Turkcell Marketing Strategies

Turkcell Marketing Strategies

Management Brand Analyzing : Turkcell

Turkcell’s History

GSM-based mobile communication started in Turkey when Turkcell started its operations in February 1994. Turkcell signed a 25-year GSM license contract on April 27, 1998 with the Ministry of Transportation of Turkey. Since then, it has continuously increased the variety of its services based on mobile audio and data communication, its quality levels and as a result, number of subscribers. As of December 31, 2007, Turkcell has made 8,0 billion US dollars worth of investment in Turkey, which doesn’t include the price of the license. Again as of December 31, 2007, with its 35,4 million subscribers, Turkcell is not only the leading operator in Turkey, but is also the second biggest GSM operator in Europe in terms of subscriber numbers. Its competitors are Vodafone with a market share of 24% and Avea with a market share of 16% in Turkey.

Financial Analysis of Turkcell

Turkcell's shareholder structure is as follows: 51% is held by Turkcell Holding A.Ş., 4.15% by Çukurova Holding A.Ş., 13.07% by Sonera Holding B.V., 2.32% by MV Holding A.Ş., and the free float is 29.38%. Çukurova Group controls the company despite holding only 18% of the share capital, due to a complicated shareholding/voting structure.

Turkcell’s shares have been traded on Istanbul Stock Exchange (IMKB) and New York Stock Exchange (NYSE) since July 11, 2000 and it is the first and only Turkish company ever to be listed on NYSE.

Below is the Turkcell’s stock diagram is IMKB with some informations such as listing date etc.

Symbol Last Trade
16:01 19 May NYSE
Only Close
19 May 08 Change Volume
TKC $ 19.17 19.17 +0.23 (+1.21%) 2,784,982
Industry* Mobile Telecommunications
Issue Type ADS Common
Country of Origin Turkey
Listing date 11 Jul 2000 (IPO) (ADR)

Turkcell’s Fintur subsidiary is a holding company for its non-GSM and international GSM investments. These investments include Azercell, a provider of mobile services in Azerbaijan, Geocell, a provider of mobile services in Georgia, GSM Kazakhstan, a provider of mobile services in Kazakhstan, and Moldcell, which provides mobile services in Moldova. The company also has operations in Iran, Cyprus, and Ukraine. The Astelit company that Turkcell holds the majority shares of in Ukraine, started its operations in February 2005 with its brand life:) . Life:) has reached 8,0 million subscribers as of December 31, 2007.

Other Turkcell businesses include Bilisim, a provider of educational services over the Internet and television, Global, a telemarketing company, Turktell, a marketing company, Inteltek, a gaming company, and Libero, a betting company.

Turkcell operates under a license where by the company pays the Turkish Treasury a monthly fee equal to 15% of gross revenue.

Turkcell, as the leading operator of Turkey and nearby regions, entered the Board of Directors of GSM Association in early 2003. With more than 700 members from 217 countries, and 2 billion subscribers represented by these members, GSMA speaks for the world mobile communication market. Its Board of Directors, consisting of 23 people, has some of the world’s leading GSM operators like Vodafone, Orange, NTT DoCoMo, AT&T Wireless as well as Turkcell. The GSMA leads and coordinates the international GSM industry, brings together operators and mobile phone manufacturers, application developers and content/service providers onto the same platform. Through its position in GSMA, Turkcell is able to follow up on the global developments very closely and plays an active role in the establishment of the new global strategies.

Turkcell, with its wide coverage area and its large variety of services abroad is able to provide its subscribers with mobile communication services in Turkey and around the world. With its investments, Turkcell now covers all the settlements in Turkey that have a population of more than 3000. As of May 09, 2008, Turkcell has signed contracts with 581 operators in 197 countries, ranking it among the top operators in the world in terms of provision of international services. Turkcell also ranks among the top operators in terms of GPRS roaming, with contracts signed with 320 operators from 129 countries.

Turkcell Product Analization

Levels Of Product

Core Product(Intangible):
- Telecommunication ( Phone Calls, SMS etc.)
Actual Product:
- Tariffs
- Applications
- High Quality( Nearly Covers Whole Turkey)
- First Mobile Telecommunication Company in Turkey - Turkcell

Augmented Product:
- Easy to install both Prepaid and Postpaid SIMCards
- You can find a Turkcell Store everywhere to subscribe, buy counters, pay bills etc.
- Great After Sales Service
-Turkcell takes care of all customer problems and notifies customers about everything immediately

Turkcell adds new tariffs and applications due to it’s customers interests. It also identifys new features for different target customers to attract people to subscribe to Turkcell.

