MCI offers 20% discount in 'Family & Friends' plan

March 19, 1991|By Leslie Cauley | Leslie Cauley,Sun Staff Correspondent

WASHINGTON -- Now we know why comedian George Burns, New York Giants Coach Bill Parcells and country crooner Tammy Wynette were making lists of people they call -- so they can hand them over to MCI Communications Corp. as potential new customers.

MCI introduced yesterday a new residential calling plan that offers a 20 percent discount on up to a dozen numbers a customer frequently calls. The calls can be to anyplace in the United States, including Alaska and Hawaii. The 20 percent discount is applied on top of any other discounts, such as those offered on holidays.

The plan, dubbed "Family & Friends," is free and open to all MCI customers.

There's only one catch: Everyone on the preferred list of callers has tobe an MCI customer.

That means none of the 12 family and friends can subscribe to rivals US Sprint or Amerian Telephone & Telegraph Co. If any of those dozen family and friends don't subscribe to MCI, then it's up to customers to convince their pals to switch -- or find another friend or family member to call.

Michael Balhoff, a telephone analyst with Legg, Mason, Wood, Walker in Baltimore, said MCI's new plan has the net effect of turning customers into telemarketers. But so long as customers are getting a good deal, he said most probably won't care.

"There's a telemarketing effect where people will be inclined to call people with whom they are close and say, 'Do you want to save 20 percent?' " Mr. Balhoff said. "A lot of family members will probably switch over because 20 percent is a hefty discount . . . and I think that will be attractive to people."

And the plan is a good deal for MCI because the company winds up "paying consumers only for a good, hard sale of MCI's product," he said. "It's a very interesting, very innovative idea that will probably work to some extent."

The plan works like this: Customers compile a list of up to 12 people they want to have in their"Circle of Callers" and submit it to MCI. Participating customers must provide the name, address, phone number and relationship of the nominee.

Customers have the option of telling nominees about the plan themselves, or they can hand names off to MCI's customer service department. Nominees who are not MCI customers will be contacted by MCI and invited to switch long-distance companies.

AT&T, which offers a residential calling plan that features discounts for frequently called area codes, characterized Friends Family as a creative way for MCI to generate sales leads.

"It eliminates a lot of work MCI would normally have to do," said Jim McGann, an AT&T spokesman in Washington. "We think our customers do not want to do sales prospecting for long-distance vendors."

Mr. Burns, Mr. Parcells, Ms. Wynette and other celebrities have appeared in "teaser" ads for the new service. A follow-up campaign began yesterday.

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