DRTV Short Form Media Rates - 2nd quarter update. There is a lot of concern regarding the 2012 Presidential Campaign’s effect on DRTV media rates and avails. I can tell you in Florida, during the political window of the Republican Primary, most of the local avails went to political ads and advocacy ads. The good news is that national cable (which is the cornerstone of DRTV) has been effected little, if any. Of course, no one knows what will happen in the fall. I predict that the “battleground” states will have few local avails. DR marketers should not be hurt too much, but the local retail environment and the spot branding buys will certainly be affected.
In the first quarter there was much optimism (like 2011) and rates started to gain upward pressure almost immediately. Second quarter is traditionally a high priced quarter, but we have seen some easing of rates, as perhaps the 2012 optimism was too high again. A savvy, tough media buyer always understands value and looks for bargains. What is happening on one network in terms of demand may be different on another – and it changes week to week. For example, a prominent network geared to African American audiences recently cut their rates significantly, as they have inventory.
We are finding many DRTV remnant opportunities for our clients including nationwide remnant inventory for $5/minute in up to 8 million households. In Direct Response Television media buying the trick is to reach an allowable cost per order that works for your offer. Check here to learn more about this concept. Bottom line, we are exceeding our clients’ expectations and are generating leads for as little as $5 in some cases. Our stated mission has always been, “Your success is our success.” We can lower your cost per lead or order, and we back every media buy with affidavits and timely reporting.
Please subscribe or bookmark us and feel free to share our information. Thanks to all of you who read my blogs and appreciate the straight talk, DRTV information, and assistance you derive for your planning and new projects. I take a lot of pride in my direct approach because as we all know, knowledge is power.
Saturday, April 28, 2012
Saturday, February 4, 2012
DRTV – How to Calculate Cost Per Order or CPO
CPO, Cost Per Order, Allowable Cost Per Order. These are the key metrics for successful direct marketing. And for 20 years, I have been educating my clients, potential clients and members of this great industry. I’ve been blogging about the DRTV and Infomercial business for 4 years and the keywords usually center around the cost to produce or air an infomercial or Direct Response TV commercial. But make no mistake, you can’t make money or break even or execute any direct marketing strategy without knowing your Allowable Cost Per Order. Let’s define the terms for this blog or click here for an Infomercial Glossary.
Cost per Order (CPO): The average cost of television media to generate one product order, determined by dividing the cost of a specific infomercial telecast by the total number of orders received from it.
Ad Allowable: Your ad allowable tells you how much you can afford on a cost per order basis. The ad allowable is the dollar amount determined to be the maximum media expense for each unit sold in order to generate a legitimate profit. Also referred to as Allowable Cost Per Order.
In order to calculate your cost per order, you must be able to track response and sales by media airing, week, month and so forth. DRTV and DR Radio are accountable forms of advertising (unlike branded advertising), and your DRTV Media Agency must have a media management system that tracks calls, web hits, and orders for each airing, broadcast week and broadcast month. Handled properly, the direct marketer should receive data daily that estimates the CPO and receive data weekly with reconciled reporting that tracks the CPO to the penny.
We provide our clients a report called an Allowable Report. Upon setting up a campaign, we crunch the numbers, consult with the client and establish an Ad Allowable or Allowable Cost Per Order. Our custom report shows the client at a glance all of the stations, networks and airings that are below the Allowable and all of the media that is above the Allowable. A savvy and responsive media buyer cancels all media that is under performing the allowable and reorders the media that is working.
To learn more about DRTV Media Rates and Rollout strategies – click here. Don’t forget to subscribe so you receive all of the latest info on the DRTV Media business.
Cost per Order (CPO): The average cost of television media to generate one product order, determined by dividing the cost of a specific infomercial telecast by the total number of orders received from it.
Ad Allowable: Your ad allowable tells you how much you can afford on a cost per order basis. The ad allowable is the dollar amount determined to be the maximum media expense for each unit sold in order to generate a legitimate profit. Also referred to as Allowable Cost Per Order.
In order to calculate your cost per order, you must be able to track response and sales by media airing, week, month and so forth. DRTV and DR Radio are accountable forms of advertising (unlike branded advertising), and your DRTV Media Agency must have a media management system that tracks calls, web hits, and orders for each airing, broadcast week and broadcast month. Handled properly, the direct marketer should receive data daily that estimates the CPO and receive data weekly with reconciled reporting that tracks the CPO to the penny.
We provide our clients a report called an Allowable Report. Upon setting up a campaign, we crunch the numbers, consult with the client and establish an Ad Allowable or Allowable Cost Per Order. Our custom report shows the client at a glance all of the stations, networks and airings that are below the Allowable and all of the media that is above the Allowable. A savvy and responsive media buyer cancels all media that is under performing the allowable and reorders the media that is working.
