Advertisements—we see them everywhere. Whether it's television commercials, pop-up ads, billboards or direct mailers, we are surrounded by marketers determined to grab our attention and spur us to action in some way. And while some of these tactics may seem scattershot, much of this advertising is targeted to you specifically. Steve Springer (MBA, '04), Regional Director for Sales and Marketing at Verizon, spoke to Dr. Laura Munoz's class about how the multi-billion dollar company determines exactly how and to whom their marketing messages will be delivered.

Using Data to Drive Targeting

Springer began by explaining that his division is responsible for marketing Fios, Verizon's fiber optic cable network that provides internet, television, and voice services to homes and businesses in areas of Texas. But because the service is not available to every household in the DFW area (only in those areas where the actual fiber optic cable has been installed), Springer and his team must make marketing decisions based on detailed reports in order to most efficiently target their current and potential customers.

"Television and radio ads don't work for us," Springer told the group. "Not only are they expensive, but they generate calls to my call center from areas where I can't provide service. So that kind of marketing is not an efficient use of our resources." Instead of blanketing the entire Dallas-Fort Worth Metroplex with mass-marketing advertising, Springer and his team analyze various data points to determine where their greatest potential for growth lies. "We focus on three specific areas," he said. "Acquisition, retention, and upsell."

Customer-Driven Marketing

Because Fios enjoys a hefty market share and good customer satisfaction ratings in areas where their service is available, Springer explained that the company puts a greater emphasis on retention in communities where their market share is already high. "There will always be some customers who shop on price. And everyone below you wants a piece of your business, so we focus on retaining customers in areas where we have high market penetration," he said. "We want to show our customers that we care about them and will not always be trying to sell them something."

To retain customers, Springer and his marketing team craft messages specific to their target market. For instance, he spends a good portion of his marketing budget to sponsor community events. "High school football is huge in Texas," he said. "And it's something that communities rally around, so we want to be a part of that." In addition, Verizon has sponsored other events such as video game tournaments and robotics competitions to reach IT-savvy customers.

Springer further discussed how Verizon's marketing messages change depending on the demographics of a community. Denton, Texas--home to two universities--has a very large rental community in proportion to other real estate, which affects the types of products his team promotes. "Renters are usually more interested in data alone and less in cable and voice," he said. "So we don't usually offer higher-priced bundles to those customers."

The Importance of Data Analysis

Springer underscored the importance of making marketing decisions based on hard data. Verizon's data comes from a variety of sources, including in-house customer information and from third party research firms that report on market share relative to competitors. "The bottom line," Springer said, "Is that you have a limited marketing budget, so you must have the data to support any marketing decision you make."