Direct Response in Television, Part 1
Direct Response in Television, Part 1
Please Note: This article was written for companies considering a product or service for a national television audience. As a local advertiser, you can take certain aspects of this information and apply it to what you are looking for in your marketing. Is it a fantastic sale? Is it a new product in your area? Is it a limited-time offer? Whatever the motive, direct response is direct response whether it is local or national. If you have a unique product or service that has national appeal, this article may be especially useful.
There are plenty of false expectations when it comes to direct response marketing on television. The general consensus among non-professionals is the “You put an ad on TV…man the phones…and put the money in the bank.”
If this were true there would be more millionaires coming out of the direct response television industry than any other. Unfortunately it’s not that easy, but direct response can be the method to expose a product or service to a mass audience effectively, efficiently and profitably.
Before beginning such an effort however, a number of questions will need to be answered. It is the answers to these questions that provide the basis for your strategic plan and insure your offer gets a fair and valid test.
Let’s start with the question “Is my product or service suitable for direct response television marketing?”
This is one of those instances where you can answer a question with a question. There are certain generally accepted criteria that you can apply to your product or service to see if it would have potential as a DRTV offer.
1. Does the product or promotion have mass appeal?
2. Can the benefits be effectively demonstrated?
3. Is the offer attractively priced?
4. Does it have at least a 4:1 cost-to-sales ratio?
5. Is the offer hard to fulfill?
6. Can you enhance revenues by adding complementary products or promotions?
7. Does it have a trademark, or celebrity to tie in to the advertising message or retail?
One note of caution, however -- answering “yes” to these questions does not guarantee success. It only shows that your product or service qualifies as a direct response television promotion.
Overall, six out of seven promotions fail to one degree or another.
What each and every successful promotion has in common is a well thought out and articulated business plan that answered other very important questions:
What is the objective of the promotion?
You would be surprised how many companies fail to define this up front. It is not enough to say “I want to make money ... or sell product ... or some such goal” but you need to look at all the objectives, Primary, Secondary and Tertiary.
Simply stated, the primary objective could be “Generate profitable orders or leads” with the secondary objective being “Create a data base of customers for an ongoing sales effort” and among the tertiary objectives you might want to consider is “Creating awareness in order to force distribution at retail”.
Knowing this, up front, is critical not only for your own success but is very important information for the advertising or marketing agency you work with.
Is there a branding element to consider?
If a direct response advertiser wishes to brand himself, this will need to be accounted for in both the creative and media. Elements in the commercial need to reinforce the brand image. Whether that image enhancement takes the form of a spokesperson, logo animation and music, tag line or other methods, effective branding considerations should be made in advance of any production or media planning.
In addition, with regard to media, you may want to allocate a certain portion of the budget to programming or times of the day designed to deliver optimal awareness rather optimal response.
Are you looking for a sale or qualified lead?
The type of response you receive is contingent on the “call to action” that should be integral in the commercial or infomercial. Generally speaking there are 2 types of promotions; “Hard Offers,” or products or services sold at price points that are fully disclosed, and “Soft Offers,” meaning products or services that request a response for more information.
How you determine whether your product or service is appropriate as a Hard or Soft offer will be determined by a number of factors including price, internal telemarketing capability, complexity of the sale and need for face-to-face appointment, among other things.
In addition, what you can afford to spend to acquire a customer is a very important factor in coming up with an answer to this question.
What are the “ideal” price points for the various types of offers?
In my experience there is a rule of thumb: For short form DRTV (1 and 2 minute commercials) use an impulse price point e.g. $19.95. For long form (30 minute “infomercials”) you can charge much higher price points but be sure to have payment or financing options available.
Are there other goods or services you, as an advertiser, can provide?
Critical to the financial profile of a successful offer are the total revenues that can come from an average sale, and what that customer might represent in terms of “lifetime value.”
In DRTV it is very common to have various upsell offers to present to the consumer at the time of their initial response. This enhanced revenue stream can often take a marginal or unprofitable promotion and turn it into a profitable one. Upsells or even downsells can take many forms but common ones are; “Additional Units”, “Extended Warranty”, “Rush Delivery”, “Companion Products” etc.
In addition, some advertisers use the opportunity to enter a customer into “continuity” or “automatic shipment” programs. Some examples of continuity programs with which you might be familiar are the record and book clubs or vitamin supplement type offers. The monthly revenues that can accrue from ongoing consumer sales can be significant and the longer they stay in a program, the more significant these revenues become.
What type of telemarketing is best suited to the promotion?
Today’s telemarketing technology and options are many and varied. For example there are:
• Live Operators in a Shared Environment
• Live Operators in and Enhanced or Dedicated Group
• Interactive Voice Response that uses Totally Automated Technology
• In-house/Client Owned and Operated Group
In addition, you can also use a pre-recorded message to attempt to pre-qualify callers prior to speaking with a live operator.
The type of service you finally chose to use depends on the nature of the offer and the selling proposition.
How can you integrate online marketing into the DRTV promotion?
Recently in some promotions, 15% to 20% of response is coming online. Generally speaking, the younger the demos the higher the response, but even offers appealing to seniors have 10%+ response online.
To take advantage of this trend, many marketers create a micro-site for their promotion. Beyond The TV is one of the best ways to do this. With a branded campaign in place and the power of the combined efforts of all advertisers in the program, you are directing viewers to an online place that is easy to get to and can offer additional promotions and incentives.
What is the best way to establish lead or order processing procedures? Do I need to outsource fulfillment and customer service?
It never ceases to amaze how a successful promotion can fall apart due to the lack of preparation and attention to detail on the back end. It also never ceases to amaze how many companies decide to test their promotion without having product ready to ship within the 30 days required by law.
Marketers must be ready to ship orders or information within 24 to 48 hours after receiving the request. Respondents expect timely receipt of their order and appreciate it when they do get this type of action.
Also, if you do not have the facility to handle shipping and customer service in a manner consistent with customer expectations ... outsource fulfillment. The operation should have experience in dealing with television promotions and if you find the appropriate resource you will also find that it is money well spent.
