The Definition of 5 DRTV Media Terms You May Not Know August 11, 2009
Posted by johnmathes in Advertising, DRTV Media.Tags: broadcast media, DRTV, DRTV Media Buying, Infomercial, media, television commercial
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You may be an experienced advertising and marketing practitioner but if you are relatively new to the DRTV world you may not be familiar with some of the more common terminology. Let’s run down a few in this post.
Back-end: Any product transactions occurring after the initial direct TV sale generated by an infomercial or long-form spot. Back-end sales of the DRTV product and related add-on products can be generated via inbound telemarketing, direct mail, continuity and club programs and catalogs. Back-end sales can account for 50 to 90% of all product sales. Retail sales are generally not considered “back-end”.
Continuity Program: This is a DRTV product purchasing program that encourages consumers to purchase the first in a series of products for a lower than normal price. Extensively used for music and book series. The CP is also deployed successfully for beauty, diet products and self-development products.
Cost Per Order (CPO): Refers to the television media cost to generate one product order. The figure is determined by taking the cost of a specific infomercial airing and dividing it by the number of orders received. A $1,000 spot that generates 100 product orders would have a CPO of $10.
Media Efficiency Ratio (MER): A common measurement, the MER is a snapshot of an infomercial’s overall success or failure. The ratio is derived by dividing the total sales from a flight or campaign by the media cost. For example, if you buy a half hour for $1,000 and generate $3000 in sales, MER is 3. Sales/Media Cost = MER.
Per Inquiry Fee: A broadcast schedule in which the advertiser does not pay a set amount to the station or network for the time. The advertiser pays a contracted amount for every call booked into the toll free number or website tied to the station/network. The more calls generated, the more the advertiser pays. It takes the market risk out of the media time, but typically there isn’t enough PI time available to support a campaign.
Per Order Fee: Same idea as PI, except the fee is calculated on the basis of orders instead of inquiries.
These are just a few of the terms used in DRTV media planning and buying and we’ll explore more in future posts.
