Insight Communications Co. and Source Media Inc.'s
Interactive Channel have been working together to bolster the MSO's initial
digital-tier offerings in Rockford, Ill., with "SourceGuide" and
"LocalSource."
SourceGuide is IC's electronic program guide, while
LocalSource is a server-based suite of localized digital-programming services grouped
under three branded umbrellas: "LocalGuide," which includes city- and
neighborhood-specific real estate listings, as well as listings of restaurants, movies and
other entertainment events; "School Zone"; and "DailySource,"
encompassing horoscopes, news, weather, sports and business-news updates.
The MSO has signed more than 900 digital subscribers since
Insight Digital's April debut, senior vice president of marketing and programming Pam
Euler-Halling said during an interview in New York. That's up from 700 in June.
The companies have been amassing data on what those initial
customers like most, which may soon be factored into future consumer marketing materials
targeting prospects.
When digital subscribers turn on their TV sets,
they're greeted with "a 'Welcome' screen that's really a menu
screen," IC president Tom Oliver said. Specifically, that menu screen says,
"Welcome: Insight Digital," and it lists such options as "Program
Guide," LocalSource, "On Demand TV," "Digital Music" or simply
"Watch TV," Euler-Halling added.
One of Insight's initial concerns involved the Welcome
screen: At first, executives wanted to feature only an icon that viewers could click in
order to get to the menu page, but they then shelved that idea. Insight has had no
negative feedback at all from subscribers about the Welcome screen, Euler-Halling added.
.
WHAT'S WORKING BEST?
During the first month, 90 percent of Insight's
digital-cable customers accessed one minute or more of LocalSource, and 50 percent have
used the service more than twice daily for between six and 16 minutes per day, Oliver
said.
Detailing specific consumer favorites so far, Euler-Halling
agreed with Oliver that "horoscopes are the killer app," given their popularity
among Insight's early-bird digital customers in Rockford.
Those subscribers also are gravitating to the DailySource
news and weather reports, Oliver said, adding that their tune-in and tune-out pattern is
comparable with the way viewers check forecasts on The Weather Channel.
Still other favorite features are local-recreation items
under LocalGuide, such as tee times at golf courses, and School Zone, ranging from school
districts' event calendars to lunch menus.
This fall, Oliver said, Insight subscribers will be able to
find students' homework assignments on that site, as was done during IC's 1998
analog test for Century Communications Corp.'s system in Colorado Springs, Colo.
Last year, IC said, its analog test in Colorado Springs
showed that 70 percent of subscribers using the analog version of the bundled interactive
services did so weekly, "resulting in an equivalent rating to that of [MTV: Music
Television]." That test has since been "terminated by mutual agreement,"
Oliver added.
HOW THEY'RE
MARKETING IT
Unlike the first digital-cable offerings by
Tele-Communications Inc., which primarily expanded the number of basic-cable networks
available, Oliver said, Insight Digital will gradually introduce Internet-based and
interactive elements, all with an eye toward quickly driving digital penetration to 30
percent and beyond.
Insight, which currently has 68,000 basic subscribers to
its analog service, acquired the Rockford system from Cablevision Systems Corp. in
January.
Consumer interest in digital will be driven by a bundle of
applications, and not by any one application, Oliver added, which is why IC has developed
"the Source suite, a family of core digital applications."
"This is a rebuild rollout," Euler-Halling
observed, so it will require gradual marketing. Oliver said the rollout will be "node
by node. It's not like switching on [to launch] Cartoon Network."
The strategy will be "to bring the customers along
step by step, so as not to overwhelm them" with all of the offerings at once, IC vice
president of marketing and communications Wendy Borow-Johnson added.
Insight Digital's marketing support -- built around
the theme, "Imagine This" -- will differ from traditional analog marketing in
other ways, too, Euler-Halling said.
For instance, the digital product requires "long-form
commercials and a revival of door-to-door selling." Newspaper ads, outdoor ads and
billstuffers are still other components in the marketing effort.
IC also helped Insight to develop training materials for
its customer-service representatives.
New subscribers get the new set-top box, a videotape and a
colorful booklet explaining Insight Digital's many features -- as well as popcorn,
Euler-Halling said.