Turkcell has different brand signatures such as ;

It’s main logo :

And others(Tarife Yumurtlayan Tavuk, Cell-O-Can,Cell-O, Özgür Kız):

Turkcell SWOT Analysis

Strengths - First Mobile Phone Operator Company in Turkey
- In 16.11.2007, Turkcell had nearly 35 million subscribers - Strong Awareness initiative from Management team and midmanagement( Due To Corporate Governance of Turkcell) - High Coverage(Nearly Whole Turkey)

Weaknesses
- No committees( Due To Corporate Governance of Turkcell)
- Poor Relations with Investors/External Community( Due To Corporate Governance of Turkcell)
- Turkcell has higher communication prices compared to other mobile operators

Oppurtunities

-Everyday, more people buy mobile phones and subscribe to a mobile operator, Turkcell may attract new customers
-Other Mobile Operators Subscribers may change their mobile operators because of more appropriate services or prices may be provided by Turkcell

Threats

- Telecommunication Market is a growing market and all mobile operator companies want to hold more percentage in the market
- Strategies, Campaigns and Advertisements of other competitors in the market
- Subscribers may change their mobile operators because of more appropriate services or prices may be provided by other mobile operators

Turkcell Marketing Strategies

Turkcell provides coverage of an area that, as of March 31, 2007, includes 100% of the population living in cities of 3,000 or more people, 97.21% of the total population, and 80.44% of Turkey's land area.
Turkcell has international roaming agreements with 503 operators in 192 countries as of June 16, 2006. It claims to have more international GPRS roaming agreements than any other operator (203 operators in 81 countries as of August 5, 2005).
In March 1999, Turkcell launched a prepaid service named "Hazır Kart" (English Translation: Ready Card) for subscribers with lower spending levels, or who preferred to have more incoming than outgoing calls. Hazır Kart subscribers have access to all Turkcell's global GSM services.
Turkcell has been the "Official Communication Sponsor" of the national football and basketball teams since 2002. It also sponsors 14 of the 18 football teams in the Turkish Turkcell Super League. The "Turkcell Football Awards" project was initiated in 2003 to encourage "fair play" by awarding athletes who show fairness, impartiality, and solidarity.
Turkcell also sponsors the Istanbul International Film Festival and co-sponsors the Istanbul International Jazz Festival. Since 1999, Turkcell has supported the restoration of the ancient city walls in Bodrum. The last phase of the project, the restoration of an ancient theater, was completed in June 2003.
Turkcell has also continued to sponsor the CeBIT Bilişim Eurasia event, one of the major information technology fairs in Europe, for the tenth time in 2007.
Turkcell's main educational project, "Contemporary Girls of Contemporary Turkey", which started in 2000, grants scholarships to 5,000 young women in less developed parts of the country. The project received international recognition in June 2001, when it won the UK "Institute of Public Relations Excellence Award" and the "Crystal Obelisk Award" from the Foundation of Women Executives in Public Relations in New York in 2002.

Turkcell’s Tariffs and Applications

Mobile Health care Applications (Mobil Saglik Uygulamalari)

Turkcell introduced innovative telemetry applications to visitors throughout
Turkey's CeBIT trade fair during September 2006. Turkcell has differentiated itself from its competitors through participating in these demos and attracting a large number of visitors to its stands. Mobile health care applications allowing the timely and effective transmission of crucial information between patients and health care workers even while mobile is becoming widely used in the global health care industry. These solutions called Mobile Diabetics and
Mobile EKG offer time saving, efficiency and convenience for the health care sector. Turkcell is currently working on commercialization of these solutions with its partner ecosystem.

Future Services

Third Generation Mobile ("3G")

3G technology, offers full interactive multimedia and is expected to bring mobile networks significantly closer to the capabilities of fixed-line networks and allow for the introduction of high volume-based data services like video telephony. Multimedia services will likely feature prominently in 3G networks, and may include, in addition to conventional mobile voice and data services:

high speed Internet and intranet access, video telephony and conferencing, mobile TV, entertainment, information and high precision location services, and direct instant access to home or office IT systems.

Turkcell's ability to implement 3G services will be dependent on clearing the 3G regulatory and licensing process. The Telecommunications Authority has announced that there will be a tender process for the awarding of 3G licenses during the first half of 2007. 3G licenses will be sold for a minimum $252 million for the largest bandwidth. The Telecommunications Authority may attempt to award at least four 3G licenses, possibly resulting in, at least one new entrant into the current market. Turkcell believes that 3G services will be important for its business and intends to participate in the 3G licensing process.

