HUNTSVILLE – Delegates to the 2012 Canadian Cable Systems Alliance annual Connect conference were advised by a series of speakers Monday afternoon (and we’re paraphrasing here) that their customers care only about themselves and what’s happening, or isn’t happening, on their screen, whichever one they happen to be using, rightnow.
As any cable operator will know, customers are increasingly demanding, but this where independents have a chance to shine, digital marketing expert Mitch Joel of Montreal’s Twist Image told delegates (a number of pictures of whom are posted below this piece). He demonstrated how the retail world is moving more and more into direct relationships (for example, do you “like” any company on Facebook? Follow any on Twitter?) and that’s where independents, owing to their smaller size, should find their advantage. “The value you have and can bring to consumers is from the power of direct relationships,” he said, noting that power “is paramount to your success in the future.”
Joel also challenged the assumption that we live in a multi-screen world saying that while we did for a while, where people would watch TV, work on a laptop and text on a smartphone all at the same time, the functionalities of all of those have come together so that people are using just a single screen, often a tablet, to work, consume, shop, and communicate. Those functions that once required several devices can often be accomplished using one, with the right software or applications.
He outlined some of the success stories on crowd-funding web site Kickstarter, where 75% of the ideas posted there reached their funding goal and businesses or products were launched because of it, and how those manufacturers have direct relationships with their customers who are happy to help launch an innovative product they need by making a purchase.
One of the key ways to build that customer relationship is “sex with data”, added Joel. Now, don’t think of anything freaky, just think of melding the traditional sources of linear data all cable companies will have access to just from the regular cable/broadband/phone customer database with social media feedback so that operators can see, for example, that customer Joe Smith at 123 Main St is also @joesmith on Twitter who has told his followers what he likes to watch on TV. Mining that data builds what you know about customers and can help operators serve them better. It’s not a privacy invasion, just a good way to gather information to personalize customer experiences.
However, he noted, don’t try to go all interactive on them in the TV space. Instead, add value to what is, essentially, a passive media. “There is a mass majority of your customers who just want to watch great programming,” he said. And if they want to get interactive, there are myriad ways they can already do it, so if you want to interact, you must add value, he said. As an example, Joel pointed to the Lodgenet app on his iPhone which lets him use his phone as a TV remote, easily finding channels for him, no matter what hotel he is in. There’s no immediate payback in terms of revenue for Lodgenet when people use the app but over time, it makes people remember – and like – the brand, for that direct relationship.
WHEN IF COMES TO DISRUPTIVE brands, Netflix is the one most often named by those in the TV business as a feared game-changer. While there are challenges, (and some who don’t fear it at all) and change is happening, research shows the cable package is still undeniably strong, said Gord Hendren of Charlton Strategic Research, citing 2012 survey work he has done for CTAM Canada.
Subscription TV may need some added flexibility and lower pricing in the future, but the ongoing growth of over-the-top video hasn’t yet caused a ton of people to cut the cord. According to his research, 53% of Canadians have watched a TV series or movie online in the past three months and it’s no longer confined to the young as online viewing is seeing strong growth in the 25-54 age category, said Hendren.
However, while Netflix is still the predominant player, “their momentum is decreasing,” he added. “It’s a good, low-cost content provider,” but growth in viewing via other portals is on the rise. Plus, Canadians are getting more willing to purchase devices like a smart TV, Apple TV, Roku or Boxee to bring in as much as they can of what’s on the web. Fifty percent of those surveyed who were aware of their OTT options say they would consider buying a product or service to deliver OTT video to them.
All that said though, total buy-in of OTT is still pretty low in 2012, with the aforementioned Netflix leading the way (20% subscribe to it), with Xbox Live (11%) as the number two.
All this choice will lead more Canadians to not cut off their cable completely, but take a hard look at the list of channels they subscribe to as they struggle to fit their burgeoning video and media costs into the family budget. “People are more likely to reduce their number of channels… that is the much more likely scenario,” said Hendren.
“A change is coming in terms of how consumers are looking at the kinds of content they are getting and how they are going to be trimming,” added Hendren. While 33% said in 2011 they wanted to discontinue their TV subscription for Netflix, that figure has fallen to 18% in 2012. However, half of those Netflix customers surveyed said they were very or somewhat likely to reduce the overall number of channels they subscribe to. Among non-Netflix subscribers, 36% said they were looking to cut back.
While there is potential for growth still remaining among those who don’t subscribe to cable at all, the only way to win back those 16% of Canadians who say they might subscribe to cable is a dramatically different pricing and packaging scenario. “They are not necessarily buying the way you are selling these days,” said Hendren.
Those customers want lower prices and the ability to pick and choose the individual channels they want to watch, with the top five identified channels they would choose being HBO, Discovery, CTV, History and TSN.
***********************
THE CCSA PRESENTED ITS member and supplier of the year awards on Monday evening at its popular Board of Directors dinner with Novus Entertainment winning the former and Channel Zero the latter.
Pictured is Novus’s Diane Robertson accepting her company’s award.
Channel Zero’s Cal Millar accepted the supplier of the year award from CCSA president and CEO Alyson Townsend.
The “Showcase” trade show floor was pretty packed Monday morning.
Cartoon Network’s Kristin Murphy and Mary-Anne Taylor.
Source Cable’s Myrna Bontje tried her hand at slot hockey at the Clearcable booth.
Co-opérative de câblodistribution de l'arrière pays Stephane Arseneau (left) and Marc Picard.
Markdale Cable’s Dave Armstrong (left) and CRTC’s Len Katz.
It’s definitely fall in Huntsville.
CCSA board chair and Access Communications CEO Jim Deane, on the big screen.
Astrocom Cable’s (Geraldton, Ont.) John Emmans received a special gift from CCSA’s Chris Edwards.
CRTC chair Jean-Pierre Blais holds court with fellow commissioners Len Katz (right), Suzanne Lamarre (left) and the CCSA’s Harris Boyd and Alyson Townsend.
Luc Perreault at The Weather Network/MétéoMédia booth.
The Sunday night social crowd was a big one.
Hawley Chester of Platinum sponsor Fox Cable Networks welcomed delegates Sunday night.
From left, Super Channel’s Dawna Dunlop, Kim Perdue and Grant Campbell.
Story and photos by Greg O’Brien
