September 2010 – Channel Crossing: DRTV

Nothing Lasts Forever…Thank Goodness

This has been a challenging year at best. A bullish media market drove up rates, while a lingering economic downturn depressed consumer confidence and as a result, their willingness to respond to DRTV offers. Here’s the good news. The 2011 television Upfront market was extremely strong. That means there will be less pressure from high-rate general advertisers on the Scatter market, where DRTV resides.

Furthermore, DRTV response rates are on the rise. Despite the summer’s news reports of sinking consumer confidence, we’ve seen an across-the-board improvement in DRTV response rates, a pure impulse purchase and one of the truest measures of consumer confidence. Improved consumer response, coupled with a stable media market, has enabled more campaigns to achieve profitable scale.

What Have We Learned?
As 2010 moves into 2011, the DRTV industry will continue to improve. How long it will take consumer willingness to purchase $10, $14.99 and $19.99 items to trickle up to more expensive infomercial offers remains open ended. However, we expect that the improvements in the media market and in consumer confidence that are now boosting short-form DRTV will begin to have a sustained and positive impact on long form later in the fall.

What new insights can we carry forward from the trials of the past year? The first is that neither good nor bad times will last forever. Our industry is affected by powerful and dynamic economic and social trends. To think that we can affect or beat these forces is fool-hearted at best. We need to be nimble enough to take advantage of opportunities when they arise, and intelligent enough to adjust our exposure to constant social and economic change.

We also need to constantly protect and add value to the “As Seen on TV” retail franchise, which has become the dominant revenue channel of our industry. Scott Boilen of Allstar Marketing raised a pressing concern as a panelist during an industry conference in May. Boilen said that the biggest risk we faced was the pretenders that take advantage of the hard-earned As Seen on TV retail space, with products that have never been seen on TV in a meaningful way.

As these DRTV wannabees sit unsold on store shelves, retailers are going to lose confidence in the next wave of deserving products. As an industry, we need to embrace a more reliable method to monitor and report on DRTV campaign activity than we currently settle for.

Don’t be impatient and settle for mediocrity. Over the past year, some of the smartest and most successful DRTV marketers in the world have compromised their standards on campaigns delivering ROIs below historic norms. They justified their decisions based on high media rates and poor consumer response. Some said that DRTV would never again be a profitable stand-alone channel. Over the past year, a media earnings ratio of 1.3 became the new 2.5.

Fortunately, the media market has grown more stable and consumer confidence is on the rise. Scalable, profitable campaigns are starting to take off. Just keep in mind, nothing lasts forever…be patient, nimble and track everything that you do and the DRTV industry will prosper when times allow.

Dick Wechsler is CEO of Irvington, N.Y.-based Lockard & Wechsler Direct, and chairman of Electronic Retailer’s Magazine Advisory Board. Contact Wechsler at rwechsler@lwdirect.com.

September 2010 – Channel Crossing: Legal

Do You Need a Legal Physical?

When was the last time you had a physical? What about a legal physical? If you’ve got a product you’re selling on TV, online or at retail, it may be a good idea to get one from a qualified attorney.

The Examination
Not to worry you, but here are just a few of the subject matters to be considered in the course of such an examination:

• Product/Patent rights. If you obtained your product or invention from someone else, do you have a written contract? Does it include all the rights you need to market the product for as long as you will need to market it and in all the channels of distribution you desire? Is there a patent application or patent? Should a patent application be filed, and if so, by whom and at whose expense? What about international IP protection? Can the product be marketed without infringing someone else’s patent, i.e., has a search of other patents been conducted? Are the royalty and other financial obligations clear?
• Name/Trademark rights. If you obtained the name or trademark of your product from someone else, do you have a written contract? Is it a license or assignment? Does it give you the rights you need to use that name or trademark in commerce as and when you desire? In the contract, is it clear who is indemnifying whom and holding them harmless against future third-party claims, alleging trademark infringement if any arising out of the use of the mark? Is the mark even available for commercial use in the United States or does it infringe registered or unregistered “common law” trademark rights of a third party? Is it confusingly similar with a third party’s mark? Has a full search been done on this, i.e., beyond just a Google search and a www.upsto.gov search? If it is available, should a U.S. trademark application be filed, and if so, what kind, by whom and at whose expense? Is the mark too descriptive to be registered with ease or too easy for someone else to come close to with a similar but lawful “knockoff” name? What about international registrations? And, is the name perhaps too good, meaning the FTC might view it as being deceptive if it impliedly conveys to the ordinary consumer that your product has some benefit, if that claim isn’t substantiated?
• Ad Copy/Copyrights. Who owns the spot or infomercial for your product? Who owns the content of the website? Is there a written, signed “work-made-for-hire” agreement or copyright assignment contract with every person who provided any creative input, so the “chain of title” is clear and is in your name for copyright purposes? Has the material been registered with the U.S. Copyright Office? What about registering the material with U.S. Customs? In your contracts, is it clear who is indemnifying whom against third-party claims, alleging copyright infringement arising out of the material?
• Production. Is there a production contract? Is it clear? Does it include the necessary “work-made-for-hire” language? Does anyone (e.g., talent) have a right of script review or approval? Have you consulted with legal counsel about the script and advertising claims? Are there any edits that should be made or supers or disclaimers added for legal reasons? Were the product demonstrations “rigged” in any way? Is there a release form signed by all on-camera talent? Is there a testimonial affidavit signed by all of your testimonialists? How were they recruited? Were any of them paid or given anything and if so how much, when, by whom and for what?

If you have an expert (e.g., a doctor) who is going to endorse your product in your ad, what exactly did he or she do to evaluate the product and to support whatever he or she is saying or implying about it in the ad; and is there a signed expert endorsement affidavit to back it up? Under your contract, is it clear who will indemnify whom for any third-party claim of copyright infringement or false advertising arising from the ad?

• FTC claims review. No advertising should be done without there having been some FTC claims review or consultation ahead of time. What express claims are being made? What would the FTC believe the implied claims are? Liability exists for both express and implied claims. For each, do you have adequate substantiation according to FTC precedent? Given your product and your claims about it, what degree of substantiation would the FTC likely require? Do you need a clinical? Do you need two? Does it need to have a placebo group or other design features? Is there any preexisting substantiation you can borrow from, that may apply to your product and your claims? What edits could be made and what supers or disclaimers added, for a reduced legal risk level? What substantiation could be developed? Does your product or your claim about it fall into a category that the FTC historically has been interested in (e.g., weight loss)? Are you subject to other regulatory bodies such as the FDA? Do you use testimonials? If so, have you ascertained and are you disclosing the results that one can “generally expect” from use of your product in the depicted circumstances? Are you using the word “free” and if so how and why? Are you “guaranteeing” any results? In terms of the online space, is your privacy policy adequate? Are your terms of use adequate? Are you running a sweepstakes or contest? Are you using disclaimers and disclosures properly and in the right locations? Are you using online affiliates or affiliate networks? If so, is their conduct in compliance with the FTC Act and the FTC’s guidelines? The same question goes for any bloggers or other social media participants you pay or to whom you may send free product or gifts. Are they, for example, disclosing the material connection that they have with you (e.g., that you gave them free product)? Finally, in your contracts, who is indemnifying whom for FTC or other third party (e.g., attorneys general) claims of false or deceptive advertising?
• Contracts. Does everyone who has an obligation to you, and does everyone who has a right to be paid by you, have a signed contract? Is anything vague, ambiguous, unclear or otherwise a “loose end,” and if so which party does that favor?

