More than marketing to make the Spark ignite

16:00, Feb 28 2014

A long time ago one of Telecom's head honchos interviewed me for a job. The interview was on one of the top floors of Telecom's (then) skyscraper headquarters in Auckland, in front of a killer view.

The general manager was clearly taken with the view, because that is all he looked at for the entire interview, so I had to address my answers to the side of his head. It's stuck with me because it's the only interview I've ever done with virtually no eye contact.

The other thing that stuck with me was his final question: "Do you like money? A lot of people make a lot of money at Telecom, mate." The insinuation was that if I wanted to make money, this was the place to be.

While this happened 20 years and three chief executives ago, I think this evasiveness, hierarchy and propensity to put money before customers are still part of the Telecom brand.

And I'm guessing they are part of reason current chief executive - Simon Moutter - decided it was time for a rebrand, along with evolution from being a "phone" company.

However while the motivation seems reasonable, the decision to go with "Spark" and the associated $22 million rebrand bill have flabbergasted many.


Putting the return on investment question aside, Telecom doesn't have a brilliant record when it comes to branding online.

Wind the clock back seven years ago and Telecom launched its online shopping mall, Ferrit.

Seeming, as it did, to be inspired by one of the most hated predators of native birds, Ferrit didn't immediately capture the hearts and minds of Kiwi consumers.

While estimates vary, the consensus is that Telecom ploughed $30m into Ferrit, before incoming chief executive Paul Reynolds knocked the dollar-munching ecommerce rodent on the head in January 2009.

Apart from paying its advertising agency to write apparently independent reviews of Ferrit products, the digital rocket scientists at Telecom made another blunder as well. They failed to do a quick check of similar websites.

The case in question was which was a global pornography website.

No one at Telecom had checked the URL neighbourhood it had moved into, with the result that Telecom was forced to buy the sex site and shutter it.

Wondering if Telecom had learnt their lesson, I had a click around. The first thing I came across was which is a communist revolution website where the home page reminds us that "the emancipation of the working class will only be achieved by the working class itself"'.

But it gets better, is an adult dating website positioned as a fun site for serious daters and proudly promises to be "the #1 way to jump-start your love life", perhaps not exactly what Moutter has in mind. on the other hand is an inactive URL originally registered to Telstra Clear then transferred across to Telecom's arch-enemy Vodafone after they acquired Telstra in 2012.

Putting aside the colourful collection of digital companies with similar names, it's timely to return to the question of return on investment, one that interests me as a Telecom shareholder.

The real cost here isn't the $22m Telecom is spending on the rebranding, rather it is the lack of return on that investment if the company fails to deliver on its new brand promise.

Trying to crystallise exactly what that promise is from public-facing documents suggests the newly branded company is about "life, energy and the creativity of New Zealanders".

According to the fizzy statements on their website, Spark is meant to reflect a new energy in the business and a faster pace it will operate at.

That's going to have be a bit quicker than the current sluggish pace of its response when my wife rings them to let them know our ADSL home internet has gone glacial.

And it's going to have to be a hell of a lot quicker than the seven weeks it's taken for their media relations team to respond to a media inquiry from me.

That's the bottom line really. Corporate brands have two parts - prescriptive and descriptive.

Prescriptive is the part that starts with branding experts and involves orchestrating desired brand values, proposition and essence that then gets rolled out by an army of consultants and media-buyers.

Descriptive is the actual experience that people have with the organisation - the honesty of its claims, the service from customer support, the tone of contractors and the quality of the service.

If the distance between the prescriptive and the descriptive is too much, the brand becomes a mockery.

Right now the whole exercise feels like it's been captured by the army of marketers and agencies that will be among the beneficiaries of the $22m.

For Moutter to deliver on the brand promise will have little to do with them and everything to do with service delivery.

I know he's got some good people - his operational security people are among the best in the industry - he just needs to give them the means to deliver excellent service.

As a Telecom shareholder I hope he succeeds.

Mike "MOD" O'Donnell is a professional director, ecommerce manager and author. His Twitter handle is @modsta. He never did get offered the job at Telecom.