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5 Tips that Make $1,000,000 work like $2,000,000

June 18, 2012

By: Michael Medico

You work hard…you plan the client’s campaign…you negotiate the best rate…you buy the media and in the end the other agency guy who takes 2 hour, 3 martini lunches gets the same rate.  So what can you do to make a difference and become the client’s hero?

Well, let’s assume that you’ve got a pretty good budget and there is a portion of that budget that can be reallocated to more opportunistic media.  Here are some tips that we use every day to make our clients happy and make us look good!

  1. Remnant Broadcast Network, Cable and National Syndication: When considering your remnant (unsold or discounted media) media it is important to consider including first and second run syndication with targeted programming. In addition, you should actively seek last minute opportunities and be ready with a spot when these opportunities arise. These two points will help you achieve greater discounts off the rate card pricing.
  2. Broad Rotation versus Fixed Position: When extending your media dollars, it is important to integrate “Broad Rotations” into your campaign. While Broad does include “Prime”, “Late Fringe” and “Weekends”, meaning potentially lower than average ratings, the cost per point is significantly discounted resulting in a higher volume of affordable spots.
  3. Add a Call to Action: Using even a soft call to action, such as “visit”, qualifies for direct-to-consumer discounted rates. In addition, with the increase in web, mobile and tablet use while watching tv, you can seize the awareness opportunity to generate and/ or expand your customer database. Don’t forget to reward prospects/ customers who visit your site by providing them with a special deal, coupon or offer.
  4. Bonus Weight on Affiliated Media Outlets: When negotiating with networks, request bonus weight (at no additional cost) to run on affiliated outlets. For example, when you purchase media on Lifetime, you negotiate additional spots on Lifetime Real Women and the same thing can apply to broadcast stations and their digital counterparts. Be mindful  – if you are provided digital placement, ensure that you monitor performance separately in order to optimize appropriately. The added weight and frequency will enhance the buy and potentially extend your reach.
  5. Add Impact to National Schedules: there are a variety of techniques to do this, but the two I want to focus on are (i) Unwired Cable and Broadcast Networks and (ii) Local Avail Position on High CPM Media. An Unwired Cable Network is an independent group of cable outlets that are managed and presented as a single media source to achieve effective, efficient reach. Similarly, an Unwired Broadcast Network is used in the same manner, CBS, NBC, ABC, etc. and generally airs in all dayparts. You can also add significant impact to your national buy with local avails on national cable networks.  Not only can you achieve cost efficiency based on the local avail rate but, depending on the network, you can clear a significant portion of the households…low cost = low CPM.

We’ve successfully supported a variety of clients and partner agencies achieve their rating goals by leveraging the tips outlined above. This is one of the reasons I love this business so much, there are always ways in which we can identify new opportunities to work with the media to help our clients and…make us look good.


Saints and Sinners

June 13, 2012

While direct response has no place in a spirited theological discussion, I do believe there are “Saints and Sinners” among the companies and their agencies that try to use DR to market their product or services.  So where do we start? Well I like to start with the saints, you know, those guys and gals that get it and do it right.

A saint follows the “Ten Commandments of Direct Response” and while they were not delivered by Moses, they should be carved in stone.