Consult with an Expert
On some of the above matters, it may be reasonable to defer getting legal advice until you’ve tested your campaign and you know it will make money; but on others, it is a major risk to do that. Figuring out which is which is the first step. As they say on TV, “always consult your physician before beginning this or any other exercise program…”

Greg Sater is an attorney with Rutter Hobbs & Davidoff in Los Angeles. Contact Sater at (310) 286-1700 or at gsater@rutterhobbs.com.

September 2010 – Columns: Guest Viewpoint

DRTV Categories and Product Promises Withstand Hard Times

Recent economic reports offer a mix of messages that may as well come accompanied with the disclaimer, “Results may vary.” However, as DRTV marketers continue with their own varying outcomes during what has now become known as the Great Recession, there are some encouraging signs. Nielsen reports that primetime viewership is up 3 percent in households that have high-definition television sets and that nearly 52 percent of all U.S. TV households are now watching TV with the more vivid technology.

What’s Considered Recession-Proof?
The phenomenon is no doubt a reflection of the hunker-down mentality that many consumers have adopted–think “staycation”–where folks forego pricey expenditures and, instead, focus on feathering their nests and bringing balance to their lives. Interestingly, the most successful long-form DRTV products of recent note reflect these very same ambitions. An analysis of the IMS Retail Rankings for May 2010 illustrates that there are several categories and types of consumer products that appear to withstand the vagaries of a shaky economy:

Five of the top 25 shows come from the Health and Fitness category, including four of the top 10, reflecting buyers’ desire for a body makeover. While this category seems to consistently be a dominant one in both good times and bad, its current resiliency may in part be attributable to the sort of personal recalibration that occurs in times of economic strife. The New York Times reports that one-third of Americans are obese, suggesting that in addition to waistlines, the category itself will continue to grow. Further, such products are frequently sold as a convenient and wallet-slimming alternative to gym memberships.

Household products comprise the largest category, with nearly a third falling into this broad spectrum. From solutions for the kitchen to the bathroom, to the outdoors, these products all offer ways to make life at home more livable. All of the products that are winning in the current environment reflect cost-savings that eliminate the need for more expensive alternatives. For example, a steamer can be a cheaper solution to maintaining a clean house versus hiring a service to do it for you. Likewise, DRTV-marketed outdoor tools can replace a costly gardener and VoIP telephone service saves money compared to a landline.

Products that are able to withstand an economic cold front often possess another enduring quality: they offer miraculous results or instant gratification. From undergarments that instantly reshape the body to chamois that absorbs both water and consumer skepticism at impressive rates, a broad spate of such products continues to thrive despite recessionary woes.

While it may seem like the current trend will never end, it’s worth remembering that such climates, like the seasons, are cyclical. Neither a blue-sky mentality nor an outright embracing of the blues should color the day. Rather, it’s faith in our ability to embrace the tenets of success that will chart the industry’s future prosperity.

Peter Koeppel is president of Koeppel Direct, a full-service media buying agency based in Dallas. He can be reached at 972-732-6110 or online at pkoeppel@koeppelinc.com or twitter.com/DRTVBUYER.

September 2010 – Columns: Your Association, Your Bottom Line

A Wealth of Leadership

September is a landmark month in the calendar of the direct response marketer. We gather as an industry at the ERA D2C Convention (incidentally, this marks the 20th anniversary of the event) where we forge and renew friendships as well as business relationships, all while educating ourselves and sharing knowledge with the goal of further honing our craft. And we reflect upon the year that was, celebrating some of the industry’s finest and most innovative work at the ERA Moxie Awards Gala.

September marks a milestone for the ERA, too, as we welcome new volunteer leaders to the board of directors and name a new chairman of the board.

In fact, this year we welcome eight new members to the ERA board of directors. These new members will join our incumbent members to create a board that is comprised of gifted and talented leaders, and one which is balanced and nicely reflective of the industry which it represents–it’s perfectly constituted to provide leadership in what’s certain to be a pivotal 2010-2011.

We welcome two more women to the board: Omni Direct’s Denira Borrero and Cecilia Turner of International Commerce Agency. Both bring extensive DR experience–domestic and international–and join existing members Stacy Durand of Revenue Frontier/Media Design Group and Murad’s Carey Grange to give us four female senior executives on the board.

Adding to the group’s international contingent and providing an Asian perspective is Harry Hill of Oak Lawn Marketing Group. (In addition, John Mills–of John Mills Limited–will represent Europe as the new chairman of the board of ERA Europe.)
DRTV marketers are certainly foundational members of our association, and BJ Fazeli of BJ Global Direct and veteran industry and ERA leader Elliott Segal from Guthy-Renker represent this crucial sector of the industry.

HSN’s Greg Henchel will ensure that we continue to have a board presence from the home-shopping space. Dave Wallace of Syndero brings a wealth of experience from the e-commerce world. Matt Fisher is SVP and GM of direct response at LiveOps, a very techno-centric company with leadership that has its roots in e-commerce, as well.

The board’s new chairman will be Jeff Tuller, president of Savvier. Jeff, a true industry leader, has been a valued member of the association for many years, continually taking on positions of increasing responsibility. A member of the Strategic Planning Committee, Jeff is well positioned to lead the association in the first year of the three-year implementation of the strategic plan. As new vice chairman, SF Video’s Steve Feinberg will ascend to leadership for the 2011-2012 term.

I would be remiss if I didn’t acknowledge outgoing chairman Lee Swanson and thank him for his outstanding service throughout the year. Lee has led ERA through a transformative period. He served as vice chair during the re-launch of the ERA D2C Convention and ERA’s mid-winter event, The Great Ideas Summit. As chairman, Lee was an enormously positive influence and helped drive the approval of the strategic planning process and saw it through to its successful conclusion with the ultimate board approval of the strategic plan.

And as we head into the critical first year of the plan’s implementation, I couldn’t be more impressed with the assembled ERA volunteer leadership. I know that as members, you share my enthusiasm and look forward to working with them in the coming year.

September 2010 – Feature: Special Section-An Industry Remembers

Direct response veterans reflect on 25 years of the infomercial and the lessons that they’ve learned along the way.

BY RICHARD SCHEINER

Welcome to the fourth installment of Electronic Retailer’s celebration of the 25th anniversary of the infomercial.

