! of 10 1 ! Broadcast Creative Pitch Allee Lizama
Background:
✦ Sprint Corporation is a telecommunications company based in Overland Park, Kansas ✦ Owns and operates third largest wireless telecommunications network in the United States ✦ Their major competitors are Verizon, AT&T and T-Mobile ✦ SPRINT is an acronym for Southern Pacific Railroad Internal Network Telecommunications ✦ 54 million subscribers as of Q1 2014 reporting Mission Statement: "Sprint's vision to be a world class company, the standard by which others are measured, includes a commitment to developing a world class supplier base that is reflective of the communities we serve.” Current Brand Position: [see Figure 1.0] ✦ Sprint’s market share is current 16% of the U.S. market ✦ AT&T and Verizon each hold 34% market share ✦ T-Mobile holds 14% market share ✦ 2% market share is held by other smaller companies U.S. Cellular Service Market [See Figure 1.1 & 1.2] ✦ saturated market in the maturity phase ✦ higher incomes and higher spending on telecoms ✦ relies heavily on price competition and technical innovation market trends: [See Figure 1.3] 4G LTE coverage ✦ ✦ Sprint is behind the competition in LTE coverage ✦ 110 markets covered ✦ AT&T has 328; Verizon has 500 ✦ LTE is expected to dominate the wireless scene and is critical to a provider’s success dissatisfaction with internet quality relative to voice quality [Ericsson 2014] ✦ expects speeds to support video and music streaming [Ericsson 2014] ✦ Brand Reputation: social responsibility: ✦ Sprint focuses heavily on sustainability and is consistently ranked as a highly eco-friendly company ✦ Sprint is ahead of competitors in terms of sustainability ✦ The Sprint Eco-Logo is used to represent devices that reflect the brands environmental vision and green specifications [sprint.com/responsibility] ✦ Sprint has also partnered with several leading Corporate Responsibility (CR) organizations to further its sustainability efforts [sprint.com/responsibility] ✦ Boston College Center for Corporate Citizenship ✦ Business for Social Responsibility ✦ Carbon Disclosure Project ✦ Ceres ✦ Corporate Responsibility Officer Association ✦ EPA Green Power Partners ✦ EPA Plug-in to Ecycling ✦ EPA WasteWise ✦ FTSE4Good ✦ Global Esustainability Initiative
! of 10 2 ! ✦ GreenBiz Executive Network ✦ The Green Grid ✦ United States Green Building Council LEED Program products & services: ✦ Sprint is perceived as low-quality relative to the other major carriers. ✦ Sprint is not considered innovative by the general public because of their slow speed at adopting widespread 4G LTE coverage. ✦ Sprint is considered a low-cost offering and are well-known for continuing to offer unlimited data plans. However, their offerings are also considered as low-value relative to other carriers so they are often identified as a ‘low price, low quality’ provider. ✦ Sprint is considered unreliable due to their lack of coverage and slower coverage speeds relative to other providers [See figure 1.4] vision & leadership: ✦ New CEO Marcel Claure just replaced Dan Hesse ✦ Sprint has been talking about building the most powerful mobile broadband network in the country since 2007, but seven years later, it is still far from its goal. As it stands now, Sprint’s 4G network is the slowest in the country, has least amount of coverage in major cities and has the smallest overall capacity. ✦ “Just give us time, and we’ll build the 4G network of your dreams” [Tech News and Analysis, Dan Hesse, former CEO] ✦ Seen as ‘not living up to their promises’ and ‘not innovative’ in the marketplace financial performance: [see Figure 1.5] ✦ not currently profitable, have seen a net loss over several consecutive quarterly statements ✦ have been losing subscribers over time prospects growing slowly Current Target Market and Strategy: Overall, Sprint uses mass marketing strategies and competes primarily on price ✦ Small businesses ✦ “Framily” Plans offer large discounts as you add more lines to your account ✦ families ✦ “Framily” Plans and Family Share Pack Plans ✦ Mimicking AT&T and Verizon Family plans but competition primarily on price ✦ women, minority, disabled veterans ✦ primarily due to their ‘inclusive’ advertising tactics ✦ college students [The Observer; March 2011] ✦ Sprint ID Packs organize applications for different campuses ✦ “It is very important for us as a company to reach out to students. By serving on the board at the Mendoza College of Business and lecturing a couple of times per year, it is clear [to me] who our target customers are.” [Dan Hess, former CEO 2011] ✦ “Simplicity and value are the two qualities which we attempt to show in all of our products” [Hesse 2011] Current Offerings: Sprint Family Share Pack Premise: Sprint is changing the wireless industry with this plan that provides consumers value and flexibility, plus unlimited talk and text. ✦ committed to providing the best value in wireless by giving customers the 1GB shared data allowance for $20 with the Sprint Family Share Pack ✦ double the data offered by Verizon and more than 3 times the data offered by AT&T at the same price point (Compared to shared data allowances for 500MB Verizon More Everything Plan and 300MB AT&T Mobile Share Value plan.) ✦ family of four can get 20 GB of data for $160 per month, a significant jump for Sprint in terms of data offered. This is significantly more cost effective than those offered by market leaders Verizon and AT&T which provide only half the data (10 GB) at the same price ($160).
