Jul 27, 20226 min read

Market Research, GTM strategy for new mobile carrier in New Zealand

Focusing on New Zealand, a high-level market research view on how much

Product X’s mobile service would be used in New Zealand.

The analysis includes the level of mobile disconnectivity in New Zealand, estimated usage in New Zealand, effective ways to segment the market in New Zealand, potential use cases for the Product X service in New Zealand, estimate on the number of potential users for the Product X service among boaters in New Zealand, potential revenues for the Product X service in New Zealand and Go-to-market strategies in New Zealand.

Usage-> Total population of New Zealand: 5M

Total active connections: 135%- 1.35 * 5 - 6.75M users (including people owning multiple cell phones).

Major competitor market share- > Vodafone (40%), Spark (40%), 2 degrees (19%), Others (1%)

Positioning for Product X-> Try sinking into 2 degrees market share as it is less prominent of the three main competitors.

Vodafone, Spark are very well positioned in the market, so pricing, marketing and distribution channel analysis would be needed to dive into their market share.

Research & Development would be needed to decipher what customers in New Zealand are looking for especially the age group 15-64 years old account for 64% of the population and would be the targeted audience for Product X in New Zealand. So, capturing their buying behavior, decision drivers and creating value propositions accordingly is going to be the critical task.

Use Cases-> A lot of the population is moving towards post-paid plans, with the pre-paid plans’ population declining gradually. Offering attractive plans in this domain make sense going forward.

Advances in telecommunication technology going forward is going to be important. Factors which should be considered is Sophistication, Autonomy, Convenience and Performance. The features these incorporate are connectivity and features.

GTM Strategies->

Monthly Data Plan/Post-Paid Plan

-All the three main competitors are offering their prices within the range $55-60 per month. Product X here should charge $50 per month, the unit margin might be less initially, but the sales volume would compensate for that. Once a threshold market share is acquired, looking at trends close to that of 2 degrees, then Product X can move its prices comparable to that of Vodafone and Sparks of $59/month.

- Vodafone in this price range seems like the most attractive option as it offers 15GB data (10 GB base+ 5 GB Bonus) and free Netflix yearly pass. Product X thinking on the same lines should offer a fixed + variable data plan customized to its user’s preferences.

-Offer users the variable data on special requests, the aim behind this to capture why do they need the extra usage of data and catch that behavior to develop a better product. For example, if more data is being used for video tethering or playing games, then Product X can offer special plans for these activities and capture more users by distinguishing itself in such a developed market.

- The smart move here by 2 degrees is that in its plan it is offering a free cellular service between Australian and New Zealand customers, which is smart from a strategic point of view. Product X should devise a plan on similar terms given the dynamic nature of movement and proximity between the two countries.

Prepaid plans

1.25 GB + 200-minute rollover

-Same competitive price across the top 3 companies, so the strategy should be to offer lower price than that to acquire market share in the beginning.

-Spark is trying to distinguish itself with added perks such as discount on Spotify perks, WIFI hotspot day and Data Stack capabilities.

-Product X should apply ML algorithms to capture the demand in users it is acquiring and leverage that training data to gather information about what added incentives its customers are looking for. This would establish long-term dependency and a legacy relationship with customers specially in a highly developed and tightly segmented market like New Zealand.

2 GB + 300-minute rollover

-2 degrees strategy for acquiring customers is free calls within their network which is not the right plan as their market share is relatively low compared to big earners while they are charging same.

-Product X will have to distinguish itself here by offering all these features while maintaining a competitive price for both these data plans.

- Casual rates which the user can pay is highest for Spark followed by 2 degrees and Vodafone. This would be a good starting point for Product X to take their product into the market and advertise as lower casual rates would open a lot of customers to take up the Product X service in the first place.

Unlimited Mobile Data Plan

-All three main competitors have almost similar offerings in this plan with the key differentiator being the flexibility by Spark to renew or continue the plan for $10/ additional month. Product X could extend a similar capability so maintains its user retention.

