Cable operators have never faced bigger marketing challenges. With new video-on-demand (VOD) and digital telephone services, their array of products is expanding, each requiring a slightly different sell. As if competition from satellite TV weren't bad enough, giant telcos are getting into the video business.
Char Beales tries to help cable executives cope with their headaches. As president of the Cable & Telecommunications Association for Marketing (CTAM), Beales marshals marketing executives from cable systems and networks to collaborate on the challenges and fully exploit the opportunities that the increasing power of technology creates. As 2,000 CTAM members gather for their annual convention in Boston this week, we asked Beales about the issues operators face in getting new customers and keeping the ones they have.
A decade ago, cable operators were seen as so unreliable that few would trust them with something as important as their telephone service. Now digital-voice orders are pouring in. What's up?
That's a reflection of the $100 billion cable companies spent to make their plant reliable and improve service. The cable companies are making tremendous strides on the technical end, on the product end, and on customer service. Look at the JD Powers study. Cable phone service ranked as tops in customer satisfaction in five of the six regions.
Which should be cable's primary marketing opponent, DBS or telcos getting into video?
They have to fight both. DBS has been a strong competitor, and cable has been making huge inroads because of the bundle with Internet and, now, phone. Cable's been winning a lot of customers back from satellite. There's also a major battle to take the phone customers away from the RBOCs [regional Bell operating companies]. You can't really say telcos are offering much video yet.
Isn't cable gaining against DBS because DirecTV and EchoStar are curtailing their marketing efforts?
Their cost per subscriber acquisition is going up. How they're changing is by qualifying their customers, because they were putting a lot of bad customers on. Then it become a question of which side gets the people that can't pay their bills. Maybe we can push them toward the RBOCs.
As cable entered new businesses, there was a trend—or perhaps a fad—of hiring marketing executives from completely outside the industry, from consumer-products companies or airlines. How has that worked out?
New talent in the marketing ranks is coming from the outside, but more in related businesses. I see a lot of cellphone executives come into the business, such as Marvin Davis at Comcast. Cable marketers have actually been doing pretty well. The average corporate chief marketing officer's tenure is something like 18 months. Cable is more stable than some other businesses.
What cable marketing trends interest you?
Comcast is buying national network ads for the first time. They have a very clever campaign. Cablevision has been very aggressive about selling the bundle. We're seeing innovation in search-engine marketing, which had been pretty much left to the satellite retailers.
We're working with all the companies to target marketing, which is such an important segment. A lot of these aren't super-sexy but the blocking and tackling you need to be successful.