As we all now know, Al Gore did not invent the Internet by himself, and Lebron James can’t win a championship without some help. It takes many individuals to create a success, and the direct response industry is no exception.

As inventors, marketers, producers, media agencies, telemarketers, fulfillment service suppliers, webmasters and product manufacturers–many of us have played our part. Some individuals have endured the test of time, and others have stepped in to bring the genre to the next level.

In preparation for the D2C Convention in Las Vegas in September, the ERA Public Relations Committee and ERA staff have been busy at work, assembling exhibits of some of the industry’s most iconic and memorable infomercial products to be featured at the convention’s 25th Anniversary Pavilion. Included will be product samples, clips of memorable shows, and information on some of the people and companies that have contributed to the growth and success of the infomercial. We urge all attendees of the convention to stop by the pavilion to visit and reminisce.

This month, we hear from Mercury Media’s John Cabrinha and Dan Danielson, Tim Hawthorne of Hawthorne Direct, Jeffrey Knowles of Venable LLP and Richard Stacey of Northern Response (Int’l) Ltd.

Richard Scheiner is chief operating officer at International Commercial Television Inc. in Wayne, Pa.

Dan Danielson
and John Cabrinha
Co-Founders and Co-Chairmen
Mercury Media

Electronic Retailer: How did you both get into the DRTV industry?

Dan Danielson: John Cabrinha got his start in the DRTV business in 1982, answering telephones for one of the first home shopping shows called “Telephone Auction.” He worked his way up from an operator to a media buyer and was actually an “on-screen demonstrator” a couple of times.

John Cabrinha: I met Dan Danielson at a company called SyberVision in 1987. We were two of the first people to ever call a television station and convince them to sell us a half-hour. We developed relationships with cable systems and broadcast stations all over the country. Back then, stations didn’t know what the value of the time period was and neither did we, so we did some calculations on what they should sell it to us for, and we waited for the response to see if we were correct. We quickly developed a database of stations, markets and time periods and what price they worked for and what types of products were successful.

Danielson: This was so early in the history of DRTV that half-hours weren’t even called infomercials back then. There were only a handful of shows on the air during that time, and we were all learning things as we went along.

ER: Is there any one product that you believe changed the face of DRTV for the consumer?

Danielson: If we look back over the past 25 years of infomercials, we could almost create a time line of the business over those years based on the “mega-hits” that were out there–the products that became household names. Some people in the industry are too young to remember some of the older titles that were there at the start of the business.

SyberVision: The Neuropsychology of Weight Loss was one of the first “home look- and-feel shows.” So many shows followed the style that this show set in 1987. Tony Robbins Personal Power was one of the first shows to use true celebrity hosts and to appeal to a mass audience. Ron Popeil’s Food Dehydrator and Pasta Maker were two of the first massive kitchen product hits. There were other kitchen shows that worked, but Ron took it to another level.

Cabrinha: Tae Bo is one that we consider “the” mega hit because it was the first show that hit the airwaves and ran so much media in a relatively short period of time, and people still talk about it to this day. It is a show to compare your success to, and that success was met or exceeded over a long period of time by The Total Gym.

We consider Bare Escentuals to be the quintessential makeup product that created a brand and had a long TV life and shelf life. Magic Bullet would be considered the modern day big hit. It’s had a long TV life, went to retail and continues to be successful in both channels. They set a trend and broke the mold. I’m sure there are so many shows that we are leaving out that were monumental: Proactiv Solution (long life, brand establishment), Power 90 (exercise, weight loss, customer satisfaction, web, etc.), Kevin Trudeau (various shows developing the talk-show format). Also, Time-Life (with the music and video). We could go on and on.

ER: What is your most memorable (insightful, funny or endearing) story of the DRTV industry or a colleague in the industry to date?

Danielson: We have been doing this for such a long time now that we have so many stories and experiences that have been funny, exciting, humorous and sentimental. As the industry is getting older, the individuals in the business are getting older. We have lost some of our fellow industry pioneers in the past few years. We have always loved this industry because of the people. We have worked with so many great people, whether as clients, vendors, consultants or just friends growing up in the business.

There are lots of stories that we can’t publish, and there are many that are way beyond the word limit we have in this article. The one reason we keep going to work every day and attending every industry event is because we love the relationships and the people we have met over the years, and look forward to seeing those relationships continue to blossom, and hopefully continue to develop relationships with new people as they come into this industry.

Timothy Hawthorne
Founder, Chairman and Executive Creative Director
Hawthorne Direct

Electornic Retailer: What were you working on 25 years ago, in relation to DRTV?

Timothy Hawthorne: In November 1984, I sat in the basement of a local electrician’s home (one of the few C-band satellite owners in Fairfield, Iowa), struggling to tune in tiny cable network, Satellite Program Network (SPN), awaiting the telecast of my first infomercial to air in what, unbeknownst to me, was soon to be a new era of DRTV.

Moments after the hour-long infomercial, I anxiously called our small telemarketing partner in Omaha for results. I was disappointed to learn only 100 orders had been posted. One hundred seemed like a fraction of the potential, considering SPN was in 5 million homes. I pulled out some scratch paper and did my first MER calculation: cost of media: $3,000. Sales: $30,000. Ohhh…a 10 to 1. Thus began my transition from DGA director and documentary filmmaker to DRTV advertising. Over the next 18 months, I helped build the Beckley Group, 525 staff strong, with over $100 million in sales–one of the first major long-form direct marketers.

ER: How has the DRTV industry changed over the past 25 years?

Hawthorne: In 1986, I launched Hawthorne Direct, an ad agency dedicated to bringing long-form DRTV to brand advertisers. For 15 years, I had been telling compelling human interest or investigative stories via documentaries; now I was telling product stories. I still considered myself a filmmaker, not an adman–but these “product stories” presented an even greater challenge: results not measured in TV ratings, but sales and immediate feedback on how successful I executed my visual communication skills. It was thrilling and frightening at the same time.

My vision was that all major brands should capitalize on long form’s inherent power: “The more you tell, the more you sell.” It took a while, but over the past 25 years, hundreds of brands have incorporated DRTV into their marketing mix. Along the way, average production budgets tripled, media prices quintupled and hit ratios “inverse septupled” (from 1/3 to 1/20). Simultaneously, our business has gained complexity, credibility and customers, and expanded product categories, professionalism and stability.

ER: What, if any, technologies and trends will influence future growth and help to shape the DRTV industry?

Hawthorne: PVR, VOD, Internet, mobile, interactive TV, gaming, local, TV Everywhere, Digital Out of Home, social, apps, fragmentation, consumer choice: these are the hallmarks of the New Media age–nothing less than a revolution in communication and advertising as significant as moveable type.

The 65-year-old linear TV viewing experience will remain for a few more decades but diminish in use, replaced by viewers interacting with advertising messages on four screens: TV, computer, mobile (hand set or tablet) and out-of-home digital displays. The primary threat to all advertising remains: in a world of infinite choice, how do we engage viewers in our products’ stories? Any ad delivery mechanism that provides consumer control, immediacy and relevancy will win out in the end. But ads incorporating the trademarks of DRTV–great products and motivating offers–should always find success.

