The Scope of Branding

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I would first and foremost like to acknowledge the generosity of the villagers of Telav, Shela, Kaneti(Gujarat) and Amgachia(WB) who in spite of their busy life took time to let me understand their lives.

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I am also deeply indebted to Prof. Rajat Iyer and Prof. Arbind Sinha, Faculty MICA,for being a thesis guide in every sense of the word. I would also like to thank Mr Shailesh Yagnik, Librarian MICA, and all the library staff for their immense cooperation without which this might not have been possible.

I would also like to thank Prof. Rajneesh Krishna for clarifying my doubts about various Market research tools and methodologies despite his busy scheduleand engagements.

I would also like to thank Mr. Raj Kumar Jha,O&M Outreach who shared with us valuable inputs in Rural marketing and inspired me to work on this topic.

I would like to thank my parents who have been a constant source of inspiration for me and have held me through ups and downs in my life.

I would also like to thank all my friends for helping me organise my thoughts,constant encouragement, sleepless nights and chota breaks.

Thanks guys for giving me confidence to submit this document.

Executive summary

Today Mobile phones have made their presence felt not just in urban India but also in rural areas. This phenomenon has increased the scope of branding which most company considered a tough turf in rural India. Though it may seem a far-fetched idea currently but considering the giant leap the economies of developing nations like India is making, tapping of rural markets & building brands for this market make sense.

Innovative use of Mobile application is helping war torn Afghanistan fight corruption and elevate the standard of living of its people. Similarly in developing nations, application developed for local needs like M-Pesa in South Africa, Pesapal in Kenya are finding consumers and helping the brands make an impact.

Study in the past conducted in various geographies have developed model for either urban consumer or directly generalized model for mobile marketing. From the literature review few factors were derived for mobile advertising like (1) utility, (2) context, (3) control, (4) sacrifice, and (5) trust. My study aims to works on these parameters, but specifically on rural India to find out attitude and behavioral implication of mobile advertising. The study also includes technology barriers & advancement in India and barriers related to social implication in rural areas like language and cultural difference.

For the purpose of the study a qualitative research has been commissioned across two regions – Gujarat and West Bengal. This was a contrasting study to find out the motivation underlying the use of mobile phones and the prospect of mobile marketing across two extreme geographies since West Bengal is one of the least mobile savvy state whereas Gujarat has one of the highest mobile phone users.

Focus group discussion & depth interviews with the help of projective techniques revealed the underlying motivation for using mobile marketing. It mainly reinforced the fact that while rural consumer do not want intrusion in their life they are willing to open up the space for better living standards. Hence the desire to gain knowledge and make money to elevate the living standards was of prime importance.

The study also reveals certain limitation to mobile advertising which has to be kept in mind while designing any mobile marketing campaigns.

Finally the study proposes a framework to facilitate acceptance of mobile marketing message among consumer and maximize marketing objective of brands, which outlined as follow

1. Collaborate with Service providers

It is a win-win situation for the service providers as well as the marketers and not to forget the consumer, if the contextual targeting of advertising is maintained.

2. Precision targeting

It is rewarding for advertiser since they are able to overcome the challenge of predicting who’s on the other side of a product or service purchase and target them with brands according to the demographics

3. Develop content relevant for the consumers in collaboration with Media agencies

Develop content of significant importance by understanding the day to day life of rural consumer e.g. the language assistance application which has the potential to become a way of life for the consumer and then only can a brand reach the stage of resonance in the mind of rural consumer

As a concluding note, this conceptual study offers to provide a discussion on how mobile advertising might subsidize wireless infrastructure growth among underprivileged societies and allow marketers to target more specifically the consumer in media dark region.

Also with the collaboration of private partners the social development in rural areas with the help of mobile communication will be faster. Marketers can increase their consumer base by targeting the huge potential at the bottom of pyramid and hence increase their bottom line significantly as well as deliver to their promise of corporate social responsibility.


C. K. Prahlad in his book “The Fortune at the Bottom of the Pyramid” says, “If we stop thinking of the poor as victims or as a burden and start recognizing them as resilient and creative entrepreneurs and value-conscious consumers, a whole new world of opportunity will open up”. This statement has been taken to like a gospel truth by marketers in India and many are now trying hard to target this untapped potential.

India is a country of 1.13 billion, out of which 70% of the people are living in the rural India.

The marketers all around the world interested in India are becoming more curious to explore the rural potential. With 128 million households, the rural population is 3 times the urban. As a result of rural affluence, fuelled by good monsoon and the increase in agriculture to 200 million tones, the rural India has large consuming class of 41% of middle class and8 58% of the total disposable income.

The Census of India defines Rural India as anything which is not urban. Village is defined as a basic unit for the rural areas is the revenue village, might comprise several hamlets demarcated by physical boundaries. Thus a Rural is defined when it meets the following criteria

  • Minimum Population <= 5,000
  • Population density <= 400/sq. km.
  • 25% of the male population engaged in agricultural activity

Reserve Bank of India defines rural as ‘Locations with population up to 10,000 will be considered as rural and 10,000 to 100,000 as semi-urban.’ Similarly NABARD, Planning Commission, Sahara also define the villages on population criteria.

As mentioned in The Rural Marketing Book, Pradeep Kashyap and Siddhartha Raut (ed.2008), the rural economy has seen tremendous growth since 1990s because of thirteen consecutive good monsoons. This various radical changes in rural market has been testimonial to this development, some of them are as follows;

  • There has been a 600% increase in the outlay of rural development programmes in the five year plans from Eighth to Tenth Five year plan.
  • 41 million Kisan Credit Cards (KCC) has been issued since the inception of the scheme amounting to a total of Rs. 97,700 crore of cumulative credit. The number of KCC issued is more than the 40 million credit-plus-debit cards issued in urban India.
  • Also a 230% increase in the flow of institutional credit for agriculture from 1997-98 to 2004-05 has been registered.

Today Mobile phones are ubiquitous not just in urban India but also in rural areas. This phenomenon has increased the scope of branding which most company considered a tough turf in rural India. Though it may seem a far-fetched idea currently but considering the giant leap the economies of developing nations like India is making, tapping of rural markets & building brands for this market make sense. There is virtually no branding effort in these areas so a scope for brand salience & resonance doesn’t increase. Mostly brands in these areas right now are competing on price points which will cease to exist as differentiator as customer becomes more evolved & bestowed with financial prowess. But there seem to be branding efforts from the marketer’s viewpoint and also there is some franchise on factors other than price from the consumer view.

