NEW YORK (AdAge.com) -- Cisco has long been known as a maker of back-end equipment, the routers and hubs that connect offices to the internet. But lately the firm has jumped into the consumer market, perhaps as a result of its relatively flat sales over the past few years, which have hovered around $40 billion annually since 2008. But a key growth area has been its consumer products, having bought Linksys in 2003 and Flip Video in 2009.
But last week the 26-year-old firm unveiled its most ambitious consumer product yet: Umi, a high-definition, high-bandwidth video-teleconferencing device retailing for $599 with a $24.99 monthly service fee. The product includes a camera that clamps to the top of anyone's HD TV and a set-top box that connects to the TV's cable receiver and to the internet via a broadband box. Though the product requires a companion to get the full HD effect, it's compatible with Google video chat and may soon be compatible with Skype. Basically, it's a webcam on steroids.
Ad Age talked with Cisco's Exec VP-Chief Marketing Officer Sue Bostrom, who has been with the company since 1997 when she joined as VP-services marketing, about the company's consumer-facing ambitions. Ms. Bostrom, who has deep experience in business-to-business electronics and software marketing, previously had been senior VP-global marketing for FTP Software and prior to that was with National Semiconductor.
Ad Age: Cisco isn't really known as a consumer company. What are the challenges you face getting the word out about this product?
Ms. Bostrom: At Cisco, as a brand we've been working for four to five years in terms of really expanding how people think about Cisco. This is all an outgrowth of our human-networking campaign. We believe the brand has a lot of expandability. Cisco has a huge mission to expand in the minds of the consumers.
Ad Age: And Umi is part of that expansion, clearly.
Ms. Bostrom: It started, really, with our acquisition of Linksys and Flip Video, so we have already been testing ourselves in the consumer space. With regard to Umi, the exciting thing about it is that it really is the manifestation of Cisco's vision, what the company is all about.
Ad Age: You're referring to your business teleconferencing product?
Ms. Bostrom: Yes, TelePresence, and being able to take our experience from that technology and building a product specifically for what consumers need has been an interesting opportunity.
Ad Age: Businesses are well aware of your TelePresence product, but what's your consumer-marketing strategy then for Umi?
Ms. Bostrom: We have three important strategies for that. First is awareness, then what we call experiential and, finally, viral marketing. But the most important thing is awareness. It's harder for people to understand that this category of product exists. They're familiar with video communications and computer but this is an entirely different experience. So we're doing additional Ellen Page ads to get people to be aware of the product.
Ad Age: I've seen those Ellen Page commercials. They're funny. But I always wondered, as a consumer, why I'm seeing commercials for a product I can't buy. Was it part of the early strategy to pre-game Umi?
Ms. Bostrom: Actually, no. We didn't extend her into the consumer campaign until after we saw how the TelePresence campaign was working, and it worked great. The larger campaign for us was to just expose people to the human touch of TelePresence. So you saw in those commercials things you can relate to, such as doctor's visits, or a classroom setting. We wanted people to understand that video is pervasive, and it's going to be even more pervasive in our lives.
Ad Age: So what will these new Ellen Page spots look like and who is the agency behind them?
Ms. Bostrom: Well, we work with Ogilvy very closely, we have for a long time. With the new spots with Ellen, we set up in an environment where she actually called friends of hers -- mostly unscripted, and you see her interacting with all different friends of hers. What's great about Ellen is she comes across as so natural and authentic, which was important to this product.
Ad Age: Any other TV or ad spots?
Ms. Bostrom: We have product integration on TV, like we did for TelePresence on "24" or "Transformers" or "30 Rock." That's one of our key strategies, to allow people to see a live demo of the product in a form of entertainment that they love. So we're going to move forward really aggressively as you can imagine with the Umi product, and one of those, of course, is our association with "The Oprah Winfrey Show." It'll allow Oprah and her guests to connect.
Ad Age: So in which other shows will we see the Umi product? You mentioned "30 Rock" before.
Ms. Bostrom: My team is not allowing me to share that. They're working with scripts, and they don't want to give away too much. I can say it'll be one of the top shows out there today and one show we feel will be emerging. But also shows we think where it'll make sense. Shows where families are involved, for instance.
Ad Age: Where will Umi be available?
Ms. Bostrom: So I talked about the awareness aspect, and the next aspect is experiential. First, you can go online right now to Cisco.com and place a pre-order. Second option will be in Best Buy Magnolia stores, about 400 of those around the nation. We'll be setting it up in a couple rooms so you can have that kind of experience. And third, we're actually making it available in high-end malls.
Ad Age: Is the move into consumer territory just an experiment? How committed is Cisco to this space?
Ms. Bostrom: We're very committed to being successful in the consumer market. Umi brings a lot of the great technology from Cisco into the living room. We're very committed to this not only because it's potentially a great market but also because the lines between the business world and the consumer world are blurring -- so much of the innovation today is being driven by the consumer. So what I see for Umi for the longer term is families using it to tutor their kids, for instance. Where's the best French tutor? In Paris. Also, for things like doctor's visits. Insurance agents. Anything you can imagine where you're would want to have some kind of trust-based relationship.