Services

International Roaming

Today, Turkcell’s coverage extends to many countries in Europe, Asia, Africa and North and South America. As of December 31, 2006, Turkcell offered their subscribers international roaming in 193 destinations around the world, pursuant to commercial roaming agreements with 539 operators. As of April 6, 2007, they offered their subscribers international roaming in 193 destinations around the world, pursuant to commercial roaming agreements with 543 operators.

Since July 2002, Turkcell has been providing roaming services for the prepaid subscribers of foreign mobile operators visiting Turkey. They were the first operator to provide such a service in Turkey. This service, called "passive
CAMEL", can only be enabled if both operators have installed CAMEL system on their networks. As of December 31, 2006, Turkcell offered prepaid roaming to the prepaid subscribers of 135 operators in 76 destinations. As of April 6, 2007, we offered prepaid roaming to the prepaid subscribers of 141 operators in 79 destinations. Since October 2004, they have offered roaming services for Turkcell prepaid subscribers going abroad. This service, called "active CAMEL", can only be enabled if both operators have installed the CAMEL system on their networks.
As of December 31, 2006, they offered prepaid roaming to Turkcell prepaid subscribers through 150 operators in 88 destinations. As of April 6, 2007, Turkcell offered prepaid roaming to Turkcell prepaid subscribers through 155 operators in
90 destinations.

Since October 2002, Turkcell has offered GPRS roaming. As of December 31, 2006, Turkcell had 276 GPRS roaming partners in 113 destinations. Turkcell has signed 280 GPRS roaming addendums, or extended service agreements, to enrich the GPRS roaming availability. As of April 6, 2007, Turkcell offered their subscribers GPRS roaming through 280 operators in 114 destinations.

In order to balance international SMS traffic, Turkcell started to sign international
SMS Interworking Agreements with other mobile operators in April 2002. As of
December 31, 2006, they had signed 134 International SMS Interworking Agreements.
As of April 6, 2007, their subscribers can send SMS to 536 mobile operators located in 193 destinations including 130 CDMA/ TDMA operators in North America.

Tariffs

Turkcell’s charges for voice, messaging, and data consist of monthly fees, usage prices, bundles, and volume discount schemes and options under various tariff schemes. Their license agreement provides that the Telecommunications Authority sets the initial maximum tariffs, after consultation with them and the consideration of tariffs applied abroad for similar services. Thereafter, the maximum price levels are adjusted based on increases in the Turkish Consumer
Price Index. The increase applied to the price cap is 97% of the increase in the index. Turkcell’s maximum price levels are established due to
"-Regulation of the Turkish Telecommunications Industry."

Each customer subscribes to a voice tariff. Voice tariff packages vary based on type of subscriber (postpaid or prepaid, corporate or individual), time and destination of call, and call volume.

Main Tariffs

Turkcell has basic tariffs, offering on-net (Turkcell subscriber to Turkcell subscriber) usage advantages and a range of targeted tariff plans. Turkcell’s basic tariffs are widely preferred by their subscribers. Their main tariff is BizbizeCell which provides on-net usage advantages. We have segmented tariffsplans that are targeted at specific subscriber groups.

The main tariffs listed below for postpaid and prepaid subscribers are as of
April 5, 2007 (US dollar amounts are based on the April 6, 2007 exchange rate of
TRY 1.3625 = $1.00). Prices for prepaid BizbizeCell are based on the 100 counter card price level.

* Prices include 18% VAT but exclude the 25% Special Communications Tax.

(1) This tariff is offered to a specific group of subscribers.

(2) Based on Turkcell’s smallest counter package (900 counters)

(3) Discounted on-net price is for calls and SMS to other KampusCell subscribers.

(4) PSTN: Public Switched Telephone Network (landline)

(5) OMO: Other Mobile Operators

Based on March 2007 averages the majority of Turkcell’s subscribers use the
BizbizeCell Super On Net tariff.

StandartCell is a standard Turkcell tariff;

BuyukSirketcell is a corporate tarif;

KampusCell is a community tariff for students in high school and universities; Toplukontorcell is a package for corporate prepaid subscribers that creates cost advantages for corporate users because counters can be purchased in bulk and distributed among users.

In addition to the above Turkcell has segmented tariff plans that are targeted at specific subscriber groups.

They have loyalty programs, based on their main tariff plans, that support their retention efforts while incentivizing usage. The following programs represent some of Turkcell’s retention plans that reward long-term loyalty and continuous usage.