A lot of work in the field of mobile telephony has been going around e.g. A team of MIT Media Lab’s Next Billion Network participants – next generation of tech movers and shakers- who are building technologies to help people in the developing nation to raise their incomes, learn to read, get where they’re going, and diagnose their health. (david-chandler, july-2-2009)

Innovative use of Mobile application is helping war torn Afghanistan fight corruption and elevate the standard of living of its people as depicted in the following new report. (Loyn, 2009)

Nokia have also felt the rural potential and developed product consumer in those regions. Even their communication for the Model 1100 has been specifically targeted at the rural audience fully portraying the need in the rural settings. (Banerjee & Sangameshwaran, 2009)

Also the value of VAS industry is estimated to be Rs.16500 crores by 2010 according to a research by RNCOS, with expansion into rural markets where more services in banking, gaming data and TV segment will be seen. (Mobile VAS to Drive Telecom Growth, 2009).

Thus the future of mobile marketing looks optimistic and with rural economies building into a sustainable model, marketers have to no longer think about the return on marketing investment.

Literature review

In the following literature review, I have reviewed the various published articles & white papers from journals, books & Reports. First I have looked into the knowledge created on rural marketing & it implication, in this domain a lot of work has been done with a global perspective and quite a few with the Indian market in viewpoint.

Rural Marketing & its Implication

Some of the studies are regularly published in the Journal of Rural Marketing by RMAAI to help marketers keep track of updates in rural market. A study on evolution of rural consumerism conducted by Hansa Research reveals the rural consumption pattern over a period of five years i.e. 2000 to 2005. The study has data on three levels i.e. exposure in terms of communication and education, consumption of several categories of products and distribution of these products.

According to the report shampoo consumption in rural India has increased from 13.9 % in 2000 to 31.9 % in 2005. (The Rural Marketing Journal of RMAAI, 2007)

Dr. Vinod Kumar Bishnoi and Bharti of Haryana School of Business have done a research paper on Awareness & Consumption Pattern of Rural Consumers towards home and personal care products. The paper contains details on awareness and usage of brands in rural areas. It also tries to find out the motives and factors behind brand choice, the sources of information and to measure any association between demographics and brand choice.

Regarding motives and factors behind brand choice, Bishnoi and Bharti say that rural consumers purchase a product mostly for its utilitarian value rather than the peripheral values. Consumers tend to stick to the brand once they are satisfied with it. The brand loyalty in this case is unusually high even though consumers switch FMCG brands very frequently. The rural consumer is also very quality conscious. Advertising and retailer’s advice play a major role in decision making. The consumer is also a little cautious with price levels. The study also reveals that there is clear association between income level and expenditure habits in these products. The primary source of information about brands is television. Retailer, newspaper and radio are other prominent sources. As Bishnoi and Bharti highlighted in their paper some very interesting aspects, that whatever is the leading brand in all the products that remains leading irrespective of any demographic variable be it income, education, age or gender. This might be explained by the fact that the family structure in rural India is such that that several people of various education and age group stay together.

The contemporary media scenario in India is marked by a frenetic proliferation of television channels, FM radio stations, daily newspapers, mobile telephony and digital media. Despite this situation, as the following article argues, the poor while highly visible almost everywhere in urban and rural India remain, ‘invisible’ in the nation’s mass media. (Kumar, Jan 2008)

To successfully market products in rural areas, distribution is a critical barrier which needs to be overcome. An understanding of the structure of distribution in rural areas would help in the development of an efficient distribution system. The paper after a thorough literature review proposes a conceptual framework which identifies the drivers of the structure of distribution in rural areas. (Rajesh & L. K., January – June, 2005)

The paper discusses the need for strengthening marketing efforts in rural India. The author mentions about the rural network, whose basic objective is to try and get clients who are looking for a national strategy in rural marketing and provide help in implementing such plans across different regions with the local expertise. The paper also deals with instances on how marketers aiming to target their brand commercials to both urban and rural audiences are required to do well to pre-test the spots and that the spots communicate what is intended for the targeted viewers, thus providing the basis that there is a huge difference in rural & urban consumer and they have to be dealt with differently (Rajan, 2005)

The second stage of my literature reviews knowledge on the mobile telephony- the development with respect to marketing, the intention in developing VAS, user perception of mobile marketing, the obstacle & barriers to mobile marketing.

Carter in the journal of Mobile marketing defines mobile telephony as a set of buzz words like Mobile marketing, mobile advertising and m-commerce. He examines the Generation Y, the generational cohort born between 1979 and 1994, which researchers think will change the marketing landscape forever. This paper addresses some of the many issues and opportunities that may affect marketer’s abilities to reach Generation Y African-American mobile consumers. (Carter, June 2008)

Another journal in mobile marketing reveals that empirical studies have been limited to exploring consumer justifications for accepting or rejecting cell phone advertising on either a speculative basis among possible mobile marketing users, or a post hoc basis among those who had already chosen to receive cell phone advertising. This research explored consumer justifications in the context of a field test, in which mobile phone users were offered subscriptions to a mobile phone text based advertising program. Thus found out that among acceptors information benefits of cell phone advertising was prime due to positive attitude towards information & entertainment. While for the rejecters the perception of having to pay for advertising was enough to discourage participation. (Newell & Meier, Dec 2007)

This journal examines the drivers of consumer acceptance of SMS-based mobile advertising. A conceptual model and hypotheses are tested with a sample of 4,062 Finnish mobile phone users. Structural equation modeling is used to test five drivers of mobile advertising acceptance: (1) utility, (2) context, (3) control, (4) sacrifice, and (5) trust. The results show that utility and context are the strongest positive drivers, while sacrifice is negatively related to the acceptance of mobile advertising. Thus marketers should pay particular attention to the utility and relevancy of mobile advertising messages. (Merisavo, Kajalo, Karjaluoto, Virtanen, & Salmenkivi)

Mobile Marketing

I have reviewed the various application of mobile telephony and the consumer perception towards mobile marketing in particular and mobile application in general.