To learn more about DRTV Media Rates and Rollout strategies – click here. Don’t forget to subscribe so you receive all of the latest info on the DRTV Media business.
Saturday, January 21, 2012
DRTV Media Rates and Rollout Strategies
Direct Response TV Rates are based on supply and demand. After the upfront quarterly media buys are made by the largest corporate advertisers, media companies have inventory that may be used for spot branding buys (scatter media buys) and DRTV or Direct Response Television. Check back here often because we also cover radio which works a little differently.
Media rates flatten in the early part of the first quarter and slowly rise as we move closer to the important second quarter with many Spring and outdoor activities starting up again such as lawn maintenance, outdoor recreation, and Easter.
HOW TO ROLLOUT YOUR PRODUCT
Many of our clients understand the concept of a media test or tests to determine the best price points, offers and media strategy. But often we are questioned about the cost and execution of a rollout strategy.
Direct to Consumer: If your product is a Direct to Consumer product such as a supplement or skin care product that will rely on DRTV or DR Radio sales, a rollout can start slow and simply build and ramp up slowly based on sales and budget capability.
Lead Generation: Lead generation rollouts may be impacted by your call center or inbound telemarketing capacity issues. Once your lead generating DRTV commercial or short form infomercial is tested and you are within your allowable, a slow but steady ramp up can take place like Direct to Consumer. But if your phone room is small, steps must be taken to make sure all calls are answered and all leads responded to in a timely fashion. Also lead generating spots are well suited for Per Inquiry or PI distribution once the creative has been tested.
Direct to Retail: Many of the best known direct response products are consumer products that solve a problem and cost $19.95 or less. In the Direct to Consumer model often continuity sales or auto ships or reorders keep the backend very profitable so the marketer can afford a decent allowable cost per order. Check here for more on the allowable concept. The Direct to Retail model uses retail sales to complete the “backend” sales which are crucial to success. DRTV commercials drive retail sales. The retailers are looking for robust media plans in order to give you their precious shelf space. Direct to Retail rollouts should start with budgets of $25,000 per week and a strategy to be rated as an up and coming product. Often media funding companies are brought in to help with this type of rollout.
Monday, January 2, 2012
DRTV Response Rates-Allowable Cost Per Order
DRTV Response Rates. $50 per spot DRTV. According to my research these two key words come up in many searches. So let’s talk it about because if you are looking for the latest 2012 DRTV Media information, The DRTV Media Blog is the place to get it. Please mark it or subscribe.
For those of you just getting started, DRTV is an acronym for Direct Response Television, which is a method of advertising on TV on a National or Local level in which the advertiser pays low, low rates which are pre-emptible or, in other words, remnant media. Savvy marketers and advertiser establish an allowable cost per order to reach sales goals that should be preset.
DRTV Response Rates are usually tracked via metrics known as Media Efficiency Ratio or Media Ratio or MER. Let’s define a few of these terms:
Media Efficiency Ratio (MER): The total number that decides an infomercial's overall success or failure. The ratio is derived by dividing total sales by the media cost. Sales/Media Cost = MER. This term is also sometimes referred to as Media Ratio or simply Ratio. You can track your TV commercial media buying efficiency on a single airing, a group of airings by station or a week, month or quarter.
Ad Allowable: Your ad allowable tells you how much you can afford on a cost per order basis. The ad allowable is the dollar amount determined to be the maximum media expense for each unit sold in order to generate a legitimate profit. To calculate your allowable add all of the revenue per unit including postage and handling and then deduct all of the expenses including cost of goods, telemarketing, etc. Here is a tool that may help you determine your Ad Allowable.
Cost per Order (CPO): The average cost of television media to generate one product order, determined by dividing the cost of a specific infomercial telecast by the total number of orders received from it. Compare this number to your Ad Allowable and you will know if you are reaching your goal or not.
Media rates ease up significantly in the first few weeks of a new year then gradually move back up as the winter nears its thaw. First and third quarters are the best TV media buying quarters as far as rates with second and fourth quarters having the most demand from corporate and branding advertisiers who pay higher rates.
For those of you just getting started, DRTV is an acronym for Direct Response Television, which is a method of advertising on TV on a National or Local level in which the advertiser pays low, low rates which are pre-emptible or, in other words, remnant media. Savvy marketers and advertiser establish an allowable cost per order to reach sales goals that should be preset.
DRTV Response Rates are usually tracked via metrics known as Media Efficiency Ratio or Media Ratio or MER. Let’s define a few of these terms:
Media Efficiency Ratio (MER): The total number that decides an infomercial's overall success or failure. The ratio is derived by dividing total sales by the media cost. Sales/Media Cost = MER. This term is also sometimes referred to as Media Ratio or simply Ratio. You can track your TV commercial media buying efficiency on a single airing, a group of airings by station or a week, month or quarter.
