Given the high levels of pay-per-view usage among minority
viewers, some industry executives believe those viewers should have more of a presence in
cable's marketing plans for digital-PPV deployment.
Operators said they are adequately reaching minority
viewers by targeting their digital product to multipay premium users. Nevertheless,
industry executives said they will inevitably look to develop minority-specific materials
in the near future.
Most operators have developed generic marketing campaigns
targeted toward high-end analog-premium and PPV users. With digital technology able to
offer more than 25 multiplexed services and 30 PPV channels, providing an enormous amount
of movie choices, the industry's initial push is to maximize revenue from its best cable
customers.
But some observers believe that the industry could benefit
from creating more minority-oriented marketing campaigns touting the benefits of digital.
Research has shown that African Americans and Hispanics are major purchasers of analog-PPV
programming, in particular.
According to ICR Survey Research, African Americans
represent 10 percent of U.S. TV households, but they make up 12 percent of PPV buys, 13
percent of PPV-movie buys and 13 percent of PPV-event buys.
The ratio is greater for Hispanic viewers. While
representing only 8 percent of TV households, Hispanics generate 16 percent of all
PPV-event buys and 11 percent of all PPV-movie buys.
"We already know [minority purchasing habits] in the
analog business, so it will inevitably transport itself into the digital business,"
Viewer's Choice vice president of research Anthony White said.
Operators, however, have yet to create any
minority-specific or urban-tailored promotions for their digital-PPV offerings.
At AT&T Broadband & Internet Services, for example,
the focus continues to be more on the broader target of premium buyers, rather than more
narrowly targeted groups.
"We position digital PPV in the same way throughout
our systems," AT&T Broadband director of partnership marketing and PPV Robyn
Remick said, "but we're reaching our best customers, many of whom are
minorities."
While not deploying specific marketing materials toward
minority viewers, Cox Communications Inc. feels that it is sufficiently reaching the
minority audience through its targeting of heavy premium and TV users with its digital
message. Cox currently has more than 100,000 digital subscribers throughout the country.
"Everyone knows that [minorities] are heavy television
users," director of product development Lynne Elander said, "so we feel we're
reaching minority viewers through our current efforts."
Apparently, the message is getting through to the urban
markets. A recent survey by The Yankee Group said 20 percent of viewers in urban markets
believe their cable company is offering digital services.
"In fact, the awareness of digital cable is higher in
urban markets than it is in most rural markets," Yankee Group director of media
strategies Bruce Leichtman said. Further, 50 percent of urban subscribers are aware of
digital cable and digital PPV.
"It's like any commodity: You have to get the consumer
message out," he added. "If you don't get the message out, people don't know
about it, and they can't sign up for it."
White said as the industry begins to move into the next
phase of digital deployment, operators may begin to target minority viewers.
"It's not an indictment on the industry. They are
having a hard enough time just getting the boxes out without micromarketing," he
added.
Elander believes the minority audience should receive more
focus in the near future. "There is a recognition that this is a market that we
should be better serving -- particularly the Hispanic market," she said. "We
have not developed Spanish-language materials for digital PPV, but it's something we will
look to do."
Even without such marketing, digital PPV's performance is
impressive when compared with analog-PPV numbers.
Currently, White said, early returns show that buy-rate
increases are "fivefold." And the total of actual households using PPV triples
after systems upgrade to digital from analog, despite the lack of intense, targeted
marketing.
"But once we're able to target market more, you'll see
an even greater increase in PPV performance," he added.
"[The minority audience] is a segment that are good
users, but that have not been marketed strategically yet," he said. "More and
more in terms of building relationships with consumers, these should be cultivated as
valued consumers."
Remick said AT&T Broadband's urban-market systems,
which had been channel-locked in analog, are thus far responding to digital, and they tend
to perform better with events than movies.
Those systems carrying BET Action PPV's action-adventure
PPV service, in particular, performed better with movies and events than systems that
didn't carry the channel.
