INFOMERCIALS TAKE OFF IN THE UK
RESPONSE MAGAZINE
Do Infomercials really work in the UK?
The use of American made Infomercials is something that UK TV audiences have only just got used to seeing on their screens over the last 3-4 years. However, the global marketing policy of “One World, One Ad” has often failed internationally. Pepsi’s “Come Alive with Pepsi” was translated into one Asiatic language as “Pepsi brings your ancestors back from the dead”. And Kentucky Fried Chicken’s “Finger Lickin’ Good” first hit China as “Eat Your Fingers Off”.
There will always be a high failure rate with DRTV & Infomercials products and testing USA products in the UK is no exception. However, the fact that something has worked well in the US gives most European DRTV players confidence that there is a good chance the same product will work well over here.
UK marketers have often marvelled at how buying off the TV screen has matured into very big business in the USA. QVC were the trailblazers in the UK (launching in October 1993) and their popular “live” show format is still regarded as the perfect balance between entertainment and hard sell reaching 95% of UK cable homes and 100% of Satellite homes. Their success in Britain spawned several smaller “live” home shopping channels but these have never become serious challengers and some have already shut down.
QVC UK has outmanoeuvred and outsold all of these newcomers maintaining their dominance from a fairly small demographic group - typically older female viewers. Home Shopping in the UK has never really managed to excite younger TV viewers - but this is about to change.
Growth of Transactional TV Channels
What UK marketers have discovered however, is that the longer half hour show format is ideal for targeting a broader social-economic demographic. The continued growth of TV channels in the UK offering 3 hours per day of home shopping is said to be generating revenues in excess of £483 million per year.
Merrick Page, Media Director of London based ARM Direct comments, “What the Americans have known for a long time is that ‘the more you tell, the more you sell’. They understand the simple rule that the longer you can talk to a prospect, the greater the chance of a sale. British marketers have taken a while to learn that one of the great strengths of long-form is that TV viewers actually choose to watch an Infomercial because they are attracted to it while channel surfing. Once hooked they tend to stay with the show”.
Do US Infomercials transfer to the UK?
At present about 18 Infomercial product categories are on UK TV screens. These include Audio & Video, Automotive, Beauty & Wellness, DIY, Food & Beverages, Jewelry & Watches, Home & Garden, Electronics & Computers, Collectibles, Health & Fitness, Multi Media and Gifts.
The danger, however, for US advertisers lies in assuming that what they can do on one side of the Atlantic can be automatically repeated on the other. FDA Approval doesn’t mean a thing to the BACC (British Advertising Clearance Centre). All Infomercials must comply with the UK’s stringent TV Broadcasting Rules.
For instance, nudity is accepted in France but would never be allowed in the UK. Sometimes whole product categories are banned. For example it’s still not possible to use Infomercials to sell dietary or vitamin supplement products in the UK.
It’s also not possible to use Doctors, Dentists or anyone else claiming to be in the medical profession in an Infomercial or DRTV ad to endorse your products. Selling to children is also highly regulated. And all Testimonials have to be authentic and backed up by signed declarations.
Getting UK Infomercial Compliance
Less controversial product categories like fitness, housewares, collectibles, music & videos plus cleaning products tend to be the strongest sellers. Even so, several US sourced health & fitness Infomercials have recently had to be taken off air in the UK due to non-compliance issues as well as over enthusiastic testimonial content.
Specialist DRV agencies such as ARM Direct help clients to navigate their way through UK broadcast regulations and also to lobby for changes within the TV industry with a view to helping the public have even more home shopping choice on their screens.
Tracey West (ARM Direct’s European DRTV Manager) is well known within the UK DRTV & Infomercial business, she says “Over the years I’ve often been approached by companies wanting to run their Infomercials here in the UK and compliance has often been the main stumbling block. It’s not much good making a great Infomercial in the USA only then to find you cannot run it in an English language market like the UK simply because you were not aware of this country’s BACC broadcast compliance issues”.
