Elaborative SWOT Analysis of Vi – One of the World’s Top Indian Telecom Operator

Quick Stats on Vi

Founder	Kumar Mangalam Birla
Year Founded	2018 as Vi
Origin	Mumbai
No. of Employees	13,520
Company Type	Limited Company
Market Cap	Rs 30,75 Crore (2021)
Annual Revenue	Rs 42,126 Crore (2021)
Net Income/ Profit	Rs 44,464 Crore (2021)

 

Products & Services by Vi 

Vi has been in the telecommunications industry for more than a century and gives its best services in

• Mobile telephony
• Wireless broadband
• Internet services
• Pan India Voice
• Data services across 2G, 3G and 4G platform

Competitors of Vi

Vi competes on a global level with many other telecommunications. The competitors of Vi are:

• Reliance Jio
• Airtel

Now that we understand the company’s core business, let’s delve into the SWOT Analysis of Vi.

SWOT Analysis of Vi

SWOT analysis is a strategic planning tool that can be used to do a situational analysis of the company by measuring strengths, weaknesses, opportunities and threats, the company is facing in its current business environment. 

It deals with two factors: internal and external. Strength and weakness are based on internal factors whereas opportunities and threats rely on external factors of the company.

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

Below is a step-by-step detailed guide to help you with the SWOT analysis of Vi.

Strengths of Vi

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:

• Advertising: Celebrity brand ambassadors have boosted the brand to a great extent. Vi also has high brand visibility in form of social media ads, television ads, and others such as banners, etc.
• Customer Base: Vi is one of the most popular cellular service providers in India with more than 352 million subscribers. As of 2019, Vi had 403 million users worldwide.
• Extensive infrastructure: From its partnership with Airtel to build the Indus Tower, Vi has extended its infrastructure all over the country which is helping it in gaining new customers.
• Unique Marketing: Vi as a company invests highly in marketing strategies and tries to develop creative marketing campaigns to grab the attention of consumers. The company has several other creative marketing campaigns which have left an impression on the market. They are huge in the social media marketing space and this has won them many customers. If you wish to learn social media to stay relevant as well, head on over to IIDE’s Social Media Management Course and get started.
• Great Deals: Vi is known for the best big data plans. Whether it is a postpaid unlimited data plan or a 100 GB plan it continues to serve the customers with great deals. Vi has a complete edge over the market when it comes to big data plans.
• Network Coverage: Vi has excellent network coverage. Its yearly growth rate is 1.1% in India. Also, according to the latest TRAI telecom regulatory, Vi had the highest upload speed of 6.7 Mbps speed in May 2021.

Weaknesses of Vi

Weaknesses are aspects of a business or brand that have a scope for improvement. So let’s check some of Vi’s major weaknesses:

• Outsourcing Operations: Outsourcing operations has helped in reducing its prices. This causes the risk of the company having to be dependent on some other companies which may affect its operations
• High Debt: Vi has been under huge debt. This is because their acquisitions have been turning out to be bad investments and also high credit and low margins.
• Financial Losses: Recently, Vi is facing huge financial losses due to increasing tariff rates and Sim consolidation results in decreasing customer base. The government of India has also stopped supporting Vi and they don’t want to run the telecom.
• High Prices for Small Plans: Vi postpaid plans pricing seems to fall slightly on a higher side which is comparatively expensive for people in India to afford it. Vi’s competitors like Jio seemed to have an upper hand when it comes to budgeted calling and data plans.
• Reliance in Indian Market for Major Revenue: As Vi has its main headquarters in India  it is providing the services more efficiently and gets major revenue from India. It is mostly dependent on the Indian market and hence lacks revenue from worldwide.

Opportunities of Vi

Opportunities for a company are the sectors in which a company may progress considering the current market situations and weaknesses of other companies.

• Strategic Partnership: As far as MNP is concerned partnering with smartphone companies is going to be the smartest strategy. This guarantees fixed cash flows in the future and would also ensure an increased customer base.
• Market Development: Considering the brutal competition in the telecommunications industry & shrinking margins, venturing into new markets/developing economies will prove to be a success for the company.
• Untapped Scope of the Current Market: Although it currently provides 4G coverage, such networks should be provided even in rural areas. Also developing more infrastructure to provide better connectivity. The company should aim towards providing these services to most of its regions, these would, as a result, help the company to achieve higher profits and an increase in customers.
• Advancement in Technology: The current advancements in technology and 5G trials could also prove an excellent success for the company. 5G and LTE services are not yet very common in the country especially in rural cities, Vi can extend their services in this direction to get new customers.
• Affordable Plans: Vi should reduce its data plans so that people in India can openly afford them. It should follow its competitors’ pricing methodology to stay competitive in the market.

Threats of Vi

Threats to a company are the reasons that are causing or may cause a decrease in the number of customers.

• Competitor Jio: Jio has been providing the customers with faster network services and has also developed much more in the 5G technology. Jio’s ethernet cable services labelled Jio Fibre has gained a lot of attraction due to its low pricing and the great internet speed with rare to no fluctuations in internet speeds.
• Government Regulatory Framework: As a result of the normal auctioning of spectrum & change in government policies, there is a possible threat to the stability of this market, as companies with deeper pockets are more likely to gain from these auctions.
• Competition: The continuously changing prices in the Indian market and the rising margins are adversely affecting Vi’s business by a huge amount. Reliance Jio had started free data and calling a few years back which caused a huge disruption in the telecom sector, causing other companies to reduce their prices.
• Mobile Number Portability: MNP is a set of rules that provides the customers with an option to change the company while keeping the number, since Vi has higher pricing in comparison to some other service providers there is a huge possibility of customers changing for cheaper service alternatives.
• Huge Losses: Vi shares fall by 8% and there is a massive loss of user base due to increasing prices of plans and poor services in some areas. If such losses continue will let Vi face huge challenges to keep itself in the market.

Now that we have done a deep dive into the SWOT analysis of Vi, let us conclude our learnings below.