Also innovation from companies for rural consumer were of considerable significance as firms like Nokia had earlier launched a basic handset with a torch (large parts of rural India don’t have electricity) and an alarm clock.

In another paper, an instrument for measuring attitudes toward mobile advertising is developed. The results of a survey indicate that (1) consumers generally have negative attitudes toward mobile advertising unless they have specifically consented to it, and (2) there is a direct relationship between consumer attitudes and consumer behavior. Hence concluded that it is not a good idea to send SMS advertisements to potential customers without permission.

Their attitudes were favorable if advertisements were sent with permission. This implies that permission-based advertising may become a major mechanism in the mobile environment in the future. The research notably points out relationship between attitude, intention and acceptability of Mobile advertising through empirical study. The respondents were more willing to accept incentive based mobile advertising. Finally, intention significantly affected how and when the respondents read the message. (M. Tsang, Ho, & Ting-Peng, 2004)

Although mobile phones have been shown to be highly effective as education content delivery mechanisms, underlying handset and subscription costs have limited their usefulness in many underprivileged countries. Thus the author proposes a model where education content can be subsidized by mobile advertising and a business model is developed where sellers is able to communicate to buyers in their native tongue and vice-versa in order to close transactions.

The paper touches on many key issues that are determining the mobile marketing sector. The mobile dam is about to burst and marketers have to be prepared for this through well developed and formulated ethical strategies. Customers will have to be gently cajoled and locked into useful market applications. (Ranchhod, June 2007)

Impact of Technology in Marketing

The article “The Missing link-Why mobile marketing is different” is rich with illustrations, examples and detailed footnotes, includes a thorough discussion on how marketing, technology, and business practices and models have matured and converged over time to make the medium what it is today. He discusses the impact network migration from 2G to 3G, globalization, the changes in marketing practices, and the value system have had on mobile marketing practices. He suggests that we need to focus on developing successful revenue models, create favorable conditions for relationship marketing and long term-dialog amongst the players in the industry, and that we must have a global mindset and to put aside any not-invent-here mentalities. (Steinbock, June 2006)

Again in the paper stresses on the increasingly complex and demanding customers as ICT developments becomes rapid and marketers start coping with highly demanding customer who require extraordinary experiences and highly user-friendly service interfaces particularly in technology services, such as mobile marketing (as illustrated in the Figure below). (Steinbock, June 2006)

Rationale/Information Gap

The rural market works on 4 As i.e. Accessibility, Affordability, Acceptability and Awareness and the traditional four Ps of marketing cease to exist in this scenario.

There is a presence of huge potential in rural India but at the same time there is a lot of obstacle faced venturing into these markets. Low per capita disposable incomes, large number of daily wage earners, acute dependence on vagaries of monsoon, seasonal consumption linked to harvest & festivals and special occasion, poor roads power problems and inaccessibility of conventional advertising media.

As much as there is potential, there is also a good amount of ambiguity on how to create brand salience in these markets.

In such situation marketers who see huge potential in rural market with around 700 million consumers, everyone would like to take its brand to the next level of brand salience & resonance. Hence with increased penetration of mobile phones there has been more chance of mobile communication entering the media dark region. It may seem farfetched as an idea to brand product for rural consumer when presently we think that rural consumer stress on affordability.

Much has been written about rural marketing, the consumption patterns, attitudes & behavior of rural consumer in India and Mobile marketing in isolation but the whole perspective of mobile marketing for rural India is not covered in the literatures.

Therefore this study aims to look at the future prospects of mobile telephony as a means to communicate brand promotion and create a brand resonance with the rural consumer.

Research Objectives

Objectives are as follows;

  • To find out the present usage of mobile telephony among rural users and their perception of brands using mobile marketing
  • To find out the technology/language barriers in implementing branding activities in the rural environment

The objectives will aim to find out what are the technology barriers, governments policies and technological advances for the implementation & development of mobile application to facilitate interactive marketing. It also aims to understand the acceptability of technology in the rural environment and the language barrier, since most of the rural India has lower literacy rate and use local languages as means of communication is prevalent.

The second objective aims to find out the acceptability of mobile marketing in the rural context and how will it affect a brand. We intend to discover whether the consumer reacts to marketing communication over mobile phone in positive manner and how will it affect the purchase intention of the brand.


Secondary Research:

  • Present and future platforms/technology which makes mobile telephony ubiquitous for Rural India
  • Studying the branding & marketing efforts of companies for rural India, the number of companies interested in marketing & branding their products for rural India

Primary Research:

Qualitative research is applied to understand the consumer perception in rural India while using mobile telephony. This is done in two stages;

  • Focus group discussion with rural respondents
  • Depth interviews with rural respondents
  • Depth Interviews with marketers after the FGDs/DIs

The TG of the study is defined as:

Age: above 15

SEC RI, R2, R3

Location: West Bengal, Gujarat

Gender: Males & Females

Presumption is that the decision makers in rural India are generally the head of the family, who is the male member. Also the same holds true for mobile users, though a considerable amount of women these days are using mobile phones too. So I have conducted FGDs across all age group for the male sample size. Each FGD had people from the same caste & same gender to maintain cohesion & focus in the discussion.

West Bengal has the least mobile phone user whereas Gujarat is one of the highest mobile phone users. Hence it’s a contrasting study to find out the motivation underlying the use of mobile phones and the prospect of mobile marketing. The following table represents the No. of users in Gujarat and West Bengal.

  • 2 focus group discussion in each location i.e. Gujarat and West Bengal
  • Five depth interviews in each location
  • Interviews with marketers after the FGDs

Profile of respondents:

  • All respondent must be using mobile telephones in daily basis
  • Should be literate with primary school education

Secondary research

From being charged for incoming calls to getting paid for calls you receive and then a pay per second regime, Indian wireless telephony has come a long way.

India has one of the biggest telecom markets in the world. It has the third-largest telecom network in the world and second-largest among the emerging economies. The Indian telecom industry generated revenues of approximately US$ 32 billion in 2007–08 with a growth rate of 60 per cent over 2006–07. It witnessed a compound annual growth rate (CAGR) of approximately 29 per cent from 2002–03 to 2007–08.