Jeffrey Knowles
Partner
Venable LLP

Electronic Retailer: How did you get into the DRTV industry?

Jeffrey Knowles: In the late ’80s, my brother, an entertainment attorney in New York, introduced me to Tom Fenton and Dick Kaylor at Synchronal. I did some legal and FTC-compliance work for the company, which was then the largest infomercial company in the nation.

In 1990, Congressmen Ron Wyden and Norm Sisisky invited members of the infomercial industry to testify at a hearing about the industry’s practices. I was tasked with preparing Greg Renker, co-founder of Guthy-Renker, to testify as the industry’s representative.

During Greg’s testimony, Sisisky asked whether there were industry standards or an industry group representing the interests of companies producing infomercials. When Greg said there were none, a light bulb went off. I decided the industry needed an association, and I set out to organize it.

Over the next few months, I worked with Greg and other industry leaders to form the National Infomercial Marketing Association (NIMA), which eventually became ERA. Twenty-one years later, the rest is history.

ER: What product or products have changed the face of DRTV within the past 25 years?

Knowles: In my opinion, Proactiv Solution is the single most transformative DRTV product over the past 25 years. It has generated more sales than any other DRTV product, and Guthy-Renker’s success integrating A-list celebrities into direct marketing marks a turning point in the industry’s history.

The Thighmaster was another transformative product. As the first wildly successful exercise product marketed through DRTV, it paved the way for other exercise programs such as Tae Bo and P90X that have continued the tradition of reshaping the industry and customers’ lives.

Thighmaster was also one of the first DRTV products to experience widespread counterfeiting and marketing of knockoffs. Many of the legal strategies we employ today to defend clients’ intellectual property were developed while protecting the Thighmaster.

ER: What is your most memorable (insightful, funny or endearing) story of the DRTV industry or a colleague in the industry to date?

Knowles: Greg Renker’s testimony before Congress in 1990, was a turning point for the industry in more ways than one. I will never forget how Greg carried himself during the hearing. At the time, he was only 33 and was president of one of the fastest growing direct marketing companies in the nation. Only a few years earlier, he had been working at the Indian Wells Racquet Club. I had prepared a number of executives to testify before Congress during my career, and it’s safe to say none of them were like Greg.

Watching him in front of the committee and the steady gaze of television cameras from all three major networks, you could tell he was something special. The way he carried himself, the way he responded to questions with the perfect combination of conviction and respect, I could see this was a guy with the intelligence and passion to reshape an industry.

Richard Stacey
President and CEO
Northern Response (Int’l) Ltd.

Electornic Retailer: How did you get your start in the DRTV industry?

Richard Stacey: In 1984, I had a company in Canada selling home-study courses that I wrote on how to get rich in your own business and real estate. They were sold through seminars and mail order. I began seeing infomercials in the United States, selling similar courses by people like Tom Vu, Tony Hoffmann, Hal Morris, Paul Simon and Ed Beckley. I decided to write a script for a 60-minute show called “Blue Print for Success.” That show was a condensed summary of my eight-hour live seminar.

The first time we aired it, the station ran it for free, as they thought it was a public-service educational show. That’s how “early” those days were back then! The phone lines were jammed for over a week from that first single Sunday afternoon airing. From that day forward, I was in the infomercial business.

ER: What product or products have changed the face of the DRTV industry within the past 25 years?

Stacey: In the beginning, the infomercial industry was mostly home study and self-help courses. As the ’80s progressed, companies began experimenting with hard goods like the Hard-Hammered Chinese Cooking Wok or the Annushka Cellulite Reduction Kit. Then the industry literally exploded and everybody got into it. At the same time, the cable industry was expanding so they had plenty of airtime to sell and the industry had plenty of shows to fill it. It was a perfect partnership. We locked up huge blocks of airtime often from midnight to 6 a.m. on most stations. We stopped producing shows and started distributing them. We’ve now distributed over 3,000 shows over the past 25 years. The products have not changed too much–need, greed and vanity still sell. There are certain types of products that fit the DRTV genre in short form and long form. Lately, it’s more about retail and products that can be introduced by DRTV and later sold into Walmart.

There are many memorable and breakthrough products and productions that took the industry to new levels each step of the way. I always thought Media Arts with its Amazing Discoveries series had a big impact in the early days by showing what was possible. Guthy-Renker took it up a notch with its first Personal Power show, which again demonstrated a new standard of quality in DRTV products and production. These types of shows pointed the way.

ER: What is your most memorable (insightful, funny or endearing) story of the DRTV industry to date?

Stacey: What I have always loved about this industry is that there is always something new and exciting going on. Probably the most important insight is that there is no telling what people might buy–it almost always pays to test. Our biggest hits are often ones that you would not have predicted in advance. Sometimes, a show is not so well produced or the product is sort of gimmicky, but that is often what sells.

I remember years ago, a show on how to get better grades in school that reportedly cost a million dollars to produce (a lot of money at that time), that was shot on film and starred many sports stars like Wayne Gretzky. We had to call the station to see if it aired–there wasn’t one call! A few days later, we aired a very simple show called Smart Mop and it took off like a rocket. So you just never know. It also means you have to always keep an open mind because no matter how crazy or off-beat a product is, it might just be the next winner.

September 2010 – Feature: Channeling Radio Response

Generating Greater Response and Media Attribution With Stronger Response Mechanisms

BY ANDREW G. GORDON

This past summer, I spent quite a bit of time driving in my car and I had the opportunity to listen to a lot of radio. What I heard really surprised me. The creative messaging in the direct response radio spots was, for the most part, great, but where many of these commercials fell short was with the response mechanism in the call to action (CTA). Many of the spots weren’t using the response mechanisms effectively, and I’d be shocked if the response rate didn’t suffer.

There are three elements that make an effective response mechanism for a direct response radio or TV spot. It does not matter what kind of response mechanism you are using–whether it is a toll-free number (TFN), URL or SMS Short Code–a strong response mechanism must be unique, memorable and attributable only to the individual media outlet that generated the response. If you have these three elements in your favor, you will increase response volume and optimize your media buy to generate greater ROI. It is that simple.

Toll-Free Number Response
When selecting TFNs for your radio campaign, keep in mind, “an 800 number” is a generic term for all toll-free prefixes, but you can’t use just any toll-free prefix. Consumers are predisposed to dial an 800 number. Use anything but a true 800 number and you will lose calls. Even though they are less expensive, you must avoid the use of 888, 877 and 866 toll-free prefixes, and don’t be tempted to use the new 855 toll-free prefix, which will go into service next month. It’s harder to acquire or lease true 800 numbers, but finding the right vendor, with the depth and type of 800 numbers needed, is your critical first step.

