Clustering Value Drivers of Indian Telecom Customers - Pathway for Effective Strategy Formulation

In recent years, Indian telecom organizations are experiencing tremendous growth rate and are brimming up with immense potential. However, increased competition for more customers has forced these organizations to transform radically from what is ‘best produced’ to what the customer ‘perceives as the best’. The objective of this study thus, is to first explore various customer value drivers in the Indian telecommunications market. After identifying these through factor analysis using Principal Component Analysis Method and taking Eigen value greater than one, they are subjected to cluster analysis and the respondents are grouped based on their demographic profile. The objective of this analysis is to enable the telecom service providers to devise a suitable strategy based on the importance of a particular value driver from customer's perspective. The results of cluster analysis reveal vital information about the preference of a particular customer value driver for a particular demographic segment. This information may be vital for managers to cater more effectively to the needs of a particular cluster in a particular demographic segment; and thus enable them to improve their customer database resulting in larger profits.