DRMA Spotlight: Expanding Thane’s Vision1 Feb, 2016 By: Thomas Haire Response
As Amir Tukulj adds “owner” to his CEO title, he takes a look back at where the Toronto-based business has come from — and a look ahead at a bright future.
DRMA member company Thane Direct recently underwent a sale process, as its long-time CEO, Amir Tukulj, and members of its management team agreed to acquire the business. Toronto-based Thane is a leading global direct response consumer product developer/manufacturer/marketer with subsidiaries in the United States, Canada, Scandinavia, Mexico, the United Kingdom, and Australia. The company also owns Media Latino Services, a pan-regional media buyer for 20 Latin American countries.
Recently, Response spent some time with Tukulj, discussing his and the company’s background, the recent changes, his thoughts about the health of the performance-based marketing space, and his plans for Thane’s future for this DRMA Spotlight.
Q: What is your professional background and how did you come to lead Thane Direct?
Amir Tukulj: Helping take the direct response business international led me to Thane. I started in this business in the late 1980s when I became a distributor in the former Yugoslavia for U.S. DRTV companies that were expanding into Europe. A very noteworthy supplier at that time was Interwood Marketing and Rob Woodrooffe, with whom I later partnered after I moved to North America. Those were fun years, when products and media were abundant and the business was fairly simple — i.e., all about storytelling and taking orders by phone.
Due to the war in my former country, I moved to Canada and in the early and mid-1990s, I traveled the world, looking for distributors who would be interested in getting into this business.
In those days, we demonstrated to international product owners that the DRTV model worked — by buying media ourselves from satellite television and putting their phone numbers on the end tags. We demonstrated the viability of the model when they saw that the phones would ring and people were buying. They became very motivated to go in and buy media themselves locally.
The logistics — how to collect payment and how to ship the goods — varied from country to country, and we needed to determine how each company would operate. Also as part of our early model, we bought media time and resold it to distributors locally. DR expanded across Europe first, and I was one of the 12-13 initial Pan-European distributors. After Europe, I set up business in the Middle East — the first DRTV distributor to address this region — and both Rob and I set up Latin America and Asia.
The trend in the industry at that time was much more toward long-form, but Interwood was not involved in infomercials. Realizing this, I made a change in 1997 and partnered with Bill and Denise Hay to form Thane Direct to handle and grow the company’s international sales. The main competitive advantage I brought was the understanding of international markets and the mentality of international distributors. That made a huge difference in the way we approached the market. We also focused these markets, as opposed to them being an afterthought. We also realized that it was desirable to set up your own subsidiaries in key markets throughout the world, while continuing to provide products and service to international third-party distributors.
Thane has been private-equity owned since 1999. It became apparent to Thane’s shareholders that the growth for the company laid outside the U.S., and we transformed ourselves from being a U.S. company with an international division to becoming an international company with a U.S. division in 2006, which is when I became the CEO of Thane.
Q: How and why did you form the new Thane?
Tukulj: Due to a special set of circumstances, the opportunity presented itself in 2015 to myself and to other members of the management team to take over the company. We did so, supported by a consortium of Canadian financial institutions, completing a successful management buyout. I am now the controlling shareholder of Thane. This was a natural progression because we’ve been managing the company for some time and have been widely perceived to be the main — if not the only — value creators within the company. It was a natural progression after having spent 17 years building the company.
The old Thane had U.S. shareholders and was a U.S.-based company, whereas the new thane will have Canadian shareholders and be a Canadian company. To outside partners, nothing much will really change.
Q: What does Thane do that sets it apart from other companies in this space?
Tukulj: There is not another company that matches our international strength, and that has always been our greatest competitive advantage. Part of our longevity can be ascribed to empowering our local managers to run their offices. Also, we encourage them not to just rely on products we develop in Canada, but to source other products. The media landscape and the industry is changing — the business is becoming omnichannel and the natural progression is to focus on retail. We have significantly increased the number of retailers around the world with whom our products are listed and sold.
Q: What are biggest accomplishments or changes for Thane in the past year?
Tukulj: The biggest accomplishment was the completion of the management buyout (MBO). This has been a year of consolidation and completion of our MBO — and now we turn ourselves to the future.
Q: What are the hottest topics facing marketers in the performance-based space?
Tukulj: U.S. DRTV marketers work hard to achieve their domestic success, and have come to understand the significance of the international market for their products. At the same time, they recognize the importance of working with distribution partners who are thoroughly familiar with all of the nuances relating to each of the international markets. The international marketplace is quite different from the U.S. — including different regulatory environments for DRTV, different payment structures, different packaging and shipping requirements, different cost structures, different purchasing power. U.S. marketers do not typically have the manpower or knowledge to deal with all of these issues.
We always recommend that DR marketers consider the international marketplace as they prepare to roll out their products domestically. As a result, by the time a campaign is tested and launched in the U.S., product owners can eliminate any lag before that campaign is introduced internationally. We work closely with our clients to address building their assets for international delivery. Thane has also worked with clients to conduct simultaneous U.S.-international roll outs, with key elements of the campaign — including approvals, packaging, pricing, and testing — occurring concurrently across several markets.
The international market is no longer an afterthought, and less work is required to mount international campaigns. We fully recognize that our marketer clients have invested much of themselves — time, resources and more — when launching their products domestically, and that the same commitment must be applied to the international arena.
Q: What are your plans for the next three-to-five years for Thane?
Tukulj: There are two areas of focus for us. One is to determine how the digital medium can be awareness generating on a similar scale as TV has been. The TV landscape is changing. While people are still watching, they are watching differently than they used to. While they also continue to respond to our programs, they are responding differently. As a result, digital is a medium for the future, and we are focused on how best to utilize it. Second, digital expansion will lead to changes in the product categories that we get involved with. We need to develop products that will meet the requirements of the digital medium. We hope that Thane will transform itself to a digital marketer that also uses digital media and television to drive awareness for its products.
We will continue to invest in our existing product categories and they will be an important contributor to our revenues and profits in the future. But looking at five years from today, the brands and categories that generate 100 percent of our revenue today will be less than 50 percent as we create new categories that will be more geared towards the digital market. ■