Management and Operations Assignment : Virgin Mobile

Evidence that the proposed initiative will be viable for Foleo Retailing NZ

1
Foleo Fones had to deal with Telecom Australia that acted as a gateway between the users and
distributors. The new way of selling phones over a longer period "plans' was beneficial for Foleo
business expansion (Fell n.d.).
The research illustrates that operating multiple channels results in a positive impact on the
financial performance, including, low-cost market access, increased customer satisfaction and
creating strategic advantage. Adding non-store channels enables the retailers to gain economies
of scope without the need of building new stores (Zhang et al. 2010).
Virgin Mobile Australia growth initiative
An example of mobile phones retail expansion is Virgin Mobile Australia. It consists of mobile
phones, mobile networks and broadband 3G services. It is considered as a leading provider in the
telecommunications market. It has more than one million broadband and mobile subscribers. It
has about 900 employees across Australia and a call center in the Philippines. The company
faced the problem of increasing demand for data communication while seeing a slowing demand
in the voice communication which represents its traditional source of revenue. The company
depends on the social media as a primary market channel but unfortunately, the customer
inquiries were overcapacity for the number of staff. The management at Virgin Mobile had to
find an alternative way to overcome this obstacle. It did not hire a call center associate, instead, it
decided to develop a social customer community that could decrease the costs of the call center,
enhance the customer service and sustain Virgin business. The online platform enabled the
company to effectively communicate with the customers, answer their inquiries and provide
solutions to their questions (lithium 2018).
Apple Australia growth initiative
The mobile market reached its saturation level in 2011/2012, the major changes were driven by
the rapid expansion of the smartphones and tablets. Apple could respond to the market changes
and meet the customer demand with 8.67 million smartphones and 4.37 million tablets in
Australia in May 2012 (Australian Communications and Media Authority 2013). Apple has
introduced the iPhone in 2007 that required certain changes, the smartphone usage increases the
usage of internet data. It also requires upgrade in the mobile networks to support the 4G services
and enables the WiFi networks in Australia. More extensions took place, including, the mobile

2
payments and cloud computing and location-based services (Australian Communications and
Media Authority 2013).
Moreover, Apple has inaugurated a new generation of software developers worldwide. It has
opened the App Store in 2008 that enabled the iOS developers to develop mobile applications
that could function with the iPhone. This represents the basis of the global App economy, the
App developers develop applications for billions of users (Mandel & Long 2017).
The Apple Pay App was introduced in Australia in 2016 and it did not attract many customers.
Only 9% of Australians pay by using their mobile or purchase through the mobile browser.
Apple faces the challenge of influencing the customers towards more use of Apple Pay. On the
other hand, the Australian market is reaching its peak in using the smartphones which provide an
indicator for the future probability of more customer dependency on the Apple App (Deloitte
2016).

3
References
Australian Communications and Media Authority 2013, 'Communications report 2011–12 series-
Report 3—Smartphones and tablets: Take-up and use in Australia', Commonwealth of Australia,
Australia.
Deloitte 2016, 'Mobile consumer survey 2016 - The Australian cut - Hyper connectivity: Clever
consumption', Deloitte, Australia.
Fell, J, 'Foleo Fones', Macquarie University, Australia.
lithium 2018, Case study: Virgin mobile Australia leverages Lithium to decrease costs and
improve customer service, viewed 17 May 2018, <https://www.lithium.com/resources/case-
studies/virgin-mobile-australia>.
Mandel, M & Long, E 2017, 'The Rise of the Australian app economy', Progressive Policy
Institute, Washington.
Zhang, J, Farris, P, Irvin, J, Kushwaha, T, Steenburgh, T & Weitz, B 2010, 'Crafting integrated
multichannel retailing strategies', Journal of Interactive Marketing, vol 24, pp. 168-180.