Analyzing GiffGaff's Marketing and Growth Strategies

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UNIT 32
BUSINESS STRATEGY
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Table of Contents
INTRODUCTION............................................................................................................................. 3
LO1 IMPACT AND INFLUENCE OF MACRO ENVIRONMENT OVER AN ORGANIZATION..................4
P1 & M1..................................................................................................................................... 4
LO2 ASSESS AN ORGANIZATION’S INTERNAL ENVIRONMENT AND CAPABILITIES.........................8
P2 & M2..................................................................................................................................... 8
LO3 EVALUATE AND APPLY THE OUTCOMES OF AN ANALYSIS USING PORTER’S FIVE FORCE
MODEL TO GIVEN MARKET SECTOR............................................................................................ 12
P3 & M3................................................................................................................................... 12
LO4 APPLY MODELS, THEORIES AND CONCEPTS TO ASSIST WITH THE UNDERSTANDING AND
INTERPRETATION OF STRATEGIC DIRECTIONS AVAILABLE TO AN ORGANISATION.....................15
P4 &M4.................................................................................................................................... 15
CONCLUSION............................................................................................................................... 21
REFERENCES.................................................................................................................................22
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INTRODUCTION
With the rapid changing world, there are many types of changes made in terms of defining the
effective set of technologies and procedures in order to enhance the various sectors defined
during the establishment of new business. As the UK has been defined as the perfect place for
the establishment and development of the business there are many new sectors which are
defined in the UK, one of the most popularly growing sector analyzed in the UK is Mobile
Telecommunication sector (Belton, 2017).
As per the survey done by Deloitte it has been found that more than half of the population
laying between the age of 16-75 years are using smartphones which is estimated to be 22
million people, where people belonging to the age of 16-24 years defines 74% use of mobile
services, as the result of which the mobile industry has generated £3.8bn in retail revenue
(Anton, 2015).
One of the most popular companies in the sector of telecommunication in the UK is named as
Giff Gaff, which has been running as an operator of the virtual network by using the networks
of UK’s O2 company. The company has been owned by the owners of the Telefonica which was
introduced on 24 November 2009, the headquarters of the company has been found to be
established in Uxbridge, Greater London, UK. The company introduced its first product as the
prepaid SIM card using 2G and 3G standards (Holloway, 2017).
Figure1: giff gaff
Source: (Holloway, 2017)
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LO1 IMPACT AND INFLUENCE OF MACRO ENVIRONMENT OVER AN
ORGANIZATION
P1 & M1
The marketing strategy being used in the giff gaff is defined to be different from the other
telecommunication companies, as the company has been owned by the Telefonica it uses the
collaborative type of approach contributing towards the expansion of the business with
satisfying the customer demands, where the team of the company is built of multi-talented
employees including stakeholders such as investors, customers, trade union partners as
employee, etc. The company has no trade shares as the company is defined as a privately
owned company. The minimum allowance of giff gaff defining the share value at €1,000 is
owned by O2 (Bryson, 2018).
As the company has been defined the part of the Telefonica, the trade union in the company is
purely based on the exchange of services and goods defined in the company with respect to the
taxes imposed over the company by the government of the country. The employees of the
company are defined to have a high level of skills and capabilities defined during the
development of various new strategies and tasks.
With the combination of various strategies depending on the factors such as geographical,
psychographic and demographic the marketing strategy of the company is defined. Thus, to
supply the best and effective set of services the set of strategies are defined as per the
requirement and the demand of the people. The company includes the factor such as the cost-
effectiveness leading towards the development and growth of the company (Barney, 2014).
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Figure 2: Stakeholders in giff gaff
Source: (Belton, 2017)
Apart from these factors, there are various external and internal factors which are defined in
the company in order to regulate and maintain the development and progress of the company
which is defined by using the PESTEL Analysis of Giff Gaff:
POLITICAL ECONOMICAL SOCIAL
 There are many laws
which are defined as
the government of
the UK in terms of
networking and
wireless issues as the
company belongs to
the sector of
telecommunication.
 The aim of providing
the stability towards
the inflation rate
leading to rapid
recovery towards the
gross domestic
product has defined
the positive impact
over the demands of
customers in the form
of their expenditures
along with corporates
in the
telecommunication
sector.
 The implementation of
the best set of services
dealing effectively
with the demands of
the customers has
been focused in this
sector (Kharub and
Sharma, 2017).
• The issues related to the
tariff plans and the set of
services provided by the
company is focused on.
The limited demand
towards the
communication
defining the mobile
services and
productions have been
decreased due to a
decrease in the rate of
 The set of services in
relation to the internet
and mobile among the
customers have
defined the path
towards the change in
demand for
communication.
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unemployment in
2013 by 7.2%
With an aim to create the
new services over existing
services, the government
should approve the
suggested plan, to ensure
that no action is violated
during the implementation
of the new services.
 Due to the rise in the
level of disposable
income, mobile
communication has
been also increased as
per the demands of
the customers.
 The value and
importance of
telecommunication
are increased due to
the introduction of
devices such as iPod's
tablets in many
universities and
schools (Lewis, 2019).
