An Integrated Marketing Communications Plan

Alexis Neel | Katie Shive | Jessica Taylor | Trevor York

TABLE OF CONTENTS

Executive Summary

Strategic Summary Chart

Company Info

Product Analysis 1

Secondary Research

Competitive Analysis 2

SWOT Analysis 2

Target Market Analysis 3

Marketing Strategy

Marketing Objectives 5

The Big Idea 5

Media & Creative Plan

Mobile Application 6

Promotions 6

Social Media 7

Viral Videos 7

Media Objectives 8

Media Outlets 8

Evaluation 10

Appendices

DIRECTV Package Offerings 11

Competitive Analysis Chart 12

Detailed Budget Plan 13

Return on Investment Projections 14

Creative Samples 15

References 22

EXECUTIVE SUMMARY

DIRECTV’s Refer a Friend program is a unique promotion offered only to current

subscribers. Although this program accounts for a small portion of overall newly acquired

subscribers annually, the value of every new customer is significant in relation to customer

lifetime value and churn. Ultimately, DIRECTV must increase program usage amongst existing

subscribers as a means to boost total company sales. This integrated marketing campaign will

focus on increasing the number of subscriptions driven through the Refer-A-Friend program.

This will be done by motivating and engaging current DIRECTV subscribers through the Refer a

Friend mobile application and website in order to facilitate referring activity, as well as promote

repeat referrals.

The total campaign budget is $1,000,000 with full national reach of all 20 million current

subscribers. The current subscriber base will be reached through various media platforms

including: Facebook, Twitter, Instagram, YouTube, direct mail, e-mail, and text message. The

campaign’s big idea, “My DIRECTV 100”, will encourage current subscribers to refer

individuals in order to receive the savings and benefits the referral program offers. Moreover,

additional promotional codes will be distributed to subscribers bi-annually. The mobile app and

website will facilitate referring activity and make it easy for subscribers to use the program.

DIRECTV will concentrate its efforts toward its current subscribers. Within that broad

customer base, Millennials (ages 20-37) will be targeted specifically due to their value seeking

and tech-savvy behavior. Due to this target market’s value-seeking behavior, individuals will be

drawn to the savings offered by DIRECTV. Ultimately, DIRECTV’s goal of increasing the

number of participants in Refer a Friend program from 10% to 25% will be achieved.

STRATEGIC SUMMARY CHART

Research Findings Corresponding Strategies

“Millennials place the highest importance on getting value for their money and on having a positive purchase experience” (O’Donnell, 2014).

Make the Refer a Friend program easy and convenient to use, thus ensuring the overall purchase experience is positive for current subscribers.

Millennials are the most “tech savvy generation, are the most open to trying new apps, recommending them, and even paying for them (Erwina, 2014). “More than half of mobile app users report light usage (four hours per week or less). This suggests that the majority of apps need to provide value within short usage time windows” (Harmond, 2014).

Create a program-specific mobile application where current customers can refer individuals and track the number of referrals made and total discounts received.

39% of Millennials aged 25-34 use as many loyalty programs as possible. More specifically, Millennial men are “more likely than consumers in other segments to adjust their behavior in order to get the rewards they want” (Kaiserman, 2013).

Make the promotional campaign digitally integrated through the addition of a mobile app and better social media management will attract this target market.

Due to the economic downturn in 2008, the use of loyalty programs significantly increased as consumers looked for ways to save money on everyday household products and services (Fay, 2010).

The “My DTV 100” campaign emphasizes how individuals can use the money they save from using the referral program. Additional promotional codes will be distributed biannually for even more savings.

According to Billy Hulkower (2014), 24% of networkers with 200 or more friends will only follow a company if they are having a promotion or sale.

The campaign should focus on the benefits the customers and referred individuals receive using the Refer a Friend program, so we will create a hashtag on all social channels that allow others to share their story.

82% of homes in America currently pay for television service, and of that percentage, 43% are happy with their current service (Hulkower, 2014).

