Company Opts for TV Ads Over YouTube: Conversions Cheaper3 Jul, 2013 By: Doug McPherson
VENICE, Calif. – When Dollar Shave Club, a company that offers $1 a month subscription for razor blades, introduced its video ad on YouTube last year, 12,000 people bought in within 48 hours. It was a case of instant Internet stardom. The company’s slogan – “Our blades are f***ing great” – clearly helped.
Entrepreneur Magazine reports the viral video cost just $4,500 – not much to launch an entire marketing strategy.
Last fall, Dollar Shave Club raised $9.8 million in a funding round and has started using some of that cash for direct response TV ads. In January, the company began running a more conservative 60-second version of its YouTube video on ESPN, Spike TV and Comedy Central, according to Kate Kaye, a writer with AdAge.
The ads are the company’s only non-digital ads aside from some radio spots. Kaye reports Dollar Shave Club’s goal is to compete at the same level with big players like Gillette in the $13 billion global market for men’s shaving.
Adam Weber, vice president of consumer marketing at Dollar Shave Club, tells AdAge the company was initially hesitant to buy TV because it wouldn’t be able to effectively track results compared to online video channels.
But after learning about a company called Convertro that helps advertisers pinpoint the ideal times and places to run TV ads along with analytics, Weber says, “Convertro runs through a model and spits out that the TV ad at that airtime delivered this many incremental orders for us.”
After four months of using Convertro, Dollar Shave Club reports its cost-per-acquisition dropped 48 percent between March and May.
“If you’re running a TV ad, the natural consumer behavior is to type the URL directly or search the brand,” Weber tells AdAge, suggesting last-click attribution models that attribute acquisition only to a search or display ad click aren’t “giving any credit to the TV ad you ran.”