Ops Diversify to Serve Markets

December 18, 2007
Via Multichannel News

When most people think of the cable industry's multicultural and diversity efforts, they tend to think of ethnic programming tiers and international long-distance calling plans.

But a successful multicultural effort means more than just programming and product offers, according to operators. Interestingly, it also translates into more than just heritage or background. For many operators, it turns out that diversity includes any group that is passionate about something, be it ethnicity, culture, gender, team affiliation or geographic location.

Cox Communications' Orange County, Calif., operation, for instance, is fixing its sights on the area's senior population, which has very different needs and desires from younger customers. And in Kentucky, where the U.S. Census Bureau data states that more than 90% of the population is white, Insight Communications has found that multicultural differences are most prevalent in folks' college and high-school team affiliations.

That's not to say multiethnic efforts by operators aren't blossoming at every turn. In Cox's Santa Barbara, Calif., system, where more than 40% of the area's population is Hispanic, the operator has become increasingly engrained in the Latino community with programming offerings, community outreach and marketing campaigns.

Comcast has created several alliances with national ethnic organizations that, in turn, allow local markets to create partnerships aimed at attracting and retaining multiethnic customers. Other operators around the country are forging similar partnerships.

Paying attention to various ethnic groups makes good sense, especially given recent population changes, said Susan Gonzales, vice president of the Comcast Foundation and senior director of federal government and external affairs for Comcast. According to 2005 U.S. Census Bureau information, 45% of American children under the age of five are minorities. And the number of minorities are growing: In 2006, the nation's minority population reached 100.7 million, up from 98.3 million the year before. Hispanics accounted for almost half (1.4 million) of the national population growth between July 1, 2005, and July 1, 2006, according to U.S. Census data. The department also predicted that in 35 of the country's 50 largest cities, non-Hispanic whites are or soon will be in the minority. It's that kind of data that has made diversity a priority for the entire industry.

Programming aimed at specific ethnic groups has mushroomed in the past couple of years. Direct-broadcast satellite providers EchoStar Communications and DirecTV have long been at the forefront of luring people of color and culture to their litany of ethnic programming packages. But cable operators are gaining speed. No longer are a few African-American and Hispanic channels enough to lure and retain customers. Cablevision Systems, for instance, offers a group of nine programming packages featuring channels from around the world in such languages as Spanish, Russian, Italian, Chinese, Korean and Hindi. Charter Communications' Glendale, Calif., system is heavily Armenian and offers customers eight channels on its basic, expanded basic and digital tiers featuring news and entertainment in Armenian, Russian and Farsi. Charter is also streaming international, foreign-language movies and TV programming on its Web portal. Initial content includes on-demand movies and TV programs in Chinese (Cantonese), Hindi and Spanish. More content is planned for the future, according to the company.

Long-distance calling plans have also been warmly embraced by customers served by Time Warner, Comcast, Cox and Charter, among others. The idea behind these packages is to drive triple-play bundles of video, voice and data service, executives said. But it also is a way of endearing the cable operator with customers. By making it easier and cheaper to talk to relatives across the border or across the ocean, the operator is letting customers know it cares.

Comcast has long offered a slew of products aimed at its ethnic audiences, particularly the Hispanic market. For example, in 2004, the operator introduced a video-on-demand service aimed at Hispanics. It's been a huge success, registering double-digit growth in number of orders of culturally relevant programming such as movies, music, children's fare and sports, as reported by Multichannel News . But the company's launch of "Mexico Cien," 100 minutes of long-distance calling to Mexico for $4.95 a month, has been equally popular. The product launched in five test markets (San Francisco, Chicago, Denver, Portland and Seattle) earlier this year. Comcast plans to roll out the service nationwide in the first quarter of 2008.

But those are just a couple components in Comcast's diversity and multicultural plan. The company has a four-pronged approach that includes programming, employment, community investment and supplier diversity.

COMMUNITY TIES

"All our efforts at the company are predicated on those four things," Gonzales said. "It's really all about becoming a member of the community where we work and live."

That's exactly the way Insight feels about it. But what do cable operators that operate in predominantly monoethnic areas do to expand their multicultural efforts? It's all about connecting with whatever customers are passionate about, according to Insight president and chief operating officer Dinni Jain.

