Initially cellular was perceived as a rich man’s service due to high upfront cost .Also, the marketing strategies of many operators were influenced by those of subscriber-end telecom products, mostly considered an extension of IT/Office Automation (OA) products. Therefore, in the introductory phase, emphasis was on using direct and indirect channels, both heavily depending on sales force.

The "direct" channel, i.e., the sales force employed by the operator, has been mainly used to address key segments like corporate or VIPs as well as the other interested subscribers. The "indirect" channel comprised mainly of the dealers having a sales force as well as data bases. Many of these dealers thus came from IT/OA industry. They were dealers in EPABXes or computers/peripherals or high-value products and/or having a good contact base like credit cards, hi-end stores/boutiques, and even car dealers. And Pareto’s Rule did seem to apply with 20 percent of the dealers controlling 80 percent of the market. The early success of operators came from early adopters in which dealers played significant role to improve the reach to such potential subscribers.

As the hi-value segment was getting exhausted, the focus shifted to the middle segment, thanks to the falling handset prices. This also required higher brand and product visibility and much wider reach shifting the focus from sales force to the sub-dealers, mostly small shop keepers with big glow signs. It not only stood out but also provided identity, legitimacy, and loyalty. Also included were many free lancers with more emphasis on short term results than loyalty. Thus, it became common to have dealers having multiple sub-dealers and the indirect channel dominated the business.

As the market matured, operators had to face the incidence of bad debts and fraud (though limited) which also made an impact on the channels strategy. More and more operators are now putting priority on credit control which translates into stricter controls and regular auditing of the indirect channels too. In order to maintain high brand equity, it has become necessary for operators to check the indiscriminate deployment of sub-dealers. Also, the search as well as retention of the quality subscriber, with high airtime usage being a priority over numbers, may once again make the direct salesforce a more favoured channel which may also be cost effective. However, this needs to be analyzed carefully for each market and situation. The dealer incentivization is also now being increasingly linked to airtime usage and retention rather than simple acquisition of the subscriber. Sometimes, the operators also have to depend on the dealers to provide hand sets to subscribers.

With enormous success of pre-paid in other countries and India too, the focus is also on mass market using pre-paid, the target subscribers being the anonymous, families (young, old, and housewives), travelers, etc. The retailers, including street-corner kiosks, came to play big role, sometimes the size of the glow-sign being bigger than the kiosk itself. As against regular subscription which required time-consuming credit checks, pre-paid service has been retailed on the counters/shelves just like an FMCG. So, a pre-paid card can be bought at a supermarket, Delhi’s Palika Bazaar shop, a small electrical appliances store, or the nukkad paan-wala, with or without the handset, far more convenient for the subscriber as well as the operator.

With the vast areas and population to cater and need to retain quality subscriber and resultant focus onto customer relationship, the operators have started organizing distribution channels geographically, with one main distributor or a big dealer taking care of sometimes up to hundred sub-dealers and retail outlets in his area.

As the focus has shifted from subscriber numbers to airtime usage, the retail outlets act like sales and service centres where the subscribers can be familiarized about various value-added services, additional accessories for the handsets, and other relationship and usage enhancing aspects. Also, these retail outlets are one stop-shop for handset problems, payment drop boxes, grievance addressal, etc. Most of the retail outlets are dealer-owned with subsidy or financial assistance from the operator in the form of higher commissions, POPs, furnishing concepts and sometimes, maintenance funds, but only rarely owned and run by the operator.

The operators in the circles have also relied heavily on the dealers and other indirect channels as the population is widely spread over large number of cities/areas and tends to be highly influenced by the factors like personal recommendation and contact. The circle operators also use big retail outlets in the bigger cities and more of dealer owned outlets in the smaller cities. Such dealers generally use the same outlet for business other than cellular as well, for instance, a tyre shop may also have some shelf space dedicated to cellular business.

So every evening, when Chacha Ramdin walks across to his nukkad paan-wala for his daily paan he refills his pre-paid too!