Marketing Audit: An Environmental Analysis of Vodafone UK, MBA Report

This report provides a comprehensive marketing audit of Vodafone UK, focusing on its external macro and micro environments and internal factors. The analysis utilizes the PEEST framework to examine political/legal, environmental, economic, social-cultural, and technological factors. A micro-environment analysis assesses the market, customers, competitors, suppliers, and distribution channels. The internal analysis includes a strategy audit, marketing productivity audit, and marketing function audit. The report culminates in a TOWS matrix, derived from SWOT analysis, to identify strategic recommendations for Vodafone UK's future. The report highlights Vodafone's strengths in customer service and digital technology, while acknowledging weaknesses in marketing and pricing strategies. Recommendations include focusing on celebrity endorsements, collaborations, and pricing strategies to maintain a competitive edge in the UK telecom market.

Running head: AN ENVIRONMETAL ANALYSIS ON VODAFONE UK
AN ENVIRONMETAL ANALYSIS ON VODAFONE UK
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1AN ENVIRONMETAL ANALYSIS ON VODAFONE UK
Executive Summary
The main objective of this report is to structure a marketing audit for Vodafone UK. The
purpose of this audit is to analyse the external macro and micro environment and the internal
factors which are affecting the company. From this analysis the tows matrix is prepared at the
end. From the analysis it is observed that Vodafone has a strong upholding in the UK market
due to their exceptional customer service and use of digital technology. However, the
company is weak in their marketing section as they are solely depended on advertisements
and the price of their network service than most of their competitors. Hence in the conclusion
few strategies are mentioned which will help to solve the challenges faced by the company
and gain long-term sustainability.

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Table of Contents
Introduction................................................................................................................................4
Discussion..................................................................................................................................4
Macro environment analysis..................................................................................................4
Political/Legal....................................................................................................................5
Environmental....................................................................................................................5
Economic............................................................................................................................5
Social-cultural....................................................................................................................5
Technological.....................................................................................................................5
Micro environment analysis...................................................................................................6
Market................................................................................................................................6
Customers...........................................................................................................................6
Competitors........................................................................................................................6
Distribution and dealers.....................................................................................................7
Suppliers.............................................................................................................................7
Internal analysis.....................................................................................................................7
Strategy audit.....................................................................................................................8
Marketing productivity audit..............................................................................................8
Marketing function audit....................................................................................................8
TOWS analysis.......................................................................................................................9
Conclusion................................................................................................................................10
References................................................................................................................................11

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Appendix 1: Company overview.............................................................................................12
Appendix 2: PEEST framework...............................................................................................12
Appendix 3: Micro analysis framework...................................................................................13
Appendix 4: Marketing audit...................................................................................................13

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Introduction
Corporate leaders can control the factors affecting the internal environment of a
business however controlling the external factors is challenging.to overcome these challenges
the corporate leaders perform macro and miro environment analysis to formulate strategies
that the organization can adapt. This report is based on the environmental analysis performed
on Vodafone UK. Vodafone is the first company in UK to have supported a mobile call in
1985 (more overview about the company is shown in appendix 1). The external analysis is
done with the help of PEEST framework along with a micro analysis comprising of market,
customers, competitors, suppliers, distributors and dealers. A marketing audit is performed
using strategy, functions and productivity of Vodafone for the internal analysis. Based on the
external and internal analysis a tows matrix is prepared. The report is structured in two
sections: the first sections comprises of the macro analysis done with PEEST and the micro
analysis, the second section mentions the internal analysis done with the marketing audit,
conclusion mentioning about the strategic recommendation and the appendix mentioning the
company overview and the analysis framework.
Discussion
The external and internal analysis of Vodafone UK is illustrated in the entire
discussion of this report.
Macro environment analysis
The analysis of Vodafone’s macro environment is done through the PEEST
framework. This will help to explore the potential threats prevailing in the macro
environment and make the company aware beforehand (Kotlyk and Jamal 2018).