Oliver emphasized that both companies still need to learn
more from their digital customers as to what motivates their choices and whether
they're happy with what they're accessing.
Insight Digital is priced at $6.95 per month for
LocalSource, the program guide, video-on-demand and a 40-channel package of
digital-audio-music channels, plus the tuner and remote, Euler-Halling said. Only one
set-top box is required in subscriber homes, she and Oliver stressed.
In addition, digital-cable program packages -- each
containing between 10 and 12 networks -- are $4.95 each, or subscribers can buy two
packages and get one free. The packages are themed by family, movies and sports.
IC announced in December that it would integrate
Source's "VirtualModem 2.5" enabling software onto General Instrument
Corp.'s "DCT-2000" boxes.
Internet access and e-mail, due this fall, will add to the
price, although Euler-Halling said details have yet to be worked out.
Insight supplies a standard remote for the current digital
customers, but a keyboard will be added once e-mail (christened "CableMail")
joins the offerings, Borow-Johnson said.
Advertisers are also interested. IC and Insight will share
ad-sales duties, with the former concentrating on national clients and the latter on local
ones.
IC's position is flexible in that regard, so sales
approaches will vary considerably from system to system, Oliver said. About the only thing
IC would object to is "both [parties] pitching the same client on the same day --
with different rates," he noted.
Source and Insight have only just begun tracking
viewers' clicks and time spent on the advertiser icons, Oliver said, and they're
not likely to go public with such information.
WHAT'S NEXT?
Insight plans to do focus research groups soon to determine
subscribers' "likes and dislikes" about the digital offerings,
Euler-Halling said. Some of those findings, including their favorite choices, are likely
to be incorporated into future marketing materials for Insight Digital, some of which will
focus on the service's "fun aspects, such as games," she noted.
Still to come are two-way services -- such as the ability
to click on a banner-type ad to get more information, a coupon and the like -- probably
late this fall, Borow-Johnson said.
"DaimlerChrysler is involved with us in some
[interactive-advertising] tests," Oliver noted. Spots "enhanced with
'AdLinking'" will enable viewers to click on a Dodge or Volkswagen spot,
for instance, to get car information, schedule a test drive, get details on car
dealerships or click to those units' Web sites.
"It'll be one-to-one, but [advertisers] want lots
of one-to-ones," Oliver said.
Euler-Halling wouldn't offer a digital-subscriber
projection for year-end, but she did say, "It would not be unrealistic to reach 50
percent [penetration of its analog subscribers] in three years."
During a demonstration, Borow-Johnson showed various menu pages, their choices and
advertising ideas:
A LocalSource menu page listing DailySource,
LocalGuide and "My Neighborhood," plus an ad banner for Hyundai Motor Co.
A DailySource menu and an ad for Rock River Bank.
News choices included national and world news, plus Web links to USA Today and the Chicago
Sun-Times.
A QuickSource page listing health, home-improvement,
legal and automotive options -- the latter page and menu page featuring a Dodge banner,
while the health section featured a Prilosec ad.
A LocalGuide menu with such choices as movie and
dining guides, "MallTV," School Zone, My Neighborhood and a Taco Bell Corp. ad
banner. By clicking on that ad banner, viewers can get coupons, learn store locations or
link to Taco Bell's Web site to learn more about, say, its Star Wars
promotion.
Come fall, Borow-Johnson said, the service will add such
enhancements as Internet-based e-commerce opportunities and CableMail.
As for the ability to order more than 3,000 new and past
movie titles through Diva Systems Corp.'s "On Demand TV," that feature just
bowed in Rockford, Euler-Halling noted.
Some consumer polls will track usage of specific advertiser
brands. This fall, Insight's MallTV -- which currently features current sales at area
malls and stores like JCPenney and Barnes & Noble -- will enable consumers to order
products such as compact discs by music genre (including a way to click onto samples from
the CDs).
The executives said they can do addressable advertising by
"pushing" ad copy on a restaurant, targeted by whether a subscriber is a
business executive who might be interested in the site for a business lunch or a couple
interested in a romantic dinner, Borow-Johnson explained.
Insight Digital will enter a second market shortly:
Columbus, Ohio. "We're looking at launching mid- to late August,"
Euler-Halling said.
