Direct response advertising is thriving despite the recession. What’s creating this environment? When brand advertisers such as General Motors or Procter & Gamble cut back on their traditional advertising expenditures, it creates more media inventory for direct response advertiser, at better times and at highly discounted rates. For example, DRTV advertisers are now able to clear spots in primetime on major cable networks, such as CNN. And Cash4Gold bought a :60 DR ad during the Super Bowl, because they secured a great deal at the last minute. These types of buys would have been unheard of during more robust economic times.
With direct response TV advertising, there is no guarantee your ad will run. Stations insert direct response ads, which are typically :60 or :120 spots, when they don’t have enough traditional advertisers who are willing to pay the full price. But in the current economic downturn, a higher percentage of DRTV spots are clearing in programming usually reserved for blue chip brand advertisers.
A few years ago, direct response TV marketers were having a more difficult time marketing their products, since media rates were higher when the economy was humming along. Many advertisers were inserting a website or an 800 number in their TV ads, in order to gain access to DR rates. Everyone from car dealers to brand marketers trying to drive consumers to their website to redeem a coupon were experimenting with DRTV and driving up the rates. This cut into the affordable DR inventory available to direct marketers. But now things are looking up for DR marketers. According to Nielsen, even though overall advertising spending fell by 2.6% last year, direct response advertising spending increased by 9.2%. The higher level of spending can be attributed to the lower rates and better clearance DR marketers are experiencing.
Direct Response Advertising Delivers a ROI
During more difficult economic times, marketers are under pressure to show an ROI from their advertising expenditures. Direct response advertising provides marketers with the metrics to precisely measure the ROI from their marketing efforts. CEO’s and CFO’s are beginning to demand the type of accountability that direct response advertising can provide marketers. The average CMO (chief marketing officer) is only in their position an average of two years, so they are under intense pressure to deliver measurable results. These factors are contributing to the trend of more Fortune 500 marketers incorporating direct response advertising into their marketing mix. For example, Johnson & Johnson is utilizing DRTV to market their Neutrogena SkinID skincare line.
Great Marketing Vehicle for Entrepreneurs
But it’s not just Fortune 500 companies that are benefiting from direct response advertising. The downturn is also inspiring entrepreneurs, who might have been laid off from their jobs, to pursue their dream of marketing a product they invented or patented. And many recognize that direct response marketing is a cost effective way for them to market their product directly to consumers and control the profits they generate from their efforts.
The increase in direct response inventory is more noticeable on TV, since stations can’t increase the length of their shows to fill in the empty time slots. However, radio is also experiencing a downturn, which is opening up higher profile, drive-time DR inventory at lower rates. Radio can reach a mass audience, but it can also be very targeted, allowing marketers to reach niche markets. Radio is beginning to innovate by incorporating HD, mobile, social networking and streaming into their offerings. The cost of producing a radio spot is also much lower than producing a DRTV spot. However, it lacks the visual component that TV offers, so it tends to work best for lead generation campaigns or programs with strong offers. Like TV, DR radio can be purchased as short form, 60 or 30 second spots, or as infomercials, which run 30 minutes.
Online is Crucial to the Success of a DRTV Campaign
The online component of a DRTV campaign is crucial to your success. Anywhere from 25% to 50% of the sales generated by a DRTV campaign are now coming through the web. So it’s important to develop a website that is geared toward selling your product or service. Many DRTV marketers also put their TV commercial on their site, so that consumers can view it again and thoroughly understand the key benefits their product can offer. Many consumers will not remember your website or the 800 number featured in your DRTV commercial. But, since 31% of people watching TV are also logged online, many end up putting a product description into Google or another search engine and that’s how they arrive at your site. It’s important to buy keywords related to your product while your DRTV campaign is running, so that consumers can easily click on those keywords and be directed to your site.
Now is a Great Time to Consider Direct Response Marketing
If you are considering utilizing direct response TV or DR radio as a marketing vehicle, this is a great time to jump into the market. Direct response advertising is thriving right now and you can take advantage of this opportunity by aligning yourself with experienced direct response vendors in the key areas of production, media-buying, telemarketing, web design, card processing and fulfillment. A strong network of DR vendors can guide you through the entire process and help ensure that your campaign has the best chance to succeed.
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