UK Infomercial Success
Until recently only a few TV channels in the UK were able to sell long-form airtime avails. That’s all changed and ARM Direct now offer longform airtime on over 40 TV channels.
Predicting the UK’s Infomercial Future
Although Infomercials are only now becoming more familiar to many UK TV viewers, the future is looking very positive.
The days when US sourced Infomercials were either ignored or ridiculed by mainstream UK marketers are just about over. Writing about European DRTV trends for Response in 2001 ARM Direct predicted that US styled Infomercials would become common place on UK TV screens. It’s taken several years for this to come about but these new home shopping channels are now very much part of the UK’s TV landscape. Annual sales are climbing, the quality of the creative production is improving and all we now need are better products.
The real test for the UK will be how long it takes for the bigger and better known Brands to wake up to the power of the half hour show. Companies in the Insurance and Financial sectors are already considering long-form advertising and this will encourage others to examine this proven format. The downside for the product advertisers is that once Brands get involved the airtime rates will very likely go up as these advertisers are willing to pay higher airtime rates.
On the more positive side the UK’s Infomercial revolution is certainly destined to help both new and established Direct Marketing & established Brands to even greater success in Britain and we now look forward to seeing more innovative products and services on our TV screens.
DRTV IS PROVING AN EFFECTIVE CHOICE FOR ADVERTISERS NEEDING AN ACCOUNTABLE MEDIUM
DIRECT RESPONSE MAGAZINE
Traditional TV advertising continues to make way for DRTV (Direct Response TV), the offspring that has matured rapidly to take a grown-up share of the UK broadcast TV ad market.
The key benefit driving DRTV’s popularity is its accountability, providing advertisers with detailed customer data that can be analysed to accurately measure the success of a TV campaign.
The main performance indicator for any DRTV campaign is its overall cost-efficiency and return on investment. Having the data-mining tools in place to delve deep into the increasing amount of customer and viewing data is therefore essential to long-term success.
So what are the key steps to analysing DRTV effectively?
(1) Estimate scheduled call volumes
Always obtain scheduled TV spot times before a campaign airs. Ensure the right copy is running, along with correct telephone numbers, and that spots are broadcast as planned throughout campaigns. This information, along with estimated call volumes, is vital to the advertiser’s call centre, so that responses can be handled efficiently.
(2) Obtain detailed DRTV response data
Know what response data is going to be available once the campaign is running and how often it will be supplied. Having an infrequent supply of data leaves little time to revise media plans while a campaign is on air. Be sure to receive exact times of calls in order to match this back to spot times at a later stage.
Collecting details of when qualified respondents called is more useful than simply noting gross call volumes. While a DRTV campaign’s main objective is the ’call to action’ to generate as many cost-effective calls as possible, the quality of respondents is also important. The number of qualified leads can feed back vital creative information, such as the adverts appeal and whether it contains a clear message. It can also influence future media plans, for example a kid’s channel may be generating a large number of hoax calls and may need to be removed from future plans.
(3) Attribute accurate responses to DRTV spots
Determine how quantifiable the data is. If TV channels have run separate telephone numbers, the response data can be assigned with greater accuracy. Should one ‘golden’ number have been used across multiple TV channels, then a spot-matching methodology is needed to attribute each response to an individual TV spot. The most efficient is a purpose-built software system programmed to do this automatically.
(4) Drill down to your DRTV results
Analyse the response data with BARB viewing figures to determine response rates and costs. The DRTV campaign’s overall response rate and cost-per-response provides a first indication of success. However, successful or not, it is essential to drill down further into the data to establish the accountability of all the TV airtime and plan how future DRTV campaigns can be improved.
Each TV channel’s performance can be judged after responses are spot-matched, but it is also important to analyse other variables, such as days of the week, dayparts (such as peak time), position in breaks and individual TV programmes or programme genres.