Market segmentation:

Although New Zealand is a developed market but certain areas within it such as rural can be considered as emerging markets. There are 721 identified rural areas in NZ right now with limited mobile connectivity, so a lot of scope for Product X to bring new users. Bringing mobile connectivity by setting up towers and leveraging its early position to charge other providers and grabbing the market share it will generate through word of mouth can be useful. Also, interactions with the locals about their pain points will be exclusively useful in setting up operations and identifying demand hotspots.

Potential Revenues->

At 20% market share, considering values from different plans ( prepaids, post-paid , unlimited data plans), Product X can potentially generate the following revenue:

20% of 6.75 users-> 0.2* 6.75= 1.35 M users

Dividing these users equally among 4 user plans(1.35/4=0.3375) suggested for Product X, the annual figures would be:

0.3375*$19(Price for 100gb monthly) *12=$76.95M

0.3375*$50(Price for postpaid monthly) *12=$202.5M

0.3375*$75(Price for unlimited monthly) *12=$303.75M

0.3375*$25(Price for 200gb monthly) *12=$101.25M

An estimate of 684.45M in revenue can potentially be generated annually. This number is a little overestimated as acquiring market share initially is going to be tough. But these figures could easily be underestimated if Product X invests in the emerging market scenario but the setup costs could be really high.

The plan on how Product X can drive market uptake and increase utilization of its initial messaging service. The methods for initial acquisition of end users, triggers to the drive end users to use the service more often, how drive repeated and habitual usage by the end user, and how to make the Product X service go viral. Assuming that the Product X service includes messaging (SMS and IP messaging) as well as Product XCast (an app on the phone that can be used by Product X to broadcast (one to many) to end users local information such as weather forecasts, major news, major sports results,..etc). The information received would be limited, and different for each geographic location and area, but be the same for everybody within a local area (e.g., within 20-30 miles.). Hence, here goes the plan.

High- Level Plan and Strategy-> Product X Service and Product XCast

Target Audience

-The target audience for Product X and Product XCast are the active mobile users in the world segmented as below:

GenZ (18-24) : 2.6 Billion users in the world

Millennials (25-40): 2.3 B

Gen X (41-56): 1.8 B

These are people who would be using the Product X service and Product XCast regularly.

Pain Points

-Different apps for different activities such for SMS, IP messaging and different apps for the broadcasting services.

- Response time is slow of the applications

- Information is not customized according to the customers needs like an emergency situation in their area.

Value Propositions

-One stop solutions for all the Product X services and in-app broadcasting.

- Will help people and students in particular be aware of the current affairs.

-Local journalists can posts their articles or research through their established channels on the app.

-Musicians can put their live podcasts in their.

-Professionals can be informed about the potential networking events in the vicinity.

Strategic Differentiation

-Include local news as well as Product X is planning.

-Include voice assistant and bot assistant services on the app.

-Reviews about different restaurant, places and articles could be included or through a like/dislike button.

-Short Insights listed on flashcards included on the app, so people need not necessarily go through the same application.

-News Stories like stories on Instagram, Snapchat could be made to better engage users.

-Use AI to capture user response and their preferences and leverage that to better recommendations.

-Offer different bandwidth mobile plans such as below:

850 MHz – 3G

900 MHz – 2G and 3G

1800 MHz – 2G and 4G

2100 MHz – 3G

This is the general cellular frequencies being offered by every operator in New Zealand. To distinguish itself, Product X show offer a combination of these bandwidths according to user need.

Competition

-Google News, Twitter and Spotify are the broadcasting platforms with major market share in their respective categories.

Acquisition Strategy

-Direct or digital marketing could be leveraged to acquire users.

-Free subscriptions could be offered in the beginning to better relay information about the app.

-Cost of acquiring customers’ needs to be weighed against lifetime generation value.

Monetization Strategy

-Advertisements in the app would generate money.

-Subscription fees could be added later on.

KPI’s

-Number of new users

-User retention (D7/D30 users)