Customer Behavior for Vodafone

This report aims to find out the reasons for brand switching attitudes and behaviors for consumers of mobile phones in the Australian telecommunications market. It explores social factors, environmental context factors, and individual difference influence factors that influence consumer decision-making and brand switching. The report also provides recommendations to improve Vodafone's marketing strategies.

Running head: CUSTOMER BEHAVIOR FOR VODAFONE
Brand Switching Customer Behavior for Vodafone
Name: Raju Goud Kesari
Student ID: 11655919
Institutional affiliation: Charles start University
Brand: Vodafone
Words count: 3500

1
CUSTOMER BEHAVIOR FOR VODAFONE
Table of Content
1.0 Introduction..........................................................................................................................2
2.0 Company and Industry Overview........................................................................................2
3.0 Social Factors and Their Influence on Consumer Decision-Making and Brand Switching 3
4.0 Environmental Context Factors and Their Influence on Consumer Decision-Making and
Brand Switching.........................................................................................................................4
5.0 Individual Difference Influence Factors and Their Influence on Consumer Decision-
Making.......................................................................................................................................5
6.0 Recommendations to Improve/Enhance Vodafone’s Marketing Strategies........................8
7.0 Conclusion............................................................................................................................9
References................................................................................................................................11

2
CUSTOMER BEHAVIOR FOR VODAFONE
1.0 Introduction
Consumer behavior relates to how consumers behave in circumstances which involve
goods, services, experiences and ideas. Generally, consumer behavior affects brand switching
and brand retention. Brand switching is whereby a brand loses loyal customers to a
competitor. The customers change their habits of buying and deliberately decide to purchase
another brand instead of their usual brand choice. This report represents the
telecommunication industry and the data sources of Vodafone Hutchison Australia Pty Ltd
popularly known as Vodafone which is a foreign-based private organization drawing its
revenue by offering telecommunication services. Therefore, the report aims at finding out the
reasons for brand switching attitudes and behaviors for consumers of mobile phones in the
Australian telecommunications market.
2.0 Company and Industry Overview
CK Hutchison Holdings Limited is a company from the Cayman Islands, whereas
Vodafone Group Plc. is a United Kingdom-based company (‘Vodafone Hutchison Australia
Pty Limited - Profile Company Report Australia’, 2017). Vodafone Hutchison Australia Pty
Limited has offices present in places like Melbourne, Sydney, Brisbane, Perth and Adelaide.
Then, throughout Australia VHA contains several contact centers like one in Hobart and
contain owned retail stores which are greater than 120. The 4G mobile network of Vodafone
Hutchison Australia covers Australians customers, greater than 22 million. The capital cities
and the selected regional centers have Vodafone TM fixed broadband services. By the year
2018’s June month, the mobile customer base of Vodafone Hutchison Australia has crossed 6
million (‘Information about Vodafone’, 2018). Therefore, the study will be conducted to
assess the consumer’s mind and understand their consumptions. Additionally, this study will
help to know the potential consumers’ psychological, social and physical behavior.
In general, the mobile telecommunication industry has grown in the last 5 years, with
an increased demand to have constant connectivity and higher data usage. This also has
increased the competition among the major players of the industry ("Market Research
Report", 2018). With the entry of Vodafone into the Australian market, it had to face a
challenge to handle their increasing customer base along with other challenges like, it had to
decrease its personnel and infrastructure cost. In the market competition, the shares of TPG
Company has increased to 22% i.e., AUS $7.65 in Sydney, which means its market
capitalization is expanding to be A$7.1 billion. Whereas, in London, the shares of Vodafone