Even a cost-efficient and successful TV channel may have poorly performing days or dayparts, which, if removed from future plans, could lead to a lower cost-per-response. Conversely, a TV channel that has not been effective may have certain times which were cost-efficient and the airtime could be restricted to these times in future. All these affect the overall campaign results.
This is why DRTV campaigns should be constantly tested, analysed and refined.
(5) Ensure transparent DRTV airtime costs
An ongoing (and campaign-end) reconciliation of delivered viewing figures versus budgets will give a transparent picture of final TV airtime costs. Reconciled airtime figures will show an over or under-delivery for each TV station, which will help plan spend levels for future DRTV campaigns.
(6) Use return on investment to judge your DRTV campaign success
When planning subsequent DRTV campaigns, use recent response rates to judge each channel’s expected performance. However, it is also important to balance the plan with cost-efficient channels and high volume generators. Response rates are guides, but cost-per-response and ROI are the key performance indicators.
(7) Variable DRTV airtime costs may reduce future efficiencies
When analysing campaign results and planning future budgets, the changeable TV landscape should be considered. A TV channel may not perform successfully month on month due to external factors, such as new competing satellite channels launching, programming changes and particularly price changes.
The majority of TV airtime is purchased through CpTs (cost-per-thousand viewers). Each station’s price can fluctuate by month. Therefore, airtime purchased in one campaign may be more expensive by the next. This can have a large bearing on future results and must be taken into consideration when planning future DRTV activity based upon previous results.
EUROPEAN ONLINE UPDATE
ERA MAGAZINE
In the recent past all the online news used to be about ambitious start-ups. However, in Europe now could be the time that online companies learn from their DRTV colleagues and join mainstream marketing.
Although the past few years have been a testing time for all marketing sectors including DRTV and Infomercials, online has taken more than its fair share of negative criticism, with accusations over wasted investment and high-profile casualties.
All this has led to questions about whether online as a standalone medium was viable, was the industry over hyped or was the problem just one of inexperienced marketers guiding the over optimistic?
All those involved in the growth of the DRTV industry will know that there were teething problems at the start. Because of ridiculous early sales and web user predictions the online industry has been asked to grow from precocious younger brother to fully fledged adult in a much shorter time than TV, Radio or Press.
But the key problem, as identified in several online industry reports, is that many e-commerce start-ups misjudged just how hard they’d have to work at promoting their websites using tried & tested traditional marketing to attract customers.
In a very short time e-commerce has been found to be a complementary medium. For example by adding a transactional URL to any DRTV commercial you’ll soon see how effective online can be in attracting extra business. Online should no longer be treated in isolation but as part of an integrated marketing schedule. This includes using online for Brand awareness as well as direct response.
The Launch of the €uro
Until recently Europe had been slow to embrace this e-commerce culture. However the signs are clear that the tide of change is rapidly building momentum, especially with the launch of the € Euro currency in January 2002 across 12 European countries (Britain, Denmark and Sweden have decided to stay out at this time).
This is the single biggest currency switch in the history of the world and it has made internet purchasing across Europe easier than ever before. Put simply if you’re online in Italy you’ll be using exactly the same € Euro currency as someone offering the goods for sale online from Germany - the customer will instantly be able to appreciate the online cost and decide whether to make the purchase. No more having to worry about today’s exchange rate for the Italian Lira to Deutsch Mark - the launch of the € Euro changes all that.
Which Europeans are using Cyberspace?
Time spent online in Europe is challenging the American total of 941.8 minutes per month.
There have been some big jumps however. In March 2005, the total minutes spent online by the Spanish increased to 713.2 minutes online (an increase from 602 minutes in 2001) and internet usage in Sweden leapt from 466 minutes last year to 581.4 minutes claiming the number three spot over the UK, which racked up 504.8 minutes.