5AN ENVIRONMETAL ANALYSIS ON VODAFONE UK
Political/Legal
With the advancement of technology, the government regulations and policies have
also grown over the years. Government impose strict regulation on telecom industry as these
firms use spectrums and generate high revenues. The policies include communication act,
restriction on network access facilities, which are affecting Vodafone (Klauer 2014)..
Environmental
Rigorous environmental regulations are imposed on the telecom industry, which
includes recycling of waste, proper handling and disposal of e-waste, prohibition on ample
usage of high frequency phones. This environmental threats are affecting Vodafone to which
they have responded by reducing their waste to half (Klauer 2014).
Economic
A business in the telecom industry is capital intensive, it needs to build infrastructure
and attain resources to stay ahead of competitors. Recently Vodafone UK has merged with
O2 to reduce their expenditure on infrastructure, implementing 4g and 5g also required a
major capital investment. However, the advancement in technology has created a demand
among the consumers thereby increasing the turnover and contributing to the nation’s GDP
(Klauer 2015).
Social-cultural
The lifestyle of people changes according to the social trend, which affects the buying
habits. The recent growth of internet among consumers has been a boon for Vodafone. Most
people use internet to a large extent daily which increases the demand for network.
Technological
Over the years, Vodafone has grown extensively with the use of technologies like 5g,
artificial intelligence, loT and by providing excellent customer service. The company has

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provided their users with myVodafone app, which would give access to different services
offered by Vodafone (Kerr and Moloney 2019).
Micro environment analysis
Micro environment analysis those factors which the decision making process and
strategy of a business. Listed below are the factors affecting Vodafone.
Market
Vodafone holds a market share of 21.3% in U.K. and the company is the leading
telecom operator in U.K. Their brand value worth more than 39.7 billion U.S. dollars.
Through implementing innovative strategies and turning their customers into their fans
Vodafone has been able to become the leading brand globally as well. Vodafone earns a
revenue of 13% from U.K. however, the less population growth in U.K. and the high capital
investment makes the company face growth challenges (Singh 2014.).
Customers
The targeted customers of Vodafone include individual, business enterprises,
corporates, business professionals and MNCs. 86% of the population in UK uses internet
daily with an average of spending six hours on internet. The customers have high brand
loyalty however, their expectations are also high. The people of UK take price as the most
deciding factor for buying any plans therefore Vodafone had to lower their price to be
competition with their peers. The customers have a high brand loyalty therefore Vodafone
should focus on their service quality to retain their customers for long time purpose (Mollah
and Sharif 2014.).
Competitors
In U.K. telecom market Vodafone faces rivalry from O2, EE limited, Talktalk Electra
and BT. The major resources of Vodafone include efficient human resource and
technological development infrastructure which provides the company a competitive

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advantage. They have also introduced a low pricing strategy to stay ahead from their
competition. To gain a sustainable competitive advantage Vodafone should implement
strategy for product development and market development. The recent telecom market of
U.K. is facing threat from substitutes as the youth prefer instant messaging apps or free
calling apps which are provided by the substitutes (Al-Atiqi and Mumen 2014).
Distribution and dealers
Forbes has ranked Vodafone 395th in the world’s best 2000 brands. The company has
a wide distribution network. Vodafone mainly uses their distribution channel for marketing,
promotion, advertising of their products and services. They invest quite a lot amount of
money for promotion to keep the mass engaged and entertained.
Suppliers
The supply chain management team of Vodafone manages the risk and value
procurement activities of Vodafone in the marketing section. They manage the risk by
handling the stakeholders of the company and developing strategy according to the market
conditions and challenges (Kerr and Moloney 2019)..
Internal analysis
A marketing audit refers to the systematic examination, evaluation and interpretation
of the marketing factors prevailing in the business environment. Through this audit the
strategies and objectives are formulated which helps to avoid the approaching threats and
enhance the market performance by using the opportunities and key resources. The
components of a marketing audit include task environment, marketing strategy, marketing
organization, marketing system, marketing productivity, marketing function and macro-
environment audit (Al Fahad, et al. 2015). A marketing audit for Vodafone UK has been
carried out below. In this audit the marketing strategies, marketing productivity and

