over the age of 31 buy more newspapers so they see more advertising in the newspapers rather then the TV. Also adults over the age of 31 see more billboards advertising mobile phones. This could be because adults over 31 may drive around more so this would mean that they would see more billboards. This reason cannot be relied on because 30 year olds also drive. Billboards are usually found in cities so this could indicate that more people over the age of 31 work or live in or around cities. This would cause them to see more billboards.
This bar chart shows the affect that gender has on people to where they most notice different types of advertising.
Here you can see that males notice the most advertising on television. I think that this is because T-mobile sometimes sponsors sport teams. Males on the majority watch more sport on television. This means that they see more of T-mobiles’ advertising here some people might say that females watch sport but for the majority of the time males tend to watch more sport on television.
Females see more advertising in magazines and newspapers than males. They see 26% of advertising compared to 24% that males see. This may be because females buy more magazines than males.
Product Analysis
This graph shows how different functions on mobile phones are attractive to males and females when they are considering buying a new phone. You can see that 46% of females think that texts are the most important function on their phone, compared to only 37% of males. This could be because females prefer to use their phones to text. This could be linked to, that more females have contract to pay for their phone. With contract you are usually awarded free texts so females have the opportunity to text people for free. This affects what function they prefer to have on their mobile.
Games, internet and photos are the least important function on phones. This is because they are relatively new to have on phones. Also people buy phones in order to communicate with each other. Males prefer these functions slightly more then females. This may be because they like to try new things and experiment more than females do. This means that they would rather buy a new phone with more gadgets and functions
This bar chart shows the difference is between males and females when it comes to paying for mobile phone credit. It is clear that the preferred way of paying for credit is Pay as you go. 57% of males and 54% of females use pay as you go. I think that more males use pay as you go because they want simpler deals on their phones. With contract you are usually awarded free texts and minutes, this is more complicated and males may not want to bother with this type of payment. Men also may use their phone less so they would lose money if they used contract.
Females may use contract more because they may use their phone more. This means that with contract they get a better deal as it is a fixed rate and they also get awarded free texts and calls. This means that they are using their phone a lot more than they actually are paying for.
Place Analysis
This graph shows where people from different areas of England buy their mobile phones. People from different areas purchase their phones from different places. This is because in different areas people have different accessibility to places where they can buy the phone.
This is shown on the graph because in the midlands and in the south people go to supermarkets and specialist shops, to buy their phones, more than they do in the north. This is because in the south more people are engaged in the tertiary sector this means that more people live near or in towns and cities. It is in theses towns and cities where the supermarkets and specialist shops are situated. This means that it is easier for the people to go to the shops and purchase their phones.
In the north, more people work in the primary and secondary sector. These people live further away from towns and cities so it takes longer for them to go to the towns. Also there are not as many towns or cities in the north as there are in the south and in the midlands. This means that people do not want to travel for miles. This is why more people in the north use the internet to purchase their mobiles than in the south. Even though the internet is more popular in the north it is still only 9%. I think that less people use phones and the internet is because they cant see the product so do not know what they are buying. The most used place where people buy their phones is supermarkets and specialist shops. This is because here the phones are on show so the customers can see what they are buying. Also if the go to a specialist shop they also get professional help so it is easier and simpler for the customer to get the right product.
This graph is showing the difference age makes when it comes to the place were people by their mobile phones. I have compared different ages and where they buy their phones. I have compared 14-30 year olds and 31+ year olds.
As you can see 39% of 14-30 year olds go to specialist shops to buy their phones compared to 36% of over 31 year olds. I believe there is this difference because they want to ensure that they get the best phone with the best accessories. This could be because the people of that age still want the best money can buy and they will go to professionals to make sure they get the best. People over 31 do not want the best phones as much as younger people do. They may rather have a simpler phone so they do not go to the specialist shop because there only the newest and up to date phones are sold.
There are only slight differences in the other places where people buy their mobile phones. This shows that age does not affect where people buy their phones.
Recommendations
Price Recommendations
I think that price is T mobiles weakest marketing Mix. From looking at my analysis graphs and from the comparison site, , I can see that T mobile has very high prices for their price tariffs compared to their competitors, such a O2 and Orange. This means that they will not be getting as many customers as their competitors.
If T mobile wants to make a larger profit they need to get more customers and in order to do that they need to lower the price that they charge for calls and for texts.
Even though T mobile do have specialist price packages, such as Flext, their competitors have many more packages. These packages are varied for different sorts of customer as some people want different things from other people. I think that T mobile should have more price packages as it would attract more people to use T mobile. This is because different people use their mobiles in different ways. As it attracts more people T mobile will have more customers and so they will be getting a larger profit.
Promotion Recommendations
T mobiles most successful marketing mix is promotion. It is what a majority of people think is T mobiles strongest marketing mix. T mobile spend a lot of money on promotion especially in advertising on the TV and on the Radio. This is a very good way for T mobile to increase their sales and they could develop and increase their use of the TV and radio to increase their sales further.
By using TV and radio, T mobile only advertise to a limited number of people. If they used different types of advertising such as magazines and newspapers they would be informing different sorts of customers of their products. So by advertising in newspapers they would be focusing on older people as according to the data they notice advertising more in newspapers which shows that they read newspapers more than younger people do.
If T mobile keep advertising on the TV and on the radio as much or more as they are at present and also advertise in different places and sources, the amount of customers that they have will increase which will in turn increase their sales and their profit.
In some European countries especially Germany, T mobile have telephone boxes. This promotes T mobile and also gets them profit. T mobile could do this in England, it would promote them more but also it would give them a larger profit as people would use their telephone boxes.
Product Recommendations
As my analysis showed most people think that texting and phoning is the most important function on their mobile phone. T mobile along with all other mobile phone companies has being developing mobile phones with more functions such as internet and cameras.
Some people may prefer to have a simple phone with fewer functions. Not all people will want simpler phones especially younger people so T mobile still wants to keep developing phones with more functions so they keep young people as their customers. But if T mobile wants to increase the number of people they serve they can make phone with fewer functions. The people who will be more likely to buy these types of phones would be older and will want their phones for just texting and calling.
If T mobile wants to have a greater profit they want to make phones that their customers want. If T mobile made phones that were exactly as the public wanted them to be, they would have more customers and so more profit.
I think that T mobile should have different phones and different types of pay packages for different aged people. This would mean that they would have an increased market share with more customers which would bring them more profit.
Place recommendations
Most of T mobiles sales are made in specialist shops. I think that T mobile should develop where they sell their products in order to increase the number of potential customers and so increase their sales and profit.
If T mobile made their products more accessible by selling them in a greater range and number of locations their sales would increase.
There are many other different locations available for T mobile to use in order to gain a wider range of customers. I think that the internet is the place that T mobile should try to increase their sales. The internet is the cheapest option for T mobile to sell their products and it has a wide and easy access to many people. Most people have internet access which means that if T mobile develops their internet site to be more appealing and make it easier and more convenient to use people may start to use it more.
Bibliography
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Business Studies for OCR GCSE By Peter Kennerdell, Alan Williams and Mike Schofield