Ad Allowable: Your ad allowable tells you how much you can afford on a cost per order basis. The ad allowable is the dollar amount determined to be the maximum media expense for each unit sold in order to generate a legitimate profit. To calculate your allowable add all of the revenue per unit including postage and handling and then deduct all of the expenses including cost of goods, telemarketing, etc. Here is a tool that may help you determine your Ad Allowable.
Cost per Order (CPO): The average cost of television media to generate one product order, determined by dividing the cost of a specific infomercial telecast by the total number of orders received from it. Compare this number to your Ad Allowable and you will know if you are reaching your goal or not.
Media rates ease up significantly in the first few weeks of a new year then gradually move back up as the winter nears its thaw. First and third quarters are the best TV media buying quarters as far as rates with second and fourth quarters having the most demand from corporate and branding advertisiers who pay higher rates.
Saturday, October 29, 2011
Infomercial Airtime Cost
Thanks for visiting the DRTV Media blog for the latest updates on infomercial airtime costs. Everyday our telephones ring with marketers looking for straight talk and information on TV and Radio airtime. We've been helping entrepreneurs, large corporate clients and product developers for almost 20 years now.
So let's talk Direct Response TV and DR Radio.
Short Form TV or DRTV:
Each year it's the same story. Rates go down in the first quarter, and it's easy to clear. There are many opportunies with TV viewing at it's highest levels of the year (think weather). Then rates begin inching up. Second quarter rates always jump because of the push for Spring and Summer activites. Now I know you think the economy is bad - but you can't sell anything unless you advertise. Check the financial news - the media conglomerates are all making money!
Long Form TV Infomercials:
A lot of marketers think this format is old school - but not the smart ones! And many companies with great products well suited for long form TV, want to test with short form to see if the investment is warranted. Not the smartest strategy either. I suggest you flip through the channels late at night or on Saturday and Sunday morning. You will see that the format is alive, that many great products are being introduced, explained, pitched and sold. So what's happening to rates? Long Form TV Infomercial Rates are flat! There are many opportunites here, and with a smart bulldog of a media buyer, you can make money with your product. Remember - the more you tell, the more you sell!
Short Form Direct Response Radio:
This format works great with soft offers, dietary supplements, and lead generation. With good inbound telemarketing you can convert soft offer leads into $400 sales! We know, because we're doing it! They key to DR Radio is finding remnant time at depressed rates. It takes a lot of work, but it pays off for the client. For example, if a station sells "retail" time at $150 a minute - we expect to pay $25-$40 per spot. If a national radio network is selling their programming at $1000.00 per minute, we expect to pay $200.00!
Long Form Direct Response Radio:
The more you tell, the more you sell! For nearly 20 years we've been explaining this and the smart clients make money! This is a tricky format to buy because the stations like to work long term deals. But savvy media buyers know that a product must be tested one or two weeks at a time. We call it Direct Response for a reason. What do these time slots cost? Anywhere from from $25 to $2500.00 per half hour. If your product does not demand visual demonstation or could work in a talk show format, give long form radio a try.
Thanks again for visiting, and, as you can see, this blog is a lot more than just DRTV Media. I've been buying, negotiating, planning and researching media for over 30 years, and I'm happy to share my knowledge and experience with everyone interested.
So let's talk Direct Response TV and DR Radio.
Short Form TV or DRTV:
Each year it's the same story. Rates go down in the first quarter, and it's easy to clear. There are many opportunies with TV viewing at it's highest levels of the year (think weather). Then rates begin inching up. Second quarter rates always jump because of the push for Spring and Summer activites. Now I know you think the economy is bad - but you can't sell anything unless you advertise. Check the financial news - the media conglomerates are all making money!
Long Form TV Infomercials:
A lot of marketers think this format is old school - but not the smart ones! And many companies with great products well suited for long form TV, want to test with short form to see if the investment is warranted. Not the smartest strategy either. I suggest you flip through the channels late at night or on Saturday and Sunday morning. You will see that the format is alive, that many great products are being introduced, explained, pitched and sold. So what's happening to rates? Long Form TV Infomercial Rates are flat! There are many opportunites here, and with a smart bulldog of a media buyer, you can make money with your product. Remember - the more you tell, the more you sell!
Short Form Direct Response Radio:
This format works great with soft offers, dietary supplements, and lead generation. With good inbound telemarketing you can convert soft offer leads into $400 sales! We know, because we're doing it! They key to DR Radio is finding remnant time at depressed rates. It takes a lot of work, but it pays off for the client. For example, if a station sells "retail" time at $150 a minute - we expect to pay $25-$40 per spot. If a national radio network is selling their programming at $1000.00 per minute, we expect to pay $200.00!
