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Direct Response Marketing

DR Hits No. 1 on the Charts!

1 Jul, 2009 By: Thomas Haire Response

DR Hits No. 1 on the Charts!

Entertainment marketers continue to turn to direct response television as a driver for marketing, even as the Web and other outlets grow in strength.

By Thomas Haire

For decades now, entertainment marketers have utilized direct response television to peddle music and movies to the public. From those old K-TEL record sets you remember from the 1970s, through Time-Life’s extended (and still continuing) run of success marketing records, cassette tapes, VHS video tapes and now CDs and DVDs, to newer successes from companies like Razor & Tie, DR has long been a staple of entertainment marketers’ arsenals.

Such success stories have driven larger players — from major record studios to large Hollywood movie studios — into DRTV, and beyond. “The reality in today’s marketplace is that all music advertising, in theory, is direct response,” says Yosh Katz, senior media buyer for the Santa Monica, Calif.-based Gary Group, which handles media buying and planning for Warner Music, Universal Music, Sony BMG, Capitol Records and the wildly successful “NOW” line of music compilations, among others. “We want the consumer to go to our client’s Web site, call our client’s number or go to any online retailer and buy the product.”

Robin Rifkin, vice president of media buying and sales for New York-based Razor & Tie, agrees, adding, “Music companies are using direct response television as both a means of promoting a release with less expensive advertising and as a way of encouraging direct consumer interaction with the entertainment artist or product. Music labels are seeing an increase in DRTV for both standalone sales and increasing awareness to drive demand once a CD is released into retail.”

The success of music and DVD sales via direct response has even drawn DR marketing giant Guthy-Renker Corp., long known for its work in the beauty and fitness markets, into the arena. Its recent efforts in the TV-on-DVD market (Carol Burnett, the Dean Martin Roasts) have done well.

“As a direct response marketing company, we offer studios or other content owners the ability to reach an incremental audience when they have content that still has an avid fan base, offers multiple hours of enjoyment, comes with never-before-seen, value-added material and — most importantly — is exclusive, can be collectible and watched multiple times with family and friends,” says John Volturo, senior vice president of new product development for Santa Monica, Calif.-based Guthy-Renker. “Going the direct response route allows the content owner to re-introduce content while avoiding competition in a crowded market that really focuses on ‘new.’”

TV Still the Main Outlet

While entertainment marketers and DR experts agree that direct response television is a natural fit for CD and DVD sales, new media outlets that are extremely direct-response friendly offer entertainment marketers a chance to expand the scope of their efforts. However, most seem to agree that it still begins with television.

“Each offer requires a different set of outlets, and we have used them all,” Rifkin says. “While new media is becoming a bigger part of our business, TV advertising continues to be the most effective, efficient way to reach an active consumer. We like print but there is less flexibility in print as the production demands of print make it more difficult to react quickly to consumer feedback.”

Katz says that while mobile DR is “definitely growing” — “with the Internet on your phone, you can basically buy music the exact same way as on the computer” — he believes that the explosion of online music retail options has actually emboldened the power of DRTV.

“Television is still the primary focus of budgets, and is still the greatest ‘reach’ vehicle,” he contends. “The music industry has shifted more of that money to DR as we have realized the reality of the marketplace. When we realized the consumer can respond to an ad and have the product delivered and have a finished paid transaction within four minutes, we started to see the light of DR’s effectiveness.”

He adds that DR becomes a branding mechanism through this process as well. “We are always selling a specific product of an artist, but more than the CD, we are selling the artists themselves,” Katz says. “The effect is that someone can get into a song, which leads to buying the album, which leads to buying all the albums by the artist.”

Volturo says those in the DVD space, be it feature films or television programs, are also TV-centric when it comes to kicking off a DR campaign. “Most campaigns begin on TV and, with success, move into other channels,” he avers. “If a story can be told about the content on TV — and there’s a Web site that complements the story and allows the viewer to find more information — it’s a win for all if the marketing is done right.”

Growing Spot Lengths Among Trends

Among the newer DRTV concepts that are growing in stature and importance are longer-length short-form spots. Rifkin says, “We have moved beyond the days of only utilizing 30-, 60- and 120-second spots, as we find that — for certain offers — a 10-second spot can work. And others can demand something as long as five minutes. Broadcast outlets are becoming increasingly flexible in accommodating these needs. The entertainment world is utilizing longer length spots, like five minutes, to whet the appetite of the consumer and drive them to a new movie release. This can be used for any new product that needs longer explanation time.”

