Cingular focuses on loyalty

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Cingular Wireless today breaks a campaign aimed at increasing customer loyalty in a business noted for its amount of turnover.

The company will introduce "rollover" minutes on its cellphone plans, where Cingular Wireless consumers can push unused minutes into the next month. Consumers still have to pay the set monthly fee their plan requires regardless of the number of minutes rolled over. Only consumers with a plan that charges at least $39.99 a month are eligible.

The campaign, from Omnicom Group's BBDO Worldwide, New York, features two national TV spots, national newspaper ads and spots on radio and the Internet.

"This business is becoming much more of a share game and a switcher game rather than a new-user game," said Vince Overbey, Cingular's executive director-advertising. "The growth in the industry has slowed considerably. We believe with this product we have a very clear, distinct product offering vs. the big buckets of minutes and price-oriented offerings others may have."

a first

Cingular is a joint venture between the wireless divisions of SBC Communications and BellSouth, which offered such a plan to its subscribers two years ago, but only in the nine states it covered.

"To my knowledge, no other wireless carrier lets you roll over minutes today," said Roberta Wiggins, director-wireless mobile services, Yankee Group, a communications and technology consultancy, but cautioned that "such a strategy threatens to seriously endanger a carrier's profit margins. The negative impact on profit margins may offset gains in customer loyalty and churn reduction," she said. If customers do bank leftover minutes, it could affect the amount that Cingular collects in fees from consumers who exceed their free-minute allotment.

But Mr. Overbey said "the numbers have been run and we believe with this rollover that it will be profitable for us and also delivers a great value for the consumer."

Cingular Wireless spent $411 million in measured media in the U.S in 2001, and $221 million from January through May, according to Taylor Nelson Sofres' CMR. Mr. Overbey declined to say how much the rollover campaign was worth.

contributing: tobi elkin

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