Would You Cancel a Profitable DRTV Infomercial or Spot?7 May, 2010 By: Irv Brechner Response
Sound like a crazy question? Yes, but that’s exactly what can happen to DRTV media planners who are not aware of what’s happening on their clients’ Web sites and in their search programs.
Around the turn of the century, consumers could continue to call or place mail orders, but also added the ability to click on the Web URL on their TV screens. By 2006, 20-60 percent of responses were happening online.
Advertisers tried to develop tracking URLs, such as www.domainname.com/tv/32 where the “/tv/32” extension after the “.com” could theoretically track web activity coming from DRTV spots and infomercials. We realized early on that 90 percent of consumers don’t type what appears after the “.com,” and worse, typos would lead to “page not found” errors.
Looking at the chart above (which represents actual data from a marketer), advertisers resorted to allocating Web orders based on three methods:
- Even distribution. Web orders allocated evenly to each TV network
- Media expense distribution. Web orders allocated based on the media spent on each network
- Inbound call distribution. Web orders allocated based on the percentage of incoming orders taken by phone
Based on the belief that these methods were flawed, I began to think about a different system of allocating Web orders. If you look at this chart, you will see how various methods of allocation impact the CPL or CPO.
For example, on the line directly under “CPL Analysis” you’ll see “Only looking at 800 Number,” and next to it, one yellow box (acceptable CPL) and nine pink boxes (CPL too high). If we only counted phone orders and ignored Web orders (due to the inability to track properly), nine of these 10 placements had CPLs too high and would likely be cancelled.
The next three lines represent the allocation methods mentioned earlier. Even though they are flawed, they represent a clearer picture of what happens when you factor in Web activity. All of a sudden, five or six media placements now look profitable. Taking into account a proprietary system, seven out of 10 are profitable.
But that’s just the beginning. Fast-forward to today: mail orders are non-existent; phone orders are on the decline; and consumers are now using search engines to respond to advertising.
This phenomenon, which we call “search-driven media,” has captured an order generated by a DRTV commercial, but there’s a 99.9% chance the media people can’t factor these responses into their analysis. That’s how profitable placements that merely look unprofitable are cancelled.
What can you do? Take two steps.
- Learn how to track orders that do come in on the URL that is displayed on the screen. Set up a system to combine Web orders received in this manner, plus phone orders, plus any mail orders that come in.
- Get your media people to work closely with the people that manage your search program. Ideally, they should be the same company or team. Your search people, when given a media schedule, need to watch for spikes in search impressions, clicks and orders, and develop a plan to allocate them back to the media placements.
Then, and only then, do you have the truest possible snapshot of the performance of your DRTV media placements. While the search component of this exercise is more of an allocation based on observations, it is very directional and will give your media people the best possible data on which to make future decisions.