Create additional promotional codes in the amount of $10, $25, and $50 and distribute to subscribers who refer individuals to sign up with DIRECTV.

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COMPANY INFO

DIRECTV was founded in 1990 and began offering digital entertainment to households and

businesses across the United States in 1994 (A Brief History of DIRECTV). DIRECTV quickly

became the industry leader by the end 1995, boasting more than one million satisfied customers.

DIRECTV disrupted the satellite television industry and continues to incorporate new innovation into

its product offering. High definition technology was introduced in 2007, as well as connectivity to

the Internet (About Us: Company Profile). Today, DIRECTV is one of the largest premiere digital

television service providers in the United States, offering high-definition entertainment to more than

20 million households and businesses (Marketing Edge, 2014).

DIRECTV’s Refer-A-Friend program is a unique promotion offered only to current

subscribers. Although this program accounts for only a small portion of overall new subscribers each

year, the value of every new customer is significant in relation to customer lifetime value and churn

(Marketing Edge, 2014). Ultimately, DIRECTV must increase program awareness amongst existing

subscribers as a means to boost total sales.

Product Analysis

DIRECTV offers customizable packages for all types of entertainment enthusiasts—ranging

from babies to grandparents, movie lovers to die hard sports fanatics. Subscribers of DIRECTV can

enjoy more than 285 channels, all of the latest Hollywood hits, and sports packages that no fan can

deny (About Us: Our Company). DIRECTV offers six different base packages, ranging in price from

$19.99-$87.99. Subscribers may enhance any package offering with additional upgrades for an extra

fee. Customizability is an attractive quality to customers because they ultimately get to choose a

package that fits their budget. All plans are charged monthly and require a contractual agreement.

(Review Appendix A for more detailed information.)

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SECONDARY RESERACH

Competitive Analysis

Competition in the market is fierce and companies are vying for market share. DIRECTV’s

competition comes from television service providers, such as Dish and Comcast. Secondary

competition comes from online video distributors, such as Hulu and Amazon Instant Video.

Currently, DIRECTV holds approximately 20% market share in the United States

(DIRECTV Annual Report, 2013). Although this number is larger than other competitors, the

company is still fighting to keep current subscribers, while at the same time gain new ones. Two

ways the company does this by offering the more HD channels and exhaustive sports packages.

Although Dish and Comcast offer lower average monthly rates, neither company has nearly close the

amount of HD channels or sports packages. A competitive analysis chart is provided in Appendix B

for further reference.

SWOT Analysis

The strengths of DIRECTV include: a large subscriber base (holding 20% of the market share

in the United States), high brand recognition, strong customer satisfactions rates, substantial channel

capacity, and exclusive programming content. Some weaknesses of the company include a lack of

intrigue of customers for the Refer a Friend program, the requirement of an annual contract, and

higher package prices over competitors, such as Dish and Comcast. If customers must sign an annual

agreement, many may be turned off from using the service, especially if they are value-seekers.

Opportunities for DIRECTV include higher user-involvement through subscriptions and user

expectations, such as High Definition television and recording capabilities, as well a rebounding

economy, which allows for more disposable income and the purchasing of luxury items, such as

DIRECTV. One threat the company faces is the recent joint marketing agreement between Verizon,

Comcast, Time Warner Cable, Cox, and Brighthouse Networks. This huge merger has high

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credibility and a large customer base. As well, the television industry is dramatically being

influenced by technology advancements. Some new improvements include: remote viewing, HD

channels, and 3D capabilities. These rapid changes are threats to DIRECTV. Another threat the

company faces is the increased cost of satellite services for all providers (DIRECTV, 2014). Finally,

demand for online distributors, such as Hulu, Amazon, Roku, and Apple is increasing in popularity

annually, leaving less market share for satellite service providers.

Target Market Analysis

According to DIRECTV, its target audience is current subscribers— specifically new

customers who have just come onto the platform, customers who actively participate in referral

programs, customers who have positive experiences with DIRECTV, and value seekers looking

for ways to save money on their bill. Based on the secondary research conducted, the findings

support DIRECTV’s target market. Therefore, the primary target market for this campaign will

focus on Millennials who are current DIRECTV subscribers, are satisfied with their service, and

ultimately seek out value when making purchase decisions.

