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Thorough SWOT Analysis of Gruppo TIM – An Italy Based Telecom Company

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In our previous article, we had done an explicit SWOT Analysis of the 8th largest telecommunications company in the world, Movistar. In this article, we will see the SWOT analysis of Gruppo TIM, a telecommunication company. 

Gruppo TIM is one of the world’s top 20 telecommunications providers. They have been operating since 1994. Spending 27 years in the telecommunications industry, they have gained a satisfactory amount of goodwill and gained a handsome amount of net worth.

Looking into the brand’s giant reach to the people is because of the marketing strategy and Gruppo TIM’s keen interest in launching digital marketing portals. As the world today stands on the verge of being digitized you should get ready to delve into the new marketing strategies to get your potential customers. if you want to learn more about digital marketing and its different attributes do check out Free Digital Marketing Masterclass by Karan Shah the founder and CEO of IIDE.

With the motto to connect as much as people across the globe Gruppo TIM is always striving hard to be the best. In this blog, we will have an elaborate SWOT Analysis of Gruppo TIM. Before we delve, let us discover more about Gruppo TIM Group, its founding, products, financial status, and competitors.

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About Gruppo TIM

SWOT Analysis of Gruppo TIM - TIM Store Outer Look

Gruppo TIM is legally called TIM S.p.A is an Italian telecommunications company having its headquarters in Rome, Milan and Naples, providing fixed telephony as well as DSL data services.

Gruppo TIM was officially created on 27 July 1994 by the union of several telecommunication companies among which SIP, Iritel, Italcable, Telespazio and Sirm were involved. This was due to a plan of reorganization of the telecommunication sector presented by the IRI to the Minister of Treasury.

Gruppo TIM is a unified telecommunications services company that provides mobile and fixed telecom services, voice, messaging and data, internet, and broadband services. From which Gruppo TIM provides phone landline services and mobile services in Italy, GSM mobile phone services in Italy and Brazil and DSL internet and telephony services in Italy and San Marino through its subsidiaries. It also operates in international telecommunication services for other operators and corporations, through its subsidiary Telecom Italia Sparkle.

 

Quick Stats on Gruppo TIM
Founder SIP
Year Founded 1994
Origin Italy
No. of Employees 51,917+
Company Type Public
Market Cap € 9.108 Billion (2021)
Annual Revenue € 17.97 Billion (2019)
Net Income/ Profit € 1.22 Billion (2019)

 

SWOT Analysis of Gruppo TIM - TIM Produtcs in Display


Products Of Gruppo TIM

  • Fixed Telephony
  • Broadband Internet
  • IT Services
  • Networking Solutions
  • Digital Televisions


Competitors of Gruppo TIM

Gruppo TIM operates on a mass level therefore it also has competitors. Following are some of the competitors of Gruppo TIM:

  • Fastweb (Milan, Italy)
  • Telekom Slovenia (Ljubljana,Slovenia)
  • Bouygues Telecom (Paris, France)
  • Eircom (Ireland)
  • Royal KPN (Rotterdam,Netherlands)

Now that we have taken a glance at what Gruppo TIM is, let’s take a look at the SWOT Analysis of Gruppo TIM.


SWOT Analysis of Gruppo TIM 

SWOT Analysis is a useful technique for developing business strategies for both new and current businesses. This simplified methodology is used to assess a company’s competitive standing. SWOT analysis of Gruppo TIM can help the organization develop effective and efficient business strategies.

To better understand the SWOT analysis of Gruppo TIM, refer to the infographics below:

SWOT Analysis of Gruppo TIM - SWOT Infographics of Gruppo TIM

Below is a thorough guide to the SWOT analysis of Gruppo TIM.

Strengths of Gruppo TIM

The brand’s competence gives an edge over capturing the maximum market in the industry and earning more profits. Hence here we go with the strengths as follows:

  • Strong Cash Flow System: Gruppo TIM has a strong free cash flow that provides them ample amounts of resources to expand and diversify their company.
  • Quality Returns On Capital Expenditure: Gruppo TIM is relatively successful as compared to its competitors in implementing new projects and generating good returns on capital expenditure by increasing the doors of revenue for them.
  • Automation of Activities: One of the major strengths of Gruppo TIM is the automation of all the activities and projects which has brought a good amount of consistency in the quality of the products. This automation has given an edge-over to Gruppo TIM to scale up and scale down according to the demand and conditions of the market’s current situation which is working from home & office. 

