Sunday Communications Limited Case Study

Summer Law         

10/31/2015

Sunday Communications Limited Case Study

Introduction

        Sunday Communications Limited was launched in Hong Kong in 1997, with six other mobile phone operators already competing fiercely in the small market by offering different tariffs and services to customers. Nevertheless, with the introduction of mobile number portability (MNP) in March 1999, competition for subscribers became a virtual free-for-all. Under this circumstance, Sunday gained its opportunity and entered the market successfully with its innovative market approach. Sunday positioned itself as a “lifestyle” brand, its core strategy was to “capitalise on the convergence of wireless communications and data technologies to develop innovative lifestyle-enhancing services as well as business-to-business solutions.”  The success of Sunday was soon proved when Sunday’s shares were listed on the Hong Kong Stock Exchange and on the NASDAQ in the United States in March 2000.

However, Sunday’s marketing strategy is no longer new and exciting because copycat marketing diluted the effect with a new trend that moved towards integrated marketing strategies blending various types of media. Furthermore, due to the substantial drop in net profit, PCCW acquired Sunday in the summer of 2005.  With the acquisition, new issues arise. Would the acquisition challenge the credibility of the innovative brand image that made Sunday such a success? How would Sunday compete in this new era of interactive integrated marketing, would its brand image eventually fizzle out among other competitors?  

SWOT Analysis

        Strength

• Talented and experienced management team
• High brand awareness, strong brand personality and brand equity
• Successfully positioned itself as a lifestyle brand
• Ads were being praised for creativity and originality
• Higher lock-up period of 37 months

        Weakness

• Continuous decline in revenue
• IMC strategy

        Opportunity

• MNP provided opportunity to gain subscribers
• Consumers are willing to spend money on their next mobile phone
• Consumer perceived mobile phone as a status symbol

        Threat

• Market facing fierce competition
• MNP encourages free competition

Issues

Sunday entered the very competitive mobile phone market and succeeded quickly in obtaining locked-up subscribers with its unique branding strategies. Despite its success, Sunday claimed a mere 9.8% of the market in 2000 and 8.3% in 2005. Although total number of subscribers continued to increase year to year, average revenue per user had been declining since 2001. Their aggressive branding strategies including eye catching advertisements, alliance marketing and joint promotions were very effective in the first place, but they became diluted as many competitors had followed its strategy. In the market, there are tons of similar services, which confused customers in differentiating and choosing among those services. Sunday’s wacky strategy was received with shock and excitement for some time but not anymore, Therefore, Sunday needed to find new ways to keep their innovative brand image and maintain brand awareness, as well as to increase market share and the number of subscribers, and to maintain its existing lock-up subscribers.