Millennials make up the largest share of the US population, accounting for approximately

25%, or 80 million people (O’Donnell, 2014). This group ranges in age from 20 to 37 years old.

Millennials have a significant influence on today’s consumer market because they are quick to

adopt new technologies. According to Ika Erwina (2014), Retail & Technology Analyst for

Mintel, Millennials are the most “tech savvy generation, are the most open to trying new apps,

recommending them, and even paying for them.”

Fiona O’Donnell, a Category Manager for Mintel, states that Millennials often seek out

value when making purchases because their annual income-to-expenditure ratio is nearly even

(O’Donnell, 2014). Furthermore, “Millennials place the highest importance on getting value for

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their money and on having a positive purchase experience” (O’Donnell, 2014). One primary

source of value comes from loyalty programs. According to Robyn Kaiserman (2013), Financial

Services Analyst for Mintel, 39% of Millennials aged 25-34 use as many loyalty programs as

possible. More specifically, Millennial men are “more likely than consumers in other segments

to adjust their behavior in order to get the rewards they want” (Kaiserman, 2013). At the same

time, Millennial women prefer purchasing products and services at a discount (O’Donnell,

2014).

Due to the economic downturn in 2008, the use of loyalty programs significantly

increased as consumers looked for ways to save money on everyday household products and

services ( (Fay, 2010)Fay, 2010). According to Kat Fay (2010), consumer research analyst for

Mintel, many companies who created these loyalty programs found the following characteristics

useful in maintaining a strong customer base: focusing on making customers even more loyal,

incorporating core strategic value and not just making a transaction, focusing on the individual,

enabling new technologies, and empowering employees to meet customer needs.

Customer satisfaction is pivotal in retaining customer membership. If customers are

unhappy with their service provider, they will seek alternatives, which results in loss of revenue

for the provider. According to Billy Hulkower (2014), a Senior Technology Analyst for Mintel,

82% of homes in America currently pay for television service, and of that percentage, 43% are

happy with their current service.

MARKETING STRATEGY

The strength of DIRECTV’s marketing strategy will be based upon the premise that the

program is easy to use, offers significant value to subscribers and referred individuals, and has a

strong emotional appeal.

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DIRECTV offers the Refer a Friend program to all current subscribers. For every

successful referral made, the subscriber and the friend receive $100 off their bill in the form of

$10 credits over a 10-month period. The value of a referred customer, as opposed to a non-

referred customer, is most beneficial for DIRECTV in the form of lifetime value and churn

(Marketing Edge, 2014).

Although awareness of the program is high among current subscribers, less than 10% use

the program, those who do only refer once (Marketing Edge, 2014). The main objective for the

“My DTV 100” campaign is to increase the number of referrals through the program.

DIRECTV will use the “My DTV 100” campaign to encourage engagement in the Refer

a Friend program by allowing subscribers to envision what they could do with the $100 they will

save off their bill, which provides emotional appeal to the program.

Marketing Objectives

• Increase the number of current subscribers participating in the referral program from 10% to 25%

• Increase the number of average multiple referrals to 20% • Increase the overall number of DIRECTV subscribers by 25%

The Big Idea

The “My DIRECTV 100” campaign is designed to increase the number of subscriptions

driven through the Refer a Friend program by focusing on motivating existing DIRECTV

subscribers to increase referral activity. This will be done in three ways:

1. Streamline Refer a Friend Program – the Refer a Friend program needs to be easy and

convenient to use for existing and potential subscribers. Creating a mobile application

will allow current subscriber to refer friends easily. As well, the web page will be

redesigned to be user-friendly, making it easier for individuals to sign up after being

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referred. The web page will also explain the “My DTV 100” campaign. The homepage of

DIRECTV’s main site will have a pop-up ad informing current subscribers of the Refer a

Friend program, and when clicked on, will direct them to the program’s web page.

