Marketing Surprises

I’ve spent many years selling subscriptions.  I realize that cable subscriptions are somewhat different than magazine subscriptions.  Nonetheless there are many similarities.  That’s why I was surprised when I was able to cancel my subscription to TIME magazine—with no questions asked!

First, a little background.  My copy of the August 23^rd edition of TIME arrived at my home on Friday, August 13^th.  It was wrapped with a cover explaining that my subscription term was ending, but that there was nothing I needed to do to renew.  I’m a “valued automatic renewal” customer!

But there was something else about my copy.  It was misshapen, apparently caused by some cutting malfunction in the manufacturing or mailing process. The lower right corner of the magazine was sliced off.  It was unreadable.

So I called TIME customer service and got my first marketing surprise.  I told the customer service rep of the problem and asked to have a replacement copy sent to me immediately.   The rep told me that she could not do this, because I had gotten my copy “early.”  I pointed out that TIME always arrived on Friday.  She told me that the computer would not let her send me a new copy until the following Tuesday!  I could not understand this, and asked to speak to a supervisor.  The supervisor told me that she would “make an exception,” and send me a copy.

That copy never arrived.  So I decided to call to cancel in protest.  When I called I went through the automated menu and was given the option to “press 2 to cancel.”  I fully expected then to be transferred to a live human.  I expected that I would, at very least, be asked why I was cancelling my subscription.

My second marketing surprise was that I was able to completely cancel without ever talking to a human being.

So I figured that I’d get a follow-up call in a day or so. That didn’t happen either.

So I’m not surprised that magazine subscription numbers are falling.

Welcome to KableTown

Scene from 30 Rock:  Jack Donaghy, played by Alec Baldwin, bemoans the fact that GE/NBC has been bought by a Philadelphia-based cable company known as “KableTown (with a K)”.

Jack’s underling, Liz Lemon, played by the fabulous Tina Fey, notes that her parents have KableTown down in Pennsylvania.  She then looks knowingly and directly into the camera and says, “It’s a fine and generous company!”

Obviously, it’s a bit of a parody of the real-life acquisition of GE/NBC by Comcast— currently being reviewed by Congress, but ultimately is expected to be approved.

To some who have been around the cable industry for a while, this turn of events is truly remarkable.  When cable first began, its purpose was largely to serve as a community antenna (CATV), and to bring network television to homes where no broadcast signals were easily available due to the local terrain. 

I’ve seen pictures of dancing network logo characters appearing at cable system grand openings!  (I think Abel Cable was there too—does anybody remember him?)  Broadcasters were delighted to have more eyeballs for advertisers.

Soon cable operators found ways to pick up broadcast signals from many miles away.  They delivered these “distant signals” giving their customers even more choices.  Broadcasters, especially on a local level, were less than pleased.  They heavily lobbied Congress and the Federal Communications Commission, and soon restrictions were placed on the importation of out-of-town broadcast signals.

But satellite technology and original cable programming changed everything.   Soon the cable industry was flourishing and expanding.  The Cable Act of 1984 deregulated the industry and led to unprecedented growth and expansion.  National broadcast network programming was still “king,” but viewership began to gradually erode.  Local cable systems began to sell more advertising and local broadcasters felt threatened even more.  Many local broadcasters refused to accept ads from cable operators trying to generate new subscriptions.

Cable soon had other competitive fronts.  Direct Broadcast Satellite (DBS) became a major competitor.  Cable operators, in turn, invested heavily into broadband technology and fostered competition with phone companies in telephony and internet services.

Major programmers such as Viacom and Disney mixed broadcast networks such as CBS and ABC with their substantial cable network holdings.  These parent companies used broadcast retransmission consent to further the distribution of some of their cable networks, so relationships, while not totally harmonious, were relatively peaceful.

But the harmony ended with recent bitter retransmission consent battles fought on a local market level.  Discussions are underway to find ways to help prevent such battles in the future.

How will the Comcast/GE/NBC marriage change things? 

