Paul Guyardo would merit a 2010 Brand Builder Award just due to DirecTV’s remarkable subscriber growth in recent years: The satellite- TV provider’s customer ranks swelled from 15.1 million at the end of 2005 to nearly 18.7 million in March 2010.
For Guyardo, the key accomplishment has been the company’s profitability. Operating profit has more than doubled, to $956 million in the first quarter of 2010 from a year earlier.
“It would be easy for any marketer to drive growth,” Guyardo says. “The challenge is, how do you drive profitable growth?”
DirecTV spends about $750 on marketing, equipment and installation for each new subscriber it signs up, according to Guyardo. That’s why it is crucial to develop a brand that can produce profitable growth.
“To get a return on that investment, I have to find quality customers that are going to stay on the platform for a good 21, 22 months, just so I can break even,” he says.
When Guyardo arrived at DirecTV in October 2005, he found the direct-broadcast satellite firm to be “a good brand, but it lacked focus. I think the key to building a brand first and foremost is that you have to understand who your core target audience is.”
In the past, DirecTV had taken a shotgun approach to marketing its services to a broad demographic of adults age 25-plus. Guyardo’s team conducted research that showed DirecTV’s sweet spot was actually family men, age 35 and older, who live in single-family homes.
To target this group, Guyardo moved to position DirecTV as a “premium” multichannelvideo provider. Marketing materials detailed extensive sports offerings and talked up plans to invest big in HDTV.
The satellite-TV provider adopted the tagline, “Good TV. Better TV. DirecTV.” It invested heavily in celebrity-laden TV spots and high-profile events such as the 4th Annual DirecTV Celebrity Beach Bowl, an all-star beach football game held just before this year’s Super Bowl in Miami.
In building the brand, Guyardo gives a lot of the credit to his team, but his own background also helped shape the strategy. Early in his career, he worked at advertising agencies such as Saatchi & Saatchi before moving to roles at Johnson & Johnson, AT&T, HSN and Kmart.
“Growing up on packaged goods, first on the agency side and then Johnson & Johnson as a brand manager, teaches you to think strategically and [focus on] driving profitable growth,” Guyardo says. “What was great about moving into HSN and retail at Kmart was that it teaches you to be quick and responsive and flexible to the marketplace.”
In upcoming months, Guyardo’s team will work to further strengthen the brand by highlighting the entertainment value of a number of newer technologies, including DirecTV’s new whole-home digital video recorder service, the launch of 3DTV channels and improvements to the NFL Sunday Ticket out-of-market package that allows subscribers to watch on three screens—the TV, computer and smartphone.
As Guyardo puts it: “We led the way with HD long before the competition was there, and we plan to remain the leader with these other innovations.”
Where the Brand Builders Are
2010 Brand Builders Paul Guyardo and Courteney Monroe are scheduled to speak on the opening day of the Promax/BDA Conference.
What: The CMO Summit
When: June 22, 3:45 p.m.
Where: The Diamond Ballroom, JW Marriott, LA Live
Details: Leading marketing executives take the stage for a candid discussion about content, innovation, emerging industry trends and how they continue to stay steps ahead of the competition.
Moderator: Rich Cronin, President, Rich Cronin Media LLC
Panelists: Joe Earley, EVP, Marketing and Communications, Fox Broadcasting Co.; Paul Guyardo, EVP, Chief Sales and Marketing Offi cer, DirecTV; Chris McCumber, EVP, Marketing and Brand Strategy, USA Network; Courteney Monroe, EVP, Consumer Marketing, HBO; Chris Moseley, SVP, Marketing, History Channel