SHORT FORM MEDIA REPORT 3RD QUARTER

Third quarter is traditionally the short form media quarter with the lowest rates, highest avails and some unique opportunities. So you would think that this year, especially, that rates would be low, avails high and the networks just hoping to get some business. But there are several factors that affect rates and availability is one of the most important. General advertisers buy quarter to quarter based on “cost per rating point.” And the rates these large advertisers are willing to pay are getting lower each quarter.

It has been reported that the upfront Broadcast Media Market is down three to five percent over last year. When general advertising rates decline like this, broadcasters try to make up the difference with direct response rates. In the current market, the cable networks would prefer to sell inventory at a 20-30 percent discount to general advertisers than it is to sell that same inventory to the DRTV market at a 50-70 percent discount. In addition, more and more general advertisers are placing “hybrid” or blended direct response media buys. They are using DRTV rates and placing “scatter” buys on inventory that may have been earmarked for direct response advertisers. Like we always say on this blog….your media buyer better be smart!

Long Form Infomercial Media Update

So you’re probably thinking that since the financial meltdown of 2008, long form infomercial media costs have crashed. Well in some cases this is true. But remember, this marketplace works by the basic economic law of supply and demand. And direct response is hot in 2009! Moreover, long form infomercials that are driving retail still need the high profile airtime that is only available on major cable networks. So are rates for long form thirty minute infomercials down or not? The answer is yes, but as we have written in this blog repeatedly – your media buyer better be smart – and tough! And the marketer must hold their ground when negotiating rates.

Don’t be afraid to use the old fashioned take away! That’s what we do when stations and networks refuse our bids. We walk and keep looking for value in media. What we are seeing is a lot of local broadcast airtime opening up to long form media buyers. It’s cheaper for a broadcaster to sell half hours then buy programming and try to sell spots. You can find half hours in smaller markets for $50 and $75 bucks or just a few hundred in the most desirable weekend slots. That means just a few orders can make these offers pay out. Make sure you have worked out the metrics, know your allowable cost per order and stick to it. If an airing does not pay out, demand a make good from the station or tell them you will not keep airing.

The TV infomercial, and what we mean when we say, infomercial, is a half hour long form show….is still the easiest area of direct response for the entrepreneur to launch a product nationwide. Not only can you tell your full story, but your media buys can be truly tailored to a start up budget. The cost of producing an award winning TV infomercial is a fraction of the ROI this form of marketing returns. In addition, you will be able to pull two minute and one minute short form direct response television versions and have lots of video content for your online strategies.

Check this blog frequently for media DRTV media updates.

DRTV Equals Cost Per Acquisition

Back in the day, it was easier to succeed with Direct Response television. Nationwide cable media costs were much lower, general advertisers did not use Direct Response TV as a branding medium, and there was much less competition for direct sales to the consumer on television. Now, AS SEEN ON TV SUCCESS requires a compelling media strategy, a bull dog of a media buyer, and infomercial television production that captures the audience’s attention.

But one thing that will never change is that DRTV and infomercials work based on the concept of a pre determined cost per acquisition. It is the concept of an advertising allowable or media cost per order. Great media buyers buy nationwide airtime to a media cost allowable, and know if an offer is working from the first direct response media tests. Customer acquisition costs and great DRTV media buying go hand in hand.

Infomercial Media Funding

After 16 years working with entrepreneurs, startups and inventors, we have learned the challenge of funding an infomercial or direct response TV campaign. And there's good news! Since DRTV is a direct to consumer selling science, small media tests of as little as $5,0000 to $7,500 can interest large investments in a media funding roll out.

InfoWorx finds media funding partners for our clients. In order to qualify for media funding, a marketer must have a merchant account through a large direct processor. Recently, we helped a client gain an approved merchant account in less then a week, so there's always a benefit to leverage InfoWorx' vast network of colleagues and strategic partnerships.

Media funding partners will not ask for personal guarantees, but their contract will require their loans to be paid through the flow of revenue into the merchant account. An expert consultant can help navaigate the complex landscape of direct response marketing. And even find media funding as high as $50,000 to $100,000 per week. Media funders can be persuaded to work with multi pay offers and even free trial offers if the test data supports a roll out.

Direct Response Media Costs Down

You know the saying is that everyone gets hurt in a recession, it's a matter of how much. But in my business -- the direct response media business, that sometimes is not true. You see media costs, like all costs, are driven by the number one economic law....SUPPLY AND DEMAND. Like many firms today, media companies are cutting costs, laying off workers, and hunkering down as advertising revenues decline. It has been widely reported that the Super Bowl is not sold out, and networks like NBC are restructuring their business models. Advantage - direct response marketers. We buy media to an "allowable" which is the media cost we can afford on a cost per order basis for the client to make money. Read this sentence again, if you do not get it yet. In Direct Response we measure the number of leads or orders compared to the cost of media. With media costs down across the board offers that could not work in 2006 or 2007, can now "pay out."

Of course your offer must still create the impulse for the buyer to call or log in to your website. Infomercial and successful DRTV strategies must always have an almost irresistible offer in good times and bad. The good news is that the cost of testing, the available short form and long form media is up and media rates are down.

Online Video Ads Reach a Large Audience

As online video grows, and it’s audience grows, more data is available as to who and how often they are watching. Remember infomercials and direct response television are all about the metrics. Cost per order, cost per lead, cost per acquisition. As we at InfoWorx drill down into the vast new opportunities for infomercial products, we are finding many online video ad networks who are willing to work on a cost per acquisition model. Sometimes however, working at an auction based level with a low CPM can be even more effective then direct response rates found on mainstream TV.

Here are the top 10 Online Media Destinations (week ending Oct 19, 2008)

NBC Universal 7,1655.08
Clear Channel Online Network 5,2473.72
MSN TV 5,1833.67
AOL Television 4,2993.05
PBS 4,0772.89
Yahoo! TV 3,8102.70
ABC.COM 3,5022.48
DirecTV 2,8622.03
TV.com 2,1421.52
CBS Television 2,0801.47
Source: Nielsen Online, NetView

As new data comes in, check this blog frequently. In order to reach 21st century customers, you need a scientific approach that targets your best customers with the lowest cost per order. Online video now offers a new and exciting method to drive your brand straight to your web site with an irresistible offer.

DRTV Media Buying Made Easy

Broadcast spending is down despite the election and the Olympics. Recessions, slow downs and fewer advertisers is often a good omen for DRTV marketers and their Direct Response Agencies. Why? Direct response television media buying rates are usually the lowest in the market. After all, you must make your irresistible offer or lead generating short form infomercials pay out according to your allowable cost per order. Check through this blog for more information on these important metrics and concepts for As Seen On TV Success.

Between January and August of this year television media buys fell 1.3% and removing political spends -- the decline is 1.6%. If you back out the television media costs surrounding the Olympic games....there is a year to year loss of $89.4 billion, according to TNS Media Intelligence.

For Direct Response TV, this means that there is more cheap television inventory....and this makes DRTV media buying easy for smart, savvy media buyers.