Jain " an Indian-American who grew up in the South " is a flag-waving Tar Heel who bleeds North Carolina blue. So he understands how important sports teams and schools are to his customers. And it's more than just showing the games on TV, although Insight makes sure it has plenty of sports programming to satisfy its customers. It's actually feeling as strongly about the teams as its customers do, Jain said.

Insight uses its marketing muscle to showcase how fanatic its own employees are about their sports team affiliations, forging a stronger connection between the company and its customers. It puts a human face on a corporate entity.

"It all goes back to being local and connecting with what is important to your customers," Jain said. "The cable industry doesn't necessarily have a natural advantage of being the local provider. It takes a lot of work. You can't just sponsor a local high school baseball team and call it local commitment. At the end of the day, that isn't going to protect us.

"But if you are from Lexington, Ky., and all your employees are from there and they know what is important to customers, then your advantage becomes real. If something happens to our plant and people start calling, they'll get call center people who will connect with the emotion. You'll hear them say, 'Oh no! The Wildcats are up by three. We'll get a repair truck to you as soon as possible.' It has to do with understanding your customers and connecting with them in real ways that matter to them."

Insight's markets aren't a hotbed of multiethnicity, Jain said. But that doesn't mean it's ignoring the differences that define customers' preferences and background.

"The culture of sports is huge for our territory," he said. "And we would be remiss if we didn't carry the channels that they want to watch. We carry ethic programming as well, including all the African-American and many Hispanic channels. We are also paying more attention to what women want. [Oxygen founder] Geraldine Laybourne is on our board and has convinced me that women make 80% of the buying decisions in a household and we need to start paying more attention to that group. We have to be humanly compassionate and pay attention to whatever our customers are paying attention to and need."

That's how Cox views its multicultural efforts as well, said Colleen Langner, vice president of sales and marketing for Cox's Orange County/Palos Verdes operation. In an effort to be the "trusted provider in the digital age," Cox is taking extra care to help seniors understand the complexities and benefits of the products it offers. Seniors are often dismissed as being technology-phobic and efforts to market advanced services to that demographic are sporadic. But Cox has taken a different approach in Orange County, where about 12% of the population is senior citizens.

BOOMER BOOM

"Diversity is important," Langner said. "It's really about understanding your local community. We found we wanted to focus on the senior demographic here in Orange County. We want to be everyone's trusted provider, but seniors really need to trust who they do business with. It's a demographic we really need to pay attention to because it's a growing market. The boomer market is, well booming."

Some seniors are intimidated about the digital messages operators are tossing around these days, she said. "They need a bit more hand-holding and clarity to understand why they need our services."

Cox uses a variety of methods to connect with senior citizens in Orange County. The operator has long been involved with the South County Senior Services organization. Leo Brennan, who used to run the Orange County system and now oversees Cox's Las Vegas operation, launched support for the group in 1990, said communications manager Ayn Cruciun. Cox has sponsored a "senior prom" event for the past 18 years that raises funds for Meals on Wheels and other organizations that help seniors. As of 2005, over $335,000 had been raised and over 11,000 seniors have attended the event.

Cox has also assigned specific sales people to homeowners associations, senior centers and housing complexes so they can provide educational opportunities for residents. This tactic has been particularly successful with seniors.

"If they can see how easy it is to download their grandkids' pictures or talk to them on the phone at a lower rate than what they are used to paying, it all of a sudden resonates with them," Langner said. "Like with every demographic, it has to relate to their lives. Cox corporate expects to target echo boomers and seniors more and more, and we expect to have more marketing aimed at those groups in the future. They are both a huge demographics with totally different needs and desires. We have to talk to them and educate them differently about our products and services. But they are both important."

Cox's Santa Barbara, Calif., operation is also helping customers and residents better understand the history and makeup of their community, said the system's director of public affairs David Edelman. The company is heavily involved with Santa Barbara's Old Spanish Days Fiesta, a week long celebration that includes cultural events, tours, a children's parade, the largest equestrian parade in the West, dance performances, and various celebrations around the town. The goal: To create a connection between Latino residents, as well as help Anglo customers better understand the Latino heritage and culture in the area.

"It's a dual-cultural experience," Edelman said. "Everyone gets something out of it and it's a great event."

FIESTA BACKER

Cox has been heavily involved with the fiesta for almost two decades, he said, noting that participation has grown over the years to include co-producing the Fiesta parade and opening night ceremonies with a local broadcaster; running promotional spots; and creating a four-part series called Fiesta TV . The shows highlight the fiesta's history and benefits to the community.

