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TV-101.

THE BIRTH OF DRTV

        A comparison of infomercials and DRTV Spots with all types of TV

        advertising from 30 years ago reveals what made direct response

        TV advertising feasible.  Three services made available during the

        last decade made direct response television possible. 

        They are:

        TOLL FREE 800 NUMBERS -

        The consumer is now able to respond or interact directly with the

        advertiser.  The numbers are widely available, convenient, and

        most importantly, free to the consumer.

        PROLIFERATION OF CREDIT CARDS -

        Over 100 million credit cares are in circulation in the U.S. alone. 

        This tool enables a huge number of consumers to make purchases over

        the telephone. 

        OVERNIGHT DELIVERY -

        To get consumers to respond to your sales offer right away, make

        sure you give them the satisfaction of having you product right away. 

        Remember, consumers are willing to pay a premium to get you product

        overnight.  They want it now!!

MERCHANT ACCOUNT - Service bureaus that handle order taking for you will

        almost certainly require you to have your own merchant account. 

        Without a merchant account, you will not be able to accept credit

        card payments.  Needless to say, this will seriously affect your

        overall sales figures.

                If you do not have your own merchant account to process

        credit card orders, it is essential that you use a service bureaus

        or enter into a joint marketing venture with a company that is able

        to extend you this privilege.

ACCEPTING CHECKS OVER THE PHONE - Don't limit your phone in sales to credit

        card holders.  By expanding the way TV viewers can pay for their

        purchases, you increase you probability of making a sale (with the

        introduction of checks-by-ph9one, your potential market is likely to

        grow by another 30%).  Check Verification makes you product available

        to millions of people who do not have a credit card but do have a

        checking account.  Here are some practical reasons why you should

        consider accepting check orders over the phone:

        IT COMMITS THE BUYER - The buyer doesn't have to write a check,

        write his name and address on a piece of paper, look for an envelope,

        get postage, and then mail the order.  These steps can take anywhere

        from a few minutes to a few days.  The longer it takes, the higher

        the odds your potential buyer will change his mind.

        INSTANT GRATIFICATION - Your customer's order can be cleared and

        processed faster if he doesn't have to mail a check which you bank

        has to clear before the order is processed.  With Check Verification,

        you get the money within 48 hours and you customer receives you

        product sooner.

        COMPETITIVE RATES - If your ticket price is over $59.00, you unit

        cost to process a check order by phone will be almost the same as

        the commission the bank charges your merchant account.  As this

        service become more readily available, and as merchant account

        become more difficult to acquire, accepting check orders over

        telephone is a feature DRTV marketers can no longer ignore.

CONTINUITY PROGRAMS - Develop a product or service that will fit into your

        back-end marketing program.  Remember, the easiest person to sell is

        one who has already purchased from you.

        A continually program will product sales or products or services to

        customers who have just made a purchase through an infomercial. 

        The best way to promote a continuity item is through a brochure or

        other sales literature inserted with the original order.

        Developing a successful continuity program will only enhance you

        bottom line, particularly since your advertising message is usually

        delivered at not additional expense to you.  Furthermore, your

        continuity item is being offered to satisfied customers, because

        your company made their TV buying pleasant and satisfying.

        SEEK RELATED ITEMS - Continuity items should normally be related to

        the initial product.  The consumer purchases your initial product

        to satisfy a specific need, so it stands to reason that auxiliary

        products catering to this same need stand a higher chance of success

        than totally unrelated products.

                For example:  If an exercise machine is you main product in

        the infomercial, a monthly vitamin subscription plan can be an ideal

        continuity program of you.;  It is related to the customer's

        original need (to be healthy and fit), and you can count on a hefty

        profit margin because you advertising costs for the vitamin

        subscription are minimal.

        RELATIONSHIP MARKETING - Continuity may also be looked at as a means

        to establish a marketing relationship with your customers.  Through

        profile response cars and other dynamic data, you can product a

        catalog that features several products that cater to the needs and

        wants defined by your customer base.

        To continue with the example above, you can offer your customer

        (who originally purchased exercise equipment via your infomercial)

        a wide variety of products and services in a catalog - duffel bags,

        running shorts, portable CD players, you name it.  As the cost of

        acquiring new customers increases, selling more to the same customers

        expands the potential for DRTV in almost any market.

BE YOUR OWN COMPETITION - When a product becomes an infomercial success

        story, vultures hover in a hurry, trying to duplicate your product

        and you marketing campaign.  Such competitors are called knock-offs.

        In more cases, knock-offs are cheaper versions - in both quality and

        price.  However, one of the most brilliant knock-off DRTV campaigns

        we've seen broke all the files:

        1.  The company introduced a product of a higher quality and at a

            higher price than the original.

        2.  Both products came from the same company, so the company was

            actually competing against itself.

        3.  The same celebrity hosted the infomercials for both products.

        The product was Stair Climber Plus, an upscale version of its

        predecessor, Super Step.  Both infomercials featured Bruce Jenner,

        clearly showing the manufacturer's intent to present competition

        that did not exist - in the process preempting any legitimate

        competition.  Neither infomercial mentioned the other product, and

        for a while they were running at the same time.

        WHAT DOES THIS STRATEGY ACHIEVE?

        Producing your own knock-offs, by competing against yourself,

        preempts competitors by giving them less room to maneuver.  Instead

        of competing with just one other brand, they have to position their

        products somewhere between the two that are already in the market.

        BROADER MARKET FOR YOU - There is nothing wrong with producing a

        cheaper or more expensive version of your own product.  It expands

        the appeal to other market segments that may be outside the range

        of you original product.

        GUARANTEED SUCCESS - If people bought you original product, your

        knock -off is likely to score the same success with its respective

        market segment.

        CREATES A BANDWAGON EFFECT - When viewers see two stair-climbing

        exercise gadgets competing against each other, it creates more

        awareness of stair-climbing as a method of exercise.  Furthermore,

        the competition creates the sense that the product is both a popular

        and effective way to exercise.

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