MCI takes nickel niche to everyday status

By Published on .

After a short summer ad hiatus, MCI WorldCom returns to TV this week with new creative and a new offer: The long-distance giant extends its offer of 5 cents Sundays to 5 cents every day, beginning Aug. 9.

Retired basketball star Michael Jordan returns as spokesman--this time playing a reporter and news anchor--along with his veteran co-stars, an assortment of Looney Toons characters. MCI has a licensing agreement with Warner Bros. to use the characters.

Messner Vetere Berger McNamee Schmetterer/Euro RSCG, New York, created the spots running on broadcast network and cable TV.

Spending for the new campaign is undisclosed; MCI WorldCom spent $107 million in 1998 on long-distance consumer advertising, according to Competitive Media Reporting.

CONCEPT DEBUTED IN '97

MCI WorldCom first launched the 5 cents Sunday concept in September 1997, and added Mr. Jordan and the Looney Toons a year later. The company is expanding the 5 cents program on the strength of the original offer's success.

"Our Sunday minutes volume has doubled since we launched," said John Donoghue, MCI WorldCom senior VP-consumer marketing. "There was some concern that people would just shift minutes--instead of calling during the weekday, they would wait to call on Sunday. But that hasn't happened. We've had growth on every day, although the most has been on Sunday."

LOWER OVERHEAD

The company can afford to cut prices for consumers for calls within the U.S. because its own costs have dropped during the past two years. Mr. Donoghue said charges that long-distance companies must pay to local Baby Bells have fallen, thanks to legislation and competition.

He added that although the price is down, people are using more minutes; that allows MCI to make up some of the difference in volume. And MCI also picks up other revenue streams from customers when they switch. Extra services, such as instate long-distance calling, international calls and directory assistance, make up about 50% of a customer's bill, Mr. Donoghue said.

The 5 cents everyday offer applies to calls between 7 p.m. and 7 a.m. daily and all day Saturday and Sunday. There is a $1.95 monthly fee for the plan.

Sprint Corp. debuted a 5 cents per minute daily plan called "Nickel Nights" several weeks ago for calls between 7 p.m. and midnight with a $5.95 monthly fee. AT&T Corp. offers a 5 cents per minute calling plan for weekends, part of its dime-a-minute daily plan that carries a $4.95 monthly charge.

AT&T has about 60% of the U.S. long-distance market; MCI, 20%; and Sprint, 10%.

Copyright August 1999, Crain Communications Inc.

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