That's just the beginning of the operator's community outreach efforts. Santa Barbara is very bifurcated economically and most of the residents on the low end of the spectrum are Hispanic, Edelman said. The company has aligned itself with a local charity called the Unity Shop that provides food and clothing to 14,000 of the area's poorest residents. Cox has begun producing the charity's annual telethon to raise operational funds.

"Seventy percent of the clients serviced by the Unity Shop are Latino, and it has discovered a method of creating dignity for people who can't afford food or clothing," Edelman said. "We are proud of partnering with this group that helps people in need in ways that don't cheat them of their self-respect."

Cox Santa Barbara is also involved in "Computers for Families," an initiative started by a group of local businessmen a few years ago. The group raises about $400,000 each year to provide refurbished computers for underpriviledged fourth graders in the community. Cox also gives the recipients' families a 75% discount on broadband service for three years.

"We didn't want to just write a check in our community and call it good," Edelman said. "We wanted to become partners with the community. It's just the right thing to do."

Gonzales agrees, although Comcast takes a different approach to its diversity efforts. While Cox's initiatives tend to grow from the local systems, Comcast normally initiates its efforts from the top down. National partnerships are created and then trickle down to the local level.

For example, the operator recently aligned with the National Urban League for a three-year partnership designed to increase awareness and develop the group's various education programs. Comcast will produce a series of public service announcements about the NUL's programs and services. In addition, Comcast and NUL have committed to continue their existing partnership on Comcast Cares Day, Comcast's company-wide day of service.

"Comcast and NUL have enjoyed a longstanding relationship, and it's an excellent example of corporations partnering with organizations to better serve our communities," Comcast vice president of strategic initiatives Payne Brown said.

The partnership "represents an exciting and valuable opportunity for the league and Comcast to help thousands of African-Americans seize control of their economic destiny through better education," NUL president and CEO Marc Morial said when the alliance was announced last month.

The affiliation mirrors partnerships the operator has forged with other organizations including the National Council of LaRaza, where Comcast has provided grants to eight local affiliates to encourage literacy and health. Comcast has also teamed with the U.S. Hispanic Chamber of Commerce giving the organization money to give local chapters information on corporate supply chains. And it created a direct mailer sent to Hispanic chamber members promoting Comcast's commercial services. It was the first time it used an organization's database to market its products and services. It worked well, Gonzales said, and Comcast hopes to do more of that kind of marketing with other groups in the future.

"What we've done in the past couple of years is figure out a way to do the right thing and bring it back to the business," Gonzales said.

Not only is Comcast creating new ways and routes to market its services, it is expanding its pipeline for talent and vendors. It's also able to explain its positions on policy issues to various groups in an effort to gain their support. That happened recently when the National Coalition of Latino Clergy and Christian Leaders and the Hispanic Federation blasted Federal Communications Commission chairman Kevin Martin's efforts to reregulate cable.

The clergy group criticized the maneuver as a way for Martin to impose a la carte cable subscriptions that would undermine minority programming. The Hispanic Federation accused Martin of exploiting the little-known rule from the 1984 Cable Act that would impose policies that would have devastating effects on Hispanic ownership and representation in the media. Gonzales said Comcast's affiliation with those groups didn't necessitate a response from them, it simply means Comcast has an opportunity to explain its position so non-profit groups can make decisions based on both sides of an issue.

"Comcast's diversity efforts are a web of activity that goes across all our business areas," Gonzales said. "It's also more than just writing a check. Many organizations are happy to take our money, but many want partnerships and we do, too."

This year, Comcast and the National Puerto Rican Coalition worked with Rutgers University and the New Jersey State Board of Education to create an intern program. Comcast funded the program and put some of the interns to work throughout the Tri-State area. The company also brought all the interns to Philadelphia for a day as part of its intern program that included interns from the Congressional Hispanic Caucus, the Congressional Black Caucus, Gonzales said.

"These day-long events are great," she said. "We have all our senior executives, including [chairman] Ralph Roberts, come in and talk to these kids about the industry and Comcast. All these diversity programs only work if they are supported from executives at the top and all our executives, especially [executive vice president] David Cohen, are committed to these programs."

Source: Broadcast Newsroom