As the split looms, Telecom gets ready to roll

  • Advertising
  • November 9, 2011
  • StopPress Team
As the split looms, Telecom gets ready to roll

With shareholders voting overwhelmingly in favour of splitting Telecom in two at the annual general meeting recently, the fall out from the "Abstain for the Game" campaign and the appointment of new marketing boss Jason Paris, change is most definitely in the wind for Telecom at the moment. And it's thought the first phase of that change is cranking into gear.
Telecom spokesman Mark Watts said he wouldn't comment on rumours and gossip, but as far as we can tell, Telecom is thought to be looking for a strategic partner to create the brand and brand architecture for the 'New Telecom' (which is still subject to High Court approval in mid November). Watts did say the rumours about a name change were untrue and the split entities will remain as Telecom and Chorus.

The project is not thought to involve any ad agencies at this stage, but there are plenty of brand consultancies and design shops inside the big networks that will be keen as mustard to get their hands on the trophy in an effort to grease the wheels for their agency cohorts. The full-blown creative pitch the industry has long been waiting for is expected to take place early next year.

Saatchi & Saatchi global chief executive Kevin Roberts endorsed the ham-fisted abstain campaign and, as a Telecom board member, has fought hard to retain the business over the years. Despite many in the industry deeming his position to be a conflict of interest, he was re-elected onto the Telecom board of directors recently and, given its size (according to Nielsen, Telecom's ad spend was close to $80 million in 2005, but that was down to just over $30 million in 2010) and importance to the agency, it's fair to assume he and the team will continue to fight hard for it.

During Paris' stint with TVNZ, he was responsible for pulling the plug on its long-running contract with Saatchi & Saatchi and moving it to Colenso. The agency had a seemingly fruitful relationship with Paris and Colenso has plenty of telco experience with one of Telecom's main rivals Vodafone, although things didn't end so well after it moved the account up to .99 during the current pitch, the outcome of which will probably determine who will be in if Telecom goes up for grabs.

DDB has been spading Telecom for years and already controls its direct and digital marketing through Rapp Tribal, so it's another likely contender.

None of the agencies would comment.

Telecom hasn't had much luck with its new business ventures of late. There was the failed TiVo foray with TVNZ, ferrit.co.nz, which died a horrible death, and back in April it ditched its 49 per cent stake in web portal Yahoo!Xtra because it didn't perform as expected. But there are a few silver linings. Vodafone has had a horror run with the Commerce Commission and the ASA recently, and while Telecom's total mobile customers dropped to 2.097 million at the end of June, down from 2.192 million three months earlier, it added 173,000 customers to the now seemingly reliable—and, judging by Saatchi & Saatchi's latest comparative ad campaign, fast—XT network. It's also due to start selling the iPhone 4S and other models on Friday.

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