Insight Taps Encore for Digital Boost

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Insight Communications Co. Inc. is testing a "New
video store at home" marketing campaign in Rockford, Ill., to attract basic-only
customers to digital cable.

Encore Media Group LLC helped to tailor the program for
Insight. The movie-channel provider has used similar tactics in the past to drive digital
penetration beyond the typical target base of premium-movie households.

The splashy direct-mailer -- which asks basic-cable
customers to "Kiss the video store goodbye" -- was sent about two weeks ago,
according to Insight senior vice president of marketing and programming Pam Euler-Halling.

Although it may take another week or two to analyze
buy-rates from the campaign, Euler-Halling was pleased with the initial results.

"Nonpremium homes are very heavy video renters,"
Encore senior vice president of sales and affiliate marketing Que Spaulding said, adding
that Encore's goal is to help penetrate 25 percent to 30 percent of nonpremium cable
homes with digital.

Why is Encore pushing the new-video-store concept?
"It's positioning," Spaulding said. "In a high-tech-gadget world, you
have to give people something they can identify with immediately."

The offer boasts that customers can get more than 500
movies per month with "Insight Digital." The flyer promotes 15 commercial-free
movie channels --12 themed Encore channels, as well as The Independent Film Channel,
Turner Classic Movies and Romance Classics -- for $11.90 per month, including the digital
fee and $4.95 for the movie tier.

Also playing into the promotion is Insight's
"OnSet" video-on-demand service, with access to 250 movie titles.

Spaulding said VOD compares with the just-released section
in a video store, while some of Encore's channels, such as Westerns and Mystery, act
as genre-specific aisles.

Euler-Halling stressed that movies are just one aspect of
the digital service that Insight needs to promote. The interactive program guide, digital
music channels and the "LocalSource" information guide also need to be explained
in separate campaigns, she added.

If the new-video-store mailer proves successful,
Euler-Halling said, Insight might expand the effort to the rest of Rockford. And if the
promotion demonstrates higher-than-normal close rates and retention rates, the MSO might
add other digital markets, including Columbus, Ohio, and Evansville, Ind.

In addition to the direct-mailer, Insight is backing the
campaign with billboards, radio, television and telemarketing. Encore helped with co-op
advertising funding, as well as training support for Insight's customer-service
representatives.

Spaulding said it's important to let former premium
customers know that "Pay TV on digital is not your father's pay TV." Once
they know that premium television is no longer a one-screen option, former pay customers
may come back to the fold, he added.

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