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Problem:
✦ Sprint cannot not compete with AT&T and Verizon’s massive reach and capacity ✦ Sprint does not have a differentiated strategy, they appeal to the mass market using campaigns such as the early 2014 “Framily” campaign that represented and targeted all of the different segments of the market ✦ Sprint is competing almost exclusively on price, but T-Mobile also uses a low-cost pricing strategy and is closing in on Sprint’s market share advantage
Selling Idea:
Sprint ‘Happy Connecting’ Campaign: The Premise: Rebrand Sprint’s ‘Happy Connecting’ Tagline Happy Connecting means: Happy Environment, Happy Wallet, Happy Connecting’ Conceptual Target: Young City Dwellers in the US Core Desire: Fast, efficient cell phone voice and internet service that is affordable and eco-sustainable. Fulfills Core Desire: Sprint Spark in major metropolitan areas, affordable plans compared to competitors, and strong sustainability platform. Compelling Truth: Sprint offers the best, most affordable, and most eco-sustainable service for city dwellers in the US. Target Market: Demographics: ✦ ages 25-34, 86.2% use a smartphone ✦ US younger middle class, old enough to be off of parents phone plan ✦ male and female Geographics: ✦ city dwellers: Sprint has a smaller reach but can excel in these heavily populated markets Sprint Spark is available in 46 cities: Austin, Texas; Baltimore; Bay City, Michigan; Chicago; Cincinnati; Cleveland; Columbus, Ohio; Dallas; Denver; Flint, Mich.; Fort Lauderdale, Fla.; Fort Worth, Texas; Greensboro, N.C.; Henderson, N.C.; Houston; Jacksonville, Fla.; Kansas City, Kan./Mo.; Los Angeles; Miami; Midland, Mich.; Minneapolis-St. Paul; Mount Vernon, Ohio; New Philadelphia, Ohio; New York; Newark, N.J.; Oakland, Calif.; Ogden, Utah; Orlando, Fla.; Philadelphia; Provo, Utah; Rockford, Illinois; Sacramento, Calif.; Saginaw, Mich.; Salt Lake City; San Antonio; Seattle; Sheboygan, Wis.; St. Louis; Tacoma, Wash.; Tampa, Fla.; Tiffin, Ohio; Trenton, N.J; Waukegan, Ill.; Winston-Salem, N.C.; West Palm Beach, Fla.; and Youngstown, Ohio. Psychographics: [See Figure 2.0 and 2.1] ✦ cares about environmental sustainability (66% of consumers under age 40 believe that companies should support the environment and are willing to pay more for socially responsible products and services) ✦ “At the moment of truth—in store, online and elsewhere—consumers are making a choice and a choice that is heavily influenced by brands with a social purpose,” said Amy Fenton, global leader of public development and sustainability, Nielsen. “This behavior is on the rise and we are seeing this manifest into positive impact in our communities as well as share growth for brands.”[Nielsen, 2014] ✦ March 2014 year-over-year analysis show an average annual sales increase of 2 percent for products with sustainability claims on the packaging and a rise of 5 percent for products that promoted sustainability actions through marketing programs. A review of different brands without sustainability claims or marketing shows a sales rise of only 1 percent[Nielsen, 2014] ✦ listens to music frequently and believes that it is important in their day-to-day lives ✦ Places high importance on internet usage and video streaming on-the-go. Tend to use a lot of data. Sprint Spark can and will fulfill this need. ✦ Are driven by price and data options.
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Selling Idea Platform
✦ video spot to be used primarily on social media to increase engagement and reach target market effectively ✦ emotionally appeal to consumer’s who care about sustainability ✦ spread awareness about Sprint Spark in major cities and their affordable pricing Reach [See Figure 2.3] ✦ mobile Facebook timeline ‘sponsored content’ posts ✦ Instagram ad snip-its ‘sponsored content’ posts ✦ air through traditional television ads and on streaming sites such as Youtube and Hulu ✦ Tumblr autoplay video ads Video Spot: ✦soundtrack: cuts from “Comes and Goes” by Gregg Laswell ✦opening scene girls surfing on a Southern California beach (far away) ✦ hyperlapse of beaches quickly going to ruins from pollution ✦cut to a cityscape scene, with people on phones lighting up everywhere ✦“we don’t need to give up this to achieve this” with Sprint, you can connect sustainably ✦cut to cityscape with electronics lighting up everywhere ✦“with Sprint you can connect faster”- one girl sends several people a video message of her surfing- clicks open on phones and tablets of several friends ✦with Sprint you can connect cheaper, with unlimited data only $50 a month you can connect where ever, whenever, and however much you need ✦ the girls and guys looking happy running into waves on the beach “Keeping your world healthy and your wallet heavy. Happy Connecting, Sprint.”