2. MyDTV100Codes – Discount codes will be distributed bi-annually to existing subscribers

through direct mail, e-mail, text message, and the mobile application. The discount code

can be easily shared with friends. The friend will enter in the discount code at time of

sign-up. This will allow both the current subscriber and friend to receive a discount in

addition to the current offer.

3. “How will you spend your $100?” – A series of Internet videos will be created to show

how easy it is to refer a friend, as well as the benefits of saving $100. Social media will

also be used to showcase the benefits of using the referral program.

MEDIA & CREATIVE PLAN

Mobile Application

The mobile application is strictly for the Refer a Friend program. Current subscribers can

refer individuals through the delivery of a personalized email or text message. The dashboard in

the app will show subscribers the number of referrals made, as well as how much has much

money has been saved as a result of program participation. Information will be sent to the

referred individual, directing them to the website. Lastly, there will be a social feed inside the

mobile application, combining Facebook, Twitter, and Instagram posts using the #MYDTV100.

Promotions

Current subscribers will receive “MyDTV100Codes” bi-annually in addition to the

current $100 discount offer. The code will be delivered through direct mail, e-mail, text message

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and messages in the mobile application. Codes will only be available for use during a limited

period of time. Upon signing up for DIRECTV service, the referred individual will be given the

option to enter the provided discount code. The discount amount will be revealed at time of sign-

up. A discount amount of $10, $25, or $50 will be will be deducted from both the subscriber and

referred individual’s next monthly bill.

Social Media The goal of social media is to create awareness around the benefits of the program.

According to Billy Hulkower (2014), 24% of networkers with 200 or more friends will only

follow a company if they are having a promotion or sale. The “My DTV 100” campaign allows

customers to envision what they could do with $100 dollars, as well as share the benefits of the

Refer a Friend program with their online contacts. Facebook and Twitter will be used to explain

the “My DTV 100” campaign and encourage customers to share stories of how they spent their

$100 through the #MyDTV100. Instagram will showcase the “Pic of the Week” under the

#MyDTV100, which will display photos from current subscribers.

Viral Videos

A video series called “How will you spend your $100?” will be created and posted on

YouTube. A 30-something working professional male will be the main character of this series.

The introductory video will show the man explaining the “My DTV 100” campaign, as well as

introducing the new mobile application. A new video will be posted weekly, which will show the

man continually referring friends. Ultimately, this will lead to an overall improved lifestyle due

to the money he is saving. This video series will show over exaggerated, yet comical situations.

The videos will be distributed through all social channels.

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Media Objectives

• Have 1 million subscribers download mobile application in a 12-month period • Have 1 million hits on the YouTube video in a 12-month period • Gain 100,000 “likes” on Facebook in a 12-month period • Gain 10,000 new “followers” on Twitter in a 12-month period • Gain 1,000 new “followers” on Instagram in a 12-month period

Media Outlets

Promotions

The MyDTV100Codes will be distributed bi-annually through direct mail, e-mail, text

message, and messages in the mobile application. This will be an additional incentive for

subscribers to use the referral program. $120,000 will be allocated to promotional codes.

Mobile Application

According to Bryant Harmond (2014), technology analyst for Mintel, “more than half of

mobile app users report light usage (four hours per week or less). This suggests that the majority

of apps need to provide value within short usage time windows.” The mobile application offers a

convenient means to quickly refer friends. $150,000 will be allocated to the creation of a mobile

application.

Website

Referred individuals will receive a text message or e-mail from DIRECTV on behalf of

the current subscriber. They will be directed to the website, which will contain relevant

information necessary to sign-up. The current subscriber’s account number will be included in

the message to ensure the subscriber receives the bill credit. The website will also explain the

“My DTV 100” campaign and urge people to share their stories through social media. $50,000

will be allocated to redesign the website.

