Retail Spotlight: Stack ‘Em High1 Sep, 2011 By: Bridget McCrea Response
DRTV deepens its presence in both traditional and online retail.
Today, major retailers not only depend upon DRTV to drive sales, says Fettig, but often require commitments to substantial DRTV ad spending before they will consider stocking the item. That can pose challenges for marketers, who don’t exactly have it easy when it comes to working with retailers and vying for space on their shelves.
TELEBrands is taking part in a half-pallet promotion for its Aluma Wallet across 2,500 Wal-Mart stores this year.
The fact that retailers set their plan-o-grams and make product placement decisions every six to 12 months can stand in the way of an As Seen On TV marketer that is looking to get items on the retail shelves. Securing distribution to support a future DRTV campaign, advertising and inventory commitments must be made well in advance of the media launch, says Fettig, sometimes even prior to product manufacture.
Miss any of those points and you could wind up on a retailer’s bad side. “It’s essential that these commitments be kept in order to establish the mutual trust that will enable the partnership to grow over time,” Fettig explains. “The promised media support needs to be there to ensure that retail traffic is generated, and retail sales volume is achieved. This is easy when the DRTV campaign is a big hit, and painfully expensive when it’s not.”
The economy hasn’t made it any easier on DRTV marketers looking for representation on the retail shelves. “We’re selling impulse items — nothing more, nothing less,” says Scott Sobo, president at Tarrytown, N.Y.-based SAS Group, whose products include Dream Look Instant Eye Lift, Bead Magic and Motor Up. “Unfortunately, when consumers tighten their wallets, the impulse items are cut first.”
Gripstic maker First 2 Market Products is conquering that challenge by keeping its products in the $10 to $12 range. Dan Sackett, president of the Perrysburg, Ohio, product marketer says his strategy is to get a foothold at the retail level in stores like Wal-Mart, Bed Bath & Beyond and Crate & Barrel, and then follow that effort up with a strong DRTV campaign.
Sackett says First 2 Market also plays with price points by offering, for example, a product for $12.95 or $14.95 on the air, and then reconfiguring the physical product and related price to $9.95 for retailers. When consumers see the product on the shelf at a lower price than what they saw on TV, they credit the retailer for the bargain. “This strategy works well in terms of creating value for the consumer,” he says.
With five or six new products in the pipeline right now, Sackett is enthused by the retailers’ response to the Gripstic, and plans to ride that success over the next few years as First 2 Market comes out with new DRTV products. And unlike many of the As Seen On TV “one-hit wonders” that came before him, Sackett says he’s in the game for the long haul.
“Everyone is looking for instant success, but it actually takes a long time — and costs more than anyone imagines — to get products to market,” says Sackett. “Fortunately, the return on investment and the other rewards that come with it are great.”
One of DR’s biggest challenges in retail is consumers’ tendency to purchase impulse items less when budgets are tight, according to SAS Group, whose products include Dream Look Instant Eye Lift.
Price Check, Please
Sure, it’s been more than two decades since DRTV firms began breaking down the barriers that kept their products off of retail shelves, but that doesn’t mean the process itself has gotten any easier. Margin pressures still exist, for example, and so do a lack of prime shelf space and the need to satisfy retailers’ voracious appetites for expanded product lines and new items.
Retailers’ indecisiveness over how to best position As Seen On TV products (Do we place them by the cash registers? Give them an 8 X 8 section? Stick them on an endcap?) can be equally as exasperating for the marketer in search of optimal exposure. The retailer that’s allocated a 4-foot section to DRTV products, for example, and that doesn’t want to expand that area — despite the high volume of As Seen On TV products on the market — can thwart even the most tenacious marketers’ retail plans.
That scenario has pushed folks like Iyer to put their “teacher” hats on again, and to educate retailers on the fact that more products backed by even more media will mean higher in-store sales. “At our meetings, we’re letting retailers know that we have five major rollouts coming,” says Iyer, “and helping them figure out how to capitalize on the opportunity.”
That planning has to happen well in advance, says Iyer. “If retailers don’t ride the coattails of the TV campaigns and maximize the opportunity when it’s in front of them, the opportunity will be lost and will never come back,” he explains. “Retailers need to create more features and pallet promotions, and come up with other ways to grow this category.”
Bullish on As Seen On TV’s retail prospects, Iyer says Sam Walton’s “stack them high and let them fly” selling philosophy will continue to serve the category well. “Retailers are featuring As Seen On TV products prominently, figuring them into their overall sales planning and realizing the value that they bring to their bottom lines,” says Iyer. “They’re saying, “Let’s stack it up, and sell as many as we can.’” ■