Fleece blankets, popcorn buckets and movie passes featuring “The Incredibles” are part of the communications company’s promotions to attract new subscribers. |
IT WOULD BE AN UNDERSTATEMENT to say that SBC Communications Inc. isn’t known for its marketing prowess. This former Bell telephone company is a generally well-respected, if conservative, company. It’s never been the flashy type though.
But a little flash never hurt anyone, especially in these marketing happy days in which “lifestyle advertising” rules, the incumbent telephone companies are going head-to-head in major markets with the cable companies and IP technology is changing everything.
So this old-timer is changing its clothes. Papa’s got a brand new bag. And it’s in the form of marketing and new technologies.
Of course, SBC announced in late January its intent to buy AT&T, but how that will affect SBC’s marketing remains to be seen. For the short term, that effort appears to be focused primarily on the business side.
You may have also heard about the U-verse campaign, which SBC unveiled at the Consumer Electronics Show earlier this year in Las Vegas. U-verse is the umbrella brand under which SBC plans to market all of its consumer-targeted IP-based services including voice, video and data. The company’s new 2Wire-based Home Entertainment Service, which melds DSL and DBS technologies, probably will fall under U-verse as well (for more on that service, see February xchange, page 8) .
The goal of the U-verse campaign, whose concept came from Interbrand Corp., is to educate residential customers on how SBC is bringing together portability, entertainment, and all of customers’ communications services, says SBC spokesman Wes Warnock. “We’re targeting a wide group of people with this — from the young adult market to senior citizens,” Warnock says. “We were looking for something that would appeal to a wide group of people.”
Rather than promoting specific services, the U-verse bits SBC unveiled at CES appear to be focused more on presenting the “digital lifestyle” by showing attractive images that could appear just as easily in a Ralph Lauren or Target ad than detailing particular services or information.
However, the U-verse campaign was expected to launch last month through Internet banner ads and targeted e-mails to promote the company’s new consumer VoIP service. U-verse will launch in a bigger way later this year through additional spots on mediums like television.
Announcing U-verse in his CES speech, SBC Chairman and CEO Ed Whitacre said Project Lightspeed, the company’s previously announced $4 billion initiative to deploy fiber very close to 18 million households across 13 states by the end of 2007, is at the heart of U-verse. Through Project Lightspeed, SBC companies plan to deliver integrated IP-based video, voice, wireless and data services.
“U-verse marks a new beginning for SBC and millions of consumers,” said Whitacre.
He added that attending CES, a show that highlights what’s new and next in technology, runs a little against SBC culture. “We’re not known for getting ahead of our headlights,” he said. “When SBC puts a stake in the ground ... you can be sure we’ll follow through.”
But, U-verse is just part of the plan to capture customer mindset.
SBC also is pushing its brand through joint movie promotions, bundles including gift card and product giveaways, and various other activities. The idea, says Brooks McCorcle, SBC’s vice president of consumer marketing, is to position SBC as a leading entertainment company.
“No Capes”
SBC’s first major move in this direction was a marketing campaign involving the wildly popular Disney/Pixar movie “The Incredibles.”
SBC even branded its prepaid calling cards with images from “The Incredibles.” Four versions of these cards feature each one of “The Incredibles” family members. |
As part of the initiative, SBC worked with Pixar to develop two animated commercials that promote SBC Yahoo! DSL and SBC|DISH services, and include Incredibles characters. Additionally, SBC wrapped buses with “The Incredibles” theme in about 30 key SBC markets, placed billboards in about 15 cities and is conducting a sweepstakes with a potential $10 million prize.
The communications company also offered new customers Incredibles- branded products. For example, customers that bought SBC Yahoo! DSL received four movie passes branded “The Incredibles” (the movie characters were featured on a credit-card-sized Utix movie card, which could be used to attend any movie). New SBC|DISH Network satellite TV buyers were offered plastic Incredibles/SBC popcorn buckets. And new subscribers to SBC’s unlimited “All Distance” local and long-distance phone service received a red Incredibles phone, which McCorcle notes is now a hot item on eBay (selling for $37.69 at press time).
“We’re big on music and movies,” says McCorcle, adding that SBC’s deal with “The Incredibles” gave the company “credibility” in Hollywood. “You’ll probably see us do more of this — probably a couple of movies a year,” she adds.
SBC declined to provide details on the company’s overall marketing budget or the financials relating to the Disney/Pixar deal in particular, but McCorcle says SBC’s investment in “The Incredibles” promotion was “nominal in the [larger] scheme of things.” SBC “defrayed the cost” by selling the bits Pixar made for SBC to others outside the United States, she adds.
Bundle Up
Another key tenet to SBC’s marketing strategy is bundles. But it’s more than just putting together voice, data, video and maybe wireless services, as many communications companies are doing already. “We’re trying to promote the concept of the bundle as the more you buy, the more you get,” explains McCorcle.
“The Incredibles” blankets, phones and popcorn buckets were part of that continuing strategy. Other efforts in this vein included SBC’s “Build a Bundle, Get a Bundle” promotion, which ran from Dec. 1 through January. Under this effort, customers who bought one SBC service got a $50 gift card or branded card from Barnes & Noble, Best Buy or another SBC retail partner. The value of the gift card grew as customers added more SBC services. “We want to sell bundles, we don’t want to sell just a product,” says McCorcle.