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Social Media

Facebook will be used to urge people to share their “My DTV 100” stories, and to display

a new videos from the “How will you spend your $100?” series. $50,000 will be allocated for a

Social Media Marketing Manager to oversee all channels. Twitter posts will coincide will all

Facebook posts. $50,000 will be allocated for a Social Media Marketing Manager to oversee all

channels. Instagram will be used to post user-generated content with #MyDTV100. $50,000 will

be allocated for a Social Media Marketing Manager to oversee all channels. A video series will

be created and posted to DIRECTV’s YouTube channel. A new video will be posted twice a

month. $75,000 will be allocated to create 24 videos and maintain the YouTube account.

E-mail & Text Messaging

E-mails and text messages will be sent to current subscribers monthly advertising the

Refer a Friend program, as well as explain the “My DTV 100” campaign. Newly acquired

customers will receive personalized e-mails and text-messages welcoming them to DIRECTV

and sharing the benefits of using the Refer a Friend program. Lastly, e-mails and text messages

will be sent to referred individuals, requesting them to sign-up. $25,000 will be allocated to this

media outlet.

Direct Mail

According to DIRECTV, 70% of its referrals come through direct mail. The direct mailer

will be redesigned to show current subscribers how to use the mobile app to refer friends. It will

also have a detachable card with the necessary information to give to individuals, who can then

sign up through the website. $500,000 will be allocated to redesigning direct-mail fliers.

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EVALUATION

During the campaign, the number of existing subscribers who use the referral program, as

well as the number of recently joined subscribers, will be measured. Google Analytics will be

used to track the number of signups through the mobile app and website. Hootsuite will be used

to measure engagement on all social media channels. The number of active likes, tweets, and

views, as well as the number of current subscribers, who are actively involved in sharing their

“My DTV 100” stories, will be measured as an indicator of campaign success. The #MyDTV100

will also be an easy indicator of social media engagement for this campaign.

Post-campaign, effectiveness will be evaluated through surveys distributed to participants

via e-mail, text message, and social media. The survey will measure satisfaction with the referral

program itself and whether the “My DTV 100” was effective in motivating them to use the

referral program.

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APPENDIX A

DIRECTV Package Offerings

PACKAGE OFFERINGS PRICE Select • 130+ channels

• FREE Genie HD DVR Upgrade • FREE premiums for 3 months

$19.99

Entertainment • 140+ channels • FREE Genie HD DVR Upgrade • FREE premiums for 3 months

$24.99

Choice • 150+ channels • 2014 NFL Sunday Ticket Max • FREE Genie HD DVR Upgrade • FREE premiums for 3 months

$29.99

Xtra • 205+ channels • 2014 NFL Sunday Ticket Max • FREE Genie HD DVR Upgrade • FREE premiums for 3 months

$34.99

Ultimate • 225+ channels • 11 extra movie channels • 2014 NFL Sunday Ticket Max • FREE Genie HD DVR Upgrade • FREE premiums for 3 months

$39.99

Premier • 285+ channels • Everything wanted in TV entertainment • 2014 NFL Sunday Ticket Max • Sports to the Max • FREE Genie HD DVR Upgrade • All premium networks

$87.99

Source:

DIRECTV Packages and Pricing. (n.d.). Retrieved November 21, 2014, from DIRECTV: https://www.directv.com/DTVAPP/pepod/configure.jsp?ACM=false&lpos=Header:3#package-section

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APPENDIX B

Competitive Analysis Chart

 

Package Price

Range

$19.99-87.99

$19.99-44.99

$30.15-99.99

$7.99

Pay-Per-Use

Minimum Term

Required

YES

YES

NO

NO

NO

Number of HD

Channels

199

96

104

N/A

N/A

Bundling Internet & Phone

YES

YES

YES

NO

NO

Sources:

About Us. (n.d.). Retrieved November 21, 2014, from HULU: http://www.hulu.com/about DIRECTV Packages and Pricing. (n.d.). Retrieved November 21, 2014, from DIRECTV: https://www.directv.com/DTVAPP/pepod/configure.jsp?ACM=false&lpos=Header:3#package-section Find Your Package. (n.d.). Retrieved November 21, 2014, from Dish: http://www.dish.com/dishdeals/ XFINITY TV- Comcast Digital Television Service. (n.d.). Retrieved November 21, 2014, from XFINITY: http://www.comcast.com/Corporate/Learn/DigitalCable/digitalcable.html

