Virgin territory still open to B

WHILE B Digital’s plan for world domination may not have eventuated it has certainly gained a significant national presence in the mobile telecommunications industry and, with an advertising budget of $8.5 million, is a big fish in Perth’s advertising waters.

Founded in Perth by Chris Singleton and George Gelavis in 1999 its investors include Channel 7, which has an 85 per cent stake.

B Digital’s revenue grew 28 per cent to $175 million in 2002 and according to B Digital national marketing man-ager Jeremy Cookson the company’s meteoric rise in the industry has been driven by good sales and marketing.

“The original view was that we may want to be more than a mobile phone company and that is why we chose a name that did not represent mobile phones,” he said.

“B could stand for a range of things, and if we could make a model work for credit cards or the financial sector we would look at it.

Mr Cookson is in control of one of the State’s largest advertising budgets and since its inception its marketing team has grown from two to eight. Its customer base is at 265,000 and climbing.

When the company formed it had a budget of $1 million and an aim to acquire 15,000 customers. However, when the tech boom rolled in the company and its new investors embarked on Virginesque global conquest.

“We thought that if this was working so well in Australia this could work well in other markets. So we acquired NTN in South Africa and got a reseller agreement and acquired 35,000 customers,” Mr Cookson said.

But when the tech-bubble burst in 2000 the company decided to pull out of its new markets to concentrate on conquering the home markets.

Mr Cookson agrees that the telecommunications industry is a competitive one but said he believed that B Digital’s lack of infrastructure enabled it to concentrate successfully on acquiring and managing customers.

“Companies such as Telstra have to manage the infrastructure and they have a team of people that maintain it,” he said.

“But for us our people are either in sales or customer service. We piggy-back off the Optus network.”

However, to buy “airtime” from Optus and to compete against them the company needed to develop a good low cost strategy to remain viable, Mr Cookson said.

The company allows $5 to manage each customer and $100 to acquire them. The majority of the money spent on acquiring a customer is devoted to advertising.

B Digital switched advertising agencies from Vinten Browning to 303 Advertising about six months ago.

“We had been with Wayne Vinten for about three years and we were very happy with the work they did,” Mr Cookson said.

“But after three years it was time for some fresh thinking on the business.”

Mr Cookson said that at least $5 million was spent on print media across the country.

 “We advertise consistently in the daily newspaper TV magazines across Australia,” Mr Cookson said.

“We thought The West mag was a good medium for us. We can show the product in colour and in actual size. 

“I’m not sure that we advertise as much as we present offers to market.”

And while the company has established an independent dealer network 50 per cent of sales are direct to B Digital.

Mr Cookson said that figure was attributable to its advertising.

He said call centre operators asked new customers where they saw the “B Deal” and that helped him to determine the best media cost per distribution.

At the top of the list are the WA and South Australian TV guides.

The remaining $3.5 million of Mr Cookson’s $8.5 million ad spend goes on point of sale promotional material and other marketing activities.

However, he said the company always looked for opportunities to further promote its brand in the market place and its recent promotion with FM radio station Nova was one such example.

“We had some unused air time that we could give away as a prize and we went out and asked what the radio stations could give us in return,” Mr Cookson said.

“Nova offered us the best option in terms of good airtime exposure.”