Direct Response Marketing

Retail Outlet: Honing in on the Future of Shopping at Home

1 Jan, 2006 By: Donald L. Potter Response

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Long before Sears, Roebuck & Co. distributed its first catalog, business owners sought ways to appeal directly to potential customers about their products and thereby control the buying situation. Direct response (DR) was the shortest route and surest way to consummate the sale and keep the consumer from buying another product while shopping at a local merchant.

Donald L. Potter

Over time, Americans became more urban, retailers offered a wider selection of merchandise, shopping became more convenient, and DR became a less important marketing channel. For years, consumers gravitated to stores to buy the products they needed. During the past two decades, however, consumer-buying patterns began to shift. Direct response television (DRTV) came on the scene followed, a few years later, by the Internet explosion, and now many marketers are using both media to sell direct as well as support retail-selling efforts.

Not only is the media landscape changing, the ways consumers use media is also evolving. Television viewing is being delayed thanks to TiVo and other recording devices. This means commercials and infomercials are often fast-forwarded by viewers. A great number of people do their TV watching while operating a computer. So, a commercial that prompts a consumer to respond might produce a Web visit or an online sale. Recently, retailers have been expanding the synergy between Web sites and brick-and-mortar locations through the development of buy-online/pickup-at-store programs.

Now, American home shopping channels are in the early stages of testing the use of the TV remote control as a vehicle for the viewer to make an interactive transaction without picking up a telephone or clicking a computer key. What could be more convenient? What could be more profitable? And, what could this mean in the future?

Imagine the television screen as the window to all kinds of stores. But, instead of being able to just window-shop for products, the remote device is the portal for making an immediate purchase. All the pertinent information, including credit cards, will be preloaded into the data banks of your favorite stores. So, when a commercial creates a desire for a particular product, you hit a couple of buttons on the remote and the order is sent to the retailer. The merchandise will be held in your personal shopping cart until the next time you go to that store. If you prefer, for a shipping-and-handling charge, it can be delivered.

Retailers will have you as a captive consumer — one who must go to the store to retrieve the purchased item and buy additional items, both planned and impulse. Therefore, overall store dollar volume should increase. At the very least, the retailer makes a direct sale of one item, maybe with upsells and continuity as well. Through DRTV, once considered a competitive distribution channel, the store can enjoy a new revenue stream, greater turns, added profit and have additional opportunities to build a relationship with you in hopes of becoming your store of choice.

This paradigm shift will alter the face of advertising as we know it. General TV spots will incorporate elements of DRTV, such as the call-to-action (CTA). Ads, particularly co-ops between product marketers and retailers, might feature the store phone number and URL rather than that of the marketer. Product advertising could begin to exhibit a greater sense of urgency, because quick results will be expected. Brands, by necessity, will be measured in terms of actual sales generated from advertising. Isn't that what DRTV marketers have been doing all along?

There's no timeline for this transition. No master plan. No agreement on what comes next. What is certain is that change is coming, and it's coming faster then many anticipate or most can comfortably assimilate. Technology will drive this revolution as it has all those in the recent past. It's not too soon for the DR innovators, creative thinkers and entrepreneurial spirits to be strategizing about how to hone their skills in order to carve out a big share of what promises to be a big opportunity.

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