Counters From Us (KontorBizden Konbara). A renewed loyalty program for
Turkcell’s
prepaid subscribers that enables prepaid subscribers to earn increasing bonus counters based on top up amounts for every refill to use accumulated counters; Minutes From Us (Dakika Bizden). This program began for their consumer segment in May 2005. Subscribers, once registered, can earn free minutes according to the amount of their monthly bill, while minutes earned are given in installments over a five month period;

Earn As You Go (Kullandikca Kazan). Earn As You Go was introduced in June
2005 as the corporate segment counterpart of Minutes From Us. The criterion for earning free minutes is the size of the monthly bill. These free minutes can only be used for Turkcell to Turkcell calls.

In addition, they also have two lifestyle subscriber programs:

Young Turkcell (gnctrkcll), a program that targets the youth segment; and Turkcell at Work (IsTcell), a program that targets corporate customers and professionals. Turkcell and It’s Competitors In The Market

Turkcell has entered into interconnection agreements with Turk Telekom, Vodafone,
Avea, Milleni.com, and Globalstar.

Under these interconnection agreements, Turk Telekom, Vodafone, Avea,
Milleni.com, and Globalstar agree to permit interconnection of their networks with Turkcell’s network to enable calls to be transmitted to, and received from, the
GSM system operated by Turkcell through its existing digital fixed telephone switches.

The interconnection agreements also establish understandings between the parties relating to various key operational areas, including call traffic management, and the agreements contemplate that Turkcell and the other parties will agree to the contents of various manuals that will set forth in detail additional specifications concerning matters which are not specifically covered in the interconnection agreement. These matters include quality and performance standards, interconnection interfaces and other technical, operational, and procedural aspects of interconnection.

The interconnection agreements specify that the parties shall comply with relevant international standards, including standards adopted by the GSM
Memorandum of Understanding, the Telecommunications Standards Bureau of the
International Telecommunications Union, and the European Telecommunications
Standards Institute. In the absence of applicable international standards, the interconnection agreements provide that the parties will establish written standards to govern between them.

The interconnection agreements outline the applicable interconnection principles and provide the technical basis and rationale for technical specifications and manuals to be agreed to by the parties. The interconnection agreements:

' set forth agreements between the parties relating to the location of exchanges; ' create obligations regarding network alterations;

' establish routing principles to govern how call traffic will be routed within a network and between the networks of the parties, including interconnection routing rules;

' provide for arrangements concerning capacity and expansion of capacity through new points of interconnection;

' mandate arrangements concerning the use of numbering to transmit calls in accordance with national and international practices;

' provide for periodic technical review meetings between the parties;

' permit each party to engage in testing of interconnection exchanges;

' address the consequences of transmission failures;

' create an obligation to cooperate in order to maximize overall quality of transmission of calls in accordance with international standards;

' deal with emergency calls, calling line identification and malicious call identification; ' assure the ability of a party to have access to the other party's premises where relevant equipment may be located (subject to appropriate protections); ' establish procedures to deal with network faults; and

' address issues relating to the construction and installation of antennas, towers, and other elements of system infrastructure.

In addition, the parties agree to provide to the other party information which is necessary to enable performance of their interconnection obligations, the provision of services, or utilization of equipment and/or buildings as contemplated in the interconnection agreement.

Turk Telekom

In the Turk Telekom interconnection agreement, Turk Telekom also agrees to permit Turkcell to utilize Turk Telekom's buildings, premises, and other infrastructure and to lease the means of communications transmission between Turkcell’s
GSM exchanges, base stations, and base station control stations. Turkcell retains the right, however, to establish its own transmission network at its own expense in the event that such transmission network is not made available to it by Turk
Telekom, subject to the consent of the Telecommunications Authority.

If Turk Telekom enters into interconnection agreements with other operators of mobile or similar telecommunications services, the conditions of such agreements must be the same as those in their interconnection agreement with Turkcell.
The Turk Telekom interconnection agreement specifies that ownership of the GSM equipment and other materials, including those in existence on the date of the
Turk Telekom interconnection agreement and those subsequently installed, belongs to Turkcell. The agreement also provides that intellectual property rights will belong to the developer or owner.

Charges for Energy at Switching Centers

Turkcell can subscribe to Turkish Electricity Distribution Co. ("TEDAS") or another relevant electricity distribution company as a stand alone customer and pay its energy usage charges. In such case, they will not pay

any charges to Turk Telekom.