Brand Objective
Create a competitive advantage over AT&T and Verizon by segmenting the market Differentiate Sprint from T-Mobile by competing on more than price Position Sprint as the cell phone provider of choice for young savvy city-dwellers Shed negative image as a ‘low-quality provider’ by highlighting their new Spark technology in the markets where it is available Campaign Credibility: ✦ Sprint Spark is the fastest network on the market and is designed to stream videos and music efficiently. It includes HD voice, which improves sound quality and uses noisecanceling technology to reduce background noise disturbing calls. ✦ Sprint offers unlimited data plans (unlike AT&T and Verizon) and their plans are cheaper. ✦ Sprint is the most ‘eco-focused’ wireless carrier. They were awarded this title in January 2014 by Compass Intelligence at the International Consumer Electronics Show. [Environmental Leader, 2014] Communications Interrelations: ✦ Sprint already advertises their sustainability and their Spark network but they are using a ‘mass mindset’ ✦ Sprint offers Spotify Plus free for a year to new subscribers. This synchs well with their Spark coverage, which is meant to improve streaming offerings, and it appeals well to the target market of the retargeted ‘happy connecting’ Campaign. ✦ ✦ ✦ ✦
! of 10 5 ! Figure 1.0: U.S. Carrier Market Shares
[Source: http://www.gsmarena.com/verizon_and_at_t_hold_34_of_us_mobile_marketnews-8672.php] Figure 1.1 U.S Market Spend on Telecom Services by Country
! of 10 6 ! Figure 1.2 U.S. Smartphone Market
[Source: “Mobile Milennials: Over 85% of Generation Y Owns Smartphones�, Nielsen 2014: http://nielsen.com/us/en/insights/news/2014/mobile-milennials-over-85-percent-of-generation-yowns-smartphones.html] Figure 1.3: Cell Phone Service Satisfaction/Dissatisfaction Trends
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[Source: Self-Disruption:How Sprint Blew It, Telco2.0 Research http://www.telco2research.com/ articles/EB_telco2-self-disruption-how-sprint-blew-it] Figure 1.4 Sprint Nationwide Coverage
[sprint.com]
Figure 1.5 2014 Revenue for US Cell Phone Service Providers
! of 10 8 ! [source: JackDown Research Analysis 2014: http://www.beyonddevic.es/2014/05/01/uswireless-market-analysis-q1-2014/] Figure 2.0
[Source: “It Pays to Be Green: Corporate Social Responsibility Meets the Bottom Line”, Nielson 2014: www.nielsen.com/us/en/insights/news/2014/it-pays-to-be-green-corporate-socialresponsiblity-meets-the-bottom-line.html]
Figure 2.1 Demand [for] streaming music services such as Spotify, YouTube or Vevo (41%), and curated streaming music services such as Pandora or iTunes Radio (36%). These new technologies also support music sales. For those digital music consumers listening online or through a mobile device, 18% have purchased a song while streaming it. Smartphones are the third most popular device used to listen to music behind radios and computers, but their effect on music listening is growing. Smartphones allow consumers to access music on their terms and in the palm of their hands, and more than 7 in 10 Americans now own one. This growth affects music sales, too; 39% of smartphone owners purchased music on such a device in 2014, up from 34% a year ago. [Source:“MUSIC 360: Americans Make Music their Top Entertainment Choice” in Media and Entertainment, Nielson 2014]
! of 10 9 ! Figure 2.2 Measurement of Major US Cell Phone Providers Social Media
[Source: http://blog.ubervu.com/social-media-face-off-att-vs-verizon-vs-sprint.html] Other Sources: sprint.com DailyTech “Sprint is Almost Out of the Red But Still Bleeding a Few Customers” http://www.dailytech.com/Sprint+is+Almost+Out+of+the+Red+But+Still+Bleeding+a+Few +Customers/article34821.htm AdWeek, in advertising and branding, “Sprint Narrows Broadcast Search to Final Two Agencies” http://www.adweek.com/news/advertising-branding/sprint-narrows-broadcast-search-final-twoagencies-160763 BusinessInsider 2014 “Verizon vs. ATT vs. Sprint vs. T-Mobile Carrier Plan Pricing 2014” http://www.businessinsider.com/verizon-vs-att-sprint-tmobile-carrier-data-plan-pricing-2014-9 NDSM Observer 2011 “Sprint CEO Talks Cell Service”
! of 10 10 ! http://ndsmcobserver.com/2011/03/sprint-ceo-talks-cell-service-at-nd/ BizJournals 2014 “Sprint Recognized as Most Eco-Friendly Carrier” http://www.bizjournals.com/kansascity/news/2014/01/09/sprint-recognized-eco-friendlycarrier.html?page=all Ericsson 2013 “10 Hot Consumer Trends Report 2014” http://www.ericsson.com/res/docs/2013/consumerlab/10-hot-consumer-trends-report-2014.pdf EnvironmentalLeader.com January 2014 “Sprint Most ‘Eco-Focused’ Wireless Carrier” http://www.environmentalleader.com/2014/01/13/sprint-most-eco-focused-wireless-carrier