DRTV Media Buying Blog

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For the more than 1.1 million practicing lawyers in the U.S., ramping up their business savvy is the No. 1 priority, according to leading legal publisher ALM.

“Increasingly, law firms-particularly the larger firms-are recognizing the need to bring in outside, nonlegal managers to help run the business side of their practices,” said Kevin Vermeulen, VP-group publisher at ALM.

Business development investment by law firms includes such expenditures as customer relationship management software, competitive intelligence and knowledge management tools and services, Vermeulen said.

In addition, legal services are a rapidly growing area, said John Bigay, VP-marketing and programming for Captivate Network, a media company that helps media buyers reach lawyers and other office workers via video stations in office building elevators. “For example, lawyers have used LexisNexis for years, but now RFP and database software are making inroads at law firms. These software tools are designed to help in the search for clients.”

Professional managers-those who oversee business development and other administrative functions at larger law firms-are very receptive to targeted messages, Vermeulen said. “However … law firm partners, through committees or managing boards, remain the ultimate decision-makers on many major purchasing decisions,” he said.

The best way to establish a long-term relationship with a law firm is to focus your efforts on the administrative staff, said Peter Koeppel, president of media buying agency Koeppel Direct. “They’re the ones who open up the doors,” he said. “After those doors have been opened, you can target individual partners directly.”

Peter Koeppel is Founder and President of Koeppel Direct

There are 78 million baby boomers and they represent over 27% of the U.S. population, make up 46 million households and have a combined estimated spending power of $1 trillion a year according to Business Week and Time. Those are numbers that any savvy media buyer cannot ignore. There are many misconceptions about boomers, so understanding more about this generation is critical, since they represent such an important segment of the population.

Boomers were born between 1946 and 1964 and half are 50 or over and they start turning 60 this year. Now that the average life expectancy of Americans is over 77 years, many now think of 50 as a time to restart their lives. Boomers over 50 are not anxious to retire. Fewer than 20% see themselves as totally stopping work and 81% of boomers expect to keep working past 65, according to a recent Merrill Lynch & Co. survey. Many plan on starting a new career, such as a home based business or working as a consultant in their field.

Until recently, many advertisers and media buying experts felt that the over 50 market was not worth pursuing. They focused on the 18-49 year old marketplace. Now many are beginning to realize the spending power of boomers. They also are realizing that boomers are experimenters and are not locked into specific brands. In fact, they are more willing to switch brands than other segments of the population.
Peter Koeppel is Founder and President of Koeppel Direct

Direct response television (DRTV) media buying is anticipated to pull down about $150.1 billion in sales in 2005, according to “U.S. Direct Marketing Today: Economic Impact,” the Direct Marketing Association’s recently released study of the nation’s direct marketing landscape. Conducted with support from forecasting firm Global Insight, the study also predicts a compounded annual growth rate of 6.4 percent for direct response TV ad expenditures between 2005 and 2009; in this same time period, compounded annual sales growth is projected at the same 6.4 percent rate.

Compared to direct mail’s expected ad expenditure growth rate (5.3 percent), direct response TV is gaining ground as a more valuable lead-generation and sales channel. But when stacked up against both the ad spend and sales growth rates for Internet marketing (18.3 percent/12.6 percent) and e-mail marketing (19 percent/12.6 percent), DRTV still is working to find its place in the direct response marketer’s media mix. A few challenges to continued growth are the increasing adoption of technologies that allow viewers to skip commercials and the intricacy of finding cost-effective air time.

What factors are affecting available inventory and media costs for DRTV marketers?
During the fourth quarter, short-form rates typically increase when retailers and brand advertisers selling holiday items buy up inventory at higher rates to meet sales goals during this key sales period. This tends to decrease lower cost inventory available for direct response TV media buyers and increases direct response TV rates.

This year the rate increases for short form are similar to last year on a national level. Since there were not many local elections this year, and with car dealers cutting back on advertising due to slumping sales, local broadcast TV rates stayed reasonable in the fourth quarter.

With direct response TV short-form media buying, it’s a tricky balancing act between securing the lowest rates and attaining a reasonable level of clearance. If you submit rates that are too low, your clearance could be low, and if your rates are too high, your show might not pay out. Good DRTV media buyers know how to balance these two aspects of their media buys to optimize results.

Infomercial rates did not increase much from the third to the fourth quarter, so we have seen improved response, which translates into a more profitable ROI for our clients.

Peter Koeppel is Founder and President of Koeppel Direct

Have you noticed a slump in your drtv sales? Are you having trouble establishing your new business in the drtv marketplace? Or maybe you’re established, but you just can’t seem to get the word out about your new product? If these situations sound familiar, then your media buying may be to blame.
Mistake #1: Not Clearly Defining the Product Benefits

The highly competitive drtv marketplace is constantly changing and offering consumers more and more choices. For example, if you need laundry detergent, you have a whole aisle of different brands to choose from. So how do you base your decision? Something has to get your attention to make you choose one brand over another. And you need to create this differentiation in your product as well.

Defining the unique selling proposition for your drtv product will help your target audience differentiate it from your competitors. Then work this uniqueness into your marketing plan and strategy to reach the specific audience who will buy your product.

Mistake #2: Not Diversifying Your Media Buying Mix

At one time, you could advertise on the three big television networks and reach eighty percent of the population. But now viewers have hundreds of different networks and channels to choose from just on television. Plus consumers can choose from satellite or cable television, print, radio, satellite radio, and the internet. Media buying today is very fragmented, so you need to reach your audience through more than one outlet.

Mistake #3: Not Understanding the Lifetime Value of a Customer

If you can earn a customer and keep him or her for life, then the value of that customer multiplies. For example, imagine you sell cars. If you have a customer who spends $10,000 a year to drive one of your cars, then over the lifetime of the relationship that customer will have given you $200,000. So what is it worth to earn that customer’s business? If you spend ten percent, or $20,000, to get the customer’s business, you’ll earn a ten to one return on your investment.

Avoiding Marketing Mistakes in the Future

Media buying is critical to the success of every business. Unfortunately, many businesses discount the effect it can have, and they forego their marketing efforts for other activities. Or they make one or more of these mistakes, and their marketing efforts become ineffective. Perhaps this is why nine out of ten businesses end in failure.

But your business doesn’t have to be one of the nine that doesn’t succeed. When you avoid the ten biggest mistakes, you can market your business successfully and increase your bottom line as a result with the right media buyer.

Peter Koeppel is Founder and President of Koeppel Direct

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