Many marketers are using vanity 800 numbers, such as 800-MATTRESS or 800-LAWYERS. Vanity 800 numbers are memorable and offer instant brand recognition and credibility. The only problem is they are not trackable and do not offer clear media attribution, which is imperative to optimizing your media performance.

A better alternative to a true vanity 800 number would be to use a series of hybrid vanity 800 numbers, such as 1-800-340-HAIR, which is used by a hair restoration doctor; or 1-800-947-AUTO, which is used by Geico. Hybrid vanity 800 numbers are memorable, while also allowing for individual tracking of each media outlet. The only challenge could be acquiring enough of these numbers for your campaign.

When using multiple media outlets, it’s best to use unique, memorable numeric 800 numbers, which allow for individual tracking of each media outlet.

These are the most effective types of 800 numbers for use in direct response broadcast advertising:

Repeaters: 800-236-6868
Thousands: 800-585-5000
Hundreds: 800-585-5500
Ascending: 800-246-2468
Descending: 800-986-4321

URLs/Web Response
The Internet has changed the way people respond to direct-response offers. Some consumers prefer going online to respond because it allows them to research and window shop a product anonymously. Some people like to browse on the web and buy over the phone. Savvy marketers are channeling the consumer urge to search by including URLs in their commercials. Depending on the product or target, you can offer a consumer a TFN and a URL in your commercial and let them choose, or you can exclusively drive them to the web and provide a URL as the sole response mechanism. Opinions vary on how easy it is to remember a URL, as opposed to an 800 number. The longer or more complex the URL, the less likely the consumer will remember it.

There are marketers who are using vanity URLs, such as Priceline.com or eHarmony.com. These vanity URLs are memorable and offer instant brand recognition and credibility, but like the 800 vanity number, these URLs are not trackable and do not provide media attribution.

I’ve also come across marketers who are converting their vanity 800 numbers into URLs, such as 1800Flowers.com and 1800Petmeds.com. This concept drives visitors to the website by capitalizing on the “brand equity” of the vanity number. In the creative, this method saves time by not having to individually voice the 800 number and the URL multiple times in the CTA. This allows you to repeat both your one domain name and the phone number more often, but as great as this sounds, these vanity URLs don’t allow for media attribution either.

Just like a strong TFN, a strong URL must be memorable and unique. I cringe every time a marketer uses a backslash in his or her URL. Studies have shown that consumers drop the prefix or suffix in a URL, go straight to the URL itself and foil any media attribution. For the same reason, stay away from corporate or product brand names in your URL because responders will tend to go straight to the corporate site. The purpose of using a URL as a response mechanism is to channel the listener’s urge to search online, while facilitating tracking and media attribution.

Consider basing your URL on your offer, your product or the benefit your product provides (see chart above for examples).

Along with your URL, I recommend using individual landing pages rather than individual websites. If you are using many URLs in your campaign, it’s more economical to set up a master website with a relational database, which will paginate individual landing pages that correspond with the requested URLs.

SMS Common Short Code/Text Message
According to the CTIA – The Wireless Association, cell phone penetration has surpassed cable TV, web access and home computers. With that in mind, the interactivity of the SMS or text messaging feature of cell phones and smart phones makes for a great response mechanism for direct response advertising.

SMS (Short Message Service) common short codes are phone numbers that are five or six digits long and can only be accessed from a mobile phone. The short code is a number to which a text message can be sent. For example, a short code could be a numeric 54321 or a vanity code such as COKE. Think of the short code as a destination that you dial.

The other component of SMS is the keyword that you text to the destination. The keyword can be as short as two characters, could be numeric or could spell a word. Some examples of keywords are “GO,” “25,” “HAIR” or “WINDOW.”

When using multiple media outlets, it is more efficient to use one common short code and assign individual keywords to each media outlet for tracking and attribution. Both the keyword and the common short code should both be as short and as memorable as possible. The CTA should be worded something like this: “Text insert keyword here to insert common short code here.” When using numeric keywords, in combination with numeric common short codes, try to establish a repeating rhythm between them such as “Text 44 to 44566.”

Look out for the next iteration of SMS that can be used as a response mechanism. This patent-pending technology uses the traditional keyword to short-code concept, but returns a voice call instead of a text message. This type of technology could start to replace cumbersome 10 digit TFNs.

Mobile Star Codes
The next generation of trackable response mechanisms that use a mobile device will be Mobile Star Codes. Soon marketers will be able to leverage the power of these codes on mobile devices. Mobile Star Codes act as intelligent phone numbers, instantly connecting consumers to brands, offers and promotions via their mobile devices. Each code combines the familiarity of a TFN, the power of a URL and the mobile access of a short code into one easy-to-use, easy-to-remember number.

Unlike SMS short codes that only support text responses and TFNs that only support voice dialing, Mobile Star Codes can deliver a wide variety of response types. Now your response mechanism can contain any combination of response type. You can send a consumer a text message and forward them to your call center, send them a web link or even deliver an audio or video file. As the marketer, this allows for better communication and dissemination of information.

A Mobile Star Code is placed by dialing the * button on the handset twice, followed by a unique code, followed by the send button. The unique code may be as short as two digits or as long as is needed to spell a word. You can use memorable number patterns that are easier to remember and that are shorter than a TFN, URL or SMS short code.

Until Mobile Star Codes are in wide use, with consumer acceptance and adoption, we as marketers need to make it easy for consumers to respond to our direct-response offers using the more widely accepted response mechanisms.

We need to accept that consumers are in control. Give them a choice in how they respond to your offer by combining response mechanisms in the call to action. Some powerful response mechanism combinations are the tandem use of a unique TFN and a unique URL, or the tandem use of a unique SMS short code and a unique TFN. Whether you are using a TFN, URL or SMS short code, the response mechanism must be unique, memorable and attributable to the media outlet that generated the response.

Over the years, some clients initially resisted the process to strengthen their response mechanisms, but they quickly saw the value in the process after gaining both a greater response and media attribution.

Andrew G. Gordon is president and founder of Direct Impact Group, a full-service DRTV, DR radio, remnant print and mail marketing firm that specializes in direct response lead generation. Contact Gordon at (781) 453-2200, or via e-mail at andrewg@directimpactgroup.com.

September 2010 – Feature: What’s Ailing Long Form?

Are Infomercials An Endangered Species? Just in a Recession-induced Slump? It Depends on Whom You Ask.

BY JACK GORDON

Is the half-hour infomercial headed the way of the dinosaur? Maria Kennedy isn’t saying yes, but she regards the question as a serious one.

Kennedy is vice president of direct response and paid programming for Discovery Communications in New York City–the Discovery Channel. When the U.S. economy tanked in 2008, she says, both general and direct response advertising fell off dramatically. Rates charged by her network and others had to drop. Rates remained low throughout 2009, a grim year for the television industry.

This year, Kennedy says, especially since automakers returned to the air, general advertising has bounced back strongly–and 2011 promises to be even better. The same applies to short-form DR advertising. “Short form is incredibly strong right now,” she says. “It has come back gangbusters.”