3
CUSTOMER BEHAVIOR FOR VODAFONE
have an increase of just 0.2% to ￡1.7644 (Vodafone, CK Hutchison mull Australia merger,
2018).
The international markets are researched for their price differences in the market, to
meet the demands of the customers. Thus, the premiums in Australia and internationally are
compared. According to Seetharam (2012) Vodafone has introduced Self-Service Kiosks and
centers in different regional areas to help customers. Vodafone has considered putting the
customer price premium as a perspective of their strategy. Therefore, the researcher intends
to find out the role of situational analysis in dealing with customer behavior issues which will
be the independent variable so as to assist in Vodafone’s business strategy and marketing
strategy (Foye, 2017).
3.0 Social Factors and Their Influence on Consumer Decision-Making and Brand
Switching
Differences which exist among people in society can be linked to heredity,
environment or training. Social factors influencing consumer behavior include occupation,
lifestyle, needs, consumer perception and social status (Liu et al., 2015). By targeting young
people who are active social media users, Vodafone aims at making profits by providing
services that are designed for the young generation (Vodafone.com.au, 2019). Young people
need unlimited data so that they can stream music and movies hence the company aims at
offering suitable services for them. Research by Alshurideh (2016) shows that that the young
generation who have a high affinity to technology form a large part of active subscribers of
telecommunication companies. Consumers may switch from Vodafone to another
telecommunication company if most of the people in their family or reference groups are
using the services of the other company so as to get premium services e.g. lower call/texts
rates on the same network
According to Liu et al. (2015) an individual’s occupation plays an important role in
influencing their consumer buying decisions as it has a direct influence on the services that an
individual uses. An individual’s designation along with the nature of their work has a great
impact on the buying decision that they make. People working in the field of information
communication technology and marketing need to use telecommunication services so
Vodafone targets this group of customers. An individual’s buying tendency is proportionate
to that of their earnings. Being affluent increases an individual’s tendency to take recourse to
the services of Vodafone. Further research by Ghavamipoor et al. (2017) shows that
individuals earning high incomes are capable of buying expensive and premium products

4
CUSTOMER BEHAVIOR FOR VODAFONE
when compared to individuals coming from the middle or the lower income group. People
belonging to the lower income group have more chances of spending on the necessary items
and hence the company would not aim at targeting this segment of the population (Pan and
Kang 2016).
People of lower social status will switch from expensive telecommunication
companies to upcoming companies which offer cheaper services. (Egan, Hughes & Palmer,
2015). If the social status of an individual becomes high, they will switch from one
Telecommunication Company to another which is mostly used by people of the same social
class irrespective of the price of the services. Bamossy & Solomon (2016) found out that
people leading an affluent lifestyle are the potential customers of Vodafone as they have a
higher probability of using Vodafone’s mobile services. An individual’s personality also
influences their buying decisions and has an impact on their purchasing power. Consumers
may also be advised to switch from one mobile carrier to another by friends and retail store
attendants.
Table: External Search for Mobile Phone Service Providers
4.0 Environmental Context Factors and Their Influence on Consumer Decision-Making
and Brand Switching
Research by Solomon et al. (2017) shows that brand value and ethics can make
customers feel good hence it will lead to brand retention. There are customers who have
been using Vodafone’s services for some time and they are satisfied with the service that is
offered by the company. Change of occupation may lead to a customer changing their mobile

5
CUSTOMER BEHAVIOR FOR VODAFONE
service provider if the employer provides the employee with a mobile phone (East et al.,
2016). The employee may then decide to continue using the phone for personal activities so
as to take advantage of the free services. Poor customer service by the mobile service
provider may also lead to brand switching. Some customer service staff may be rude leading
to brand switching in search for better customer services.
Based on their research, Parsons, Maclaran and Chatzidakis (2017) found out that
poor network coverage will force customers to change their mobile service provider.
Customers may also switch to another mobile service provider if they need a bundled bill, are
incurring unexpected cost on their bill or when they want to get away from contracts (Lin et
al., 2018). On the other hand, environmental factors influence on consumer behavior. Busy
days, the personality of customers, date and time of purchase, available alternatives and
geographic location are the external factors that make an impact on the purchasing decision
preferable of customers like for most of the customers, finding the stores with low traffic. It is
one of the direct as well as simple classifications in the process (Chaudhary 2016). On the
other hand, the reference group is the second group. It influences the self-image of the
customers as well as their behavior of purchasing In addition, the groups to which a customer
does not belong yet have the power of influence. Lack of an overseas call center may also
lead customers to nominate family and friends to a different mobile carrier (Huang, Fang and
Liu 2017).
5.0 Individual Difference Influence Factors and Their Influence on Consumer Decision-
Making
More women may switch brands easily as compared to men due to an unexpected
increase in their mobile phone usage e.g. constantly checking on kids at home. Javornik

