T-Mobile Us Case Study - Swot Analysis

T-Mobile US Inc. Situation Analysis

As of 2022, the company had monthly revenue per user of around 48.41 UD dollars for post-paid customers (Statista 2022). The total wireless service revenue in the United States is around 204.21 billion UDS and the number of wireless subscriber connections in s is 498.91 million.

Industry Structure and Economic Feature

This company is a subsidiary of Deutsche Telekom but it has its own team of executives who see the company’s operation. The company is led by Mike Sievert who is the President and CEO and is supported by the 16-C level of executives, presidents and executive vice presidents (T-Mobile Executives 2023).

T-Mobile has less than 10 per cent market share in large enterprise and government space and the total market is more than 50 million corporate liable lines (T-Mobile 2021). The company aims to double its market share in the next five years with the help of 5G leadership.

T-Mobile US Strategic

Business Level Strategies – the company aims to improve conversion optimization using digital marketing by bringing more customers from other competitive companies (Chaffey and Smith 2017).
Corporate Level Strategies – T mobile offers only 5G wireless access to the entire nation (T-Mobile 2021). The service is based on low-band spectrum build-out, supported by its published coverage map. The company further aims to simplify the acquisition and deployment of IoT solutions on a global basis with its parent company.

Competitive Analysis and Advantage in the Industry

The major competitors in the market of T-Mobiles include Verizon, AT&T, and Sprint. Both Verizon and AT&T have been maintaining the largest subscriber bases (Cotter and Tedla 2018). The lower churn and leading porting ratio which are the strength of T-Mobile helps T-Mobile to keep customers in the market. One advantage of this company is the acquisition of 600Mhz and 700Mhz which provides faster network coverage. The pricing of the company is also simpler and the data plans can be afforded by the customers.

SWOT Analysis

Strength

It has a reliable supplier of raw materials; thus, no supply chain bottlenecks happen. Their history of product innovation skills has also been strong and this has helped them to expand their business by expanding the market. The company also have a strong cash flow (Siddiqui, 2020). It has shown high success in Go To Market strategies for its products. With the execution of new products, the company has generated good cash returns by creating new revenue streams. The distribution network of the company is also one of its strengths. This has helped the company to reach its potential market.

Weaknesses

The company has still not been able to develop an integrated firm with various work cultures. the attrition rate is also high and compared to its competitors, the company needs to send a much higher amount to train and develop its new employees. There is still a lag in effective financial planning. Thus, cash flow is not well structured. The company has also faced issues in moving to other product segments with the present working culture that is present there. the profitability ratio and net contribution percentage are below the industry average (Siddiqui, 2020). Though the company innovates and develops new technologies, the investment required for the investments is massive.

SWOT ANALYSIS

Opportunities

since there is stable cash flow in the company, the company gets the opportunity to invest in new product segments. The new taxation policy of the country has also been an opportunity that has allowed the country to open new opportunities and increase its profitability (Siddiqui, 2020). Along with that, the free trade agreement that the government has provided has been adopted by the company and it has allowed it to emerge in new markets. After such a long period of recession, the economic uptick and increase in customer spending can help the company to attract new customers and make a customer base and increase market share. The decrease in transportation costs and the shipping process can boost the company’s profitability.

Threats

The new trend of isolationism in the economy of America can negatively impact the company’s international sales. The company has developed new products over the years but the supply of the new products has been always irregular (Siddiqui, 2020). Thus, there are high swings in the sale number over the past few years. Since it is a multinational company and is exposed to currency fluctuation, it has always been a volatile political issue across the world. The shortage of skilled workforce in the global market is yet another factor that can affect the steady growth of the company.

PESTLE Analysis

Factor	Likely to include factors such as
Political	a) Risk of military invasion b) Legal issues regarding contract enforcement c) Anti-trust laws related to Wireless Communication (Foster 2022) d) Bureaucracy and inference by the government in this industry.
Economic	a) High inflation in the market b) The workforce required in this industry has to be highly skilled. c) The changing rate of foreign exchange d) The company can use the industry’s economic indicators like industry growth rate and consumer spending to forecast growth trajectory
Social	a) Education level of the working force in the company. b) Demographics and skill level of the population (Liang et al. 2018) c) The health and environmental consciousness of the people d) Cultural factors like gender roles and social conventions.
Technological	a) Rate of technological diffusion b) Technological development by competitor companies c) Product offering effects d) Impact of the cost structure of the company
Legal	a) Copyrights and patent issues (Burns 2016) b) Employment lay c) Health and safety law d) Consumer protection and e-commerce
Environmental	a) Change in climates b) Mishaps caused by disasters c) Laws regarding the environment population d) Waste management processes in this sector

Target Market Analysis of T-Mobile US

Demographic Characteristics of Market – the main market of the company are the growing millennial population.
Psychological Characteristics of the Market – asking for better coverage of the wireless network.
Behaviors of the Target Market – they want to get data plans and equipment at a simplified price.
Strategies Appealing to the Market – the company identifies customers who are interested in wireless connections. The dense network with more spectrum is appealing to all the customers.

Marketing Mix of T-Mobile US

Product Strategy (Product Mix) – The company have been able to know the requirements of the growing millennials of the country with the increase in wireless service, the country has been able to provide wireless 5G service to the entire nation. The equipment that is developed by the company like phones, tablets, smartwatches, and hotspots meet the demand of the population.

Pricing Strategy - The company aims to maintain low pricing and simple plans that can be understood by everyone who is willing to uptake the strategies. This strategy has enabled customers from other companies to shift to this company’s products.

