MASSIVE SPENDING GOES THE PRICE WAR ROUTE

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Another year of mergers in the telecommunications world left the Power 50 bereft of Baby Bells. Only the big three long-distance companies -- AT&T Corp., MCI WorldCom and Sprint Corp. -- spent enough to crack the list.

This year telcom marketing executives returned to the basics to develop their aggressive marketing programs. The competitive long-distance companies were the first to break into and embrace marketing and advertising as an important tool. The past year has seen a renewal of that competition as all three began a renewed emphasis on product portfolios and targeting specific consumers.

Most recently, the three began a mini-pricing war over long-distance rates. Sprint Corp. came out first with 5-cent evening pricing and a "Nickel Nights" campaign from McCann-Erickson Worldwide, New York. Next, MCI WorldCom launched its own 5 cents-per-minute evening rate with a push featuring Michael Jordan and Looney Tune animated characters, created by Messner Vetere Berger McNamee Schmetterer/Euro RSCG, New York.

Just weeks later, AT&T Corp. responded with its 7-cent per minute all day pricing and a new campaign from Y&R Advertising, New York, resurrecting pitchman Paul Reiser.

Sprint, which focused heavily on events and promotions in 1998, says 1999 was the year it shifted that focus to its product line to drive segment sales.

"While the promotions angle was successful and generated a lot of call volume, we found the quality of the consumer was lower. Sprint's target is high-end communications users and we were getting low communications users who weren't very loyal," says Daniel Alcazar, Sprint assistant VP-domestic marketing.

Another hot topic of the past year was bundling. Bundling is the packaging of telecom services, such as local, long distance, wireless and/or cable access, into one cost on one bill.

There is some discussion in the industry, however, about the best way to bundle. Should a company offer every service all at once or slowly begin to bundle like services to ease the transition for consumers?

"Consumers view buying decisions for wireless and wireline as completely different purchases decisions," says John Donoghue, senior VP-consumer marketing for MCI WorldCom. "Ninety-eight percent of long distance sales are made via telephone and 98% of wireless sales are made in person . . . Bundling is powerful, but when you talk to consumers, it comes across clear that in the near term, consumers will focus on three types of bundles [wireline, wireless and

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