6
CUSTOMER BEHAVIOR FOR VODAFONE
(2016) believes that women have a greater tendency of incurring higher than expected costs
due to messaging services. The modern occupations compel people to make use of affordable
and reliable services. People in the present age want a reliable connection that they want to
use for making connecting with their family along with friends. People in the modern age are
often forced to live separately from their friends and their families as they have to pursue
their career (Loureiro, Costa & Panchapakesan, 2017). This forces the people to make use of
a mobile service that has been able to win the support of the people and has a brand appeal.
According to Bruhn et al. (2015) life stages like the desire for a new handset and
young single customers are likely to change their service provider due to poor network
coverage. Furthermore, the role of the teenagers in the family structure has increased in the
present age as the parents in Australia depend on the teenagers’ computer skills. Parents
believe that the teenagers are mature enough for making the decisions on the purchases and
hence the parents are influenced to a great extent by the choices of their young children.
Moreover, further research by Garín-Muñoz et al. (2016) shows that young and old differ on
the basis of tastes and preferences which affects their buying behavior. Older customers e.g.
Baby Boomers (aged 55 – 64 and 65+) will easily change mobile service providers due to
poor service (Martinho, Magalhães & Pires, 2017).
Young couples (aged 18 – 34) are likely to change brands due to poor customer
service since they can’t put up with incompetent customer care staff. Older couples (Baby
Boomers, aged +45) are likely to change their mobile service provider due to poor customer
service and poor network coverage. Additionally, people in society believe that an educated
person can adapt to the new way of doing things and can easily make use of new technology.
The aspect has led to an increase in the use of Vodafone’s mobile phones among the people
in Australia. Research by Lovelock & Patterson (2015) shows that there is a relation between
an individual’s level of education and their ability to use a mobile phone especially
smartphones. In Australia, the number of educated people has increased which has led to an
increase in the number of mobile phone users, which is shown in the figure below:

7
CUSTOMER BEHAVIOR FOR VODAFONE
Figure: Mobile phone users in Australia
Source: Statista.com, 2019
Vodafone offers broadband services which are relied upon, with customers using the
service for the purpose of mobile banking. According to Alshurideh (2016) young people
wish to engage themselves in risky adventures and they are more technologically equipped as
compared to the older population of Australia. They use Vodafone’s mobile phone services
for the purpose of playing mobile games. In Australia, older people normally tend to use
Vodafone’s services for business purposes while the young people use for socialization
purposes. According to Zhang et al. (2017) switching costs refer to one-time cost that faces
the buyer when they switch from one supplier of a product to that of another. The concerns
related to brand switching arises on account of time and energy along with the effort required
for switching. Men in Australia are experimental in regards to mobile services provided thus
they were likely to embrace brand switching.
Research conducted by Danaher et al. (2015) shows that there exist individual
differences in relation to brand switching. Further research conducted by Armstrong et al.
(2015) shows that 49.6% of the Australian population believe that brand switching is
inconvenient. Additionally, the research showed that time constraint can prove to be an

8
CUSTOMER BEHAVIOR FOR VODAFONE
important factor that influences the relationship in between price, quality and value. On the
other hand, time pressure can cause the customers to process the information in a heuristic
manner thus concluding that the price of a product determines its quality. Parsons, Maclaran
and Chatzidakis (2017) found out that 65% of people who switched between mobile phone
service providers were men, with around 60% of the women thinking of changing their
mobile service providers although no action was taken. People who switched their mobile
services were found to be aged between 18-44 years as they have a higher tendency of
making experiments in relation to the mobile phone service with an aim of minimizing costs.
Table: Reasons for Switching
6.0 Recommendations to Improve/Enhance Vodafone’s Marketing Strategies
Vodafone should reduce its tariff plans and offering discounts in the plans so as to
capture people of lower social status. The company should offer special kinds of tariff offer
like the Vodafone Campus Pack that can help them in effectively targeting the students.
Vodafone can also make special packs for the friend’s circle that can help in benefitting those
people who want to stay in touch with friends. Vodafone can also offer services that are
designed for that of high-end business customers that can develop the brand in the Australian

