Goodby Scoops Up Sprint's $1.2 Billion Business
Mobile Giant Turns to San Francisco Shop to 'Power Up' Sales, Stock
SAN FRANCISCO (AdAge.com) -- Sprint Nextel has named Goodby, Silverstein & Partners, San Francisco, as its new advertising agency as the mobile giant looks to reinvigorate subscriber sales and its slumbering stock.
"Goodby's sterling reputation and creative talents are second to none and together we will deliver a more integrated and strategic brand execution," Mark Schweitzer, Sprint's chief marketing officer, said in a statement. Sprint also liked Goodby's "combination of strategic strength, breakthrough creative execution and outstanding new media integration."
A big spender
The nation's third-largest mobile provider spent $1.2 billion in measured media in 2006, according to TNS Media Intelligence. However, in January when the review was announced, a Sprint spokeswoman indicated the amount was likely to drop.
Sprint has been putting a fair amount of its marketing dollars behind sports sponsorships and currently is in the midst of two high-profile, long-term deals, one for five years and $600 million with the National Football League sponsorship and a 10-year, $700 million Nascar pact.
In December, Sprint shuffled its marketing department, naming Bill Morgan as senior VP-brand advertising, overseeing brand management, advertising and media strategy and reporting to Mr. Schweitzer. Mr. Morgan, who was one of the leaders of the review, worked with Goodby when he was at SBC. Also hired to fortify marketing was Matt Carter, senior VP-customer retention.
Sprint, at the time of its merger with Nextel, retained the agencies on the separate accounts, Publicis & Hal Riney, San Francisco, which handled sprint, and TBWA/Chiat/Day, New York. However, it re-ordered the two agencies' duties, giving Riney the business-to-business assignment, and placing consumer advertising with TBWA. The merged brand launched with the tagline "Yes, you can." Last fall, TBWA devised the current Sprint tagline, "Power up," and introduced "Sex in the City" actor Ron Livingston as spokesman.
Riney and TBWA dropped out of the review before it narrowed to three finalists. TBWA is the agency for Apple, which is launching a mobile device with AT&T. The third agency finalist in the review, Young & Rubicam, New York, was eliminated earlier this week.
Goodby pips Ogilvy
In the end, both Goodby and Ogilvy had extensive telecom experience with previous incarnations of AT&T Wireless. In the convoluted history of telecom, AT&T Wireless was folded into Cingular Wireless. SBC the bought AT&T and took the AT&T name, then AT&T acquired BellSouth, which shared ownership of Cingular Wireless with AT&T. Cingular Wireless was then rebranded AT&T Mobility.
Ogilvy, AT&T's longtime agency, was in part responsible for the "raising the bar" concept that BBDO melded into Cingular advertising. Some of that branding has been used to rebrand Cingular to the AT&T name. Goodby, meanwhile, at one point stole some of the AT&T work away from Ogivly and developed a series of emotional ads around the iconic "Reach out and touch someone" line.
The agency hire comes at a time when the long period of growth for carriers is coming to an end. The U.S. cellphone market is reaching a saturation point, according to several studies. With some 230 million subscribers nationwide, about two thirds of Americans likely to acquire a phone have one.
Lack of differentiation
The carriers also are struggling to differentiate their offerings. Verizon Wireless led the charge with its reliability claim as illustrated by its "test man" advertising. Cingular, now AT&T, joined in with its claim of "fewest dropped calls." Even T-Mobile is making a similar claim in certain markets where its record is strong.
As a brand, too, Sprint has been taking a hit. Not only has its subscriber growth stalled and its share price been stuck in the doldrums, but Millward Brown Optimor has branded Sprint a "fading star," that is a brand lacking forward momentum. "They swallowed Nextel. Not well. They never had a plan," said one executive who worked on the brand. Ironically, the executive said, the brand never really got powered up.