Mary Dillon's First Mark on U.S. Cellular: a Loyalty Program

Former McDonald's Global CMO Had Hand in Shaping New Message From Carrier

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NEW YORK ( -- U.S. Cellular launches its first major marketing effort tomorrow under Mary Dillon, who recently left her post as global chief marketer for McDonald's to become the regional carrier's president-CEO. While the new push doesn't include marketing tropes from fast food, the carrier's first loyalty program takes cues from the airline, retail and travel industries.

Belief Project newspaper spread

U.S. Cellular's Belief Project newspaper spread.

The No. 6 U.S. wireless carrier will reward subscribers with points on each paid bill. Customers can then use those points to get earlier access to phone upgrades -- up to eight months earlier than industry standards, according to the company -- free ringtones and forgiveness on overages.

The loyalty program is being called the Belief Project. A campaign, titled "Wake Up," launches tomorrow to promote the new position. The effort includes TV, outdoor and digital from Publicis Groupe agency Publicis & Hal Riney. Sibling Razorfish created the website. The launch spots are brand focused, Mr. Perez said, but consumers can expect future creative to more specifically describe new services from the carrier.

U.S. Cellular spent $109 million in U.S. measured media in 2009, according to Ad Age DataCenter.

"This is an unprecedented push for the carrier with more media spending overall," a U.S. Cellular spokesman said. "Spending will be concentrated during launch and also includes a new focus on social media."

"I'm not aware of another carrier with a program modeled after loyalty programs from airlines and retailers," said Charles Golvin, a telecom analyst with Forrester. (Verizon Ventures, a unit of market leader Verizon Wireless, invested in CardStar, a mobile firm with a loyalty app, in August.)* "Other carriers have talked about this generally. Certainly, loyalty and churn reduction is a critical metric in a carrier's success," Mr. Golvin said.

The carrier's churn, or the rate it loses customers, is at 1.4%, said Edward Perez, its VP-marketing and sales operations. "That's pretty low for the industry, so it's not really the driver for us," said Mr. Perez. "[Loyalty] is a growth strategy. If you really show appreciation for customers and show they're valued, customers will be drawn to U.S. Cellular."

While plans for the program were underway before Ms. Dillon arrived, Mr. Perez said the new president-CEO was influential in honing the message and the focus on customers.

Rewards points can also be worked into other marketing efforts, such as awarding points on customers' birthdays or text-messaging for sports event sponsorships, he added.

"It's an area the whole industry is looking at," said industry analyst Jeff Kagan. "But there are dangers. With the airline industry, it can grow so big and take on a life of its own, where it gets to a point that you can't take it down even if you might eventually want to."

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CORRECTION: An earlier version of this story incorrectly stated that Verizon acquired CardStar.

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