9
CUSTOMER BEHAVIOR FOR VODAFONE
market (Liu et al., 2015). It can create business services like Vodafone Mail that can be of
immense help in delivering the presentations within a company.
Vodafone should also segment their markets and introduce premium customer prices
for calls/texts on Vodafone to Vodafone network and higher rates from Vodafone to other
networks to discourage brand switching. Vodafone can launch plans along with packages for
that of the small-medium enterprise along with the large-scale business. The segmentation
should take into account the various business within Australia and the services should be
customized on the basis of the needs of the clients and the business.
In addition, Vodafone should bring out Vodafone branded phones along with headsets
that can help in the growth of the company in Australia. Vodafone can make different kinds
of tariff plans that can draw the customer towards the company (Alshurideh, 2016). Vodafone
can improve the back-office customer service that can help in providing a superior experience
to the consumers. It has been found that consumers were facing difficulties in relation to
porting the numbers and the billing charges that were incorrect. Vodafone can improve upon
this area that can help in delivering better service to consumers.
Furthermore, Vodafone should decrease the charge that it offers for that of mobile
phone data service from $ 45 per month to that of $ 40 per month so that it can serve a wider
consumer base. There are a large number of people in Australia who belong to the middle
class and they would be able to take recourse to the service in the event of it becoming
cheaper. Vodafone should implement new strategies like competitor analysis, marketing
strategies and product differentiation to increase customer satisfaction and reach a wider
market. The company should also improve on the aspect of a network that can assist them in
the building of a strong distribution network across Australia.
7.0 Conclusion
The paper has discussed the reasons for brand switching attitudes and behaviors for
consumers of mobile phones in the Australian telecommunications market. Comprehending,
analyzing as well as keeping track of customer behavior has an important role in managing
the process of purchasing. In the present context, Vodafone analyses several factors that have
an important impact on customer brand switching. Group influence has an impact on the
purchasing process. Advertising has an important role in purchasing the product. Hence, it is
required to focus on the factors and take proper actions so that the organization can obtain
competitive benefits. Moreover, brand switching is indicative of study of individuals which is

10
CUSTOMER BEHAVIOR FOR VODAFONE
related to the purchasing of goods. An individual who is more affluent can use the mobile
network along with the broadband service offered by Vodafone. Individuals possessing a
high amount of income can purchase the premium products as compared to those people who
belong to that of the lower income group. The individuals who lead luxurious lifestyle would
have different needs from those people leading a moderate lifestyle. There occur differences
pertaining to bill shock among the male and the female gender. Women in Australia face bill
shock due to that of the higher cost of voice calls when compared to men thus leading to
brand switching. An educated person can easily adjust to the new technologies. There has
been an increase in the number of educated people in Australia that has increased the
consumer base of Vodafone.

11
CUSTOMER BEHAVIOR FOR VODAFONE
References
Alshurideh, M. (2016). Scope of Customer Retention Problem in the Mobile Phone Sector: A
Theoretical Perspective. Journal of Marketing and Consumer Research, 20, 64-69.
Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction.
Bamossy, G. J., & Solomon, M. R. (2016). Consumer behaviour: A European perspective.
Pearson Education.
Boateng, H., 2016. Customer knowledge management practices on a social media platform:
A case study of MTN Ghana and Vodafone Ghana. Information Development, 32(3),
pp.440-451.
Bruhn, M., Papen, M.C. and Zingg, D., 2015. Complaint Management on Social Networking
Platforms: An Examination of Inconsistent Complaint Behaviour and the
Identification of Potential Reduction Strategies. Marketing ZFP, 37(4), pp.201-210.
Chaudhary, R., 2016. Data mining techniques for customer relationship
management. IJCEM), 3(6).
Danaher, P. J., Smith, M. S., Ranasinghe, K., & Danaher, T. S. (2015). Where, when, and
how long: Factors that influence the redemption of mobile phone coupons. Journal of
Marketing Research, 52(5), 710-725.
East, R., Singh, J., Wright, M., & Vanhuele, M. (2016). Consumer behaviour: Applications
in marketing. Sage.
Egan, V., Hughes, N., & Palmer, E. J. (2015). Moral disengagement, the dark triad, and
unethical consumer attitudes. Personality and Individual Differences, 76, 123-128.
Foye, B. (2017). Vodafone to target enterprise with mobile and broadband services in 2017.
Retrieved from https://www.crn.com.au/news/vodafone-to-target-enterprise-with-
mobile-and-broadband-services-in-2017-455839
Garín-Muñoz, T., Pérez-Amaral, T., Gijón, C., & López, R. (2016). Consumer complaint
behavior in telecommunications: The case of mobile phone users in
Spain. Telecommunications Policy, 40(8), 804-820.

