Tactica International Inc., New York, a marketer of products through DRTV campaigns, formed a new company, Igia Direct, to manage its health and beauty line of 18 products. The company intends to unify its image behind the Igia brand, which made up 85 percent of its total sales. It expects sales to grow 250 percent this year to about $250 million.
“We're now launching an office in England, bringing our total number of employees to 75,” said Tactica's founder Avi Sivan, an Israeli native who had once worked as a stuntman before getting into DRTV marketing.
The company is also putting more marketing muscle into its Virella line of household and kitchen products, which now include six devices: the MicroJet Steamin' Iron, Aqua-Solo laundry cleaner, Euro-Lite flashlight, HairAway Plus depilatory device, Pest Alert ultrasonic pest repellent and Gamemaster 2001 video game.
“We have three products on the market now and the other three we are putting together,” Sivan said. “Two of them will be in an infomercial. We're putting a budget of $300,000 a week on TV for Virella and plan to come back with a strong campaign in April or May.”
While he said he was concerned by the number of companies in the infomercial industry that have not performed well or have gone bankrupt in the last few years, he said he hopes to avoid financial peril by diversifying his company's marketing channels beyond direct response sales.
“It all goes back to the brand name,” he said. “I'm not going to be held back by infomercials. If the product doesn't work on TV, at least my brand name is what will carry me forward into the retail stores and the catalogs and magazines.”
Tactica's chief operating officer Prem Ramchandani concurred with this strategy.
“For a long while, I think the infomercial companies believed they could continue to make money in long form,” he said. “Now with media rates much higher, it is more difficult to make money on the front end. The consumer is getting smarter and does not want to pay more money for an infomercial product when it's cheaper in retail. You need more than one leg to stand on.”
So far, its strategy appears to be paying off, much to the pleasure of Tactica's contracted manufacturers. One British supplier based in Hong Kong recently rewarded both Sivan and Ramchandani with new Porsche Boxsters as a sign of his appreciation, they said.