Sprint Corp. is earmarking $40 million for a first-ever corporate branding campaign.
Roster agencies J. Walter Thompson USA and Hal Riney & Partners, both San Francisco, and Grey Advertising, New York, have been invited to pitch the account, Advertising Age has learned.
Presentations are scheduled for early December. The advertising is expected to debut in the first quarter of 1997.
"Up until now, Sprint has more or less focused only on product or service campaigns," said Tim Kelly, the No. 3 long-distance carrier's director of advertising, who would not comment on the review or plans for the branding campaign.
NEW COMPETITIVE THREATS
Sprint's move into that ad arena makes sense as the long-distance carriers are readying strategies to ward off the competitive threat posed by the Baby Bells, which in early 1997 can begin offering long-distance service to their customers.
AT&T Corp., which spends an estimated $1 billion annually on advertising, recently awarded its coveted $100 million corporate branding account to Young & Rubicam, New York.
The long-distance behemoth is expected to begin this fall a major campaign designed to re-educate consumers on the AT&T brand. The No. 1 carrier has been consistently losing market share in the long-distance business.
While MCI Communications Corp.'s and AT&T's ad spending for first half 1996 is down close to 17% each from the same period in '95, Sprint's spending is up about 40% for the same period, according to Competitive Media Reporting.
In light of British Telecom's pending acquisition of MCI, however, MCI could prove a more formidable threat with pockets as deep -- if not deeper -- than AT&T's. The U.K. company currently owns 20% of MCI and reportedly is negotiating for the rest.
"British Telecom buying MCI would give MCI the capital it needs to be a real competitor to AT&T," said Jeffrey Kagan, analyst with Kagan Telecommunications Associates. "It's more important than ever before to build a strong brand name; it's vital for survival in the new deregulated marketplace."
Sprint's increased ad efforts this year also are being directed at its National Football League sponsorship.
Separately, Sprint PCS, a wireless alliance of Sprint, Cox Communications, Comcast Corp. and Tele-Communications Inc., will soon break new ads from Riney.
Copyright November 1996, Crain Communications Inc.