  • Total telecom subscribers – 545.05 million (January 2010)
  • Teledensity – 43.50 (September 2009)
  • Addition of mobile subscribers (July–August 2009) – 15.08 million
  • Annual growth rate of telecom subscribers (June 2008–June 2009) – 42.68 per cent
  • Average Revenue Per User (ARPU) for GSM (as on 30 June 2009) – US$ 3.80

The wireless subscriber base increased from 535.15 million in December 2009 to 545.05 million at the end of January this year for a monthly growth rate of 3.79 per cent. The wireless density in the country now stands at 46.37.

It grew at a CAGR of 45.21 per cent from June 2004 to June 2009. The handset market in India, consisting of mobile and fixed handsets, registered an overall growth of 5.8 percent from 2007-08 to 2008-09. (India, 2009)

The value added service (VAS) market in India has a great potential for growth and revenue from this growth potential is expected to reach above INR 250 billion by the year 2009-10 and more than 30% of the revenue of the telecom access service providers in the next 5-7 years. The VAS industry in India generated revenue of US$ 1.2 billion in 2007–08 and is expected to reach US$ 4.0 billion by 2015.

Top 11 Wireless Operators in the country: (September 2009) (India, 2009)

Among the wireless service providers, Tata had a 14.97 % share of the net additions during January, followed by Bharti Airtel with 14.31 %, Reliance 14.08 %, Vodafone 13.78 %, Idea 11.42 %, BSNL 11.29 %, Aircel 10.10 %, Uninor 6.68 %, Stel 1.83 %, Sistema 1.07 %, Loop 0.26 % and MTNL 0.23 %.

Market share of top 12 operators:

Bharti Airtel had a market share of 22.33 per cent, followed by Reliance with 17.72 %, Vodafone 17.27 %, BSNL 11.95 %, Tata 11.07 %, Idea 10.99 %, Aircel 6.06 %, MTNL 0.90 %, Sistema 0.60 %, Loop 0.50 %, Uninor 0.47 %, Stel 0.09 % and HFCL 0.06 %.

Present technology in India

GSM has a market share of ~75% out of the 500 million wireless subscribers

Reliance has registered a 6.73 % market share which is quite impressive for service which was launched only 6 months ago.

CDMA subscribers are at 94.5 million and here is how they are split:

Tata Teleservices which launched its GSM operations under brand name Tata DoCoMo will be another player to look out for in the next few quarters. Unitech Wireless has launched its services in 2009 and has a subscriber base of 2.5 million as of Jan 2010. New entrant S Tel added 0.22 million subscribers to take its subscriber base to 0.36 million.

Reliance rules CDMA followed by Tata Teleservices (Tata Indicom). Shyam telelink has rebranded to MTS India has a subscriber base of 3.5 million (as of Jan 2010). CDMA doesn’t look as much over-crowded as GSM but when put together the overall picture of Indian telecom looks crowded with 12 operators and 3 waiting in the wings. Reliance and Tata are the 2 companies to watch out for with the dual play of GSM and CDMA operations.

The average revenue per user of CDMA is 99 rupees and that of GSM is 205 rupees. With 3 new players coming in for GSM the ARPU’s will come down. CDMA which is supposed to be a better network for data access can use this opportunity to increase the ARPU’s and subscribers. It just has to sort out the handset availability issue. (India, 2009)

Penetration in Rural India

As on 31st September 2009, out of the total 500 million subscribers, the rural subscribers contribute 151.8 million, comprising of 10.13 million wireline and 141 million wireless. The Rural teledensity as on September 2009 was 18.46% as compared to 9.20% during the previous year in March’08. Subscription in Urban Areas grew from 328.55 Million in Jun-09 to 357.22 Million in Sep-09, taking the urban Teledensity to 102.79. Rural subscription increased from 136.27 Million to 151.81 Million, taking the Rural Teledensity from 16.61 in Jun-09 to 18.46 at the end of Sep-09.

Total Wireless (GSM + CDMA) subscriber base increased from 427.29 Million at the end of June-09 to 471.73 Million at the end of Sept-09, thereby showing a growth of 10.4%. During this quarter 44.43 million subscribers were added. Wireless Teledensity increased from 36.64 at the end of June-09 to 40.31 at the end of Sept-09.

Rural subscription (12.5%) has been growing at a faster rate than Urban (9.5%). The share of rural wireless subscription is 30% in total wireless subscription. Overall rate of growth of Wireless Subscription in QE Sept-09 (10.40%) is higher as compared to previous quarter (9.07%). Higher growth rate could mainly be attributed to the launch of GSM services by Tata Teleservices Limited across service areas.

Future Developments

Technologies in India

WiMax stand for “Worldwide Interoperability for Microwave Access” is a standard-based wireless technology that allows broadband connections over long distances.

The Economic Times, citing a study by US market research firm Strategy Analytics, reports that India will become the largest WiMAX market in the Asia-Pacific by 2013.

The study forecasts that consumer subscriptions in the developing Asian countries will grow at a compound rate of 132% through 2013, with the subscriber base reaching almost 27 million in that year.Most emerging markets WiMAX providers will launch their initial services in major urban areas, to take advantage of concentrations of existing Internet users with purchasing power. However, over the longer term the most rapid growth is expected to be in second-tier cities and in rural areas, where there is substantially less competition from incumbent broadband suppliers.(Study Predicts India to be Largest WiMAX market in Asia Pacific by 2013, 2010)

BSNL, HCL Infosystems Ltd and Intel Corp. have started a series of wide-reaching initiatives to spur economic and educational opportunities in India by expanding access to wireless broadband Internet and affordable computers. This is in support of the India government’s Bharat Nirman rural development agenda. Intel and BSNL will jointly propagate wireless broadband Internet in what is intended to ultimately become a nationwide mobile WiMAX network. BSNL will also work with the two to make available in rural India WiMAX-capable nettop computers designed by the two companies and made in India by HCL using the Intel atom processor.

Despite spectrum auction delays and other bureaucracy, India is set to be the biggest base on earth for WiMAX by 2012, and state-owned carrier BSNL, which has pre-auction access to its spectrum, has gone live with the country’s first Mobile WiMAX network.

BSNL has two parallel projects, one for rural areas and one for metro networks kicked started by Minister Sachin Pilot. BSNL intends to usher in a new era of growth in rural areas by offering a broadband speed of 7Mbps at a distance of 15 kilometers.

