Vonage targets cable company's VoIP business with new ad campaign

VoIP provider Vonage (NYSE: VG), which saw its income triple in the third quarter, is looking to grow that line by getting more aggressive in its advertising, launching a two-pronged campaign that targets customers who take bundled cable services.

The new campaign is designed to make consumers take a harder look at their cable bill--which has been in the headlines a lot recently as the pay-TV industry has seen subscribers impacted by the economy look to save money by "cutting the cord" to service providers.

The ads question the bottom line for consumers of cable's bundling practice with lines like "Our cable company sure is sneaky," and "This bundle of yours is costing us a fortune." The company said it believed about 70 percent of consumers could save money if they dropped cable's phone service and went with Vonage.

But first, said Vonage VP of marketing Leesa Eichberger, the company has to make consumers aware of what each piece of their cable bill costs them.

"We found that a lot of people are in bundles, but they don't really know what they're paying," said Leesa Eichberger, Vonage VP-marketing. "We wanted to raise that question in consumers' minds."

Vonage, with a subscriber base of 2.4 million, makes about half its revenue from that segment. And it plans to hit its cable competitors right where they live, running the ads on cable channels like ESPN, Discovery and the History Channel.

Analysts say the VoIP market is about 26 million users in the U.S., worth an estimated $14.1 billion this year, and projected to grow to $31.5 in 2016. Cable operators like Comcast, Time Warner Cable, Cablevision and Charter count about 20 million of those users.

For more:
- see this AdvertisingAge article

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