All types of companies and organizations benefit from data analysis. Two industries in which we have seen these benefits firsthand are cable and media. Over the years, we have worked with many companies in these fields to improve their businesses through data—from working with cable companies to increase the number of subscribers, to helping media companies analyze web traffic in order to improve their revenue generation practices. In this month’s blog post, we reflect on a few use cases and solutions we have been able to provide to both cable and media companies.
First and foremost, the cable industry is focused on the consumer; namely, providing quality services and content in order to gain and retain subscribers. This is why many cable companies utilize marketing analytics—these use cases have the opportunity to greatly improve the company’s bottom line by either increasing the overall number of subscribers and their longevity with the company, or reducing marketing spends through optimization to gain the same results.
For a cable company, a new subscriber represents a source of recurring revenue for months or years to come, so gaining (or losing) a subscriber has a long-term impact. That is why it is important for the company to do everything in its power to gain and keep subscribers. Using their existing data, cable companies can optimize their direct mail lists—instead of sending a mass mailing to people who may or may not be interested in their services, they can use data to micro-target their lists to be sent only to potential subscribers who are the most likely to be in need of their services, or those who have the highest lifetime value potential. This tactic reduces marketing expenses and leads to a higher overall take rate.
It is also important to retain existing subscribers. Data on past and current subscribers can be used to develop predictive models that show who is most likely to churn in a given month. With this knowledge, companies can take action to retain subscribers before they call to cancel service. Predictive models may also be utilized to determine which tactic would be most effective for retaining a given subscriber; tactics include method of contact (mailer, phone call, or email), specific offer (free premium channel for a few months, discount offer, etc.), or whether contact would be ineffective regardless of method or offer—there is no use expending resources on someone who is determined to leave. A mathematical model can also calculate a predicted lifetime value, allowing decision-makers to prioritize marketing efforts towards those who are most likely to provide the highest value to the company, optimizing marketing spend.
Some media companies, particularly those that provide large amounts of digital content on their websites, seek to analyze web traffic in order to improve their sites and discover opportunities to drive website profits by predicting key value drivers. Many insights can be gleaned from an in-depth analysis of overall website usage, such as which topics or types of content drive the most traffic. These insights can inform a company’s overall content generation strategy. For instance, if “baseball” seems to be a popular topic in a given market, but “local politics” falls near the bottom, the editors can make sure to staff more sports writers than political writers—and offer more baseball coverage within the sports department. Or, they might discover that pages with video content are more popular than pages with text and images alone. The editors could shift their focus to creating more video content in order to increase traffic. Mapping how users navigate through the site can also help to optimize site design, prioritize the most popular content, and suggest related stories that are most likely to keep the user on the site, driving overall site traffic.
While web traffic is one a major source of revenue, some media companies also collect revenue by offering subscription-based services that provide exclusive content to members. By comparing the website usage patterns of registered users (those with either paid or unpaid accounts) to users from “the wild,” decision-makers are able to draw possible conclusions on what compels someone to register to use the site. By combining this data with user segmentation data, a company can learn what appeals to visitors of different demographics and develop additional content geared towards user demographics that may be underutilizing the site in order to make those demographics more profitable.
A Wealth of Data Means Huge Opportunity
There is no shortage of data available in the media and cable industries which makes them ideally positioned to take advantage of the latest analytics solutions. This is not an exhaustive list of all possible uses of analytics in these industries; these use cases only begin to scratch the surface of what is possible. However, even the most basic data analysis project can produce huge benefits, in the form of increased revenue or decreased expenses, and can provide management with new insights into the nuances of their business.