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APPENDIX C

Detailed Budget Plan

Campaign Period: January 1-December 31, 2015 Media Allocation: $850,000 Promotional Allocation: $120,000 Contingency Allocation: $30,000 Total Budget: $1,000,000

Media $ Amount Percent

Mobile Application- $150,000 15%

Website Re-Design- $50,000 5%

MyDTV100Codes - $120,000 12%

Social Media Manager - $50,000 • Facebook • Twitter • Instagram • YouTube

5%

Video Production (24 Videos) - $75,000 7.5%

Email & Text Message Platform- $25,000 2.5%

Direct Mail- $500,000 50%

Contingency Plan- $30,000 3%

Total- $1,000,000 100%

Sources:

How Much Should I Budget for a Website Redesign? (n.d.). Retrieved November 21, 2014, from Rocket Media: http://rocketmedia.com/blog/article/setting-budget-for-a-website-redesign#.VHAUslbR8b5

Mobile Forms and Applications Blog. (n.d.). Retrieved November 21, 2014, from Formotus:

http://www.formotus.com/14018/blog-mobility/figuring-the-costs-of-custom-mobile-business-app-development

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APPENDIX D

Return on Investment Projections

Return on Investment Proje

Total Customers Marketed To: 20,000,000

Total Program Projected Costs: $970,000

Cost per Impression: $0.05

Projected Response Rate: 25%

Projected Conversion Rate: 15%

Average Customer Spending: $420

Respondents: 3,000,000

Cost per Response: $.17

Total Revenue: $120,000,000

Return on Investment: 212%

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REFERENCES About Us: Company Profile. (n.d.). Retrieved October 3, 2014, from

http://www.directv.com/DTVAPP/content/about_us/company_profile A Brief History of DIRECTV. (2006, January 26). Retrieved October 3, 2014, from

http://ezinearticles.com/?A-Brief-History-of-DIRECTV&id=134763 Build Your Perfect Entertainment Package. (n.d.). Retrieved October 3, 2014, from

https://www.directv.com/DTVAPP/pepod/configure.jsp#package-section Comcast. (n.d.). Retrieved October 3, 2014, from

http://www.comcast.com/Corporate/Learn/Bundles/bundles.html DIRECTV. (2013). Annual report 2013. Retrieved from

http://investor.directv.com/files/doc_financials/annual/DIRECTV%202013%20Annual%20Report.pdf

Erwina, I. (2014). Mobile Apps - US - September 2013 - Infographic Overview. Infographic, Mintel.

Experience TV Like A King. (n.d.). Retrieved October 3, 2014, from

http://bit.ly/1vybv4f  Fay, K. (2010, January). Customer Satisfaction and Loyalty Programs - US - January 2010.

Retrieved November 21, 2014, from Mintel : http://0academic.mintel.com.innopac.library.unr.edu/display/482442/

Harland, B. (2014, October). Mobile Apps - US - October 2014. Retrieved November 21, 2014,

from Mintel: http://0-academic.mintel.com.innopac.library.unr.edu/display/679805/ Hulkower, B. (2014, October). Pay TV and Home Communication Services - US - October 2014.

Retrieved November 21, 2014, from Mintel: http://0academic.mintel.com.innopac.library.unr.edu/display/679803/

Kaiserman, R. (2014, March 31). Attract Millennials with Loyalty Programs. Retrieved November 21, 2014, from Mintel: http://0academic.mintel.com.innopac.library.unr.edu/display/700133/

 Marketing  Edge  (2014).  2014-­‐2015  Collegiate  Echo  Marketing  Challenge.     O'Donnell, F. (2014, February). Marketing to Millennials - US - February 2014. Retrieved

November 21, 2014, from Mintel: http://0academic.mintel.com.innopac.library.unr.edu/display/680599/?highligh