From stigma to prominence, direct response television comes into its own
Online marketplace uBid.com was largely unknown outside the Internet, and the company needed to turn more visitors into bidders and more bidders into buyers. But online behemoth eBay was a force to be reckoned with.
UBid was confident that if it got its message out to more people it would win more business, and it was eager to promote its guaranteed, 100-percent fraud-free auctions as "a safer way to save."
So uBid hired SendTec, a search marketing firm in St. Petersburg, FL, to help it come up with a multichannel marketing game plan. The key objectives were to find new sources of bidders, and to find out where those bidders were coming from.
To help uBid achieve its goals, SendTec created a DRTV campaign, testing 60- and 120-second spots and buying DRTV time at a discount. Unique, trackable URLs were used to observe search activity, allowing SendTec to measure Web visits generated specifically from each airing. After establishing benchmark results, ads were optimized and rolled out in November.
The campaign achieved a reasonable cost per visitor and increased visibility outside uBid's core customer base. Clicks to uBid.com jumped 62 percent, search results on branded terms at uBid.com increased 45 percent and bidders on branded terms rose 58 percent. Overall, there was a close correlation between the number of bidders and the number of DRTV spots aired.
"SendTec has opened our eyes to the power of a fully-integrated marketing campaign, including DRTV," says Robert Tomlinson, CEO of uBid.com. "The results that we've seen clearly illustrate the effectiveness and value of this approach."
In the 1980s, DRTV was the marketing vehicle for companies that had big enough budgets to run a TV ad, but couldn't get their products into retail stores. Often airing during soaps or late at night, infomercials tried to make up for brand anonymity with flashing text, hyperactive actors and the promise of free products if viewers "Call now!" The idea was simple: Sell as many products as possible.
But DRTV is now playing a key role in multichannel marketing. Spots today feature celebrities and high-end products and work in tandem with Web sites. The medium now attracts advertisers such as MasterCard and American Express. The Electronic Retailing Association, the trade group for direct response TV, estimates that DRTV is growing at almost 10 percent annually and in 2005 accounted for $182 billion of the direct response industry.
Irv Brechner, EVP at SendTec, says, "There are two major new players in DRTV: the Fortune 1,000 companies that have started using it to build databases of consumers and drive traffic to retail stores, [and a] second, relatively new group [of] pure play online retailers who have been successful in their own niches in Internet advertising but are growing to a point where they ... are looking to TV to help drive traffic to their Web sites."
Peter Koeppel, president of Koeppel Direct, a direct response media buying agency in Dallas, adds: "I've been in this industry since 1993, and at the time, direct response was kind of looked down upon by traditional ad agencies and marketers - they considered it selling. But direct response is a viable medium, and the CMOs are going to have to think long and hard about it, even if their agency is not taking them in the right direction."
Indeed, prime-time viewing hours, once dominated by mainstream brand advertising, now include spots that incorporate direct response tactics. In fact, DRTV commercials today account for 25 percent of all TV ads, and TiVo Inc.'s recent Top Commercial Rankings report says the least fast-forwarded commercials are DRTV spots. According to a recent survey published in New Products Magazine, 73 percent of consumers say they learned about new products in 2006 from TV commercials and infomercials.
Sieglinde Friedman, VP of communications and strategy at the Electronic Retailing Association, has followed the growth of DRTV. "The Geicos and Procter & Gambles are using the actual methodology of direct response û basically, wrapping content around anything in a compelling way with a call to action: æCome to my Web site!'" Friedman says.
Observes Koeppel: "Consumers who view direct response television appear to be more engaged consumers. And, because of that, marketers are able to develop more of a relationship with those consumers, because they're going to the Web and doing research, or they are talking to a customer service person. It's more of an interactive relationship."
Even in today's fragmented media world, consumers still turn to direct response television. Marketers are integrating multimedia approaches into their strategies, while embracing the essential elements that have made DRTV so effective for so long.