Phân tích SWOT chiến lược kinh doanh di động Vietel chi nhánh Vũng Tàu Theme: Analyze external environmental factors which affect business strategy of providing mobile services of Viettel branch in Vung Tau – Military Telecom Corporation in the period of 2013 – 2015 Table of contents I INTRODUCTION II ANALYSIS OF EXTERNAL ENVIRONMENT Analysis of general environment (PEST)  Politic and Legal  Economic  Social  Technological  Environmental Analysis of industrial environment  Life circle of mobile services  Five competitive forces Opportunities and Challenges  Opportunities  Challenges EFE Matrix Competitive comparison III CONCLUSION IV REFERENCES I INTRODUCTION Military Telecom Corporation is established via the Decision 2097/2009/QD-TTg issued by the Prime Minister on 14/12/2009 Viettel is a totally state-owned corporation having the capital of 50.000 billion VND Also, the corporation has its own legal status, seal, icon and specific regulations Business activities: Providing telecom services, transmission, postage, equipments, financial investment, real estate investment, import-export and foreign investments Viettle is voted to be the strongest brand name in Vietnamese telecom market by customers The corporation is also in the top of 100 biggest telecom brands in the world Vung Tau branch – Military Telecom Corporation - Established in 02/04/2002 - Address: Truong Cong Dinh Street, Nguyen An Ninh Ward, Vung Tau city - Website: http://www.vietelmobile.com.vn - Phone number: 064.250111 - Business field: Telecom services and Information technologies - Number of employees: 164 - Revenue in 2012: 771,774 billion VND - Revenue structure in 2012: - Mobile subscribers market share in 2012: II EFFECTS OF EXTERNAL ENVIRONMENT General environment  Political and legal: The politic situation and social security in Vung Tau are very stable In 2013, the Government continues tightening the management for prepaid subscribers and promotions (newly activated subscribers can not have money added into account), which impacts directly to the development of new subscribers  Economic: Being one of the most dynamic and potential cities across the nation, Vung Tau locates in the key economic triangle of the South The city has all conditions for economic development, especially marine economy such as oil and gas, maritime, tourism, fishing and aquaculture In the period of 2010-2015 and orientations to 2020, the province focuses on developing marine economy, making Vung Tau become a modern industrial province and modern seaport in 2015 However, the macro-economic situation has not been significantly improved, especially for strong industries of the province (shipbuilding, engineering, seafood, sea port, tourism ) According to the plan of economic growth of People’s Committee, GDP of the province is expected to reach 11.5% in 2013 The province has 14 industrial zones: zones are active zones have Viettel cables  Social: Total population of Ba Ria-Vung Tau is 1,060,250 million; the number of people aged from 12 to 70 is 800,136; the market has gradually approaching the saturation point Per capita income is 33 million VND / year; the province is expected to attract about 12,000 to 40,000 workers in 2013 Annually, Vung Tau welcomes 4-5 million tourist arrivals  Technological: The provine has high economic growth (over 10% for the past years) and high per capital Locals tend to use new and high-tech services (3G, content service, value added and OTT-Over the Top…)  Điều kiện tự nhiên: The climate is divided into seasons: wet and dry Being a coastal province is a favorable condition to develop tourism, oil and gas extraction, fisheries and aquaculture but these activities must be affected by storms In dry season, Base transceiver Stations can fire; In wet season, storms can cause power outages and information disruption, which has direct impacts on the quality of services Industrial environment: a Analysis of circle-life of mobile service in Vung Tau - Mobile services market in Ba Ria Vung Tau is reaching saturated phase: - Total population of the province is 1,060,250 million; - Number of people who are able to use mobile services and aged from 12 to 70 is 800,136; Number of people who used mobiles is 772,655 - Total subscribers: 1,072,960 (more than 300,000 using phone numbers) => For such saturated market, the main competitive tool is price => Strategies of the companies: - Control the prices - Try to remain market share - Have good customer caring services Table: Report of Vung Tau Branch in 2012 Company Number of Subscriber Market share Viettel 502,038 46.79% Mobi 368,240 34.32% Vina 146,781 13.68% Other 55,901 5.21% Total 1,072,960 100% (Source: Military Telecom Corporation) b Market forces  Relations with customers: The supply is larger than the demand, and customers have the right to choose services which are better and cheaper There is a threat that old customers can give up Viettel services to switch to other services and that new customers would not choose Viettel services The branch must: - Have reasonable policies to retain loyal customers - Find corporate customers and