12
CUSTOMER BEHAVIOR FOR VODAFONE
Ghavamipoor, H., Hashemi Golpayegani, S.A. and Shahpasand, M., 2017. A QoS-sensitive
model for e-commerce customer behavior. Journal of Research in Interactive
Marketing, 11(4), pp.380-397.
Huang, Y.S., Fang, X. and Liu, R., 2017. When necessary evil is good: Customers’ reaction
to the witnessing dysfunctional customer behavior.
Information about Vodafone. (2018). Retrieved from
https://www.vodafone.com.au/about/company
Javornik, A. (2016). Augmented reality: Research agenda for studying the impact of its media
characteristics on consumer behaviour. Journal of Retailing and Consumer
Services, 30, 252-261.
Lin, A.J., Li, E.Y. and Lee, S.Y., 2018. Dysfunctional customer behavior in cross-border e-
commerce: A justice-affect-behavior model. Journal of Electronic Commerce
Research, 19(1), pp.36-54.
Liu, F., Zhao, X., Chau, P. Y., & Tang, Q. (2015). Roles of perceived value and individual
differences in the acceptance of mobile coupon applications. Internet Research, 25(3),
471-495.
Loureiro, S. M. C., Costa, I., & Panchapakesan, P. (2017). A passion for fashion: The impact
of social influence, vanity and exhibitionism on consumer behaviour. International
Journal of Retail & Distribution Management, 45(5), 468-484.
Lovelock, C., & Patterson, P. (2015). Services marketing. Pearson Australia.
Market Research Report. (2018). Retrieved from https://www.ibisworld.com.au/industry-
trends/market-research-reports/information-media-telecommunications/services/
wireless-telecommunications-carriers.html
Martinho, G., Magalhães, D., & Pires, A. (2017). Consumer behavior with respect to the
consumption and recycling of smartphones and tablets: An exploratory study in
Portugal. Journal of Cleaner Production, 156, 147-158.
Pan, H. and Kang, M.S., 2016. A Study on the Effects of the Perceived Value about Smart
Phone’s Customer Behavior: Focusing on Switch-ing Intention.

13
CUSTOMER BEHAVIOR FOR VODAFONE
Parsons, E., Maclaran, P., & Chatzidakis, A. (2017). Contemporary issues in marketing and
consumer behaviour. Routledge.
Seetharam, B. (2012). Developing Software for a Mobile Service in India. IEEE software,
29(4), 34-39.
Solomon, M. R., White, K., Dahl, D. W., Zaichkowsky, J. L., & Polegato, R.
(2017). Consumer behavior: Buying, having, and being. Boston, MA, USA:: Pearson.
Statista.com. (2019). Mobile phone users in Australia 2011-2019 | Statistic. Retrieved from
https://www.statista.com/statistics/274677/forecast-of-mobile-phone-users-inaustralia/
Vodafone Hutchison Australia Pty Limited - Profile Company Report Australia. (2017).
Retrieved from
https://www.ibisworld.com.au/australian-company-research-reports/information-media-
telecommunications/vodafone-hutchison-australia-pty-limited-company.html
Vodafone, CK Hutchison mull Australia merger. (2018). Retrieved from
http://www.taipeitimes.com/News/biz/archives/2018/08/23/2003699006
Vodafone.com.au. (2019). Mobile Phone Plans. Retrieved from
https://www.vodafone.com.au/plans
Zhang, D.J., Dai, H., Dong, L., Qi, F., Zhang, N., Liu, X. and Liu, Z., 2017. How Does
Dynamic Pricing Affect Customer Behavior on Retailing Platforms? Evidence from a
Large Randomized Experiment on Alibaba.