Long Form Direct Response Radio:
The more you tell, the more you sell! For nearly 20 years we've been explaining this and the smart clients make money! This is a tricky format to buy because the stations like to work long term deals. But savvy media buyers know that a product must be tested one or two weeks at a time. We call it Direct Response for a reason. What do these time slots cost? Anywhere from from $25 to $2500.00 per half hour. If your product does not demand visual demonstation or could work in a talk show format, give long form radio a try.
Thanks again for visiting, and, as you can see, this blog is a lot more than just DRTV Media. I've been buying, negotiating, planning and researching media for over 30 years, and I'm happy to share my knowledge and experience with everyone interested.
Wednesday, August 31, 2011
Direct Response Radio Rates – DR Radio Basics
Learn all about Direct Response Radio Rates – right here! Since 1992, I have been active in the Direct Response Industry, primarily in TV. But back in the late 1970’s and 1980’s, I cut my teeth buying local spot radio across many stations and many formats. You could say – I’ve been around the block a few times. In the last several years DR Radio has grown steadily with the explosion of cell phone use. Oh my God….Just take a look around you, no one is watching the road when they drive – they are all talking, texting and searching on their mobile devices!
DR Radio or Direct Response Radio offers marketers another channel to reach customers. And radio reach is expanding with numbers starting to come in for streaming listeners who are getting radio from their computers and mobile devices. The world of media is changing and you better keep up with it.
So how does a marketer make radio work? Like DRTV, if you pay too much or your CPM (Cost Per Thousand Impressions) is too high, your offer will not pay out. A seasoned Radio Media Buyer should have a robust history of stations that can offer low remnant rates and have worked for other offers. For example, we are negotiating with several CBS owned stations in large markets. Some laugh at our offers while others have open inventory and are happy a busy DR Agency has called with advertising dollars to spend.
Some examples of some sweet local deals recently:
- Sports station playing Dodger games at $10 per 60 second spot…plus bonus spots!
- Talk station in Philly with national personality at $25 per 60 second spot.
- Classic hits station in Atlanta with huge reach at $25 per 60 second spot.
- News/talk station in top 10 DMA at $6 per spot.
- We only buy Radio Prime time – Monday-Friday 7A-7P.
- No overnights or evenings which are dead times in radio.
Remnant Radio is also available on a National basis through nationally distributed networks that carry conservative talk like Rush Limbaugh, Sean Hannity, and Laura Ingraham and music shows that appeal to different demographics like John Tesh. Buying these shows at remnant rates which can be as much as 75% lower than rate card is the way to make national radio pay off. Check back here frequently for the latest information on DRTV and DR Radio.
DR Radio or Direct Response Radio offers marketers another channel to reach customers. And radio reach is expanding with numbers starting to come in for streaming listeners who are getting radio from their computers and mobile devices. The world of media is changing and you better keep up with it.
So how does a marketer make radio work? Like DRTV, if you pay too much or your CPM (Cost Per Thousand Impressions) is too high, your offer will not pay out. A seasoned Radio Media Buyer should have a robust history of stations that can offer low remnant rates and have worked for other offers. For example, we are negotiating with several CBS owned stations in large markets. Some laugh at our offers while others have open inventory and are happy a busy DR Agency has called with advertising dollars to spend.
Some examples of some sweet local deals recently:
- Sports station playing Dodger games at $10 per 60 second spot…plus bonus spots!
- Talk station in Philly with national personality at $25 per 60 second spot.
- Classic hits station in Atlanta with huge reach at $25 per 60 second spot.
- News/talk station in top 10 DMA at $6 per spot.
- We only buy Radio Prime time – Monday-Friday 7A-7P.
- No overnights or evenings which are dead times in radio.
Remnant Radio is also available on a National basis through nationally distributed networks that carry conservative talk like Rush Limbaugh, Sean Hannity, and Laura Ingraham and music shows that appeal to different demographics like John Tesh. Buying these shows at remnant rates which can be as much as 75% lower than rate card is the way to make national radio pay off. Check back here frequently for the latest information on DRTV and DR Radio.
Thursday, August 25, 2011
Infomercial Production - Long Form TV Productions
Infomercial Producer, Ron Perlstein produces affordable, award winning, telephone ringing long form infomercials, short form infomercials and offers 19 years experience in the complex world of Direct Response TV or DRTV. We believe that Direct Response Television success depends on much more than producing an infomercial: it’s all about securing the largest market share in the shortest amount of time, putting the least amount of money at risk…thus the evolution from infomercial production to infomarketing.
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