  • Thou Shall Have No False Offers Before Me – Basically, that’s number one.  Some crazy totally compelling deal that sounds too good to be true…and guess what…it probably is.
  • Thou Shall Not Try to Sell a Stupid Product – Sounds simple right! But you would be surprised by the stupid products that I have seen through the years. Of course there is dispensation through notable exceptions…”The Singing Bird Clock” or the “Loud Mouth Bass” (Venial Sins for those Catholics reading this)
  • Thou Shall Not Steal – Yep, the same as the real Ten Commandments.  That means keep your promises, deliver what you promise and send back the money if your customers don’t like what they got.
  • Thou Shall No Covet Thy Neighbors Product – Knock offs are a fact of life but all it means is that you come in second place with marginal orders and the need for a very good lawyer that will take all the money you made on whatever sales you got.
  • Thou Shall Not Kill Thy Attention Span – Create a sense of urgency…provide a compelling offer…give them a good reason to respond.  What could be simpler? You’d be surprised at what simple is!
  • Thou Shall Not Commit Adulterous Commercials/Infomercials/Microsites – Lousy creatives, idiotic music, copy written by a 4 year old kid, bad demos and designs, wife in the spot etc.  “Lord forgive them for they know not what they do!”
  • Thou Shall Honor Thy Customers Intelligence – Consumers, at least a significant portion of them, are not stupid.  They know vastly more than you give them credit for and they can go online to get the facts.
  • Thou Shall Have No Amateurs Before The Professionals – OK this may sound self-serving but have you ever been in a room with someone who has used an agency from Florida who promised a commercial and 1,000 spots on national cable for only $10,000?  Well I have and it ain’t pretty…all that crying and cursing (a real sin). Use real pros and let them do their job.
  • Thou Shall Know Thy Objectives, Customer Demo and Gross Margin – OMG BFFs VIP to ROI.  Well, I thought it was clever but all kidding aside this needs to come before all else and requires some real thought and research.
  • Thou Shall Not Buy the Ranch in Phoenix Until Offer is Tested – Ok, so now you have created the best product ever!  You’ve made the best commercial ever!  You have the best website ever! You have purchased the best media ever!  You’ve got the best price, offer, guarantee, telemarketing, back-end upsells and price point!  You’ve got everything going for you and no one responds…now you’re stuck with the mortgage on a ranch you can’t afford.  Get the point…Everything is about testing, refining, testing again and if it works rollout.

Now for the sinners…follow the above commandments and you’ll become saints.

Does Social Media have a place in DR advertising?

June 13, 2012

Many of our traditional DRTV clients have recently been asking us how social media fits within their DR business objectives. Obviously social media is an important facet for connecting and engaging with customers – but can it also be used to drive measureable results?

Yes, it can. Over the past several months marketers continue to be reminded that the customer’s journey to purchase is as unique and varied as it has ever been. We are no longer living in the narrow world of COD, telephone, website or retail. Customers have options and with options come expectations.

Customers expect brands to have a presence in their social media “world” and to treat them with respect – not heavy handed selling, but a rewarding, sharing, customer service-driven environment. With that said, we view this invitation into the customer’s world as an opportunity to learn, motivate and empower.

If you follow tried and true DR methodologies – you will find yourself on the right path:

  1. Provide value: understand your unique value proposition and translate this into a social media environment. Provide your fans/followers with special access to offers, unique content, new products, sweepstakes, contests, etc. reward them for their presence and contributions. Most importantly, if a customer leaves feedback or makes an inquiry on your wall or photos, respond. They expect that you are there to engage not just push content.
  2. Empower customers: enable customers to purchase direct from your facebook page and easily share content with friends and family. In some cases, this fan base can be incredibly powerful for product innovation and content development. Harness their passion by hosting polls, requesting their “Favorite uses of…”, etc. to allow them to inspire others as well as your brand.
  3. Test and learn: track key performance indicators (and very possible, identify new ones) in order to assess how social media is impacting your business, your customer’s perspective of your brand and understand how the various channels work with one another. Do not take a fragmented approach to social media or it will be fragmented.

Marketers need to embrace Social Media – it is not going away and it is a tremendously powerful tool. As with any marketing efforts, it is best to take develop a plan of action and embed a test and learn plan into the strategy.

Looking Backwards and Forwards: A Personal Point of View

June 13, 2012

I hate to admit it but I began my career when “snail mail” was still a major source of response and it took us days, even weeks to know that true results of our promotions.  Through the years, of course, there has been a major shift away from mail and a whole toll-free telemarketing industry was created.  That being said, I can only marvel at what is happening to direct response and the way in which technology has changed how consumers interact with companies.