Stay tuned!

Time Mag Says We’re In the “Boring Age”

Contributor Michael Lind makes a bold statement in the March 22nd issue of Time magazine (www.time.com/time/magazine).  In the article, Mr. Lind suggests that we are in “The Boring Age.”  He indicates that “we are living in a period of stagnation” and asks if  ”the combination of a phone, video screen and keyboard really as revolutionary as the original telephone, the original television set or the original typewriter was? “
Amazingly, Mr. Lind does not use the word “digital” even once in his article.

I won’t dare to suggest that the combination of video, voice and data is as revolutionary as the original TV, phone or typewriter.  But I do believe that today’s digital age  is far from boring, and is truly revolutionary!

Digital technology has changed practically everything– from all forms of communication (including Time magazine) to medicine to politics.  Comments about Mr. Lind’s article will be seen digitally online and in blogs and tweets.   (Time’s June 5th, 2009  cover article was about revolution in ”How Twitter Will Change the Way We Live”).   Digital medical technology has improved healthcare and is likely to extend human lifespans.   Barack Obama became the first African-American President in large part because his campaign took advantage of digital technology and communications.  Ask the US Postal Service about the effect of the digital age.   I could go on and on about the effect of the digital age, but the main point is this:

None of it seems stagnated or boring to me.

Consumer Opinions About Cable on the Net

What are cosnumers saying about you on the Internet?

After my recent blog about the Cablevision and Scripps situation, a couple of individuals commented about my article; and more specifically about the parties involved.  This got me thinking about comments being made about communications companies on the Internet, so I did a little research.

Be sure to have someone from your company regularly reviewing consumer comments on blogs, Twitter, and Facebook.  Comments are being made every day–and many are either negative and/or not factual.

Here are some real-world examples:

Time Warner Cable – A quick search of WordPress.com turned up numerous blogs about Time Warner, including a number of them published by company representatives.  Kudos to them for creating such a presence.

But I also found some posts which are less flattering to TWC, including one entitled “Time Warner Cable Losing Subscribers, I’m One of Them” and another entitled “Time Warner Cable, you lie!”  Presumably someone from TWC contacted these individuals, but no follow-up comments have been posted as of this writing.

Mediacom – I checked Twitter for comments about this company and found a sad tweet from an individual who “has been caught by mediacom! No more pirate bay for me “  There were also comments about some possible outages and a complaint about telemarketing, “Stop calling me about your stupid phone service! I don’t want a land-line.”

Cablevision- I found a similar tweet about a “do not call list” and this important warning, “If my DVR messes up on Johnny Weir (Olympic figure skater), someone at Cablevision is gonna get cut.”   There were also some unflattering comments about billing and technical issues.

Cox- Tweets about Cox included “Props to the Cox Communications guy for showing up at 8am on the dot” and a rant about the emergency alert system testing during the TV show Supernatural, “IT WAS A SAD SAMMY MOMENT!” 

Xfinity – Tweets included a couple of promos from comcastinfo and DigitalMojo, as well as many questions and comments about the new branding, “”WTF is xfinity?” and “I can’t be the only one who thinks Xfinity is silly.  Is Comcast getting its ideas from Dunder-Miflin now?”

Perhaps someone from the NCTA might want to take a peek at how “cable TV” is treated on Wikipedia.  Check out this excerpt:

Fee Structure

The industry strongly lobbies against federal “family tier” and “a la carte cable television” bills which would provide consumers the option of purchasing individual channels rather than a broad tier of programming, sometimes consisting of channels which are not desired by various subscriber segments. These anti-consumer issues continue to garner attention from state governments, Congress and FCC Chairman Martin.^[7] What’s more, the argument calling for an adjustment to the manner in which cable is distributed was reaffirmed in January 2010 when cable subscribers throughout Connecticut, New Jersey, and New York found themselves in the middle of a contentious battle over an increase in subscriber fees paid to the media company Scripps Networks Interactive by cable provider Cablevision. The parties’ contract expired December 31, 2009, and as they were unable to reach a mutual agreement beforehand regarding the amount paid for each cable subscriber, Scripps pulled two of its television channels, HGTV and Food Network, from the Cablevision channel lineup on January 1, 2010 at 12:01AM. 

