Anatomy of a CLEC Ad Campaign

When it comes to selling just about anything, including apparently telecom services, dogs are almost as sure fire a bet as scantily-clad young women.

So it's not surprising that one of the best in a series of new direct mail pieces from Princeton NJ-based residential CLEC and cable television provider RCN Corp. (www.rcn.com) features an elegant-looking canine lounging on a plush sofa with his stuffed toy, raptly watching TV.

The headline: "Now anyone can enjoy the advantages of having connections."

Inside, the glossy flyer outlines RCN's one-bill, bundled ResiLink packages. RCN claims to be the only company, at least in its market areas - Boston, New York, Philadelphia, Chicago, San Francisco and Washington DC - that can offer cable TV, local and long distance telephone and high-speed Internet access, all on one bill.

The direct mail pieces are part of a multi-million-dollar "marketing initiative" launched in early June by RCN and its new ad agency of record, the Chicago office of Laughlin/ Constable. The campaign's catch phrase: Advantage you.

At a time when other CLECs are struggling or expiring, RCN, a company partially funded by Microsoft chairman Paul Allen and now listed on the NASDAQ exchange, apparently has money to burn. It recently announced $100 million in private placement funding.

"It's a very exciting time for us," says the company's vice president of marketing Marc Miller, the mastermind behind the new campaign. "When a lot of CLECs are just holding on, we're looking to get deeper into our markets and show the real advantages of our network."

The secrets of RCN's success in dark times may be the subject for another column. Suffice to say that the company is facilities based, has gilt-edged backing, a distinctive offering, a cagey strategy of concentrating on a select few of the most densely populated markets in the country and aggressive management.

That would probably be enough. But a big ad campaign can't hurt.

The marketing program will cost the company between $12 and $15 million in annual media buy and direct mail costs alone. Miller won't say how much the creative cost.

While the mass media coverage includes the usual gamut of billboards, transit sides, newspaper ads and radio spots, it is highly targeted. Out-of-home ads - billboards etc. - only appear in neighborhoods RCN's network passes and that it's targeting.

And direct mail to targeted zip codes represents fully 60 per cent of the spend. In the first phase, the company sent out between 750,000 and 1.5 million mailings.

In fact, the more targeted nature of the campaign is one thing that differentiates it from past marketing efforts at RCN. "What we're really honing down to now is how to reach the people that can actually act on our message," Miller says.

The message is also subtly different. In the past, RCN stressed the simple fact that there was an alternative to the former monopolies, and that it was RCN, and that RCN was in a battle with those incumbents.

"In the new campaign," Miller says, "we're building on that and starting to talk much more directly about the benefits RCN offers, how it solves people's communications problems, how it answers their needs and how we can be a partner, the one company for all their needs."

That message - with its "advantage you" refrain - was developed in a highly collaborative process with Laughlin/ Constable. "When you work with a good agency it's a great interactive process," Miller says. "You almost want to capture some of it in a bottle."

Not that Miller's team and the agency just sat around and brainstormed cute ad copy - although there clearly was some of that. The process also involved detailed analyses of the competition. And nothing was left to hunch.

"We talked a lot to both customers and non-customers and spent a lot of time not only thinking about what the message should be but finding out what resonated with customers and what would take us where we were trying to get."

The campaign team used focus groups, surveys and one-on-one interviews to test its ideas. And that process hasn't ended.

"We've continued to test with current customers and non-customer and hone the message," Miller says. "We believe it will have a lot of legs as a result. We'll continue to evolve it."

The campaign was developed relatively quickly in part because RCN did not have to go through a time-consuming agency review, or train its agency of choice on the business.

Laughlin/Constable had been the agency of record at 21st Century Telecom Group, a Chicago-based CLEC that RCN acquired last year. Miller came to RCN from 21st Century. The rest, as they say, is history.

"It was a time to respond quickly to the market," Miller says of RCN's decision to bypass an agency review. "When we realized we needed a new agency, they were the logical choice."

The campaign has two main objectives: to convert existing customers to RCN's bundled ResiLink service packages and, of course, to bring in new customers. Miller says the company will be able to measure the success of the campaign, though he won't reveal any of the targets the company has set.

"We do have a base line study or awareness in each community," he notes. "And we'll continue to do [those surveys] every six months to ascertain whether awareness is up or down."

For smaller, poorer CLECs, the kind of spending RCN is committing to this campaign and the level of sophistication may seem almost surreal. Who can afford not only the kind of media buying RCN is doing, but also the luxury of a top-notch agency?

The answer is: successful CLECs. And how do successful companies get to be successful? Well, in part it's because they commit themselves seriously to marketing and advertising.

Something to think about perhaps as you enter your next phase of fund raising.