According to a leading internet research group, it is estimated that 60.5% of the US population aged 15+ has access to the internet, 38.2% are regular users and 21.5% have purchased online.
Compare this to Europe, where 44.6% (213 million) have access, 24.7% are active users and an average of 12.3% have ever purchased online.
Some of this may be attributed to the fact that many pan-European DRTV spots and Infomercials featuring URL’s are only just beginning to be frequently seen in some countries.
However, in Europe there has been a slight decline in male users (the most populated countries France, Germany, Spain register a 60/40 male/female split). This is good news for companies that sell weight loss products (TV broadcast regulations restrict the use of DRTV spots or Infomercials to sell dietary products in most European countries).
To gain an appreciation of internet penetration in Europe, it is important to consider each country on its own accord. There are significant differences between the countries in North, West and Southern Europe, in terms of online access and online purchasing.
The massive variance of internet usage in colder Scandinavia when compared to warmer Southern Europe illustrates these differences. The further south people live, the less they surf. Sweden, Norway, Denmark and Finland have an average online connection of 59.3%, while 49.7% of the population are regular users.
In stark contrast the sunnier southern countries of Spain, Portugal and Italy we find that the average access to internet facilities is just 16.4%, and only 13.2% have recently been active online. Purchasing habits also reflect this limited internet usage, with just 4.6% having ever made a reservation or purchase online (compared with 19.7% in Scandinavia).
Caught in the middle, both geographically and statistically, are Switzerland, the Netherlands, Austria, Germany and the UK, where slightly over one-third of the population aged 15+ now surf the net.
Whilst the Scandinavian online connection % is impressive it is worth noting that the UK and Germany are the most important online markets in Europe accounting for more than 63.4% of online sales. What’s more the trend for European online shopping tends to be very much inward looking. For example the total exports beyond national European borders account for only 11.2% of European online retailer’s revenues, whilst exports out of the European zone generate just 3.4%.
Closer look at online Britain
Given that the UK shares the English language with the USA and currently there are more TV stations in the UK [than any other European country making TV airtime the most affordable] it is worth a quick look at the e-commerce market potential there. The total UK online households are estimated at 9,735,000. This makes the UK the Second largest European online market with around 16million people using the internet at home. The top 5 ISPs attract 65% of all Britons. Half the online population visits an entertainment or retail site every month. 67% of Britons use a search engine with askjeeves.com and google.com being the most popular. The UK online population grew by a massive 25% in 2001.
e-commerce - What is working in Europe?
According to the latest Forrester Research, the leisure travel sector generates the most internet sales in Europe and this category is expected to grow by a further 23% in 2003.
In Europe, the categories that will show the most significant e-commerce growth between 2003-2005 will be computer software (up 69%), books (up 64%) and computer hardware (up 59%). It is predicted that Food & Household plus Videos & Music will also see rises of over 42% during this period.
The potential for e-commerce + DRTV
As time spent surfing the net increases day by day, many in the DRTV industry are concerned that internet sales are detrimentally impacting on DRTV media results. This need not be the case. On the contrary, the association between purchasing via the television compared with the internet in Europe can be seen as a complimentary rather than disparaging relationship for marketers.
Channel 4 is a national terrestrial TV station in the UK, with a total audience of 12% (UK TV audience 57 million). Recent figures conducted by this station show that internet users still pay more attention to TV than any other advertising medium. Only 22% of respondents discovered internet addresses via the radio and 26% via billboards and posters. Compare this to the 64% who discovered website addresses via spots on TV, and the potential for DRTV advertisers gaining extra business by adding their website URL’s to their pan-European creatives becomes apparent.
By including a URL in a DRTV commercial, advertisers may greatly increase their potential up-sell revenue. More buying opportunities can be achieved via the internet, by strategically manoeuvring customers through a website, thereby exposing more selling points as well as more product lines.
The DRTV industry in the UK has already identified and reacted to this new trend and ARM Direct is at the forefront of this online revolution.