SBC recently offered this Incredibles phone to new subscribers of its unlimited “All Distance” local and long-distance phone service. The phone is now a hot item on eBay, recently being offered for $37.69. |
Just last month, SBC took a slightly different take on the bundling strategy with its “Connect and Collect” promotion. New customers were offered $50 to buy content or goods including movie downloads, music downloads, Incredibles phones and gift cards.
SBC also is using, or recently has used, other special promotions such as MGM DVD, Harry and David’s and golf-package giveaways to help drive additional sales and interest from a variety of audiences.
Reach Out and Touch Someone
Event sponsorship and customer outreach are also a bigger focus for SBC these days. That includes everything from attaching its name to large events like the Olympics to demonstrating its services at football games, shopping malls and festivals.
Mall demos, door-to-door sales and catalogs are also part of SBC’s plan of attack.
During the holidays, SBC had some retail areas in malls with people selling products. The company has outsourced a contingent of “hundreds of people” to do door-to-door sales in target areas where competing cable companies have had reasonable success, according to SBC. The company even arranges meetings with local chambers of commerce in its new DSL markets to demonstrate the service, says Warnock.
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bringing it together SBC is tying together its various products and services into an integrated whole. That message of integration is at the heart of the U-verse campaign. FastForward , from Cingular Wireless and SBC companies, is a device that forwards incoming Cingular phone calls to a designated landline phone, while the wireless phone’s battery is recharged automatically. The calls forwarded to the landline phone do not count against monthly allotted Cingular minutes.SBC Unified Communications combines all messages in one place. Wireline and wireless voice mail, e-mail and faxes all come to the same inbox, where they can be checked by computer or phone.SBC companies and Yahoo! are extending their alliance to other products, giving a common look and feel to popular features, including Yahoo! Music services, Yahoo! Photos, SBC Yahoo! Parental Controls and remote access across devices. Content, like photos and music, resides in one place and is shared easily among multiple devices. |
In October, SBC for the first time put out a catalog featuring all its services. The catalog was mailed to customers in the fall and is available online. “In the future we’ll do more catalogs and FSIs (free-standing inserts in newspapers) versus direct mail,” says McCorcle.
On a larger scale, SBC for the 2004 Olympics sponsored NBC’s broadcast of the games in August and the network’s Olympics Web site. The telco also held SBC Yahoo! DSL photo contests with local NBC affiliates, and SBC Yahoo! DSL sports fans could access live streaming video and various Olympic events.
SBC also is playing sports on a smaller scale. During SBC’s College Football Tour during football weekends, the SBC College Football Tour 53-foot trailer travels to 10 college campuses, demonstrating services such as SBC Yahoo! DSL and online gaming with Xbox Live (in some cases featuring the local football team), SBC|DISH Network and Wi-Fi service.
SBC also is trying to appeal to the college crowd through a blog-based network of content and services called Project D.U. It presents more than 20 original content Web sites that discuss entertainment, music, fashion and sports.
This past summer, SBC visited more than 150 community and state events with an interactive mobile display as part of the company’s Be Connected Tour. Live, interactive product demonstrations included SBC Yahoo! DSL Internet services with Xbox Live, digital photo services and downloadable music and movie trailers, as well as SBC|DISH Network programming, including digital video recorders, HDTV programming and music stations.
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what’s in store |
Here is an inventory of the various ingredients in the SBC pantry that the company can use to create new service offerings.
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Music festivals are another target for SBC. The company recently sponsored a concert series in multiple cities aimed at the Hispanic market. For a separate concert, called the Clapton Crossroads Event, SBC Yahoo! DSL members had exclusive online viewing privileges of performances by Eric Clapton, James Taylor, B.B. King and others. SBC says its involvement on the concert circuit will continue.
Let There Be Light
“Marketing has taken on a whole new light at SBC, and we need it” with Project Lightspeed, says McCorcle.
The main driver of Project Lightspeed, of course, is to give SBC the bandwidth to deliver new video services — along with voice and data services — that eclipse those already available from the cable companies.
SBC last year announced plans to be the first U.S. telco to use Microsoft’s IPTV platform. LeeAnn Champion, senior executive vice president of IP services at SBC, says IPTV will provide the telco with four simultaneous video streams per home and the ability to present HDTV programming. It also will allow every room in the house to be PVR-equipped, enable instant channel changing and bring about the convergence of voice, video and data.
Champion demonstrated at CES how a Motorola cell phone could program a home PVR, and she even previewed a video clip on the cell phone. This service, though not yet available, is on the SBC roadmap. But this intersection of wireline-based entertainment with a mobile phone is a prime example of the integration message at the core of the U-verse campaign.
| Links |
| 2Wire Inc. www.2wire.com Cingular Wireless www.cingularwireless.com EchoStar Communications Corp. www.dishnetwork.com Interbrand Corp. www.interbrand.com Microsoft Corp. www.microsoft.com SBC Communications Inc. www.sbc.com Yahoo! www.yahoo.com |