For the set of employees and
customer’s safety and
security, the set of laws
defined by the government
towards the safety and
security must be followed.
 The stability level of
the company has been
affected by the level of
employment and the
unemployment rate.
 The use of
communications and
mobiles has been
increased with the
increase in the
population rate of the
country.
TECHNOLOGICAL LEGAL ENVIRONMENTAL
 In order to meet the
demands of the
customers, the
enhanced set of
techniques must be
applied in an
organization.
The office of communication
has been defined by the giff
gaff company in the UK, in
order to define the way of
regulating the communication
sector.
 The emission of
harmful radiations
during the
implementation of the
techniques related to
wireless
communication harms
the environment
(Lewis, 2019).
 The way of defining  The leaders of Giff gaff  The soil gets
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the high amount of
profit in the company
can be defined by
providing the latest
set of technology
implemented in an
organization.
generate the effective
set of procedures by
incorporating with
OFCM to satisfy the
marketing demands.
contaminated by using
substances such as
plastic and cadmium
leading towards a
decrease in nutrients
of the soil.
 The number of
messages and the
voice calls has been
decreased due to the
top providers of
providing the best
and fastest
communication way
to the customers.
 In order to determine
the protection of
consumer rights in the
company's sector of
working, the OFCM
contributes towards its
best.
 With the aim of
defining
environmentally
friendly measures,
various set of
procedures have been
defined in the
company (Manning,
2017).
Figure 3: PESTEL ANALYSIS
Source: (Manning, 2017)
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LO2 ASSESS AN ORGANIZATION’S INTERNAL ENVIRONMENT AND
CAPABILITIES
P2 & M2
In order to deal with the internal environment of the company, SWOT Analysis has been
defined:
Strengths Weakness Opportunities Threats
The effective way of
dealing with the
upcoming problems
works as the strength
of company Giff Gaff.
There has been a
constant increase in
the number of
competitors in the
sector of
telecommunication.
The increase in the
demands of customers
for the best set of
services leads towards
the chances of
generating a high
amount of profit.
With the increase, the
other number of
competitors with the
best set of offers
serves as the threat
for the company.
Due to the effective
establishment of the
parent company
named as Telefonica,
it serves effective for
Giff gaff to apply the
best set of strategies
and techniques
defined.
By establishing
many
infrastructures of
the company within
the country, can
lead towards the
implementation of
the ineffective set
of procedures and
strategies.
In terms of making the
network more safe and
secure, new alliances
have been introduced
within the company.
The diversification of
the company in
various sectors needs
to define a set of
opportunities for the
people (Manning,
2017).
It serves
advantageous for the
giff gaff to establish
The development of
Giff Gaff has been
affected due to the
The economic growth
of the country has been
improved by the
To prevent the loss in
the company,
effective set of
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its business, as the
parent company has
been defined as the
largest
telecommunication
company in the
world.
total revenue
generated by
Telefonica.
increase in the rate of
employment offered by
the giff gaff company.
facilities needs to be
generated which
satisfy the customer
demands.
By providing effective
mobile signals and
quality of services the
strength of the
company has been
determined.
The market of UK
has been increasing
with the increase in
the number of
taxes, which serves
as the weakness of
the company.
In order to develop the
name of the company
in the sector of
telecommunication, a
large amount of
investment has been
made by the giff gaff
company.
In order to attract the
major number of
people towards the
company effective
set of methods and
procedures must be
introduced (Manning,
2017).
The introduction of
the various methods
and procedures in an
organization provides
a more safe and
secure environment.
In the market of the
UK, mobile markets
fail to provide the
allowances of data
in the company.
In terms of delivering
the best set of services
towards the customers,
high-profit generation
can be done in Giff Gaff.
The major threat
towards the company
is defined with loss of
customer faith over
the company.
The company
provides the best set
of facilities to deal
with the safety and
security of the
information shared by
the costumes over
the internet.
The profit
generation of the
giff gaff is
determined to be
low as that of its
parent company
Telefonica.
In terms of introducing
the new set of services
and strategies in an
organization, the
opportunities towards
employment and
development can be
increased.
The ineffective
delivery of services
and products towards
the customers may
lead to suffering huge
loss for the company
(Favaro, 2015).
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Figure 4: SWOT ANALYSIS
Source: (Hatch, 2018)
Despite determining the factors based on the SWOT Analysis, the internal capabilities of Giff
Gaff can be determined by using the VRIO/VRIN Model which is defined as:
Resource Value Rare Imitation Organized
Awareness of
Brand
Yes, the products
and services if
the company is
being popular
among the
customers.
Giff Gaff’s
efficiency has
been determined
by the
customers.
In brand
development, no
barriers are
defined.
Towards the
organizational
background of
the company,
capabilities of
the company
have been
effectively
defined.
Strategies of
Pricing
To determine the
high amount of
profit, effective
strategies are
implemented.
No, the
procedures and
strategies
defined over the
platform of
common
business are
The set of
strategies being
implemented are
analyzed at a
regular time
interval.
The strategies
may be changed
(Barney, 2014).
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