DRTV and retail shouldn't be mutually exclusive

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What if you could use the accountability of direct response marketing and advertising, coupled with the reduced media rates that are available to direct response advertisers, to drive retail sales?

DR allows the astute marketer to optimize every dollar spent on marketing and advertising. The age-old adage, "50 cents of every dollar spent on advertising is wasted," is simply an excuse for inefficiency and lack of accountability. In today's world of data availability and tracking, I call it "Follow the dollar."

A consumer should never be viewed as a single transaction. In contrast, she can be a series of transactions and needs to be nurtured and annualized. When a product is consumable, then multiple sales to a consumer requires no further explanation. When it's not consumable, exponential value can be achieved by developing a relationship with the consumer and offering her incentives and bonus purchases. This builds loyalty and repeat sales.

But when is the best time to transition from DR to retail? Both retailers and manufacturers are at loggerheads with each other over the use of DR. Many retailers see DR as a dirty word that competes with retail for consumers' dollars. On the contrary, DR can and should be used as the No. 1 ally of the retailer, both at the beginning of a products lifecycle, as well as when it reaches maturity.

A minimum reach of 70 percent with a frequency of 4.5 per month for about six months prior to retail, is advised. Otherwise a successful DR product can end up on a store shelf gathering dust.

EXAMPLE

Acme Industries sells a widget via DRTV. The campaign is successful and Acme starts selling through retail channels. Acme discontinues DR advertising and promotes the widget for sale at retail, and everyone is happy - for a while. Acme has now lost the immediate cash flow from DR, valuable one-on-one consumer tracking and interaction, as well as DR advertising rates.

Acme's smarter approach would be to continue with DR advertising to maximize advertising dollars, continue building a consumer database, and use incentives to drive consumers to retail as follows:

Send coupons/rebates to existing database, redeemable at participating retail locations.

Set up a "refer a friend" incentive program for existing consumers.

Incentivize new consumers to visit a Web site and register for coupons/rebates.

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