The Advertiser
July/August 1998

Taking Event Marketing to New Heights

Today, corporate partnerships, sponsorships and event marketing are big business, and AT&T is involved in a big way. Each year, large portion of our total advertising and marketing budget is spent in connection with sporsorship events of every type - from local to global.

But as resources for developing partnerships grow ever scarcer, the ability to leverage our sponsorships to the fullest has become increasingly important.

Awareness was once the goal

At one time, our goal was simply to stimulate awareness through promotions and sponsorships. Then, with tighter funding and greater competition in the telecommuncations industry, we realized that events could be more than an awareness tool - they were useful for generating sales, too.

This worked for us because there's a lot of strength in the AT&T brand - in fact it's one of the top ten in both the consumer and business markets. It's one of our greatest assets - one that we're naturally very proud of.

Our reputation as a top-ranked marketing organization is built largely on the strength of our brand, as well as on our strength as an advertiser. What people often miss, however, is our strength as a direct marketer. By using databases combined with DM techniques - outbound, inbound and direct mail - we've become one of the permiere DM companies in the United States, if not the world. It's one of our core marketing competencies and one of the primary ways we drive business or, as we say in our industry, "put minutes on the network."

Event marketing evolves

I have always found it a bit surprising that AT&T's strength as a direct marketer hasn't been more widely recognized. But since direct marketing is my background, I suppose I'm somewhat biased. In any case, the challenge for me was to combine our strength as a database marketer with our involvement in sponsorships and events - and make it complementary to our DM efforts. We watned to create yet another phase in the evolution of event marketing.

The beauty of this convergence, as it began to crystalllize for us, was that more than ever before it would help us leverage our sponsorships and create a higher degree of competitive advantage for AT&T.

Data-driven promotion - as we call the concept - is all about collecting data from customers or potential customers, and then using this information to create offers that are relevant and that we can target to specific segments of our market.

This isn't 1984...

It's not exactly a coincidence that we were developing this latest phase of event and promotion marketing just as AT&T's overall consumer marketing strategy was undergoing a major overhaul.

Until recently, AT&T used a consumer marketing approach that hadn't changed much in the years since the 1984 break-up of the Bell System: We offered a whole range of telecommunications products to a whole range of consumers. It was an approach that had worked well for us for a many years. But a few years ago, ever-increasing competition in the industry forced us to reevaluate this strategy.

It didn't take much to see that we needed to make some dramatic changes in our efforts. Rather than giving our products priority, it was our customers who needed our attention. Rather than letting customers figure out what were the right products for them, we wanted to understand their needs and give them offers to meet those needs. Thus was born AT&T's customer-segment marketing focus.

The NBA Shootout - a data-driven success story

With its ability to target specific customers, our new data-driven promotions techniques dovetailed perfectly with our new consumer strategy.

Let's take a look at one of our most successful recent events - the AT&T $2 Million Shootout sweepstakes - to illustrate how we use data-driven techniques.

AT&T has partnered with the National Basketball Association - the NBA - since 1992, when we signed a multi-year agreement to become the league's official telecommunications sponsor. In addition, we worked out promotional agreements with many NBA teams, giving us the opportunity to hold local and regional promotions with an NBA theme. We even developed a series of AT&T PrePaid Cards featuring images of 58 different NBA players.

The Shootout sweepstakes was another outgrowth of that partnership. The event took place during halftime of the second game of the 1998 NBA Finals in June in front of a cheering live audience and millions of television viewers. One randomly selected winner, after being flown in Salt Lake City, was given the opportunity to shoot from the three-point line - with a chance to win up to $2 million for making five shots. (Our winner, by the way, sank one of five shots and came away with $250,000.)

The benefits of having the AT&T brand in broad display during such a prestigious sporting event as the NBA Finals are obvious. But what was even more important to us was our ability to target our marketing efforts toward important consumer segments throughout the entire promotion.

We advertised the sweepstakes for five weeks during the end of the NBA season using an integrated media approach that included television, magazine, newspaper, in-arena and Internet banner ads. TV ads were aired during NBA broadcasts during slots we had previously negotiated as part of our sponsorship deal. Magazines included Sports Illustrated and ESPN Magazine. Our banner ads appeared on the NBA Web site and linked to a special AT&T site. The key message for all media was the same - to encourage basketball fans to enter the Shootout sweepstakes by calling a toll-free number: 1-888-6-FINALS.

