April 2005 - The Marketing Link

As more general advertisers struggle to qualify their advertising budgets through brand marketing, others realize building a brand name can be achieved through direct response advertising. Are the lines blurring between these two marketing methods?

By Vitisia Paynich

“Historically, traditional brand marketing was the initial way people felt comfortable with building a following. I don’t think that’s really enough in today’s world, says Bob Rosenblatt, group president and COO of Tommy Hilfiger in New York City.

These days, marketers and advertisers are under extreme pressure to make every advertising dollar count; however, a solid return on investment (ROI) may not be immediately evident when it comes to the general advertising model. What’s more, building brand identity cannot depend solely on traditional commercial advertising that boasts a catchy slogan or a humorous story line to enthrall the television audience. If the product spot fails to communicate an effective message or incite a sense of urgency for the product, the marketer may not be aware of what needs to be improved in the commercial campaign. This is mainly because the ROI is not integrated into the overall marketing model.

Rosenblatt adds that when companies spend an exorbitant amount of money on large advertising campaigns, they’re hoping that consumers will be affected by the number of images they see of the brand and be able to respond to them. He argues that in brand marketing, it’s difficult to correlate the success of an ad with what is actually happening. So although the consumer may remember a particular commercial that played during the half-time show of a major sporting event, it doesn’t necessarily guarantee that same consumer will likely recall the brand name, much less buy the product or service.

“In direct response, I think it’s a lot easier to be able to gauge return on investment. And I find it’s very helpful to be able to measure-whether it be through the Internet, mail campaigns or direct response television-what your costs are,” Rosenblatt says.

So, when it comes to traditional brand marketing versus direct response marketing, are the lines blurring? Or, should marketers simply expand their marketing budgets to make room for both?

“As an agency, we’ve never had the luxury of just doing brand marketing or just doing DR,” notes Lucas Donat, CEO of Santa Monica, Calif.-based Donat/Wald. “We’ve always had to do both. Any branding consideration always has to pay for itself through positive ROI on every advertising dollar.” He believes no matter if you’re a Fortune 500 company or a company that is just getting off the ground with a new product or service, the branding component facilitates the response.

Part of building the brand is instilling trust and credibility in your product that resonates in your marketing message. One of Donat/Wald’s clients, eHarmony, has actually strengthened its brand identity through the direct response medium. The online dating service began advertising on radio, but didn’t really make a dent in the marketplace. However, when it opened itself up to DR, eHarmony began to successfully penetrate the online dating market (see eHarmony cover story on page 24).

Since the beginning, Oreck CEO and Founder David Oreck has been the face behind the brand. He appears in DRTV, radio and print ad campaigns.

“I think the reason [eHarmony] responded to us was that we saw them as a billion-dollar brand,” notes Donat. “My belief is that eHarmony will become a Fortune 1000 or Fortune 500 company. And they will be an example of a company that grew from ground zero using direct response to build them into a huge national brand.”

Another company that has transformed itself into a national brand through direct response is Oreck Direct. “I think because we’ve had such great success in building our brand through our direct response advertising, we didn’t perceive a need to really do traditional brand-type advertising,” explains Maribeth Yasinski, national sales manager for Oreck Direct in New Orleans, La. The 41-year-old company has been a major player in the floor-care and houseware products category through the use of DRTV and direct response radio, which has also enhanced its retail presence.

While she couldn’t go into specifics, Yasinski hints that Oreck may be taking a different approach with its DR campaigns and adds, “in the coming months, you may see some different looking ads for Oreck in addition to what we do currently. Up to this point, the main focus had always been on the direct response mechanism to get the customer to respond immediately [and] the ads would create that urgency.” While it’s not likely that the company will depart from the DR model, the new creative campaigns may help to simply augment its overall brand identity.

What transforms a DR product into a full-fledged national brand? Donat contends that emotional authenticity is a key ingredient. “With eHarmony, what you see are these real testimonials of couples that embody the benefit, which is the joy of love based on deep levels of compatibility,” he explains. The other key factor that adds to the emotional authenticity is the spokesperson. eHarmony DR spots feature founder Dr. Neil Clark Warren, who has been closely identified with the brand name.

That couldn’t be more true for Oreck. The company’s founder, CEO and namesake, David Oreck, is the brand, as he is the one closely identified with the upright vacuums and air purifiers by appearing on the DRTV programs, radio spots and even on Oreck’s Website. Having company founders like Warren and Oreck at the media forefront help to personalize the overall marketing message.

Another important element to brand building is consistency throughout all facets of the marketing, as well as throughout the organization. Rosenblatt stresses the importance of senior management’s role in the brand message. “The company needs to know who it is in order to maximize the success of the brand,” he suggests. He explains that the message not only needs to appeal to the consumers’ wants and needs, but also must be clearly defined by the top-tier level in the company and communicated to every level.

While the long-term benefits of integrating brand marketing into the DR model seem obvious to most marketers, others are still reluctant to take a chance on direct response. Still, some companies that have, in the past, remained loyal to brand advertising are rethinking their marketing methods.

“It seems to me that the general media advertisers are beginning to take a serious look at direct response,” says Donat. “There is an acknowledgement now that direct response can play a very serious role in the way all companies view their advertising.”

Rosenblatt agrees. “I know there have been some bigger companies that as of late have been working in the direct response business that, frankly, a few years ago might not have entered that arena, because they may have thought there was a stigma attached to it,” he says. Rosenblatt adds that one of the biggest misconceptions about DR is from an integrity standpoint, where the players are not as savvy and professional as those in other fields.

“That is absolutely untrue,” he says. “I think that if people took the time to understand the billions of dollars that are spent throughout [this industry], they’d realize that this arena is one of great growth opportunities.”

Donat says, “There’s a company in the weight-loss category that we’re talking to right now, and they have driven their brand a little bit but they really haven’t cracked the direct response code,” he explains. “Once they do that, their budget can go from $5 million to $30 million, but they can only grow that budget if they know how to generate positive ROI on that advertising spend. And that’s one of the powers of direct response-to help fuel and drive brand.”

Rosenblatt also feels strongly about the overall benefits of direct response and how it ties in with brand marketing. “I’d like to think that’s one of the reasons why they brought me on board here [at Tommy Hilfiger] is to start looking at all different channels of distribution that make sense to us. Tommy will be doing a TV show I believe in June, called “The Cut,” on CBS. And, I believe it’s going to start us on a path where we’ll be able to use all the different ways of communicating to people, which will ultimately drive us toward direct response.”

When it comes to brand building through direct response, Donat believes it’s important that the marketer and the DR agency understand the metrics and the financial objectives of the advertising initiative. He also suggests marketers and advertisers determine whether the branding effort has a direct correlation to a response component or call to action.

He explains, “So often I’ll hear, “This is a branding spot,’ or “This is going to be my DR spot.’ And to me, if you’re doing the right work, the branding should be a facilitator of the response. They should not be two discreet initiatives. At some point in the evolution of advertising, people began to segregate those two concepts and I think what we’re seeing is the fusion of those two again.”

However, Rosenblatt contends that at the end of the day, the true test is how well you speak to the consumer. As he puts it, “I think the company that is able to figure out who that consumer is on a [personalized] basis and gives that consumer the most convenient reason to buy the product-and it has to be a great product-will be the one that comes out the winner.”

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