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Telenor was one of the world’s largest mobile telecommunications companies and headquartered in Norway. It is looking if it is the ideal time to expand the business portfolio. How should it move forward?
Joerg Niessing and Hilke Plassmann
Harvard Business Review (IN1328-PDF-ENG)
February 27, 2017
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Case answers for Telenor: Revolutionizing Retail Banking in Serbia: Digital Transformation of the Customer Experience
TELENOR GROUP AT A GLANCE
Telenor Group was founded in 1855. It belongs to the Telecommunication business sector. In 1990, it expanded its operations in Norway, Europe, and ASIA. In 2006, it acquired 100% ownership in Mobi 63 in Serbia.
Navratil, CFO of Serbian bank, wants to emphasize and invest in the mobile banking sector in Serbia, which is comparatively weak. To implement this strategy, he wants to come up with a marketing strategy so that he can convince the Telenor group to go ahead with this new idea.
The Gist of Mobile Banking in Serbia
- Navratil has researched the mobile, and direct banking of Serbia, and people have expressed their dissent towards direct banking. Still banking sector of Serbia has managed to lead the market and earn desirable profits.
- Navratil wanted to do better and make the target market of Serbia realize that mobile banking could do better in terms of accessibility and convenience.
- People of Serbia don’t trust mobile banking due to factors like poor or lost internet connectivity. They were also less trained and had little knowledge in terms of how to use mobile banking.
- There are various segments he has analyzed in terms of Demographics and Psychographics. He then focused on things like brand positioning, differentiated services from other banks, brand logo, configuration, network outreach to its customers through a physical store or other alternatives, the channel of communication, and lastly, pricing strategy.
Telenor Wants to Capture Mobile Banking Market in Serbia
Direct Banking Services
- This is the most formal sector of banking in Serbia, with a lot of saturation.
- Entering this segment would require a banking license and clearance from the government.
Affiliated Banking Services
This is another domain through which Telenor can enter the mobile banking sector.
To enter here, Telenor has to get into tedious negotiations and agreements with the local banks.
- This is the informal domain, and Telenor has a lot of experience in.
- Easy Paisa in Pakistan became an instant hit, and Telenor can replicate this model in Serbia.
- A similar branded interface can be created under Telenor Umbrella in Siberia.
The Financial Service
- Mobile Wallet can provide numerous financial services to the consumers of Serbia. Before entering the direct banking services, Telenor should get the financial expertise through the mobile wallet first.
- The mobile wallet can help consumers pay for local online shopping, utility bills, funds transfer within mobile wallet users and pay for Telenor mobile bills.
- After getting the right expertise, Telenor can enter the mobile banking market through direct banking by buying an existing bank of Serbia, which can help it avoid the protracted licenses requirement.
- Customers are less likely to shift towards a new service
- Trust issues concerning privacy and safety
- Differentiation factor: First company to introduce a mobile wallet and capture the untapped market
- Telenor will get first movers advantage
- It will not tarnish the brand image of Telenor’s in case of spillover
- Easy for Telenor to generate revenue since it has built a loyal customer base.
How to Target the Right Segment
Target segment 3
- Employment: 73 percent of the target audience
- Gender: Balanced ratio of male and female
- Personal traits :
- Like challenges, taking risks, and comfortable using the internet and mobile apps.
- Encourage changes, and their income level is the middle-income group.
Target segment 1
Consumers believe in…
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