WiMax plans to bring to the underserved communities several key applications to meet the Indian government’s target to reduce the country’s woeful levels of broadband penetration.

Some of them will include;

  • Utility bill payments
  • Issue of official documents like land or vehicle registrations or birth certificates state e-government processes
  • Inter-village communications
  • Aims to harness video to support telemedicine and remote education

The government expects the subscriber base for combined wireless and wireline connections to touch 600 million by the end of 2012, from 500 million at the end of September 2009.But the mobile WiMAX component may likely to be much smaller – with WiMAX used for fixed wireless broadband Internet access by business and some residential customers since most companies in India plan to use 3G services for mobile Internet and WiMAX for fixed broadband access.

3G is the third-generation of mobile phone technology standards. The typical services associated with 3G include wireless voice telephony and broadband wireless data, all in a mobile environment. However, with the capability for high-speed wireless data transfer, 3G has enhanced or made possible a myriad of additional applications such as mobile video, secure mobile ecommerce, location-based services, mobile gaming and audio on demand.

India’s leading telecoms firms Bharti Airtel, Reliance Communications, Vodafone Essar and new entrant Telenor are enthusiastic to participate in the 3G auction for all-India spectrum.

Few international telecom groups like AT&T, Australia’s Telstra and South Korea’s SK Telecom are also interested in bidding for the 3G spectrum to gain foothold in the fastest growing telecomm market of India.

Though the 3G track record doesn’t inspire confidence, since in Europe, overbidding nearly bankrupted many operators. India’s state-owned BSNL has been offering 3G since a year ago, in 300 cities with a consumer base of 700,000, but has cut tariff twice.

Limitations to 3G have been the slow adoption of mobile internet in the country as statistic says, only 40,000 or so iPhones are being used in the country and smartphones make up well under 5% of the handset market. Of India’s 530 million-plus subscribers, only 2 million regularly use the mobile Net, mostly to download pictures of cricket players and Bollywood stars, according to the Internet & Mobile Association of India

Mobile Marketing in different geographies


In 2003, Mobile2Win (M2W) has launched India’s first short message service-enabled billboards which use SMS codes instead of eight-digit phone numbers on ads.

By sending an SMS to a number — 8558 — and keying in the relevant code, prospective customers will receive brand or promotion-related information instantly. The service eliminates the need to remember eight-digit numbers.

M2W, which executed the project for Mumbai-based Creations Publicity, is eyeing areas in Gujarat (western city) and southern parts of the country for its SMS-enabled billboards.

‘We are targeting service companies, who want to reach out to prospective customers directly through these wireless marketing campaigns’ – said one of the Mobile marketing agency.

In 2004, Kellogg’s India has launched a short message service (SMS) campaign to tie in with an offline advertising push for its flagship Corn Flakes brand in India. The campaign titled “Dimaag chalega nahin daudega,” was a multimedia campaign using television, radio and cinema advertising, which allows consumers to register for the Kellogg’s Club to receive, downloads from the brand, such as wallpapers for mobile phones and health tips. Kellogg’s, which has secured its place as one of the early adopters of Short Messaging Service in the ready-to-eat cereals category with the wireless initiative, worked with mobile marketing agency Mobile2Win to develop the campaign.

In 2005, it was estimated that mobile marketing will be the next BIG thing. Cadbury tied up with Reliance Mobile to promote its ‘Pappu Paas Ho Gaya’ campaign in 2005. A student logging onto this Reliance service for exam results would receive the message ‘Congrats — Pappu pass ho gaya’ if he had passed.

Hewlett-Packard, the IT giant, ran a mobile campaign based around the tagline “Your notebook tells your story” in 2009, and a separate initiative aimed specifically at students.

The head of the organization’s marketing and consumer personal systems group, said “mobile marketing is the most responsive medium ever so far. We get a unique identity of the customer.”

In June 2009, Nokia Life Tools was launched in India, which includes Agriculture, Education and Entertainment related services especially designed for the consumers in rural areas and small towns of India as one of top emerging mobile markets.

Developed countries – Eastern Europe

Turkey- One of Mobilera’s most prominent activities is running segmented and permission based mobile communities for brands wishing to attract and acquire new customers, retain existing ones, increase stickiness and trigger the use of products and services. A typical client is Turkcell, a Turkish mobile operator in a market where the average youth has two and a half SIM cards and there is little loyalty.

Mobilera created a mobile loyalty programme using a combination of demographic data and operator information on individuals’ behaviour and usage. Customers were then invited to join the programme and offered prizes and tickets in return. Over time this has accumulated 18m users – half of Turkcell’s total user base.

In Georgia, it oversaw a launch campaign for Geocell, a new mobile operator, of a mobile youth community called Zoom. The campaign used a variety of events and marketing. The specific mobile elements were:

  • Free club content was made available on a WAP site, along with a free airtime welcome bonus
  • SMS Trivia from a launch party was also made available
  • A 2-for-1 offer could be redeemed at McDonalds.

The total campaign, involving a continuous run of such offers, resulted in a 140 per cent rise in Geocell membership. In further activity, discounted cinema tickets were offered to members: 40 per cent of members used the offer more than once. In addition to driving subscribers to Geocell, the company also claims that Zoom members spend on average 10 per cent more on mobile services than average Geocell customers. Other examples were cited from Ukraine and Moldova.

Developing countries – A Case of Africa

One of the features of the South African market (also available in Serbia and Egypt and likely to appear in other markets) is free “Please Call Me” (PCM) messaging. Mobile phone users will send this type of SMS message – typically they have a quota of free PCMs as part of their airtime deal – to a contact rather than making a call which would incur a cost.

There are some 20m PCM messagess sent in South Africa every day. Consumers also use them to confirm the times of pre-agreed transactions – such as picking or dropping someone off – with the time that the message is sent serving as the prompt for the understood time the action to take place. The PCMs can also carry commercial messages and these are typically booked out by advertisers at the earliest opportunity.

The country has also experienced rapid growth in instant messaging on mobiles (which is cheaper for consumers than sending an SMS). The leading supplier, Mixit, has 7.5m South African customers and has launched into other markets.

PCMs have been used by OMO, the Unilever detergent powder.

