Three lessons for SMEs from Telstra’s rebranding exercise

Telstra has been using its new advertisements for three months now, but already the telco giant has said it’s seeing signs of success.

Chief marketing officer Mark Buckman told the Australian Financial Review this morning that the ads, which use a variety of bright colours and music to show off Telstra products and services, have produced a “good uplift” in both brand consideration and satisfaction, especially non-customers.

It is the biggest marketing push in nearly two decades and is costing the company several million. The purpose is to make Telstra a little more coherent and show how it’s changing.

Although the move is risky, Telstra is responding to a changing market. Telsyte director of research consulting Chris Coughlan says the move is a necessity – “they have to show how they are transforming the company”.

Here are a few lessons SMEs can take away from Telstra’s latest advertising move:

Look where the market is heading

The telecommunications market in Australia is changing rapidly. Soon, the most powerful companies won’t be at the top because of how many assets they control, but because of the power they wield in customer service and scale.

Telstra recognises this, and as Coughlan points out, its advertising focuses more on customer service and products rather than its strength in asset management.

“There’s no real competition in assets when the NBN is built, so across the company there has been a transformation in that approach. They’ve been doing a lot of good things in the way they deal with customers.”

The entire industry recognises this shift. iiNet has been building scale in preparation for the NBN, with managing director Michael Malone suggesting it’s on the prowl for more.

“They’ve got to transform the entire company, this has to represent what they’re doing in that area,” Coughlan says.

Rebranding is more than a logo

When Telstra first announced its advertising plans, Brandology managing director Michel Hogan told SmartCompany the telco giant needed to be careful about using the word “rebrand”, as a company’s brand consists of more than just ads.

But as Coughlan points out, the change has come from within, with the telco adopting an entirely new model for how it bills customers.

“You can’t just do this big of a rebrand and then use it as a piece of spin, you need to have some sort of change within the company as well.”

“They’re doing a lot of good things in terms of the way they deal with customers, they’ve got a whole new billing format that you can actually understand, and there’s a product restructure going on.”

Customer complaints have continued to fall, according to the latest Ombudsman report, suggesting Telstra’s changes are having an impact.

Rebranding isn’t just designing a new logo – it’s about restructuring the company from the inside out.

Focus on the details

Buckman told the Australian Financial Review this morning the ads had featured bright colours and music to show “positive movements” in the company’s attitude.

In order to combat a negative association with its brand, Telstra needs to use elements with more positive associations. Advertisers use specific colours for specific purposes, and as Telstra’s ads have shown, the company is keen to evoke a sense of delight.

“The logo hasn’t changed here,” Coughlan says. “They’re just using different colours based on the subject target.”

“There’s a whole branding book associated with using this type of stuff.

Someone may view an advertisement and not notice anything, but Telstra recognises colours, shapes and sounds are just as important as the product when it comes to an effective marketing strategy.