Promotional/ Advertising Plan – The company aims to advertise the effectiveness and speed of the connectivity provided by them. It converses with the customers that first come to use the website. It analyses the customer’s behaviour, preferences, location, and device use and based on that, advises the services best suitable for them.

T-Mobile US Competitive Analysis

i) 4Ps’ comparisons with competitors -

ii) Product - the products of T Mobile are wireless 5G services and equipment

iii) Price - the prices maintained by the company should be based on their customers (Cohen 2012). Keeping the profit margin, the company should ensure that they can hold their customers by maintaining the cost price most suitable for the customer.

iv) Place – to fulfil the company’s vision, marketing and distribution are crucial. The clients of the company should be provided with information about the products, sales services, accessibility and other vital factors regarding the product.

v) Promotion – promotion is important for any product. Promotion can be done in the form of advertisements, marketing strategies, personal selling, and maintaining good relationships with customers.

vi) Strengths’ comparisons with competitors - the pricing of the company is its primary strength. Apart from that, innovative products and schemes developed by the company are also a strength. It helps to draw the attraction of customers.

vii) Weaknesses’ comparison with competitors - the work culture can be considered a weakness of the company. It does not yet have an integrated work culture.

viii) Organization’s Competitive Advantage – the high market brand name and the budget-friendly prices of the wireless plans are its advantages.

Key Success Factors

The key success factor of the company is its ability to expand its products and hold a client base. The company’s history of innovation has always been strong which helped to expand its business. According to US CEO John Legere, the key lesson of the company that helped it to succeed was to shut up and listen to the customers and employees, stand for anything, get out of the way so that change can happen and share the reward of success with both the employees and customers (A_StevensonCNBC 2015). The company in 2012 wrapped up its merger with a prepaid wireless carrier. After this, the company started to see real positive changes in the industry.

Problems and Issues in T-Mobile US’s Organization

The economic crisis and recession that took place during the COVID-19 pandemic had an impact on the economy of the company (Salam et al. 2021). This led to a financial downfall. Apart from that, the lack of integrated working culture is another issue of the organization. The investment required for making innovations is also large. Hence, the company tend to strive in making new innovations in the time of financial crisis.

References

A_StevensonCNBC, 2015. T-Mobile CEO to Cramer: 'shut up and listen'. [online] CNBC. Available at: <https://www.cnbc.com/2015/04/28/t-mobile-ceo-to-cramer-shut-up-and-listen.html> [Accessed 7 Feb. 2023].

Asker, J. and Katz, M.L., 2022. The Sprint/T-Mobile Merger.

Burns, P., 2016. Entrepreneurship and small business: start-up, growth and maturity. Bloomsbury Publishing.

Chaffey, D. and Smith, P.R., 2017. Digital marketing excellence: planning, optimizing and integrating online marketing. Routledge.

Cohen, H., 2012. 4PS Drive Mobile Commerce (& The Marketing You Need!) [research]. [online] Heidi Cohen. Available at: <https://heidicohen.com/4-critical-types-of-mobile-info-customers-want-now/> [Accessed 7 Feb. 2023].

Cotter , R., and Tedla, V., 2018. T-Mobile US Inc. (NASDAQ: TMUS) - smf.business.uconn.edu. [online] T-Mobile US Inc. (NASDAQ: TMUS). Available at: <https://smf.business.uconn.edu/wp-content/uploads/sites/818/2018/03/TMUS-One-Pager.pdf> [Accessed 7 Feb. 2023].

Foster, C., 2022. Varieties of neoliberalism: courts, competition paradigms and the Atlantic divide in anti-trust. Socio-Economic Review, 20(4), pp.1653-1678.

Lawless, J., 2017. T-Mobile: Ramping up Impact with WinWin, Tri-Sector Strategies.

Liang, J., Wang, H. and Lazear, E.P., 2018. Demographics and entrepreneurship. Journal of Political Economy, 126(S1), pp.S140-S196.

Musonera, E., 2019. Marketing Strategies in the Telecommunication Industry and Network Services: A Case Analysis of Wireless Carrier T-Mobile. Journal of Marketing Perspectives, 1, pp.18-37.

Salam, M.A., Saha, T., Rahman, M.H. and Mutsuddi, P., 2021. Challenges to Mobile Banking Adaptation in COVID-19 Pandemic.'. Journal of Business and Management Sciences, 9(3), pp.101-113.

Siddiqui, S., 2020. The SWOT OF ANALYSIS OF THE NEW T-mobile pending merger with Sprint. [online] LinkedIn. Available at: <https://www.linkedin.com/pulse/swot-analysis-new-t-mobile-pending-merger-sprint-sherazi-siddiqui> [Accessed 7 Feb. 2023].

Statista, 2022. Topic: T-mobile US. [online] Statista. Available at: <https://www.statista.com/topics/996/t-mobile-us/#:~:text=T%2DMobile%20customers,churn%20rate%20of%200.93%20percent.> [Accessed 7 Feb. 2023].

T-Mobile executives, 2023. Mike Sievert, president & chief executive officer: T-Mobile executives. [online] T-Mobile executives. Available at: <https://www.t-mobile.com/our-story/executive-leadership-team/mike-sievert> [Accessed 7 Feb. 2023].

T-Mobile, 2021. Tmobile outlines supercharged plan for uncarrier to further extend ... [online] Available at: <https://www.t-mobile.com/news/business/t-mobile-analyst-day-2021> [Accessed 7 Feb. 2023].

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