Over a 38 day campaign in November 2007, 34m messages were tagged with prize-related additional content by the Unilever brand, including free airtime and a few cell phones. The results were:

  • 485,000 entries were received from 185,000 unique visitors
  • The total campaign cost was 14,500 euros, giving a cost per contact of just 8 eurocent
  • Unilever has launched many other mobile campaigns subsequently.

Advertisers such as Cadbury’s and Peugeot have also aired similar campaigns.

Africa is home to the world’s largest mobile-based payment system, M-PESA, which allows customers to send money to any cell phone number in Kenya. The two-year-old service already has over 6 million users, more than double the number of Kenyans who have bank accounts. Westerners who have access to checking accounts, ATMs, and wire services may not understand the significance of this capability, but to the unbanked masses of workers who would otherwise have to endure long bus trips to deliver money to their families in rural areas, this service represents significant empowerment.

Innovative use of Mobile application is helping war torn Afghanistan fight corruption and elevate the standard of living of its people as depicted in the following news report.

There are innumerable uses of Mobile application & services which can be used in tandem with development of Rural India.

Language & content

The ubiquity of mobile phones apart from the purpose of Voice application is restricted for adoption by the masses. This is evident by the fact that the application are developed in the 1st & 2nd world countries and mostly by the English speaking population and hence making it difficult for the masses to adapt. Hence a requirement for development of application in local language is important.

Thus in geographies were mobile application has seen growth it was mainly due to the development of technologies portable in the particular region and implemented to cater to the local needs. One such concept is the language instruction products, subsidized by contextual advertising.

Although this concept can be sensitive to consumer backlash against anything other than subscription or opt-in advertising, carriers and advertisers are looking for improved means to segment and target mobile user demographics, especially in countries with rapidly growing populations (e.g., India and China). This convergence for wireless services, a commonality of need for English language capabilities and a ready supply of global advertisers eager for “3rd screen” branding makes for a compelling case as to why wireless carriers, application providers and content providers should consider offering mobile language instruction services as a means to off-set high.

Similarly other products for Education and Health Awareness programs can be associated with contextual advertising and offered to consumers in the media dark region.

(Source: Language Assistance Products Support Mobile Advertising In Underprivileged Countries, International Journal of Mobile Marketing, June 2007)

A Research was conducted by the Stanford (University) Learning Laboratory (SLL) to understand the prospects of portable electronic devices to maximize learning effectiveness found that “simply having access to the application anytime, anywhere increased daily attention to learning Spanish and boosted motivation”.

Hence mobile application has the potential to be used for learning assistance and be able to teach the language of the medium to its users helping then to elevate the social & education of the users.

Prospects of Mobile advertising

Mobile advertising, although in its nascent stage is growing as global brands are quick to recognize the unique personal nature of cell-phones as compared to other media like computers, television and print media. A significant part of this model is language itself: sellers must be able to communicate to buyers in their native tongue and vice-versa in order to close transactions. Mobile advertising has the potential to transact in such close deal by enabling the consumer to interact with the brand in their local language.

Easier Segmentation & Targeting for Marketers

There is a cost of delivery for any service and someone has to pay for it as competition increases and more and more companies get into price war, pointed out by Deputy Managing director of Bharti Airtel. This loss of profit is either shared by the company by denting its revenue or the consumer as the telecomm market becomes more competitive.

It is rewarding for advertiser since they are able to overcome the challenge of predicting who’s on the other side of a product or service purchase and target them with brands according to the demographics. The targeting of advertisement with the use of demographics data will result in less cluttering of the medium as well as other media. This will provide valuable insight into the ‘back-end demographics’ of a mobile customer.

A download from situation-specific phrase kit, e.g., “On the Jobsite,” likely shares certain key personal demographics (e.g., 18-40 year old male) as others who download the same package.

From the language instruction path (base to secondary) an advertiser may gather, what is the end-user’s native language, while the mobile number itself and inherent GPS capability contained within most handsets tells about the current location and hence the base market. Thus a properly developed application in mobile telephony might be able to provide the four “golden demographics” to a potential advertiser: gender, age, language, and location.

None the less a simple post paid customer provides demographics information which can be shared with the marketers with due permission, for precision targeting of marketing messages in various campaigns.

Why mobile advertising is lucrative for Service providers?

The price war has driven calling rates to well under 1 cent per minute, slowing the industry’s profit growth and denting stock prices. The need to look for alternate revenue streams becomes more important to balance the bottom line, service providers are looking into collaboration with marketers either through application developer or media agency. It can be a win-win situation for the service providers as well as the marketers and not to forget the consumer, if the contextual targeting of advertising is maintained. It might be backlash if the marketers start bombarding with irrelevant advertising and create the similar kind of clutter as in other media resulting in low consumer engagement and rejection of messages.

Some of the suggested model can be Google-esque advertising supported model or more evolved new business models in voice. Vodafone has already piloted a free airtime deployment for consumers willing to choose an advertisement instead of their regular ring-tone. Over 1.5 million mobile phone users are subjecting their callers to advertising already by opting for this service across many circles. This phenomenon is driven by advertisers trying to make the targeting of their ads more precise and it’s a lucrative options for service providers who are battling with lower ARPU. Thus subsidizing call through newer advertising model provides an alternate revenue streams.

Limitations of Mobile Marketing

After understanding the scenario of mobile marketing with respect to technology and trends of brand promotions in India in general and rural areas in particular, here are some of the constraints in the implementation of mobile marketing.

  1. Technology is fast changing and for communication of multimedia messages better bandwidth is required which is difficult to be implemented with the present technology available. Though development for new technologies like 3G and WiMax are on its way, which promises a lot of innovative ways of marketing in this ubiquitous medium of mobile phones
  2. Better handset for reception of multimedia messages are a prerequisite and for developing nation like India where most of the people belong to the middle income group investment in costly 3G-enabled handset is a tougher proposition. Also the present design of handset and user interface makes it difficult for rural consumer to understand and seamlessly browse through the application.
  3. Poor literacy rate in especially in rural areas makes it difficult in the understanding of application & services. Also the lack of awareness of services available to the consumer and limited source of awareness medium is a road block.
  4. India is a land of thousand languages and similarly varied culture, all with their own nuances and tradition, hence developing content in local language is a challenged in such a diverse situation.
  5. Not only textual content but also multimedia content has to be in sync with the cultural connotation and need not offend any section since it’s important for marketers to lure their consumers and not turn them away.

