Infomercials 101

By Michael Conkle, Sandcastle Interactive

You've got a great product that is bound to be the next Infomercial home run. It has wide appeal, demonstrates wonderfully on TV, and can be sold many times above your cost. You know that DR TV is one of the fastest paths to marketing your product but you haven't the slightest idea how to go about it.

The truth is, getting your product sold on television is not nearly as daunting as it may seem. Understanding the basic steps involved and who can help along the way, will put you well on put you well on the path to being the next Ab Doer or Roto Zip.

This article will look at a couple of options and then break the process into three components, Program & Product Development, TV Production & Media Buying, and Operational Support, (i.e., merchant banking, telemarketing, and product fulfillment/customer service). We'll then take a look at how each works, and fits in with the other two.

Choosing Your Direction

If your product hasn't made it much beyond the idea/prototype stage and your overall funding isn't sufficient to carry the entire project, you might consider partnering with a Direct Response Marketing Company. Working with concepts and ideas is how these companies have become successful. They know what it takes to create a top-notch Infomercial program.

Licensing your product and turning the ball over to someone else may reduce or eliminate most of your risk, but it also greatly limits your upside profits as well. The bottom line is that you have to have an understanding of your products' upside potential as well as what you'd be giving up by licensing the marketing rights. Infomercial Marketing Companies are usually more than willing to help with this assessment if they have an opportunity of providing services down the line.

In the case though where you've done your homework and have the funding necessary to pull it off, the profits will be yours. Let's see what it takes to put all of the necessary pieces together.

Program and Product Development

Before your show airs and you begin taking calls, you'll need to have your product ready to ship, and know what your selling price can be. Commonly called, "The Offer", this is a combination of product components (instructions, materials, premiums, packaging, etc.), and what your customers will pay. The general rule of thumb is that you'll want at least a 4:1 mark up between the cost of goods, and the selling price.

You should develop several offers in terms of product, pricing, number of payments, and premiums. Remember, the better your product looks and the more value it has to consumers, the better your chances of success. Testing will be the only way to find out which offer works the best.

The ERA membership can help develop your program and offer. In our listing you'll find Manufacturing Reps, Packaging Specialists, and Marketing Consultants, which can answer your questions and provide necessary services.

The program development phase is also a good time to understand and qualify your product benefits, unique features, and points of differentiation to other similar products on the market. These are the things that make your product stand out and will be critical when the times comes to begin producing your Infomercial.

TV Production and Media Buying

The creative process involved in producing your Infomercial combined with the power of the media driving it, is what makes the 800 number ring and drives people to your web site. There are literally hundreds of television production companies and media buying agencies across America, but very few specialize in the world of the Infomercial. Knowing what sells and how to make someone get out their credit card is as much of an art form as producing a box office hit. You'll want to hire an Infomercial Producer who's established and has a string of successes to offer. The ERA membership has many to choose from.

Once hired, your producer will get to know your product inside and out. Your understanding of the product and close involvement here will make their job easier and help to produce a winner. They will plan and write the show, set up your testimonials, help find an appropriate host, shoot it, put it together, and get your final master ready to be dubbed and sent out to television stations and networks. This process normally takes around 90 days from start to finish.

The beginning of production is also a good time to find an Infomercial Media Buying Company. Again, our membership listing is a good place to begin your search. Many of these companies have been around since the Pocket Fisherman and will really put your media dollars to work. Your media buying company will build a buying strategy that takes your product, audience and overall marketing objectives into play. When your show is completed, they will develop a media test designed to find out how your show and offer(s) covert buyers.

Depending on how the test results are, you may decide to roll out your show, or possibly re-edit, tweak the offer, and test again. It's important to realize that your show may not be a winner right out of the gate. The George Forman Grill, one of the most successful Infomercial products of all time, had to be tested several times before it was a knockout.

Your Media Buyer may also perform many services beyond simply buying time on TV. They understand the industry as well as anybody and can help you with many pieces of the puzzle. They handle all tape dubbing and distribution of your Infomercial to TV stations and networks. Since they work closely with Telemarketing Companies, they may also play a big role in helping you manage this process. Because of this, it's importing to find the Media Buying Company you feel most comfortable with early in the process.

Operational Support

The big four of operations are Merchant Banking, Telemarketing, The Web, and Fulfillment. The Merchant Bank processes your credit card orders and deposits money in your bank account, the Telemarketing Company takes calls off of your 800 numbers, and your web site sells product and acts as a valuable information resource. The Fulfillment Company processes your orders, sends them to your customers, and in most cases, provides your customer service.

The operational component of your Infomercial program is extremely critical to its overall success. You can have a great show converting orders but miscues in any area of operations can put you in the red. Like Production Companies and Media Buyers, there are hundreds of businesses out there providing these services but unless they specialize in direct response television, they probably won't cut it.

Because of Visa and MasterCard regulations, not every bank accepting credit cards can process orders taken form an Infomercial or Short Form Spot. The Merchant Processor needs to be able to handle large volumes of orders and be linked to your fulfillment company for batch processing of orders.

Your Telemarketing Company is where the rubber meets the road. That's where customers get their first exposure to your company and product. Very few can handle broadcast call volumes, have experience with DRTV, or possess the technology to adequately provide the reporting tools necessary to measure exactly how each spot or show that airs performs.

A good Web Site will increase your overall number of orders and greatly reduce your other operational expenses. It provides answers to questions from people not quite ready to order, validates your business, and works as an incredibly profitable aftermarket tool. Your internet presence should be designed as a direct adjunct to the TV creative and link you to customers who can supply more feedback about your product than a dozen focus groups.

Product Fulfillment Companies play a pivotal role in the sense they provide multiple functions. They receive orders from your Telemarketing Company and Web Site; they interface with your merchant bank to settle your sales, ship products and process returns. Because of this, they possess the most information about your customer and their order. It's natural then that they also provide your customer service. Since order status and returns information make up the majority of customer service activity, your Fulfillment Company is in the best position to service your customer. It becomes clear the importance of choosing a good one who is experienced in the industry.

After The Infomercial

We've focused primarily on the basics of getting a show on the air and your products in the hands of the American TV buyers. Program Development, TV Production and Media Buying, and Operational Support all work together to accomplish this feat. However, you shouldn't think it stops there. Many products that are successful on American TV also work very well as Infomercials overseas. And what about retail? Some of the hottest products on the store shelves began their life on television. As with the other components mentioned above, look to the ERA as your primary resource for finding the experienced companies you'll need to tackle these arenas as well.

Mike Conkle has worked in all aspects of the Infomercial Industry since 1988. He is one of the founding owners of Sandcastle Interactive.