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Direct Response Marketing

Field Reports

1 Jan, 2005 By: Eric Obeck, Response Contributor Response

Rhodus: We want to grow our client base and grow the types of marketing campaigns we can offer. We want to utilize more traditional direct marketing plans with some of our bigger Web clients, and we're also doing some DR radio.


Offline Advertising with an Online Response

With ad budgets on the rise, the accurate measurement of advertising effectiveness is a critical concern. How are the increased dollars being spent? What is the return-on-investment (ROI) from larger multi-channel campaigns?

Yes, some channels are simple to track and evaluate. For instance, the beauty of online advertising is its inherent measurability. But what happens when a TV, radio or print ad elicits an online response? How do you measure it?

This question continues to stump advertisers and — because there has been no tool to help answer this question — flawed “guesstimates” and equations have been used to make decisions. In many cases they have been the wrong decisions.

There is, however, one advertiser that has found an answer.

A Measurement Challenge?

In 2001, Rhino Linings, creator of the popular spray-on polyurethane lining for truck beds, began dabbling in direct response TV advertising. The response mechanisms for Rhino Linings’ DRTV ads were phone and online. While they could be assured of telephone response to their ads, online response remained a mystery. To tackle this, Rhino Linings began using a unique URL in its TV campaigns and separating out their normal online traffic from the online responses.

Over the next several years, the percentage of online response to its TV campaigns increased from about five percent to more than 30 percent. Even though Rhino Linings’ online traffic had increased since the inception of its DRTV campaigns, the company could not attribute the traffic to specific ads that ran. Without the ability to attribute the traffic, the online data would not help optimize media expenditures.

With ad buys generating increased responses, Rhino Linings wanted to take it to a new level — a major cable outlet like ESPN that would guarantee a large male target audience. Across the entire campaign, Rhino was seeing about a 30-percent online response to a 70-percent telephone response. Assuming that this was the standard, they applied the same rule to the traffic from ESPN. Upon post-campaign analysis they found that the advertising purchased on ESPN was not profitable. Or so they thought.

After weeks of running and re-running the numbers, it occurred to Rhino Linings’ leaders that they were just guessing as to the allocation of their online responses. They were simply allocating their online responses as a straight 30 percent of all responses to each individual advertisement that ran. If one station generated more or less than 30 percent of its responses online then they could be keeping losers and canceling winners.

After identifying this flaw, the company was anxious to test ESPN again in hopes of finding a winning mix. The team acknowledged that such a decision would require additional dollars, and they were not comfortable spending the extra money without being able to measure the online response directly to the specific advertising station.

Finding the Solution

Rhino Linings’ advertising partner of four years had been working on a measurement solution designed to make DRTV more accountable. This measurement technology was designed to enable advertisers like Rhino Linings to accurately track its online responses back to the exact ad and station that ran it. After testing the technology on a few mini-campaigns, Rhino Linings was convinced that it would now be equipped with the information needed to effectively measure the complete response to ads. Next stop — Sunday Night Football on ESPN.

At first glance, the telephone response results from this test were a big disappointment — far lower than expected. However, once the Rhino Linings team reviewed the enhanced results, it was astounded to see that 70 percent of the responses came online. This was unprecedented. Had Rhino Linings not been able to track this response, it would have almost certainly decided to cancel its ESPN ads based on the much smaller phone response rate.

What’s more, when compared to spots run on other networks that had a better telephone response rate, Rhino Linings was able to determine that, in fact, the ESPN spots were more effective overall in generating responses. In the end, the spots met the ROI parameters that had been set up before the buy. Without the ability to accurately track online response, Rhino Linings would have ditched a very effective medium and continued down a path of making decisions based on one-sided data.

Lessons Learned

This case taught Rhino Linings three important lessons:

1. Though using a unique URL allowed the company the ability to track the online response for an offline campaign, the results were flawed. Rhino Linings was unable to track results directly back to specific stations that ran the ads. On a broad campaign, not all stations, day parts, and creative generate the same types of responses.

2. The Web is truly emerging as a preferred response medium for consumers.

3. Rhino Linings will never measure campaign response effectiveness without taking the Web response into account again. To do so would be, at best, irresponsible and, at worst, a business fatality.

Yes, measuring response rates for offline-to-online marketing campaigns is important. But, learning how to accurately gauge where those responses are coming from is absolutely critical. As the marketplace expands and ad dollars become more plentiful, intelligent offline-to-online response measurement is the only way to truly know that your budget is being used wisely.

Response, NATPE Team Up for DR Seminar in Las Vegas

SANTAANA, Calif. — Response Magazine and the National Association of Television Program Executives (NATPE) will hold a seminar at the annual NATPE Conference in Las Vegas (Jan. 25-27) for marketers seeking to learn more about the advantages of using direct response.

The seminar, Direct Response Television: But Wait, There's More!, will be hosted at the Mandalay Bay Resort and Casino on Wednesday, Jan. 26 at 5:15 p.m., and will feature scheduled panelists: Joyce Cusack, CPO Direct; Tim Hawthorne, hawthorne direct; Carol Lint-Dotson, The Media Agency; Ron Perlstein, Infoworx; Rick Petry, Euro RSCG 4D DRTV; Jay Rhodus, 10th Degree; David Savage, ATC Agency Services; Bret Saxon, TMP.

In the seminar, the direct response experts will discuss everything television executives need to know about DR. They will focus on a variety of topics including how DR can:

  • 1. Lift ratings
  • 2. Drive branding and brand awareness
  • 3. Help marketers advertise traditional programming across the dial (not just on one station or network)
  • 4. Boost profits
  • 5. Help pay for productions
The seminar, which is included with the cost of every NATPE conference badge, will be moderated by Response editor-in-chief Thomas Haire.

Notable News

  • 1. QVC, the leading electronic retailer, has integrated Q Direct, its independent direct response marketing organization, into the company's merchandising department.
  • 2. American Telecast Products LLC, has sold its media services business, ATC Agency Services LLC, to Lake Capital LLC, a private equity firm.
  • 3. WMCN Philadelphia, a full-power, independent television station, and WorldLink, one of the world's fastest growing media sales firms, entered into an exclusive representation agreement for all national infomercial and direct response spot advertising sales.
  • 4. Shopping network ShopNBC recently signed on six new hosts. The new hosts are represented by Patrick Talent Agency, an international leading provider of television show hosts, tradeshow models, promotional spokesmodels and top entertainment.

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