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  • First Mover Advantage: Gruppo TIM was the first telecommunication company in Italy that succeeded in the reality of the internet in Italy. It is also the first launcher of short message service capability and 5G cloud network in Italy.
  • Well Built Brand Portfolio: Since, the brand Gruppo TIM is launched and owned by state initiatives, it has built a highly satisfactory portfolio in Rome, Milan and Naples, Italy. It adds up as a strength of the company as a good portfolio through state support helps the company diversify its product line.


Weaknesses of Gruppo TIM

Weakness is a barrier that obstructs a company’s success in certain ways.

  • High Workforce Turnover Rate: As compared to other firms, the attrition rate of Gruppo TIM is relatively higher indicating the downward sign on the number of employees on Wikipedia, which is one of the biggest weaknesses of Gruppo TIM.
  • Inefficient Financial Planning: By looking at the Current Asset Ratio and the Liquid Asset Ratio one can simply tell that the company is not using its financial resources as it should.
  • Brand Shift: The company has the challenge to tackle the competition caused by the new entrants who propose some more efficient technology use. And thus has also lost a small share of the market and its potential customers.  
  • Reliance on Italy for Major Revenue: As Gruppo TIM has its main headquarters in 3 cities of Italy which are Rome, Milan and Naples and it is providing the services more efficiently and gets major revenue from Italy. It is mostly dependent on the Italian market and hence lacks revenue from worldwide.
  • Competition with Brands Affecting the Market: Although Gruppo TIM has a unique marketing strategy the new brands and other existing brands are also coming up with new strategies. But to maintain the position of best telecom services they need constant advertising, improvement in their products and this causes the majority of the expenses of the brand.
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Opportunities for Gruppo TIM

Opportunities are areas of focus for a company to improve results, increase its sales, hence resulting in increased profits.

  • Technological Advancements: The new technology provides an opportunity for Gruppo TIM to practice a differentiated pricing strategy in the new market. It enables the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
  • Opening of New Markets: The adoption of new technology standards and government free trade agreements has provided Gruppo TIM with an opportunity to enter a new emerging market.
  • Improvement in the Customers: These days we see a very dynamic lifestyle of the people and hence lifestyle and standards mean more consumption of the products and services, and in turn more opportunities to encourage the purchase. This will eventually increase the market share of Gruppo TIM.
  • Increasing Consumers through Online Medium: For the last few years, Gruppo TIM has invested a huge amount of money in operating online. This investment has benefited Gruppo TIM in many ways.
  • Environmental Policies: The new opportunities will create a level playing field for all the players in the industry. It represents a great opportunity for Gruppo TIM to drive home its advantage in new technology and gain market share in the new product category.


Threats of Gruppo TIM

The environmental factors can prove to be a threat to the company and are harmful. Here are some threats:

  • Competitor’s Growth: New technologies developed by the competitor or market disruptor turns out to be a serious threat to the industry concerning the long term future.
  • Increasing Pay Levels: Rising pay level movements such as $15 an hour and increasing prices leads to serious pressure on the profitability of Gruppo TIM.
  • Legal Problems: Gruppo TIM has been caught in some legal actions such as charging money for free internet providing renewals and prepaid customer calls getting dropped in Brazil.
  • New Entries: The new entrants like Reliance are gaining market due to some policies and absorbing the market share of the existing telecom services. Hence, Gruppo TIM faces threats from such new brands as it may steal loyal customers.
  • Technical Advancement: The new competitors in the race are with some advanced technology reducing the overall market share of Gruppo TIM.
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This ends our thorough SWOT analysis of Gruppo TIM. Let us conclude our learning below.

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To Conclude

Gruppo TIM is a well-established telecommunications company with a good number of subsidiaries. In the SWOT Analysis of Gruppo TIM, we came to know about their strengths as well as their weak points. The company has a good brand profile as well as manages its consumer base quite effectively. But, suffers from some finance management issues that need to be addressed soon.

One of their greatest opportunities is that they are moving more and more towards the online mode. Which is a necessity in today’s scenario. To stand in the market and to expand globally one needs to focus more on the online part.

Hence, improving marketing skills is very paramount for digital marketing enthusiasts. If you are intrigued with the above piece of information in learning more and upskilling, check out the 3 Months Advanced Digital Marketing Course by IIDE to know more.

We hope this blog on the SWOT Analysis of Gruppo TIM has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

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Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

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