Somewhat one-sided, and clearly out of date; wouldn’t you agree?

 

Programmers’ Pet Peeves About Operators

Thank you for your tremendous response to my last post about operator pet peeves about programmers.  As promised, this is the other side of that story–featuring the programmers’ pet peeves about cable operators!  Please note that these “peeves” will not directly focus on the many issues associated with license fees and other contractual rights.

My Margin -  The late Tony Cox, of  HBO and Showtime fame, used to kid his operator friends about how they intensely  focused on their margin.  He used to refer to this as “M’margin,” intentionally merging the words.  Programmers often cite that operators will do almost anything to protect their margins, and that they are often loathe to spend money.

Send Premiums and Tickets - Everybody loves a good premium.  Programmers note that some operators focus way too heavily on getting the premiums, often at the price of getting other business with programmers accomplished.   And operators are sometimes criticized for seeking large amounts of premium items to be given away at company gatherings, fairs and festivals, sporting and other events; as well as to customer service people.  

Similarly, programmers point to the fact that they are often asked to secure expensive tickets to sporting events, concerts and plays–even when securing such tickets requires the programmers to pay hefty fees to ticket brokers to secure them!

Switcheroo – Every programmer can tell you about the times in which they invited cable operators to an event–only to have the operator pull a “switcheroo” and send a more junior person (such as the lead installer) in their place.  Also, programmers are always peeved when operators RSVP that they will attend, and simply fail to show up.  I know one programmer who intentionally “overbooks” operators at events, knowing that as many as half won’t actually attend.  He has a future in airline reservations!

No Return - Some operators are known for not returning phone calls or emails from programmers.  You can’t be a programming rep if this type of thing gets to you, but it’s high on their pet peeve lists.

No Results - Programmers often entice cable operators to engage in promotional efforts.  These efforts sometimes include rewards ( such as merchandise) for participation and submission of results.  Programmers are thus counting on participation are often dismayed when operators fail to deliver the results.  Programmers are left to wonder if the operators actually participated or if they simply are failing to gather and send their results.  It makes good analysis impossible.

So there you have it!   There are pet peeves on both sides, but it’s a great business nonetheless!

Cable Marketers’ Pet Peeves About Programmers

Programmers are famous for doing some things that simply make cable marketers crazy!  (The reverse is also true, but that’s for next week) Please note that what I’m describing here has nothing to do with the actual programming or the rates charged for said programming.  Rather, these “pet peeves” are mostly associated with the marketing of the programming.  Please note also, that I have enjoyed working as both a programmer and as a cable marketer, so I know both worlds quite well!

Death By PowerPoint! This isn’t the most important pet peeve, but it seems to be nearly universal (no pun intended, honestly).  Programmers seem to love to design and deliver elaborate (and often long) PowerPoint presentations about their products and campaigns.   Some cable marketers think that programmers get paid by the number of PowerPoint presentations.

It’s More Than Just Cable! Cable marketers these days are promoting more than one product; a fact that some programmers seem to forget.  Today’s cable marketers are selling a variety of products including high-speed Internet services, telephone, VOD, HDTV, and even business services.  Unfortunately, there is often less time to focus on each programmer’s offerings.

There’s More Than One Network! Although there’s been an enormous amount of consolidation, there are still a number of companies seeking to involve cable marketers in brand promotions.  Cable marketers simply don’t have the time to focus on all the brands and all the promotions of those brands.

One Size Doesn’t Fit All! When cable marketers actually do take part in promotional efforts with programmers, they are sometimes confounded by “one size fits all rules” for the promotions, or for validation and redemption efforts.  Cable Marketer “A”  might represent a given DMA, while Cable Marketer “B” might represent an entire MSO.  Programmer forms and/or online registration are designed one way, but not both.   Often, cable marketers must complete repetitive forms for each location or entity enrolled.

