The Power of Low & Consistent DRTV Spending

A potential retail oriented DRTV client once opened our meeting with “this needs to be a top 5 show”. I responded “Why? What is the difference for your business between a top 5 and a top 30 show?” He was speechless. They’d never really wondered. It was just a goal set by their traditional DRTV media buying group.

In truth, all advertising is far too often driven by lore and anecdote – even when it comes to media spending. And DRTV is no different. So I’ve been fascinated by DRTV’s obsession with massive spending – especially when the product is at retail.

That made it refreshing to read Byron Sharp’s latest post “A Little Advertising Goes a Long Way” (link here). Sharp focuses on campaigns with huge media bursts and finds that far too often they’re tremendously inefficient.

If you recall, Prof. Sharp is the head of the Ehrenberg-Bass Institute which studies advertising with really smart leveraging of statistics. And they develop their findings until they reveal truly scientific learnings.

Media Efficiency vs Media Spending. Sharp and his team focused their efforts on efficiency — contrasting bursts with a consistent & lower level of mass-reach media over a long period of time.

When compared with intense bursts, they found “…low weights of advertising on high reach media are very efficient. Generating a lot of sales per dollar.”

Hmmm. A lot of agencies aren’t going to like this. Agencies and clients, relying on lore and anecdote, have developed a dis-like for spending smaller budgets on mass reach media (e.g. TV). (The sad reality is that burst campaigns have the ego satisfying result of leading neighbors to say “I saw your campaign last night”. Too bad “neighbors” aren’t your dominant target!)

Why This Finding? Sharp’s team looked specifically at reminder campaigns – designed to build and keep fresh the memory pathways needed to bring the brand back to the forefront in order to drive purchase.

“The most memory refreshing dollar spent on advertising is your first. Decay in returns start immediately unless the 2nd dollar hits purely new people. And in the modern media environment the amount of pure additional reach you can get decays rapidly.”

DRTV/Retail Experience Agrees with This Finding. While Sharp was discussing reminder campaigns, I was thinking about our many 30-minute retail oriented direct response television campaigns – ones that drive long term sales and brand development while introducing new products to new markets.

These aren’t the types of campaigns Sharp studied. But consistent with his results, we often run our 1/2 hour infomercials at low levels for very long periods of time. And we find this approach develops massive retail and brand impact – in fact it’s usually the best use of the media dollar.

We’ve delivered these results for both the Kreg Jig and the Drill Doctor. Our Drill Doctor client eventually sold nearly 3 million drill bit sharpeners, at an average of around $100 each. And, in the meanwhile, developed a thoroughly recognized brand for themselves where it mattered – among dedicated tool users. Pretty powerful given their relatively low media investments.

While we’ve lacked Sharp’s statistics, we concluded this works for a couple of reasons:

1. The messages hit fresh new minds without wasting too much money repeating the message to those who have already bought or rejected the messages.

2. These fresh/unexpected messages are given time to sit before potential consumers see them again – giving new ideas time to gestate in the consumer mind. Then, when they hear the message again, the consumer hears it with new confidence or can find the new things that they want to know to decide if they’ll buy.

Media Bursts Aren’t Always Wrong. What this leaves open is the question of when bursts are right. Sharp’s post clearly leaves the door open (intentionally) for bursts.

Some new product introductions need to be executed in bursts – especially when DRTV supports some styles of retail introductions. We’ve done some very powerful 8 week campaigns for Kobalt brand tools from Lowe’s. In these cases, they had to be big & short to support the retail execution. And, they worked with exceptional power.

Some bursts are seasonal – driving sales volume at a time like the Holidays when a massive spike of shoppers are in the store and when those shoppers are buying larger volume. Or when a product has a specific seasonal cycle.

Bursts can also be strategically smart. Sometimes it’s an important strategy to influence your sales channel. So, for example, a heavy-up campaign that hits when new product reaches the retail floor can deliver the sales needed for manufacturers to become trusted suppliers.

Allocating Media Budget Takes Skill, Strategic Insight, and Experience. Far too often, the idea that integrated campaigns are more powerful causes companies to spread small marketing budgets across far too many media options. My sense (and I’d love to hear from Sharp’s team on this one) is that these campaigns lack the consistency in any one media to build true strength.

Of course only bottom line that matters is this: What is your situation and what allocation of media achieves your business result. But we should all take away from Sharp’s post a fundamental caution about the burst approach and add to it a caution about spreading too little money across too many media outlets.

Copyright 2012 – Doug Garnett – All Rights Reserved

About Doug Garnett
Growing retail based businesses through television, DRTV, and all forms of video. Doug is a strategist, executive producer, director, author, & teacher.

2 Responses to The Power of Low & Consistent DRTV Spending

  1. George Smith says:

    Great article Doug; everyone should read.

    Question though: what about short form utilization rather than a true Infomercial?

    IMO short form has a significant benefit it in that it is an ambush on the consumer who is watching XYZ rather than hoping the consumer sticks around through an Infomercial until a CTA comes up

    or they grasp the URL to look at later?

    • Doug Garnett says:

      George – Thanks for the thoughts.

      Short form has a tremendous benefit. And it has two primary weaknesses:

      1. You won’t get the TV revenue/profit benefit for products priced over about $30. This isn’t always a problem. But most of my retail clients want the profit from TV sales to help make their media cheaper – and that makes it possible to buy far more media and drive far more retail.
      2. Some products really need more than 2 minutes. And when that’s the reality, short form isn’t going to work.

      So, it’s a great medium in the right usage. Our Kobalt Tools work is al :60 and :120. And we work in the medium a lot.

      What’s interesting to me is that research shows that infomercial ambush as well – but in a different way. Infomercials work because they introduce exciting new products to people who wouldn’t encounter them in any other way. In retail, we’re on a mission. Surfing the web we’re generally on a mission in life and don’t take relaxed time to learn about a product outside of that focus.

      But 1/2 hours give people a way to learn about refreshingly new & interesting products (like the Kreg Jig) in comfort and relaxation – a far better environment than the store or online. THEN, once they “get it”, the web is a beautiful way to lead them through to closure.

      Your question about “sticking around” within an infomercial? It’s an issue. And that means when we need a 1/2 hour, we have to make our infomercials compelling to watch – through a combination of message, meaning, and solid production.

      Cheers…

      …Doug

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