Question

3. What did you learn from the story of Vodafone in Japan?

Answer 1

Vodafone a world wide leader in telecommunication sector decided to enter a huge Telecom market Japan in 2001 collaborating with Japan Telecom Co. Japan's telecommunication market was increasing at the rate of 3-4 % year on year.

Vodafone was welcomed in Japanese market as it was having good Telecom giant image and despite of being restricted market of Japan for foreign companies , Vodafone did not face such issues.

Vodafone marketing was as good as any other market.leader in Japan then also it failed.

We will discuss the causes of failures and learning we shousld take away from those causes -

• Lack of market understanding - Vodafone could not understand the very Agile nature of Japanese market and considered it similar to European market. Japanese mobile users' preferences were getting changed very frequently which Vodafone could not come up . Any organization who is going to get in to a new market should study the market , consumer behaviour of the place where they are going.to enter.
• Infrastructure facilities were not adequate enough to satisfy Japanese customers like very few investment on 3G services , very poor Network coverage, very late updates etc. Organization must spend good investment over basic infrastructure which is sufficient to provide good services to customers.
• Another issue with Vodafone was the design of the handset which they we offering in market. They were providing the same handsets which they were offering in Europe. However in Japan mobile users were well ahead in terms of technology and aesthatics of the mobile sets. Vodafone failed miserably while.providing old fashioned hand sets yo Japanese customers. Any organization which should offer the product based on the choice of the local customer they are targeting.

Finally in 2006 , Vodafone decided to close all operations in Japan and sold shares to Soft Bnak of Japan.

Thanks

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