This is useful when you need to convert some high resolution MKV video into an AVI file, in order to save space at the cost of quality. Say you have a Matroska video file, my_video.mkv. To convert it to AVI you can use mencoder (the command below is only one line):
mencoder my_video.mkv -ffourcc xvid -ovc lavc -lavcopts vcodec=xvid:vhq:vbitrate=1800 -oac mp3lame -lameopts vbr=5 -o output_video.avi
The resulted AVI file will be output_video.avi, located in the same directory as the source, and will have about 35% the size of the source file.