Oct
12

Are Cable Companies Finally Listening to Consumers?

Post by Ted Donnelly

I read an article earlier this week on MSN Money that reported Cable Companies may finally be coming around to the idea of offering a la carte programming, whereby the consumer is able to select a customized channel lineup for their cable subscription based on their individual preferences.  The concept is not exactly new and the rumors of a shift in the business model have percolated in the media for some time.


Cable companies have long resisted this change, disputing it as a feasible business model.  From a revenue standpoint, I understand the opposition.  Bundling the channels together allows the cable operators to justify higher fees, allowing the popular channels to carry the niche programming.  This is all cleverly disguised as offering more variety and more choice.  The only problem is if you cannot select what you want without paying for a depository of content that you would rather do without, it’s not really a choice at all, is it? 
 

As a provider of marketing research services, I can’t help but wonder how long they have been ignoring their consumer research findings.  I would imagine the consumer has been making noise about this at every possible touch point in their marketing research efforts for many years now.  I envision it being that recurring theme that comes up in every piece of consumer research; the side note that haunts them even when the research has nothing to do with packages and channel lineups.  It’s probably that played out point that makes the cable company brass cringe behind the one way mirror and secretly scream out, “okay, we get it!”


You really don’t need to be a marketing research professional to know customers like to pay for what they want and only what they want.  Even within our company, we certainly have had to adapt our offerings to be more nimble to our clients’ needs.  The general gist is we will provide as much or as little as you need.  We often joke that we can just blacktop your driveway for you if that’s all you really need.  There are times, especially on the consulting end, it will come with warnings and disclaimers to allow the client to make an educated decision.  Ultimately, though, the choice lies with them.  More than ever, the current business climate has amplified the concept that we must be sensitive to our customers’ needs and desires.


As the competitive space has changed dramatically for cable operators, I question whether they are truly responding proactively to consumer insights or are simply reacting defensively to the competitive environment.  With the proliferation of more a la carte content providers, such as Hulu, Netflix and even YouTube, more consumers are switching off to traditional cable.  With cable subscriber figures plummeting, this resistance to change may have been overly shortsighted in hindsight.  As consumers are acclimating to other ways to consume content, this change may be coming too late to win them back.  Admittedly, I may be a little biased, but there’s a lesson in there about listening to your marketing research data.