Getting Screen Time
Q: I'm in the process of making a product, and I'd like to market it on television much like they marketed the famous Ginsu Knives. I'm not looking to do an infomercial. I think it might give too much of my product away for free. Where and how can I locate these marketing companies?
A: Direct-response television today, which includes everything from short, 30-second direct-response shots to infomercials that run several minutes or the length of an entire program, is a far cry from the days when products like Ginsu Knives captured the imagination of TV viewers nationwide. Back then most people could view only about eight TV channels, while now we have hundreds to choose from. Also, some media rates have risen as much as 500 percent in the past five or six years, making the cost to run a successful infomercial $150,000 to $500,000 a week. And you can't cut costs by running your direct-response spots on a small local station. The response rate would be too low to cover the production costs and the 10 to 20 percent product return rate that's common in the infomercial business.
Depending on the type of product you've created, why not consider marketing it on QVC or the Home Shopping Network to reduce your risks and marketing costs? These networks buy your product at 40 to 50 percent off the retail price, test it and then sell it, so your principal out-of-pocket cost is for inventory.
Another alternative is to opt for the newest form of direct-response marketing that makes use of VHS tapes or CD-ROMs with full-motion video. In place of a product catalog or brochure, you could mail a VHS tape to a highly qualified list, like Mercedes Benz did for its new E-class cars. The response rates are higher-as much as 60 percent, according to Dworman-the videos are cheaper than many printed catalogs, and recipients tend to keep videos because they have an intrinsic value.
If your budget does permit forging ahead with direct-response television, it's best to hire an advertising agency to produce and place your spot. Production costs range from $150,000 to $600,000 for infomercials of two minutes or more, and $50,000 to $75,000 and up for a typical 30-second spot. But anything less than two minutes may not be enough to sell your product on television, according to Steven Dworman, publisher of the Infomercial Marketing Report newsletter, who says an advertiser must leave a toll-free number on the screen for 40 seconds in order for it to be effective.