Just the word “technology” sounds complex enough that it could requires a degree in computer science just to communicate with other like-minded souls.  But to me it is far simpler…technology is part mechanics (the hardware), part hi-tech (the software) and part “magic” (the results).  I don’t want to sound like a total neophyte as I spend most of my day online, but I do marvel at what is happening to our business and the world in general.

For more 30 years our agency has sought to evolve with the rapid and often immense shifts in how we conduct our clients’ business.  With all this forward-thinking I believe that it is important to look where we’ve been before we can see where we are going.   That would involve the need to adjust one’s traditional perspective to adapt to the changes that are already here with more to come.

Media Planning and Buying

Planning and buying for our clients in offline media hasn’t changed materially but what has changed is the impact of the shift in response away from telemarketing to the web.  The net impact has created the need for an ancillary budget in SEM (search engine marketing or pay-per-click).

The awareness created for the product or service through TV or radio is still meaningful but the shift away from telemarketing has resulted in the need to drive respondents to our sites rather that to our competitors.  Keyword search, retargeting and other online tools have created the system whereby a marketer can manage and direct the consumer to ultimately generate the desired response.

Response Allowable

The result of the shift in the way consumers respond has to be accounted for in the allowable, and in turn, the allowable has to be driven by the campaign objectives.  What is an “allowable”?  Simply stated it is the dollar amount, per response, that a client will allow us to spend to generate one response.

In today’s competitive environment, many of our clients as well as others using branded direct response have multiple campaign objectives.  Whether companies are looking to drive consumers online, retail, mobile…create awareness…build a database…acquire prospect information for follow up or any combination, the response allowable will need to account for all the variables as defined in the objectives.

Tracking, Analysis and Optimization

Just in tracking and analysis alone, we need to adapt our thinking to account for the response shift facilitated by the migration to online and inability to do any significant attribution.  With telemarketing it’s easy…different phone number for each station, network or print ad and your able to perform metric calculation down to the single spot or print ad.  With online that rules change entirely.  How can you attribute response to an individual media, let alone down to the spot level, when you have hundreds of commercial airings or print ads each week?

Directing consumers to sites via unique URLs can only account for about 20% of the online response.  Consumers are far more prone to enter a keyword or product/brand name in order to respond – resulting in far lower directly attributable results.

What can you do?  Well, I believe that technology will solve the problem using refinement of algorithm software combined with attribution modeling to get the effective optimization rate to above 80%…all using a desktop/laptop/mobile dashboard.

What’s Next?

From where we were to where we are, I see a number of items that will impact our business in the next 6 to 12 months:

  • Technology will continue to rule the day with major advances in response tracking for optimization
    • Advances in media management systems with far more flexibility in reporting and analyzing response
  • Media will continue to be fragmented with highly targeted networks
    • Targeted based on lifestyle, ethnicity, leisure activity and other niches
    • Agency’s will look to develop their own unwired networks to lower CPMs and acquisition costs
  • Mobile will grow as a significant factor in overall response
  • Consolidation of agency capabilities will increase due to merger and acquisition

“Future-casting” can be a tricky business and getting right even trickier in the 6 to 12 months I’ll see how much I got right.

Commitment to Mobile = Marketing Budget Allocation

June 13, 2012

Over the past several months, consumer purchasing activity on their mobile devices has surged – from mobile search to m-commerce. While brands are beginning to take note of this shift in consumer behavior, very few are actually committed to building and optimizing mobile acquisition strategies. Today brands report that only 1% of their annual marketing budget is allocated to mobile.

This lack of financial commitment demonstrates that companies are not yet clearly defining mobile business strategies and therefore are employing desktop tactics hoping for a positive outcome. As most marketers know, “hope” without strategy has little to do with actual results and can at times, do more harm than good. I expect to see a significant lift in mobile-specified advertising budgets over the next few months.

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