Katz also mentions these longer spots as a new, and valuable, trend. “A part of TV that’s growing is three-to-five minute short-form DR,” he says. “We have so much footage of artists that we saw that we could easily develop longer spots that sell both artist and product. On the flip side, so many networks and cable systems want content to fill their VOD (video-on-demand) libraries, so that’s been a good match as well. Like with anything new, it’s taken a while to catch on, but all the majors and a lot of the independents are now all over it. These spots are something more and more networks are offering, and it’s become a stronger trend in music.”

Much of the idea behind these different spot lengths comes from DR’s growing ability to brand while selling. This facet of modern-day direct response has opened many eyes among entertainment marketers and their agency partners. This response branding aspect has also led to DRTV combining with DR online to maximize the possibilities for all products.

Rifkin says, “Utilizing direct response not just to receive an order, but to create a relationship with a customer, is becoming increasingly important as marketers attempt to generate more long-term value for their efforts. In the old days, the direct response offer was often the entire focus of the marketing campaign. Today, it can often be part of a multifaceted, diverse platform — and because of that change, a greater variety of spots are needed.”

Katz talks about additional creativity allowed by the relationship-building work done by DRTV. “At The Gary Group, we’ve developed a creative approach that lets a consumer listen to every track, watch videos or even watch a live performance streamed within our online ad units,” he says. “When the consumer interacts with the ad, it opens an entire world of the artist that it might take 10-15 directed clicks to find otherwise. What we can do in that space isn’t comparable to anything else right now, and it’s why online is growing throughout the industry.”

Volturo, meanwhile, points to the growing capabilities of social networking as a new opportunity to expand the DR relationship with entertainment consumers. “Today, there are many opportunities to reach consumers where they’re really having a dialog about our products, including social media on the Internet,” he says. “Many studies confirm that the Internet is playing an increasingly important role in converting prospects into buyers. So, we’re really viewing that as an opportunity to open a dialog and then continue it past purchase to grow lifetime value even more.”

A Fine Measure of Success

Growing lifetime value of a customer is part and parcel of the measurement capabilities afforded to those entertainment marketers utilizing direct response. The ability to track success and nimbly shift gears mid-campaign has become especially enticing with the growth of DRTV drivers to online purchasing. At the same time, the expansion of online DR in conjunction with other media has added a level of trackability.

“With online ad creative, we are able to monitor all consumer interactivity relative to our ads in real time,” Katz contends. “Based on this is empirical data, we can quickly determine which sites and creative are performing well and optimize the campaign quickly to maximize results. Utilizing our online ad creative in combination with conversion tracking, we can determine specifically how a display ad impacts a purchase, whether immediate or eventual.”

Volturo believes measurements of success must be firmly decided well before a campaign takes to the air. “Before we even start a campaign, we project what its metrics should be based upon the price we pay for content and talent, distribution, marketing, etc.,” he says. If we look at category history and see that our hurdles are too high, we pass. If we see there’s an opportunity, we continue to use our key performance indicators to measure success.”

What success is may change from campaign to campaign and product to product, but one thing that doesn’t change, according to Rifkin, is DR’s effectiveness at helping marketers get the best grasp on their consumer bases. “In this day and age, with all of the information available to marketers, it is responsible to use a direct response offer to understand as much as you can about your customer,” she says. “For all marketers the flexibility to move budget into different station or formats is extremely important. Though you might know who should be interested in your product, by testing different formats a niche can be discovered. Additionally the ability to run different length spots allows your shorter message to be seen in a costly time period, while the longer spot in a different day part gives the consumer the time order.”

The choice between spot and long-form DRTV can often be a tough one for marketers with a large catalog of product — think Time-Life music collections, or classic TV series DVDs. “DR has been very big in the home video market, mostly through the use of short-form spots that activate an audience familiar with the title that it is now available on DVD,” Rifkin says. “You are marketing to people who are already familiar with the product, so it is generally not necessary to run long spots — as long as the consumer is alerted that the offer is available, that will be sufficient. Of course, if it is a new DVD release of an old TV show that is being specially packaged for a DR campaign, then that operates more like a traditional DR offer.”

Katz says music boxed sets are a natural for long-form DRTV. “Boxed sets are more expensive and elaborate, so as with any product, the more complicated it is, the longer time you need to sell it,” he contends. “They usually are over $100 and may have a lot of songs the consumer could feel they already own. Long-form could maximize that sale if the product is completely new to the public and contains a lot of material that has been unavailable until now. We also find many boxed sets are bought as gifts, so many times a non-fan is buying it for a fan.  Long-form can help convert the non-fan into its authenticity as a product.”

He adds that short-form DR is still the best course for more traditional music items. “Short form is the preferred method for individual CD sales, as the product is usually under $20 and often new material or a live performance by the artist,” Katz says. “Its usefulness is in the instantaneous nature between the response reaction and end of the transaction.”

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