Primary Research

Discussion Guidelines

Depth interview will follow the laddering approach i.e. questions will probe respondents about the product characteristic to understand the user characteristic.

I have used Story Completion and Thematic Apperception Test as projective techniques to understand the respondents.

FGDs have a funnel approach with the same set of questions as used in Depth Interviews, to narrow down the topic from the broad areas of discussion to more specific area of mobile marketing.

Approach of the discussion

Questionnaire probes into the usage pattern of the respondents and try to find out the behavior and finally the consumption pattern with regard to advertisements and brands.

Behaviour is dependent on the attitude & beliefs of the respondents, so probing was done on these parameters to find out the perception of mobile advertisements in general and other advertisement & brands in general.

Usage -> Behaviour -> Consumption pattern

Usage – utility, frequency, purpose of use

Attitude & beliefs – status symbol, smartness, Information drivers, Importance of education

Behaviour – purchase, ownership, purchase intention, recall of brands

Finally the questionnaire tries to find out the expectation of respondents from mobile marketing

Customer speak


“I donot use sms who’s going to type in English”

“I use it to get market information and talk to friends and relative that’s it”

“I use my phone for calculation, this is very helpful and saves me a lot of time” – respondents in in Amgachia as well as Sanand & Telav

“My son keeps on changing the mobile phones but I donot, only changes when there’s a new offer or scheme” a woman who recently changed to Airtel from BSNL because there’s no low priced top-ups available in BSNL

“These younger people keep on downloading songs, we don’t” -Still most of them had set a hello tunes, only few out-rightly rejected the idea of putting a hello tune since it’s a waste of Rs.15 per month.

“Life without mobile will become like a bullock cart, we’ll go back to primitive age if mobile phones not around for a day. We’ll have to use pigeons for communication if we no longer have mobile phones” – at a FGD is Sanand village.

Most of the respondent considered mobile phones to be important and they don’t keep it on silent mode even when they are watching a movie in cinema

Attitudes towards Brands & Advertising

“I like watching ads only when it’s funny otherwise I change channels, its very irritating to watch them in the middle of soaps”

Respondent from Amgachia,WB said “I like watching ads and try out products like cosmetic after watching ads in TV”

Respondent in Kaneti,Gujarat said “I buy products (consumer goods) only at the recommendation of retailers in our town ”

“I don’t take telemarketers seriously, yes I do receive calls from Bima (Insurance) agents etc, but never went for these scheme, will go for tried and tested agents. These people will say something and ultimately offer you something else”

“I buy big ticket items from the dealer in the nearby town whatever he suggest has been good and we always buy product from them”

“I bought this phone (a Nokia high end) because I liked it….it cost me 15K (virtually of no use to the particular respondent)” – a rich farmer in Kanati village of Sanand.

The rich farmer preferred to buy a high-end phone which did not have a gujarati text messaging facilities even when the low-end Nokia model had the feature but it doesn’t his ego to buy a cheaper product

They all emphasized on buying Nokia handset, since it has been tried and tested and give more value for money than cheap Chinese handset. They even knew about Chinese handset- some of them said “Chinese handsets are cheap and they crash easily but Nokia is tougher and there is guarantee”

Woman in Amgachia, who is a health worker in Village, said “I do most of the shopping, my son accompanies” this was a one-off case most of the high ticket item purchase are done by male even in the case of mobile phones and services to choose it’s done by male members, though it will be used by a female.


“Agriculture related information which will bring me more profits is something I want”

Most of the respondents in the FGD at Sanand show distrust towards service provider since they thought money is deducted for nothing when they click onto something. Hence most of them are apprehensive of using any new service likewise for mobile advertising.

If they reply back to some Sms with code for some promotion they are charged exorbitantly hence they avoid doing it.

A male respondent in Amgachia said “I would like to receive information which will save time for me”

“Would want to give credits and receive money in terms of top up directly by recharging through mobile phones” – said an auto driver from nearby village at Telav

Respondent who are daily wage earner like auto driver and contractors etc, would want a service like “call back messaging”

An auto driver in Shela said “ if I can use my mobile phone to translate all that my passenger talk in English so that I understand them better, whenever I’m dealing with non gujarati speakers”

“If I get to download things free of cost I’ll do it”.“If I listen to Advertisement and in return I get some incentive I’ll do it”

“Salary sms initiated by the government is a good thing I don’t hv to check my bank account for it now”