More than a million sales leads

We received more than one million calls during five weeks of advertising - significantly exceeding our expectations.

What did we learn from those calls and how did we use the information?

Callers were prompted by an interactive voice response (IVR) system to enter their home telephone number. Immedidately, our database set to work to determine whether this was an AT&T customer and, if so, what services the caller purchased from us. During the short time the database was being searched, we kept callers busy with requests for more information - Were they college students? Were they in the military? Were they AT&T customers? (Although we were able to determine this from our databse - we asked for the information anyway to help speed the call down the approriate path.)

At this point, we had already learned lots of important information about the caller. But above all, we knew our caller enjoyed basketball. Later this information would be key in helping to create a relevant offer for that particular customer.

But the call wasn't over yet.

Through IVR, college students were led through a path to identify their school and housing situation (on or off campus). They could choose to speak with a live agent for further information on AT&T offers especially for students.

Military personnel were channeled through another path and given the opportunity to learn about AT&T offers especially for them.

Non-AT&T customers could opt to transfer to a live agent for information about an NBA-related offer - the AT&T PrePaid Card with an NBA theme.

Callers who were identified as AT&T customers were asked for information about their commuting habits and home computer ownership. By this time, our database had also determined which of our consumer segments the customer fell into and his or her average monthly bill. This allowed us to further direct calls and to give customers offers appropriate for thie segment and calling volume. Ourmost valuable customers were offered a special plan giving them half-price calling on weekends during the NBA playoff games.

And now for the follow-up...

By the conclusion of the call, we had had an opportunity to offer most callers AT&T products geared to their needs. But that's not the end of the story. We were now able to follow up on the additional data we had collected.

We used direct mail for follow-up offers. For example, callers who indicated a commuting distance of more than 30 minutes were offered an AT&T Wireless Services plan. Callers with a PC were sent a CD-ROM that will enable Internet access through AT&T WorldNet® service. College students were sent an offer for an AT&T calling card.

Although it's too soon for a complete analysis of the results of the NBA Shootout event, we have gained thousands of new sales already. And previous testing indicates that we can expect a higher response to the follow-up mail program - as much as 80 percent greater than cold direct mail.

Putting people in motion

In general, we've found that our new approach to events marketing helps us accomplish one of the hardest tasks marketers face: putting people in motion. When callers got out of their seats to pick up the phone and enter the Shootout sweepstakes, we were already over a hurdle. And in the telecommunications services industry, getting people to take action really is a big hurdle.

People normally shop for telecom services only when they have a real need, like when they move to a new home, or when a telecom provider calls them (usually at dinnertime, of course) to make a pitch. The consumer who proactively calls his long-distance company to ask about opportunities is a rare bird indeed.

But data-driven promotions can turn outbound cold calling into inbound, in-motion calling. As a result, we're convinced that this is the best technique yet for improving business results using value-added promtions and events.

Of course, it takes a lot of preparation to make it work. We spent about a year developing the concept before we put it to actual test.

One of the challenges is that, commonly, large companies and ad agencies are compart mentalized. There's the promotion department, the DM organization and the sponsorship group - and they're not exactly used to working together. Getting them integrated requires some effort. But based on our experience, I recommend that you find a way to integrate those groups within your own organization or look to your agency to provide the integration.

Of course, I've made the assumption that you've already selected the right partner for your promotion. Some readers may recall that in an earlier issue of The Advertiser, I described AT&T's approach to event marketing as a long-term commitment to a partner, similiar to a marriage. At tha time - about two years ago - our primary concern in even marketing was to select sponsorship partners whose brand image complemented our own. I talked about how we wanted to create a partneship that had the ability to be a strategically competitive tool.

That's still true. But what's changed is that data-drive promotions, give us an even greater abiilty to leverage our promotions. Selecting a partner is perhaps more critical than ever, but the end results make it worth investing the extra effort.

Data-driven promotions are clearly in the future of AT&T's sponsorship and promotions program. We plan to continue our work with the NBA and other partners where data-driven promotions have already proven themselves. And we plan to braoden our work to create more events that help us leverage our partnerships to the fullest - because it's a win-win-win situation: a win not only for us and our partners, but a win for consumers as well.

Earl Quenzel is AT&T's education markets vice presicent with responsibility for leading AT&T's effort to privide cutting-edge communications solutions for the univerity marketplace, including students, faculty and administraion. Previously he lead the organization responible for AT&T's loyalty programs, sponsorships and partnership events.