Can’t Tell The Players Without a Scorecard! Programmers seem to reorganize or restructure quite often, so it’s often difficult to keep track of current reps.  Sadly, that consolidation I mentioned earlier has a lot to do with this issue.

Let Me See Your Marketing Plan. All new programmer representatives are told that they should work to form a true partnership with the cable marketers they’re calling on.  Sometimes this can be taken to extremes.  I recall one very new (and very green) programming rep calling on me (when I was in a operator role) and nearly demanding to see my complete marketing plan.  I doesn’t quite work that way.

Save Your Dollars! Cable marketers marvel at the amount of money that is being “wasted” on elaborate promotional efforts.  Expensive glossy mailers and promotional packets are being sent regularly from a variety of networks.  (However, keep sending the cool premiums!).   And you may want to take a look at those mailing lists.  Are you sending very expensive BetaSp dubs to corporate offices– where no playback equipment exists–to people who are no longer employed?

Next week we’ll take a look at the programmers’ pet peeves about cable marketers.  Stay tuned!

Scripps & Cablevision Reach Agreement

The Food Network and HGTV have been restored to Cablevision’s lineup after the two companies (Scripps & Cablevision) reached agreement on carriage.

Did Scripps Networks Make a Strategic Blunder?

The Food Network and HGTV went dark for about three million Cablevision customers in Connecticut, New Jersey and New York on January 1st, because of a dispute over rates (and probably other things such as digital rights and more).

But I’m not about to take sides on this one.   I’ve been in programmer headquarters meetings when such disputes were discussed, and likewise I’ve been in on operator discussions when programmers threatened to pull channels.  Neither such meetings were enjoyable in any way!

My purpose in this particular column is to discuss marketing strategy.  What should a marketer do when these disputes come to a head?  Did Scripps Networks do the right thing by deploying a massive marketing campaign urging Cablevision customers to call an 800 number or to go online to complain over the loss of the two channels?

I don’t think so!

In fact, they may have made a big-time strategic blunder!

By imploring all of Cablevision’s customers to take action, Scripps has gone out on the proverbial limb, and asked for clearly measurable results.  But what if the results are not what Scripps was hoping to get?   What if they cannot motivate the essentially  niche audiences of both channels to fully respond?  Would they be proving a negative?  The folks at Cablevision will know the answers to these questions if Scripps never fully shares those results.

I had expected to see Scripps turn to Cablevision’s competitors with messaging suggesting that customers switch providers.   Perhaps that is yet to come, or perhaps they also may be dicussing rates with the competitors in the near future.

To be fair, Cablevision has employed a similar strategy in asking consumers to “e-mail Scripps, and tell them to turn your channels back on while we negotiate.”  

There’s little doubt that we’ll be seeing more of these public battles in the future as broadcasters and programmers negotiate rates with cable and satellite providers.  All sides should be careful what they ask for–both in terms of rates and in terms of public reaction.

Marketing Emergencies

• Your direct mail drop has problems!  Mail is being delivered with the wrong offers, the wrong prices or the wrong products to the wrong people!  Your call centers are freaking out!
• The printer and mail house were all set to print and drop your biggest campaign of the year.  But then there was this blizzard and nothing was going to get done and your quarterly numbers were at risk!
• An independent phone book company (unbeknownst to you) decides to feature your company in a “Frequently Called Numbers” section.  Unfortunately they misprint your 800 number and instead use the number of a sex chat line!  (As a cosmic rule, misprints always seem to go to sex chat lines!)

The above stories are true stories.  Having lived through each of them, I can tell you they seem a little more amusing now than when they were actually happening.  But one thing I learned from these and other “marketing emergencies” was not to panic!  

It’s almost become a cliché, but marketing emergencies are hardly ever fatal to just about anyone.  The key is to treat them as true learning experiences and to take steps to prevent them going forward.