But long form? As of mid-summer, the long-form market has picked up so slightly that she might as well call it flat. She estimates that long-form rates are still down 15 to 20 percent from two years ago across most or all networks.

Also troubling to Kennedy is that she is seeing no influx of new advertisers into the long-form space. “In short form, we’re getting tons of new advertisers every quarter,” she says. Not so in long form. The established infomercial marketers are still there–”the Euro-Pros and Product Partners and Guthy-Renkers”–but no new marketers seem to be trying long form. And the “big corporate advertisers” who at least dabbled in long form in the past–she mentions General Motors and Wyeth Pharmaceuticals as examples–are no longer doing so.

“The industry hasn’t seen a big new hit in long form for a couple of years,” Kennedy says. So, she wants to know, is this just a slump of some sort? Or is the half-hour infomercial format no longer working for some reason? “I’m asking,” she says. “I want to know.”

Consumer Confidence?
Among media agencies that buy television time on behalf of DR advertisers, the consensus is that the infomercial format is perfectly viable and healthy. The problem lies in the national economy. Therefore, it’s temporary.

Why would long form be slower than short form to recover from a recession? It’s simple, says Dick Wechsler, president and CEO of Irvington, N.Y., media agency Lockard & Wechsler Direct. Long-form advertising is much more reflective of consumer confidence than short form, Wechsler says, primarily because most long-form products have higher price points. “And consumer confidence is a lagging indicator,” he says. “Coming out of an economic downturn, it’s the last thing to come back.”

In other words, Wechsler says, nervous consumers remain reluctant to make more expensive purchases. He notes that one reason short-form advertising is strong right now is that price points for many successful short-form products have dropped from, say, $19.99 to $9.99, with margins being partially made up in shipping and handling charges.

ss competition for half-hour avails. Hence the fallen prices for those avails, Wechsler says. He predicts that the long-form marketplace will begin to pick up by January 2011, due to increasing consumer confidence. “But I think that the price of half-hours will continue to fall until then.”

So infomercials have no problems that an improved national economy wouldn’t solve? Another media buyer who makes that case is Dan Zifkin, president of Zephyr Media Group of Evanston, Ill. “It’s the economy” that is responsible for the sluggish long-form market, Zifkin says. It’s not the Internet, it’s not the ‘fragmentation’ of viewers brought on by proliferating numbers of cable and satellite TV channels, it’s not shorter audience attention spans. It’s the economy.

It is true, he says, that fewer new players appear to be coming into the infomercial market. But that is due to the same consolidation that produced the kind of strong, established marketers to which Kennedy referred: Guthy-Renker, Product Partners, Euro-Pro, Allstar Marketing, Tristar Products and others. And while there may be no brand new long-form hit at the moment, “that doesn’t mean the process doesn’t work,” Zifkin says. Just look at the continuing success of long-form products like exercise program P90X.

Zifkin doesn’t buy the argument that major brand advertisers of the General Motors ilk have deserted the infomercial format. They were never in it to begin with, he says, at least to any significant degree.

“The big brand guys have never really come into our space,” agrees Rob Medved, CEO of Cannella Response Television, a DR agency based in Burlington, Wis. “The closest we’ve come to bridging that gap is probably with pharmaceuticals on the short-form side. As for long form, the same verticals we had when I started in the business still dominate DR–[business opportunities], beauty, housewares and fitness.”

But does that suggest any reason to think we are witnessing “the beginning of the end of long form,” Medved asks rhetorically? “No. We’re having incredible success in the space. The Guthy-Renkers and Product Partners are as healthy as they’ve ever been.”

“It is way too early to ring the bell on the death of the infomercial,” Zifkin concurs. “I think that long form is still one of the best forms of advertising by far.”

Some executives on the TV-network side of the fence agree that long form’s problems are a temporary, recession-induced condition, brought on by a lack of consumer confidence. And even the perception that no new advertisers are trying infomercials is not shared across the board. “We’re seeing a mixed bag with long form,” says Paul Teja of Chesapeake, Va., vice president of direct market sales for the ABC Family network. “We’re seeing more new infomercials than in the recent past, which is a good indicator of strengthening in the marketplace.”

At the same time, Teja confirms that “current advertisers have cut back on the quantity and pricing of various time periods. I believe this is mostly due to the economy,” he says.

Doubts
But other network executives share Kennedy’s view that something deeper has gone wrong. “I think there are more problems with infomercials than just a bad economy,” says Christine Georgakakis, senior vice president of direct response for the TV Guide Network, located in New York City.

“The 30-minute infomercial is at risk. I think we need to do some things differently with that business,” she says.

Due to digital video recorders (DVRs) and the proliferation of TV channels, not to mention the parallel universe of Internet sites, “paid programming is getting lost in the clutter,” Georgakakis says. She also questions whether viewers still have attention spans long enough to accommodate half-hour infomercials.

Granted that the premise for the infomercial’s existence is that some products cannot be explained and sold effectively in a minute or two, Georgakakis wonders if 30 minutes is too long for today’s audiences. “Maybe we should be looking at alternatives,” she says, such as programming two 15-minute infomercials into a half-hour slot instead of one 30-minute program.

She offers one concrete recommendation: Given the prevalence on on-screen program listings for cable and satellite customers, Georgakakis says that the most important thing infomercial sponsors can do to boost the success of their shows is to list the show’s title in those on-screen guides. That is, if you’re selling real estate secrets or power mops, say so in the program listings; don’t just allow your show to appear as “paid programming.” The fee to list your title is minimal in relation to overall media costs, and it is enormously helpful for attracting viewers who might be interested in your product, she says.

Seconding that advice is DRTV producer Jeff Meltzer, of Meltzer Media Productions in New York City. He agrees with Georgakakis on some other points, as well. Clutter, for instance, is a real problem, he says. Because of what he calls “a saturation of DRTV commercials,” consumers have become more discriminating. To make an infomercial pay today, you have to make a better infomercial, Meltzer says.

He also suspects that attention spans are getting shorter and agrees that 15-minute long-form programs might be worth testing. “We probably need to get to the point quicker,” he says. “I think it’s been proven that people tend to buy in the first pod of an infomercial–the first eight minutes or so–or they don’t buy at all.”

Where’s the Bottom?
To the extent that the “problem with long form” has to do with the fact that half-hour avails are going cheap, that is actually good news for infomercial sponsors. But time buyers, time sellers and producers all know that there is a floor beneath which the price of a half-hour avail will not be allowed to fall. That is the point at which a station or a network can make more money by airing 30 minutes of regular programming, with spot advertisements, than by selling the time as a half-hour slot.

Kennedy, Georgakakis and Teja all say that their networks have not begun to convert any infomercial slots to regular programming. “But we watch [the numbers] all the time,” Kennedy says. “This is a business.”