Analysis & Findings

  1. Mobile phones are seen as a communication device, predominantly for voice communication, they are not much exposed to other utility of mobile phones. But some think there is potential for other utility; they find it very handy for calculation. They want to find utility in mobile application
  2. Mobile phone to most of the user is very important as it keeps them connected to the world. Mobile phone is an important object for flaunting social status hence a rich farmer will have a high end phone even if he doesn’t find a utility of such a phone, he goes by the look and aesthetics of it and retailer boosting his ego to buy such item. Also a rich rural respondent did not use the local language enabled basic cheaper phone since it doesn’t go with his social status. High end phones should also come up with local language enabled key pads
  3. Language is a huge barrier for using the SMS service – Most of them don’t use sms because it is in English language. Literacy in rural areas is very low and though the respondents were all literate (primary education) they cannot write or read in English which the language of SMS.
  4. All handset don’t come with local language compatibility even when some of the handset has, most of the respondent are not aware of this and don’t take into consideration this feature while buying phones since they assume SMS are only in English
  5. Ads are seen as an intrusion in personal space, they are unwanted in the middle of a television program but radio ads are fine. Also in mobile phones they don’t much pay heed to telecaller since it’s considered not a trust worthy source. But if it advertisement talks about offers and incentive, it is accepted whole heartedly.
  6. Voice or picture advertisements are more appealing since again education and literacy is a problem. People in Rural India are not well versed in English. Also generally rural consumers are more attracted towards flashy colors and pictures.
  7. There is no brand recall of any mobile campaigns or sms campaign among the respondent even among farmer after giving a stimuli of the tractor brand Mahindra since this brand do promote themselves through sms marketing among rural consumers. Brand recall is present for funny ads in Television and not related to purchase intention.
  8. Respondent in West Bengal are keen to use mobile phones for educational/informative application whereas respondent in Gujarat wanted to use mobile phones for their business (agriculture) purposes. Overall they all agree they need to be motivated with an incentive to watch advertisement in mobiles phones. This also shows the cultural differences in the two geographies. Also explains the low teledensity of phones in West Bengal as compared to Gujarat.
  9. Respondents in Gujarat were more brand conscious than in West Bengal and demands value for money at every purchase. Whereas respondents in Bengal stressed on discount offers and will go for cheaper products on-sale or with offers. This can seen as a biased view but it has been observed and validated by comparing across same SECs in both the geographies.
  10. Women respondents in West Bengal would buy product from the grocery store for the family but women respondent in Gujarat would only buy product for themselves by their own else all other shopping is done by the family head mainly the Husband or father.
  11. Only if the woman is educated she exercises her choice though in consultation with a male member while purchasing any brands
  12. Women in West Bengal were better equipped with mobile phones than in Gujarat though the proximity of the village in both the location was almost the same. Also the facility of primary education and exposure of Television and media was also same
  13. Women wanted more of gossip and soap operas to watch and men are more inclined to maximize their income or at least reduce their spends through mobiles, but women are also interested in receiving health information
  14. Purchase is not much influenced by TV or radio advertisement doesn’t work in these region and respondents are basically influenced by trial or Word of Mouth (friends and neighbors).
  15. But they do watch ads for entertainment and to basically know about the product feature but will buy only when there is an advocate. The phenomena has been consistent both in the respondent of Bengal & Gujarat.
  16. Trust is a big factor, thus the rural middle class looks for branded items rather than cheap street brands. They want value conscious consumers and will prefer to spend money for a god product.
  17. Surprising most of the middle aged respondents never played games on mobile or showed interests in them; it was only teenagers who play on their father’s phones at times.
  18. There is a feeling of mistrust among rural consumer for telemarketers. This has also to do with the fact that unknowingly they have spend money in downloading or replying to promotion SMSes which resulted in deduction in their prepaid cards. So now they don’t want to even experiment with any such schemes

Recommendation & Framework

A framework to facilitate acceptance of mobile marketing message among consumer and maximize marketing objective of brands.

1. Collaborate with Service providers

Service providers are looking into collaboration with marketers either through application developer or media agency. It can be a win-win situation for the service providers as well as the marketers and not to forget the consumer, if the contextual targeting of advertising is maintained. Though development of new technologies like 3G and WiMax are on its way, which promises a lot of innovative ways of marketing in this ubiquitous medium of mobile phones

2. Precision targeting

It is rewarding for advertiser since they are able to overcome the challenge of predicting who’s on the other side of a product or service purchase and target them with brands according to the demographics. The targeting of advertisement with the use of demographics data will result in less cluttering of the medium as well as other media. This will provide valuable insight into the ‘back-end demographics’ of a mobile customer

3. Develop content relevant for the consumers in collaboration with Media agencies

Develop content of significant importance by understanding the day to day life of rural consumer so that they are constantly in touch with the brand through the use of application. Application development has to be made keeping in mind the literacy rate of the target audience and cultural nuances while building application. E.g. the language assistance application which goes onto become a way of life for the consumer and then only can a brand reach the stage of resonance in the mind of rural consumer


Rural marketing has been an important course in MICA, and mobile telephony as it seems from the current scenario of technological advances will act as a significant catalyst for future innovation in marketing & communication.

Explore the rural marketing opportunities which as agreed by marketers all over globe & India, promises huge growth I came up with a conceptual model to maximize acceptance of mobile advertising among rural consumers. Mobile marketing guarantees a lot of avenues for marketers to innovate and reach the potential consumers hence it can be a significant tool in elevating the social status of the underprivileged societies

As a concluding note, this conceptual study offers to provide a discussion on how mobile advertising might subsidize wireless infrastructure growth among underprivileged societies and also allow marketers to target more specifically & easily consumer in media dark region.

Also with the collaboration of private partners, social development in rural areas with the help of mobile communication will be faster. Marketers can increase their consumer base by targeting the huge potential at the bottom of pyramid and hence increase their bottom line significantly as well as elevate the social status of the people by implementing marketing model.

Limitation of the Study

  1. The research was conducted on a specific region (villages in Gujarat and West Bengal) which is not a proper representative of the universe (Rural consumer in India).
  2. Due to logistical limitation few FGDs was conducted, if there were more no. of FGDs a data cut was able to be reinforced. But given the time frame and resources this was what could be covered
  3. The centre for the study was villages in close proximity of Ahmadabad and Kolkata though they are villages in census data, they are heavily influenced by urban culture and hence the actual rural consumer can be different in certain behavioral aspects

Scope for Further Study

  1. A quantitative study can be conducted at these specific location to validate the parameters affecting brand salience in mobile marketing for consumers in the present study and reinforcing the framework for a way forward
  2. The study can be conducted in other region to get a more generic view across the rural demographics in India and confirm the findings of this study
  3. The study can be fragmented into categories to understand the drivers for salience and factors which can be affecting mobile marketing
  4. Similar studies can be carried out for specific age groups and socio economic classification in rural areas to reinforce/reject the recommendation in this study


  1. Teledensity. (2008). Retrieved from
  2. (2007, April). The Rural Marketing Journal of RMAAI.
  3. Banerjee, R., & Sangameshwaran, P. (2009, october). Nokia looks to tap billion customers in rural India. Retrieved from Economic Times Business:
  4. Carter, E. (June 2008). MOBILE MARKETING AND GENERATION Y. International Journal of Mobile Marketing.
  5. david-chandler, m.-n.-o. (july-2-2009). cellphone-is-not-just-for-calling-texting. Retrieved from
  6. Hairong, L., & Leslie, T. (june 2008). MOBILE RESEARCH IN MARKETING:. International Journal of Mobile Marketing.
  7. India, T. R. (2009). The Indian Telecom Services Performance Indicators. delhi.
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  11. Merisavo, M., Kajalo, S., Karjaluoto, H., Virtanen, V., & Salmenkivi. (n.d.). An Empirical Study of the Drivers of Consumer Acceptance of Mobile Advertising. Journal of Interactive Advertising.
  12. Mobile VAS to Drive Telecom Growth. (2009, August). Retrieved from
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  14. Rajan, R. V. (2005). The Rural-Urban Divide – Is it melting? MICA COMMUNICATIONS REVIEW.
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