Quantitative Analysis Case Study

TELUS is a national telecommunications company in Canada, was founded in Alberta in 1990 and merged by TELUS (Alberta) and BCTel in 1999. It provides a wide range of telecommunications products and internet access, voice, entertainment, video, and satellite television services. Nowadays, TELUS is the third largest mobile operator in Canada, having 6.852 Million users, and facing competition comes from Rogers (8.881 Million users) and Bell (7.125 Million users). In 2010, TELUS achieves $9.8 billion of annual revenue.

Industry Environment

At the end of June 2011, Canadian wireless phone subscribers are 25.1 million, 75 percent of Canadian households having access to wireless phones. Comparing to United State, Canada has a middle level of mobile penetration, and a fast growing market. The big three mobile operators are Rogers, Bell and TELUS, taking over 90% market share.

3. Problem Definition

TELUS is one of the biggest mobile operators in Canada. However, it has lower market share (28%) than other major two, Rogers (36%) and Bell (29%). According to our research, we found the following three factors may affect TELUS market shares. Firstly, the average price of the TELUS plan is higher than others, 7.58% higher than Rogers and 38.28% higher than bell. Secondly, the variation of the plan is poor. There are only three general plans for individual to choose. Finally, the brand awareness is lower than Rogers and Bell.

When considering how to develop TELUS's competitive advantage to achieve high market share and maximize the sales. We are thinking about expanding mobile subscribe for Telus, for example increasing student users. In 2010, there are 1,148,626 students, including 218,239 international students in Canada. It implies that there is the large market created by the students. It becomes one of independent variables in later our regression analysis. For the future development of TELUS, to attractive new individual user and build the royalty with existent user will definitely improve its market share and sales.

4. Model Design & Development

In this project, we conduct two of quantitative methods; multiple-regression model and trend projection model to forecast the future sales volume of TELUS.

4.1 Data Collection

The data based on the website of Tules, Rogers, Bell and Citizenship and Immigration Canada. Basically, the major data which is the sales of Tules for monthly, the average price of Telus cellphone plan, the average price of the two major competitors Rogers cellphone plan and Bell cellphone plan, the total store number of Tules in Canada , and student number in Canada.

4.2 Regression Analysis

4.2.1 Definition of Regression analysis

Regression analysis is statistical technique used to establish the relationship of a dependent variable. By measuring exactly how large and significant each independent variable has historically been in its relation to the dependent variable, the future value of the dependent variable can be predicted.

4.2.2 Define Decision Variable and Model Parameters

In this project, 'Sales of Tules' is defined as dependent variable, 'average price of Telus cellphone plan', 'total store number of Tules', 'student number', 'average