ANALYSIS: BRAND SPEND ANALYSIS - Changes are on the way as the UK’s second-largest advertiser restructures

BT chief executive Sir Peter Bonfield recently announced a radical revamp of the company, claiming it will be the biggest reorganisation since BT left public-sector ownership. The move splits the business into six separate entities: the wholesale and retail fixed-line arm; the Concert alliance with AT&T; a global data business called Ignite; Openworld, a mass-market internet provider; BT Wireless; and Yell, the yellow pages and e-commerce division.

BT chief executive Sir Peter Bonfield recently announced a radical

revamp of the company, claiming it will be the biggest reorganisation

since BT left public-sector ownership. The move splits the business into

six separate entities: the wholesale and retail fixed-line arm; the

Concert alliance with AT&T; a global data business called Ignite;

Openworld, a mass-market internet provider; BT Wireless; and Yell, the

yellow pages and e-commerce division.



Agencies BT’s creative agencies are Abbott Mead Vickers BBDO, AMV

Advanced, Leo Burnett and AV Browne. Media buying is handled by Zenith

Media, the Allmond Partnership and AV Browne. The last two agencies,

along with New PHD, also take care of planning.



Total spend and media mix BT (including BT Cellnet) is the UK’s

second-biggest advertiser after Procter & Gamble, spending a massive

pounds 135.2 million in the year to February 2000. Almost half of BT’s

advertising spend goes on TV, followed by press, radio, direct mail and

outdoor.



BT advertises a large number of services and brands, and its latest

campaigns have focused on reconnection, BT Internet, BT Together and

TimeSmart.



The busiest advertising months in 1999 were November, May and July, and

there was activity across all media in every month except for December

1999, when there was no cinema work.



Television accounted for almost 50 per cent of the total adspend.

Newspapers and magazines picked up pounds 28.6 million, or a 21.2 per

cent share. The rest of BT’s budget was spread across radio (9.4 per

cent), direct mail (8.5 per cent), outdoor (7.6 per cent) and cinema

(3.5 per cent).



Spend details BT aims its advertising at the mass market while

simultaneously combating regional competition from cable companies. In

1999, its large national campaigns were underpinned by extensive

regional press and direct mail drives. For example, although national

daily and weekend publications accounted for 83 per cent of total press

spend, BT placed ads in 279 titles over the past year, including 95

regional titles - far more than most other UK advertisers. BT’s TV

advertising in 1999 was spread across 63 terrestrial and 63 Astra

channels.The most popular were LWT, Central, Meridian, Carlton and

Anglia TV.



Conclusions BT’s recent structural changes are designed to strengthen

its position in the key growth areas of broadband, consumer, internet

and mobile, and to create the global platform needed to survive in a

competitive market.



Some commentators think the moves are a precursor to a break-up of BT

into a number of fully independent quoted companies, which will be free

to pursue their own brand and product strategies. If this happens, we

can expect to see dramatic changes to the company’s advertising and

brand propositions.





Research by AC Nielsen MMS tel: 01344-627553 www.mediamonitoring.com.



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