Medved says that while a few infomercial avails may have vanished on channels here and there, nothing like a mass conversion to regular programming is underway. “It hasn’t happened, and I don’t think it’s going to happen,” he says. Long form may be slower to recover from a recession than short form or general advertising, he says, but those shorter ads are subject to the same basic economic conditions–and audience fragmentation exerts the same downward pressure on advertising rates.

Teja predicts no significant conversion to regular programming by his network or others. The infomercial, he says, “is one of the cheapest, most effective methods for getting across to the consumer the benefits of quality products. I believe that long form is here for the long run.”

Jack Gordon is a freelance writer based in Minnesota. He has been contributing to Electronic Retailer magazine since 2004.

September 2010 – Columns: Shop Talk

Here, There and Everywhere

For decades, conventional TV advertising wisdom suggested it took three net impressions to break through to a consumer. Infomercials were a counter-point to this argument because they did not require frequency—a viewer could be sold in one complete, half-hour pitch. While that may still hold true, things may have come full circle. With so many messages competing for a consumer’s attention combined with escalating media fragmentation, a direct marketer needs to be here, there and everywhere.

Piquing Consumer Interest
Here are some innovative ways to create consumer impressions that help develop awareness and prime viewers so that when they see your direct pitch, they are ready to buy:

• Mobile -With nearly half the world’s population now owning a cell phone and 3.3 billion global subscribers, the so-called third screen (after the TV and computer) has come of age. The iPhone alone has 200,000 apps and endless opportunities for advertisers. With the generational shift away from the TV, this can be an excellent way to broaden your consumer base.
• Product Placement - The ongoing boom in reality television gives marketers many opportunities for product placement. For example, Kymaro’s Rhythm Rocker will be featured in a new NBC series, “Ultimate Women Challenge.” The product will be showcased prominently as contestants use it to get fit in this mixed martial arts competition.
• User-Generated Content – Do-it-yourself satirists are posting their own versions of commercials and getting millions of views. Marketers should embrace such lampoons—it comes with the territory. But amateur archivists are also doing their own time lapse of body transformations by using fitness programs marketed through direct means. The unadulterated authenticity of such programs is simply terrific, organic promotion, but it doesn’t mean that marketers can’t do it for themselves, as long as they disclose material relationships with endorsers.
• Video sharing sites - Everyone thinks YouTube, but there are nearly 70 different video sharing sites that allow marketers to post content. Advertising, product reviews and personal appearances on talk shows are just some examples of what can be posted. Even an infomercial can be dissected and then organized so that consumers can get ready access to the content they seek.
• Blogging - It isn’t just about your blog—it’s about their blog. Many bloggers will post opinions about your products. And yes, such posters have to disclose any free product that you provide, but who cares? Find trendsetters in your category, send them free product and bask in their evangelistic glow.

While every marketer would like to achieve the brand ubiquity of a Nike swoosh—or even a Snuggie—sometimes, you have to seed the marketplace. While such tactics may not be as easily quantifiable as pure direct marketing, today it’s not just about being seen on TV, but everywhere the consumer is paying attention, and that could be anywhere.

BJ Fazeli is president of BJ Global Direct and Concept2Consumer. Contact Fazeli at (949) 825-5822.

August 2010 – Department: Product Talk

Nothing in the universe ever stays the same; it is either expanding or shrinking. That is especially true of your product’s reputation. Without professional networking, advertising and social media to build and expand your product’s reputation a terrible thing happens…nothing! It is becoming more and more apparent to me that the new thread common to all important product talk has come down to product reputation management. You may still call that function publicity, or advertising, or search engine optimization (SEO), or professional tradeshow networking or social media, but it all really comes down to reputation management. We’ve all heard of new media or modern media so let’s talk about “new networking” or “modern networking” and the importance of building a product’s positive reputation as part of your networking efforts. You will enhance your prospects for successful tradeshow networking if you launch even a low-cost product reputation campaign, which is specifically designed to enhance your networking prospects. Savvy media executives actively Google search direct response product categories—from weight-loss products to household items—to find hot new products online and to learn what comments people are making about them. So seasoned product promoters have learned they have two jobs to promote their products: 1) launch an online SEO campaign to create some product awareness by building the product’s online reputation; and 2) introduce their product’s good online reputation through professional networking with buyers and media marketing executives. If your product does not have a reputation, no one will search for it or find it. If you don’t know how to build a reputation for your product, you need professional help. If your product has a bad reputation (deserved or undeserved) you need to cure it by fixing the product or fixing your product’s reputation. And if you’ve launched your product and it has a successful reputation, then it is still easily vulnerable to reputation assaults by cunning competitors (a different management problem). So I believe direct response networking and marketing all begin and end with product reputation management (yes, a lot goes on in the middle, too). This month’s panel has many years combined experience in direct mail, online marketing, social media and print advertising. Joy Gendusa, PostcardMania CEO, founder and direct-mail marketing maven, recently learned that she is amongst the “Top 50 Entrepreneurs” when Business Leader Media announced its first annual awards. Gendusa focuses on her passion to educate business owners in effective ways to grow and expand their companies through various marketing techniques. Marianna Morello is president and CEO of Manhattan Media Services, a media buying company based in New York City that specializes in direct response print advertising. Morello has 30 years’ experience creating successful print strategies for clients such as Bosley, Hair U Wear, Telebrands, IdeaVillage, Jamster, JBrand and many others. The company works with clients from print media creative all the way through placement, buying, test runs and full rollout campaigns. Mike Hughes is an independent reputation management expert. www.ReputationManagementPartners.com To offer product analysis in a future column or to join our virtual trade-show network, visit www.YouTube.com/ ProductTalkShowcase, e-mail us at producttalk@gmail.com or call (925) 210-9005.

PRODUCT VIDEO #1: Yoshi Blade – Retail $19.95 The Yoshi Blade stays sharp 10 times longer than steel. Are you preparing your meals with a stainless steel or carbon knife that is dull, stained or clumsy to use? If so, this is the perfect time to say hello to the knife top chefs prefer—the Yoshi Blade! Guaranteed to stay sharp, the Yoshi Blade is made with a diamond hard zirconium oxide—a featherweight material that makes precision cutting a snap. Regular ceramic knives cost over $100. Order now and get two Yoshi Blades for $19.95.

