Cable Firms Hope for More Profit Via Net

Cable television operators hope results of a new survey will help the industry snare a heftier percentage of advertising dollars being spent by “dot-com” companies as they scramble to build brand awareness and revenue.

The survey conducted by market research firm Greenfield Online Inc. suggests that members of households with cable television also are likely to be heavy Internet users.

“We already knew that cable households are affluent by nature, but now we have data showing that cable viewers also are among the heaviest online users,” said Hank Oster, vice president of Adlink, a Los Angeles-based company that processes advertising for Southern California cable systems. “The survey clearly shows that the highest density of Internet users in Los Angeles resides in cable households.”

Cable systems accounted for a modest percentage of the $3.17 billion that dot-com and Internet companies spent on traditional advertising in 1999, according to New York-based Competitive Media Reporting. The dot-com spending spree has more broadly benefited broadcast television, radio and print outlets. National network cable advertising accounted for 15% of the total. Local ad sales--including both cable and broadcast--accounted for 13%.

“We haven’t provided enough information on the local market level so agencies could intelligently inform clients that cable is a potential alternative,” Oster said. “But now we have data backing up the fact that dot-coms, Internet and online companies can use cable to target online users.”

According to survey results, Southern California cable viewers are 67% more likely than the national average to have high-speed Internet access. They’re also 20% more likely to be signed on for four or more hours daily.

The survey also suggests that cable users who venture online are younger and wealthier than the national average. The median age of the Los Angeles cable household is 38.5 years, compared with 43.3 years nationwide. The median income is $54,356, compared with $46,667 nationwide.

Oster said the cable industry must replicate the survey in other key metropolitan areas to prove to dot-com advertisers that cable is a viable alternative to other media. Adlink purchases advertising for Southern California cable systems with 3.3 million combined households.

“We’ve already sent out direct mailers to 150 of the nation’s top venture capital firms,” Oster said. “We’re working with high-level managers in advertising agencies to keep them informed, and we’ve also sent out more than 2,500 direct mail pieces to top dot-coms.”