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marketing functions are discussed in respect to Vodafone. The framework of marketing audit
is shown in Appendix 4.
Strategy audit
The corporate objective of Vodafone is to include their name among the world’s top
five brands. Therefore, the company is expanding their global presence through extensive
marketing strategies, acquiring new customers and using advanced technology. Vodafone’s
marketing strategies involve customer engagement, they have started a programme called
customer experience excellence (CXX) to offer a different experience to their customers
which will increase their position in the market. Vodafone uses digital technology for their
marketing purposes, they are also planning to invest in digital apps like cloud to acquire more
customers (Alim and Ozuem 2014).
Marketing productivity audit
The profitability analysis of Vodafone shows that the company has a score of 4.00
which is much higher than its competitors therefore Vodafone has a high profit than its
competitors. The introduction of 5g has brought in revenues for the company, they have
acquired 3400 MHz spectrum in UK to support the 5g. Vodafone uses big data analytics,
robotics and artificial intelligence to increase their customer base and reduce their operational
cost. The use of digital technologies also helps to reduce the cost of their distribution channel
by sustaining from paying any commission (Kerr and Moloney 2019).
Marketing function audit
 Product Vodafone offers a diversified range of products from call facility, internet
access, gaming facility, to SMS and e-mail facilities.
 Place Vodafone UK have a wide network access reaching over 354 stores among
the country. By having a physical presence it provides a shopping experience to the

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customer as they get the product knowledge from the sales team. Vodafone is also
present in different social media platforms (Holmes, Byrne and Rowley 2014).
 Price Vodafone has different pricing policy for different products. It includes tariffs
plans for different services like data and voice calls. In U.K Vodafone offers
NECTAR points to reward the money spent over its network.
 Promotion Vodafone implements effective promotion strategies like the Zoozoos
advertisement, sponsorships and charities and several community initiatives. Also
offers promotions on call and data to sustain customers.
TOWS analysis
A TOWS matrix is the derivation of SWOT analysis. TOWS stands for Threat,
Opportunity, Weakness and Strength designed by professor Heinz Weirich. The Tows matrix
is used to identify the opportunities and threats prevailing in the external business
environment and formulate for the same (Gürel and Tat 2017.). The TOWS matrix from the
external analysis of Vodafone is carried out below:
 SO: Vodafone is one of the biggest organization and by expanding their 4g services
and high speed internet to more people they will achieve growth.
 OW: Vodafone is charging higher prices than their competitors, they should utilize
their organizational resources and reduce their service price.
 TS: As the youth wants more internet facilities is lesser amount of price the company
should charge less to increase their customer base (VAVROVA and KLINGER).
 WT: By conducting a market audit Vodafone can set up a pricing strategy and reduce
their operating cost accordingly to decrease the network cost.

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Conclusion
Hence concluding from the above report, currently Vodafone is the market leader in
the telecom industry. However to sustain this position the company should implement new
innovative strategies to overcome their challenges. From the external and internal analysis of
Vodafone few recommendations are developed for the future. The main potential of
Vodafone is their in depth market knowledge, resources and global access. In terms of
marketing Vodafone only does advertising which seems a very strategy, the company should
indulge more in celebrity endorsement. To enhance their brand image they should collaborate
with research and development team of cancer research and some other local concerns for
making more safer handsets.

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References
Al Fahad, A., Al Mahmud, A.R., Miah, R. and Islam, U.H., 2015. Marketing audit: A
systematic and comprehensive marketing examination. International journal of scientific &
Technology research, pp.215-221.
Al-Atiqi, A. and Mumen, F., 2014. The Strategic Alternatives of Vodafone UK in 2009.
Alim, S. and Ozuem, W., 2014. The influences of e-CRM on customer satisfaction and
loyalty in the UK mobile industry. Journal of Applied Business and Finance Researches, 3(2),
pp.47-54.
Gürel, E. and Tat, M., 2017. SWOT analysis: a theoretical review. Journal of International
Social Research, 10(51).
Holmes, A., Byrne, A. and Rowley, J., 2014. Mobile shopping behaviour: insights into
attitudes, shopping process involvement and location. International Journal of Retail &
Distribution Management.
Kerr, W.R. and Moloney, E., 2019. Vodafone: Managing Advanced Technologies and
Artificial Intelligence.
Klauer, T., 2014. Valuation of Vodafone Group, 20 May 2014.
Klauer, T., 2015. Valuation of Vodafone Group.
Kotlyk, A.V. and Jamal, Y., 2018. Methodical approach to analysis of volatility, uncertainty,
complexity and ambiguity of the external environment. Актуальные проблемы
инновационной экономики, (4), pp.65-69.
Mollah, A.S. and Sharif, A., 2014. The impact of relationship marketing on customer loyalty
at Tesco Plc, UK. European Journal of Business and Management, 6(3), pp.21-55.
Singh, P.N., 2014. Verizon acquired Vodafone: Analysis of market reaction. Industrija, 42(3),
pp.163-182.
VAVROVA, M. and KLINGER, T., MARKETING PLAN OF.