Gendusa: This is a low-cost item that you need to sell in volume so you’d start with TV, radio and billboards rather than postcard marketing. Hughes: Let’s talk about your experience with marketing products and use the Yoshi Blade knife as an example. Gendusa: Well, what I can tell you is that the Yoshi Blade has done a very good job because I know what the Yoshi Blade is. I actually just saw one in Walgreens. I thought, “I would like to have a Yoshi Blade.” I haven’t made the purchase yet, but I understood it and I knew what the Yoshi Blade was because they’ve done such a good job of getting their name and explaining how their product is different out there. To get more market share, I’d just continue what they are doing because it’s working. Hughes: So you’d use that direct-response exposure to broaden their market in retail sales? Gendusa: Yeah, I haven’t seen it in Home Goods or TJ Maxx so those would be good places for the Yoshi Blade, as well. Hughes: Let’s go back to product reputation marketing. What does it mean to you? Gendusa: You are trying to change the opinion of another human being and bring them over to a certain kind of understanding to do what you want them to do. So it’s really just a matter of communicating with people and getting people to react. That’s really basic and that works in traditional marketing, direct-mail marketing, e-mail marketing, web development and design, and user functionality. It all has to do with raising the rapport that you have with the individual prospects and getting them to make that decision to purchase. Those basic points of marketing are used in all forms of media. Morello: The Yoshi Blade is doing very well in print, on two-minute TV spots, online and at retail. The push has been to use direct response as the push to Walmart and “As Seen On TV” retail products. Hughes: How important is professional networking for someone interested in launching a new product? Morello: It’s very important—networking and knowing all the different players and whose the best at doing what. Whether it’s a call center or a fulfillment center of someone whose going to produce a commercial of the creative on your ad, networking is vitally important. Hughes: What about online marketing? Morello: Consumers are going to go online before they decide to buy rather than from TV, radio or print. The online testimonials that you have for a product will push consumers to a sale and any negative comments will cause people to think twice about a purchase. Hughes: What advice would you give someone starting out with a $19.95 product to begin a step-by-step launch? Morello: For an in-home product like this, we look at the free standing inserts (FSIs) on Sunday. We test at a low CPM to find out if we have a winner. We also look at things like Parade magazine and Weekend, which are in the Sunday papers as well. This gives us a quick reading. Once we know we have a very good response, it means the ad is working. If we are getting that type of reading, then we are definitely going to want to roll it out.

PRODUCT VIDEO #2: HotelsEtc. Lifetime Discount Card – RETAIL $89.95 Become a member of HotelsEtc. and use the company’s pre-negotiated discounts to save every time you travel, go out to eat or even buy a movie ticket—for the rest of your life! All of HotelsEtc.’s travel and entertainment discounts have been negotiated and tested to provide 100-percent accuracy. So, imagine going on an all-inclusive vacation to Hawaii, the Bahamas, or even Italy, and staying in a five-star resort for the price of a two-star resort. Or, imagine taking your family out to dinner and saving 70 percent or more off your restaurant bill at over 15,000 restaurants.

Gendusa: I think the HotelsEtc. Lifetime Discount Card sounds really interesting. If I received a well-designed post card that explained how I could get 70 percent off my travel by just spending $89.95, I would be sold. It’s a great offer for somebody who travels a lot. If you are targeting travelers, it’s perfect. I travel so much and I always stay at good hotels and it adds up. It really sparked my interest and with direct mail, you get a high enough response rate to warrant an $89.95 purchase. Morello: HotelsEtc. sounds like a very good program, especially with the economy being what it is. If you are a member, you get substantial discounts and it’s worth the $89.95 price point. To have all these things available to you for hotels, cruises, car rentals and more, it seems like a very worthwhile price for a membership like this. Hughes: How important is it to promote a product that is already on people’s minds, which is making and saving money today? Morello: In this case, you need to repeat the benefits. With the economy being what it is, people are looking to save money. The current unemployment rate has caused people to stop going out to dinner at restaurants as frequently. So on a local level to be able to go out and have a restaurant meal at discount pricing, I think they will be very interested in the HotelsEtc. Lifetime Discount Card. Hughes: For a few hundred dollars you can also buy the cards at deeply discounted wholesale rates to resell as a money-making opportunity. Morello: If there’s a way for consumers to market the cards locally for discounts on restaurants, theaters, museums, etc., then they seem to have everything covered. I think for a person who wants to start a home-based business—as a lot of people are trying to do—it sounds like a good opportunity. Hughes: Using your experience to speak as a marketing visionary, what advice can you offer new product promoters? Morello: First, you need to know whom you are marketing to and be very specific. If you are marketing to seniors, the market is huge and print alone may be just right. However, if you are marketing to the younger generation, you cannot look only at marketing online as being the future. Print is something that’s going to be around for a long time—even with younger people who love the gossip magazine. They read In Touch, OK!, Us and Star. The younger people are reading magazines and responding to ads. The web is drawing a lot more traffic than it used to. I think it’s a fantastic combination with print.

August 2010 – Channel Crossing: DRTV

Is This Just a Down Cycle?

The 1960’s Sinatra tune about life’s ups and downs contains the words…

…Life is like the seasons
After winter comes the spring
So I’ll keep this smile awhile
And see what tomorrow brings…

Media, too, is cyclical as we know all too well from the ups and downs of the past several years. National TV price plummeted, print suffered through a horrible period and double-digit price decreases were commonly reported. The repercussions were felt in the direct response media business as well: while the softness in general advertising demand opened the door wide for short-form advertisers to obtain sometimes-unheard-of rates in programs and time slots often not even available. Long-form demand suffered, given advertiser reticence to pony up the larger dollar investments in soft economic times. Long-form media sellers, producers and media buyers have seen this stagnation and lack of activity.

Now that advertising prices in the general business are on the uptick, will this mean that long-form infomercial client interest and subsequent demand will increase?

The Threat to Long Form
One theory that works its way through the conjecture mill is the opinion that the explosive growth in recent years of social media outlets (Facebook, MySpace, etc.) has taken its toll permanently on the long-form format. The argument made is that advertisers can create an interactive, social media environment that is good or more engaging than infomercials while offering a lower out-of-pocket cost. And there is certainly evidence that social media campaigns are thriving. Many media and marketing industry newsletters and publications continually feature breaking ad campaigns that are built upon social media as the base or initial part of the effort.

Well, I’m not sure the infomercial marketplace is going through anything more that one of those cycles Ol’ Blue Eyes was talking about.

Buried in those same publications and newsletters that extol the merits of social media, I recently read an interesting article from the Cable and Telecommunications Association for Marketing (CTAM) that talked about social media–but in a very different way. A recent CTAM study resulted in two very interesting findings: 79 percent of regular social networkers said they would watch a television show based on a recommendation from a friend on a social networking site, and 33 percent of regular social networkers reported they were made aware of a new television show because of something they saw on a social networking site.

What? Television is important to social networkers? These same people whom marketers believe that ad campaigns can be built around engage in social media discussions about something as traditional as good ole TV shows? How enlightening–but it’s clearly commonsense!

Before we “cycle out” things like infomercials from the marketing arsenal, let’s remember how media forms integrate with each other. Seldom does one media form stand independent of another, be it radio, print, outdoor, television or–yes–social media. Just think how much more powerful a campaign can be that meshes strong social media with the power of an infomercial and its ability to do many of the same things that social media can do–inform, create “buzz,” provide testimonials, etc. Let’s “see what tomorrow brings” before we sound the death knell for infomercials.

Dan Zifkin is president of Zephyr Media Group in Evanston, Ill. Contact Zifkin at (847) 328-1519 or at dzifkin@zephyr-media.com.