Sprint Communications Corp. figured out a way to package long-distance when it hooked up with Tandy Corp.'s Radio Shack and Sprint PCS to put Sprint Stores inside more than 6,000 RadioShacks last year.
The Sprint Store within a store, backed by an aggressive $40 million advertising campaign featuring the animated "The Jetsons," sells long distance, wireless, Internet and other telecommunications services. The combination hit on success from the start. Long-distance sales through the Sprint Stores inside RadioShack are approaching 10% of Sprint's total long-distance sales, says Terri Morrow Tansey, assistant VP-emerging markets for Sprint.
"I expect to get to 10% sometime in the next month. It has been a phenomenal channel for us," she says.
"We found out that customers had more questions than they were being allowed to ask [through traditional sales channels]. They just didn't have the place to do that," says Ms. Tansey. "We decided to let consumers buy telecommunications products the way they buy everything else."
From the beginning, the sales have followed a retail model, not a telecommunications one, says Ms. Tansey, who led the marketing strategy for the retail effort. Sales are highest around the holidays and the busy shopping periods.
The power of three advertisers-Sprint, RadioShack and Sprint PCS (a joint venture between Sprint Telecommunications, Cox Communications and ComCast Corp.)-is giving the added push of hundreds of millions of dollars of tagged advertising, she says.
With the success of the retail services, Sprint has discovered an untapped model that works. In fact, while the majority of Sprint's long-distance customers are driven to purchase through TV advertising, about half that many are buying through RadioShack.
"I always thought TV advertising would be the king of the hill-a mass medium that would deliver mass audiences. But we're finding out there are other ways customers want to purchase long distance," says Ms. Tansey.