O'Leary Returns With New Consulting Firm
He declined to disclose a dollar figure for the transaction - which observers estimate to be in the seven figures - saying, "I'm very happy with how things went down."
The terms of his departure from Tyee include a non-compete agreement, but O'Leary said those terms should not fetter the operations of his new firm, The O'Leary Group, also based in Portland. In addition to some of his own money, the new venture has funds from backers he declined to name.
"One of the main differences from Tyee is that I'll keep it kind of small and contained," he said. "We'll take on a limited number of clients. We're not immersed in production and specific services that Tyee provides." Tyee had started as a commercial production company, but grew to 100 employees and now offers such agency services as media buying, research and market consulting.
Tyee is also one of a handful of companies that has maintained a consistent business producing infomercials and DRTV spots for major brand companies, including Philips/Magnavox, Hewlett-Packard and Toshiba Electronics. O'Leary wants to continue consulting for corporations that are not only interested in DRTV marketing, but also in developing direct marketing sales techniques for the Internet.
"I see a lot of startup 'Net distribution companies that are well-financed, but they are very immersed in the technology and less concerned with sound direct marketing principles," O'Leary said. "Some of these companies develop these 'whiz-bang' sites that are frustrating to consumers if they have to download different software to get the full impact of the site."
He wants to apply his knowledge of what works in selling directly through television to interactive media, which is expected to evolve with the development of smarter digital TVs and broadband networks that are capable of delivering rich multimedia into consumer households.
"All the compelling stuff that works in DRTV can be applied to the Internet," he said. "It used to be that consumers were hesitant to order off of television. Similar issues apply to the Internet, so the challenge is to overcome consumer hesitation and make a sale."
As part of his severance with Tyee, O'Leary was allowed to continue to consult for Icon Health & Fitness Inc., West Logan, UT, a long-time client of Tyee.
Call Centers As 'Critical Link'
One important technology that has developed during the last few years allows consumers to interact with a call center while online. Consumers may either request an immediate callback - as the insurance company Geico Direct provides on its Web site - or chat with a teleservices rep who appears in a pop-screen built into a Web browser.
O'Leary said the Internet will help solve the DRTV marketer's persistent dilemma in choosing a call center. While major call centers can handle large call-spikes, they are less equipped to offer individual salesmanship. Smaller boutique call centers claim their sales reps are more informed about their products, but handling large volumes of calls is more difficult.
"In the interaction between DRTV and the 'Net, the single biggest link is telemarketing," O'Leary said. "We want to develop ways to give a consumer exactly the same kind of sales message in a Web page and all the compelling stuff that works in DRTV."
That "compelling stuff" includes a clear demonstration of a problem - whether it's carpet stains or abdominal flab - followed by an equal demonstration of a product that can fix that problem. Testimonials and guarantees help remove consumer objections to making a purchase, while pricing must correspond with perceived value. Inbound telemarketing becomes more important when consumers have complex questions about a product or when up-sells and cross-sells are necessary to ensure profitability.
O'Leary is also developing a DRTV series similar to the Tyee show "Cool Stuff from the Cosmos" that appeared on the Sci-Fi Channel. He said he expects to announce more details of the program this month.
"We're working with a well-known entertainment brand to help them develop some product lines," O'Leary said. "We expect that to take shape in the next few weeks." n