have incentive packages - Develop subscribers in sea and island areas in which the branch is dominating on network infrastructure - Create the credit for customers - Providing good caring services  Relations with suppliers - Mobile services relating to suppliers include: Network infrastructure equipments, terminals, sim phones and scratch cards - Viettel has many choices of suppliers and created strong relations with suppliers - Viettel starts to produce scratch cards and some terminal equipment such as 2G and 3G mobiles, cables, smart stations Viettel Vung Tau branch has more advantages than other network providers in terms of relations with suppliers because of absolute scale advantages and ability to produce equipments  Current rivals - Current competitors of Viettel in general and of Vung Tau branch in particular Though being a powerful group having large-scale, network coverage nationwide, Viettel still faces up with rivals such as Vinaphone, Mobiphone which has experiences and used exclusively within the telecom industry for a long time Moreover, new brands are emerging as new threats like Gphone and Vietnammobie - Network infrastructure is the same as Viettle: - Distribution systems are nearly equivalent: No - Network Vinaphone MobiFone Viettel Prices are nearly the same: Store Dealer 14 15 38 20 Sale Number of Point 1.855 1.905 1.911 employees 172 17 142 Competitve advantages belongs to companies which are more flexible and can quickly satisfy new demands of customers  Potential rivals Telecom is an industry with high turnovers and profits Many businesses want to enter the industry so that potential competitors of Viettel can be new telecom companies which are established as subsidiaries and supported by Corporations such as EVN, PVEP or VINALINE These corporations have large financial resources, extensive branch networks and are favored by the State Besides, Vietnam’s joining WTO in 2007 is an opportunity for foreign businesses to enter the market Foreign companies with modern technologies and is management skills will make Vietnamese telecom market become more colorful  Substitute products: Firstly, it is clear that cell phone products are still used by people and businesses although these products are quite outdated and inconvenient This is a left segment and Viettel can have a huge number of customers if the company can capture the sentiment people who are familiar with wired telephones OTT (over - the - top content) service: this application allows free charge messages and calls on mobile In Vietnam, there are many international applications like Viber, WhatsApp, LINE, Kaokao Talk There are also applications issued by domestic suppliers such as Zalo (VNG), Chat FPT (FPT) Other applications such as Yahoo, Facebook, Skype also provide similar features The cause of the strong growth of OTT applications is that the number of smartphone users is increasing Also, technologies like WiFi or 3G are becoming more and more popular Users only need to access applications stores on platforms of IOS, Android, BlackBerry or Windows Phone to download, install, log in and use these applications immediately Users can also use these services as long as they can connet their smartphones to Internet via Wifi or 3G According to a recent publication of OTT in Vietnam, there are about 3.5 million Viber users, million LINE users and million Zalo users The figure indicates the rapid growth of OTT applications though these applications have just emerged in Vietnam for 1-2 years OTT makes revenues of Viettel, Mobifone and Vinaphone reduce about trillion VND every year This is a challenge for Viettel Vung Tau since the rate of smartphone users in the province is quite high Opportunity and Challenge: a Opportunity  Opportunity to develop 3G subscriber: Ba Ria - Vung Tau province has high GDP and per capita income The province has good conditions to develop 3G subscribers Viettel Vung Tau is one of 15 provinces in which 3G network is supported well as 2G network Terminal equipments are manufactured by Viettel with cheap prices and suitable with customers’ tastes This is an opportunity for Viettel to attract 3G customers as well as develop second 3G subscribers Viettel has an opportunity to reinforce the leading position in Vung Tau market  Opportunity to develop new subscribers from emigrants: It is estimated that industrial zones will attract more than 12,000 new workers in 2013 Viettel has full coverage over these industrial zones This is an opportunity for Vung Tau branch to develop new subscribers and increase the market share  Opportunity to develop new subscribers in islands: Up to now, Ba Ria - Vung Tau has 52 port projects, including 18 active ports, with a total capacity of about 34 million tonnes of cargos / year, 11 projects are under construction, 23 ports are in the stage of investment preparation Marine – island tourism is a key economic sector Annually, there is about more than million tourist arrivals come to visit and take leisure activities Tourism revenue can reach trillion VND every year In the strategy of developing seafood sector to 2015, Ba Ria - Vung Tau confirms that fishery is one of leading industries in the economic development of the province Currently, the province has nearly 6,300 vessels with a total capacity of 725,417 CV In which, offshore fishing boats account for 40%, equivalent to 2,518 boats Vung Tau Viettel still dominates on coverage areas in islands This is an opportunity for Vung Tau branch to develop new subscribers  Opportunity to develop new subscribers from corporations: The province has 14 industrial zones and 29 industrial clusters, providing jobs for more than 42.000 larbors inside and outside province Viettel Vung Tau has certain pride and brand name in the region The branch has conditions to cooperate with companies on providing corporate management software, technological application, and then develop mobile services with highly incentive packages  Opportunity to develop subscribers from high schools in the province using SMAS: School Management System (SMAS) is a software system which is designed, constructed and provided freely to schools by Viettel The number of pupils from th grade to 12th grade is 93,014 When SMAS is applied, many parents use Viettel moblie service as second sim phone to manage their children b Challenges  VinaPhone and MobiFone have built stations in inslands This is a threat for Viettel since Viettel used to be nearly exclusive for sea and insland coverage  Afterpaid subscribers like VinaPhone – MobiFone –VNPT use free charge policy for internetwork conversation, leading to the destruction of the market (a dumping pattern)  Vietnamobile focuses on student segment (ARPU of Vietnamobile is only 1.2 USD), thus, Viettel can lose customers who are pupil and student  The development of OTT service can reduce the revenue of Vung Tau branch since 3G subscribers are developing rapidly  Macro-economic situation has not been improved, especially for strong industries of the province (Shipbuilding, engineering, seafood, tourism…), affecting the growth of telecom industry  Competitive advangtage of Viettel is very uncertain; Competition on prices is not a stable competitiveness  Demands of customers are higher and higher, thus, improving customer caring services is also a challenge for Viettel, especially when Mobiphone has been awarded to have the best caring services over the past years * General assessment on the industry: Telecom industry is profitable and has a long life-circle but the attraction of this industry has been reducing because of some causes: - There are molibe service providers in the market so customers have many choices - Threat of substitute product (Over the Top service) - Fierce competition - The market is reaching saturated point - Require large investment and high technology Table of EFE matrix (EFE matrix) (Opportunities) Weight Ability to response Total point Develop 3G subscribers 0.15 0.45 Develop new subscribers in sea and insland areas Develop new subscribers from emigrants Develop new subscribers from corporative customers Develop new subscribers from parents (Threats) Competitors enhance to cover sea and island areas Competitors use free charge policy for internal 0.05 0.15 0.05 0.1 2 0.05 0.3 0.1 0.4 0.15 0.45 0.1 0.2 0.15 0.45 0.05 0.05 1 0.05 0.1 2.55 conversations Potential competitors focus on certain segments (pupils, students, workers in industrial zones) Development of OTT service Macro-economic situation has not been improved Total Conclusion: Vung Tau branch can adjust well to external environment Competitive comparison Company Successful factors Weight Viettel Rank Total Mobiphone Rank Total Vinaphone Rank Total point point point Advertising Product quality Competitive price Administrative uman resource Financial position Loyal customer Global expansion Market share Total point 0.1 0.2 0.2 0.2 0.8 0.6 3 0.3 0.6 0.6 2 0.2 0.4 0.6 0.15 0.6 0.45 0.45 0.05 0.1 0.05 0.15 1.00 4 0.2 0.3 0.2 0.6 3.5 0.15 0.4 0.05 0.45 3 0.1 0.3 0.05 0.3 2.4 III CONCLUSION In order to build a business strategy, managers must objectively analyze advantages and disadvantages, strengths and weaknesses of their own businesses in comparison with those of other, and create competitive advantages Besides, it is essential to industry analysis to avoid wrong directions on reaching customers and achieving certain position in the industry IV REFERENCES “Strategic Administration” materials of the Course; http://viettel.com.vn/ http://www.vietteltelecom.vn/ http://baobariavungtau.com.vn/kinh-te-bien/ http://www.nhandan.com.vn/chinhtri.html ... competitive advantages Besides, it is essential to industry analysis to avoid wrong directions on reaching customers and achieving certain position in the industry IV REFERENCES “Strategic Administration”... significantly improved, especially for strong industries of the province (shipbuilding, engineering, seafood, sea port, tourism ) According to the plan of economic growth of People’s Committee, GDP of the... and OTT-Over the Top…)  Điều kiện tự nhiên: The climate is divided into seasons: wet and dry Being a coastal province is a favorable condition to develop tourism, oil and gas extraction, fisheries