Primus Canada has added a few more items to its ‘to do’ list. Following a string of recent purchases that made it Canada’s second-largest alternative residential long-distance carrier, Primus is looking to hire an ad agency, acquire wireless capability and increase its customer base to 1.5 million, more than double its current number of 650,000.

But to achieve its ambitious plans, little-known Primus, which only entered the Canadian marketplace in April 1997, must significantly elevate its profile. Many of its own customers, which Primus recently acquired from London Telcom and AT&T Canada, are not even familiar with the McLean, Va.-based carrier.

‘It’s challenging, but attainable,’ says Ted Chislett, president of Vancouver-based Primus Canada. ‘It’s a question of how quick we can get our act together and integrate everything. Our brand team is putting together plans right now, but nothing has been finalized yet.’

Primus has not yet decided when it will conduct a formal agency review, although Chislett concedes an agency of record will likely be in place by the fall, since the telco is ‘on a pretty fast track.’ The company’s current advertising is being handled on a project basis by Vancouver-based Wasserman & Partners, which will continue to work on the account in some capacity, Chislett says.

Primus also has the option to retain the services of Toronto-based Wunderman Cato Johnson, which handles direct marketing for AT&T’s residential portfolio, although no decisions on the matter have been made, says Chislett.

Creating awareness for the Primus brand is crucial, but the first priority will be integrating the company’s various operations in order to avoid customer confusion, says Chislett.

‘Right now, we’ve got five different call centres, different billing systems, and different products,’ he explains. ‘So for the time being, we’re going to backtrack a little bit, and remove the Primus name from London Telcom and WinTel. In the short term, it was a pretty easy decision to separate them until we get our arms around everything we’ve got here.’

Primus will use direct mail to inform erstwhile AT&T customers about the change, and the AT&T logo will appear beside the Primus logo on customer billings for a six-month transition period following the deal.

In the meantime, Primus must find a way to differentiate itself in the cutthroat residential market, where price is king and profit margins have all but disappeared. Some analysts have predicted that the emergence of Primus could spark a price war, with long-distance rates plummeting to as little as three cents per minute.

Aggressive pricing has traditionally been part of Primus’ strategy in the U.S., but the telco will also have to offer new types of value and diversify its brand in the marketplace if it wishes to last, says industry analyst Eamon Hoey, of Hoey Associates Telecommunications Consulting Services in Toronto.

‘I’d be surprised if you could find more than a decimal of 1% of consumers who recognize Primus,’ he says. ‘But this is an advantage – building a new brand in a marketplace that’s looking for that third brand. People like to rate and compare with three brands, and right now there are only two: Sprint and the ex-Stentors.’

The timing is ‘excellent’ for Primus to build its brand, adds Hoey, since many of the market providers are in the midst of restructuring: Aliant, which came about as the result of a merger of four Atlantic telcos, was only recently unveiled; Bell is trying to become national in scope; and BCT.Telus will have a presence in central Canada in the next 18 months, he says.

Primus will also attempt to lure new customers by bundling services and promoting its affinity programs, such as Air Miles, that it gained in the AT&T deal, says Jordan Worth, an analyst at Toronto-based International Data Corp.

‘They’re interested in bundling [consumer long distance] with Internet as much as they can,’ he says. ‘Pricing is declining very quickly, and telcos are looking to get revenue through enhanced data services and business clients.’

Currently, Primus has 50,000 Internet customers in Canada, many of whom were acquired when it purchased Internet service provider GlobalServe Communications last February. GlobalServe was subsequently rebranded as iPrimus Canada.

In March, Primus acquired Toronto-based London Telcom, along with its WinTel CNT Communications division, for $76 million, providing it with 150,000 residential and business customers across Canada. That was followed by the $57-million acquisition of Halifax-based AT&T Canada’s 450,000 residential long distance and Internet customers late last month.

But if it wishes to retain AT&T’s customers, Primus will have to be cautious with its branding and ensure it doesn’t deviate too far from the original offering that convinced people to sign on with AT&T in the first place.

‘That is one of the issues our branding team is working on right now,’ Chislett concedes. ‘[We’re] trying to keep the existing base sort of warm and comfy, as well as build a bit on some of Primus’s strengths.’

Retention will be a key issue, especially since Sprint Canada, the largest non-Stentor telco, has already made a play for Primus’s newest customers in a recent ad that ran in The Globe & Mail. The spot directly targets former AT&T customers who have been ‘sold’ to Primus, and beckons them to pick up the phone and sign on with Sprint.

Although this sort of advertising may cause a few defections, it’s unlikely to create much of a problem says Ian Grant, managing director of Brockville, Ont.-based telecommunications research firm Yankee Group.

‘Primus has purchased a block of potential customers who have chosen a brand (AT&T) other than the leading ones, so these people are pretty much resistant to brand pull. They did the math, signed up, and forgot about it.’