Vodafone-Essar scripts Rs 400 cr ad blitz

To conquer the second-largest telecom market in the world, Vodafone will spend around Rs 300-400 crore on an ad blitz spread over the next six to eight months.

The UK-based telecom major is looking at single name branding of its Indian joint venture firm, Vodafone-Essar (formerly Hutchison-Essar).

Vodafone-Essar will spend around Rs 10-15 crore a circle in the country, that would result in Rs 230-345 crore for the total 23 circles. This would be mainly for the rebranding exercise, while an additional Rs 50-75 crore would be spent for advertisements, sources familiar with the development told Business Standard.

The media blitz would include TV and newspapers advertisements, while a portion would also go for hoarding and online promotional activities.

The company is also looking at replacing its existing brand name - Hutchison Essar - on a single go with the new name, Vodafone-Essar. This is contrary to the earlier decision of dual branding strategy, of straddling both brand names for sometime.

"The present decision is to go ahead with a single brand, and the rebranding exercise would commence by the end of this month," a source said.

When contacted, a senior Vodafone executive said, "The shareholders (Ruias and Vodafone) are in discussions on these issues, and we will inform the press when we are ready to talk."

Vodafone-Essar would divide the company into four major regions, Vodafone-Essar (East), Vodafone-Essar (west), Vodafone-Essar (north) and Vodafone-Essar (south). These regions would be placed under different heads, while the company would function as a single entity.

The GSM player, which is the third largest in the country, is also believed to be focusing on the rural segment. This is because the company is looking at becoming a mass player and targeting the entry-level users in the country.

However, Vodafone executives denied this stating, "We will have a focus on lower-end of the socio-economic strata of the society. Vodafone-Essar will have an equal focus on both the metros and rural segments."

With most of the villages not connected over mobile networks, there exists a huge potential to expand operations to over 6 lakh villages.