Charter Refreshes Brand, Targets Lower-Income Customers

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As cable operators Comcast and Cablevision dramatically rebranded their services, the head of Charter Communications indicated his company would go softer, focusing more on creating sub-brands under the Charter umbrella.

For example, a "Charter Starter" triple-play package is being prepped that targets lower-income consumers. The customer base is tabbed as having a "high credit risk," where a large majority disconnect within nine months, many due to unpaid bills.

Speaking on a conference call, Charter CEO Michael Lovett declined to release further details on "Charter Starter" for competitive reasons.

Somewhat cryptically, Lovett said the initiative would look to limit the ability of some customers to sign up for more expensive packages "until they establish a creditworthy relationship with us." Then Charter would look to "upgrade them into (higher-end) products over time."

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Time Warner Cable is experimenting with a lower-tier TV offering, where channel choice is limited, but the cost is less. But the philosophy may be more about giving customers a lower-cost opportunity, rather than limiting them due to credit standing.

Regarding a profound rebranding, such as Comcast's Xfinity and Cablevision's Optimum, Lovett said Charter considered it after emerging from bankruptcy in late 2009, but instead has been investing significantly in "refreshing the Charter brand."

"I think there is an opportunity somewhat similar to a 'Charter Starter' to use sub-branding within products and packages," he said.

Traditionally, Charter has spent all its marketing dollars on direct-response campaigns. Yet over the past six months, it has invested heavily in brand advertising. However, Lovett indicated that did not bring the immediate results hoped for, so the company will be "dialing up" a more balanced media mix.

Charter had 4.17 million video customers at the end of June.

 

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