Charter 2003 Annual Report Download - page 27

customer contact centers, we are able to service our customers 24 hours a day, seven days a week and utilize
technologically advanced equipment that we believe enhances interactions with our customers. Our customer
care specialists receive specialized training to develop customer contact skills and product knowledge that are
targeted towards prompt and responsive resolution of customer complaints and customer retention, as well as
towards selling additional and higher levels of service to our customers. As of December 31, 2003, we had 53
customer service locations, and our 20 largest customer service locations serviced approximately 93% of our
customers.
Sales and Marketing
Charter and its subsidiaries have a single team responsible for overseeing the sales and marketing
strategies of our individual systems. For most of our systems with over 60,000 customers, an assigned
marketing manager implements our marketing decisions, while smaller systems are handled at the divisional
level. Due to our focus in 2003 on certain other operational matters and due to certain Ñnancial constraints, we
reduced spending in 2003 on marketing our products and services. For the year ended December 31, 2003, we
had marketing expenditures of $107 million. We expect to increase our spending on marketing in 2004.
Our marketing eÅorts are intended to promote good interaction, quick information Öow and sharing of
best practices between our corporate oÇce, which handles programs and administration, and our Ñeld oÇces,
which implement our various marketing programs. We monitor government regulation, customer perception,
competition, pricing and product preferences, among other factors, to increase our responsiveness to our
customers. Our coordinated marketing techniques include door-to-door solicitation, telemarketing, media
advertising, e-marketing, direct mail solicitation and retail locations. We also market and sell our services
through consumer electronics retailers and other retailers that sell televisions or cable modems.
In January 2004, we introduced the Ñrst national branding campaign in Charter's history. The ""Get
Hooked'' branding initiative will be a key focal point of our national marketing campaigns throughout the year,
designed to promote our long-term objective of increasing our cash Öow through deeper market penetration
and growth in revenue per customer. Our goal for 2004 is for our corporate team to produce six to eight
national marketing campaigns employing our new national ""Get Hooked'' Charter branding to:
‚ Promote customer awareness and loyalty;
‚ Attract former customers and households that have never subscribed to our services;
‚ Promote our advanced services (such as DVR, high deÑnition television, VOD and SVOD) with the
goal that our customers will view their cable connection as one-stop shopping for video, voice, high-
speed data and interactive services;
‚ Promote our bundling of digital video and high-speed data services and pricing strategies; and
‚ Announce the launch of our advanced services as they become available in our systems.
Programming
General
We believe that oÅering a wide variety of programming is an important factor that inÖuences a
customer's decision to subscribe to and retain our cable services. We rely on market research, customer
demographics and local programming preferences to determine channel oÅerings in each of our markets. We
obtain basic and premium programming from a number of suppliers, usually pursuant to a written contract.
Our programming contracts generally continue for a Ñxed period of time, usually from three to ten years, and
are subject to negotiated renewal. Some program suppliers oÅer Ñnancial incentives to support the launch of a
channel and ongoing marketing support or launch fees. We also negotiate volume discount pricing structures.
Programming costs are usually payable each month based on calculations performed by us and are subject to
adjustment based on the results of periodic audits by the programmers.
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