Where Do You Stand on the Great Direct-Response Advertising Debate?

The acquisition of direct-response advertising business in the television industry is viewed in several different ways by both buyer and seller of advertising. In a way, it is a classic example of those that view it as a glass half-empty and others that view it as a glass half-full. The people who view direct response as a glass half-empty often refer to the users of this type of advertising as coming from advertising’s bottom feeders — those advertisers who are ready to use anything and everything as long as the price is low. Another expression that often applies to these marketers is that they are in the dollar-a-holler advertising business. Advertising created for direct-response advertisers, in the view of these glass-half-empty people, is of poor quality, with little or any strategic thinking or positioning and also lacking production values. These glass-half-empty people view those channels that take significant amounts of direct-response advertising as having a poor buy rate from non-direct, blue-chip advertising accounts and consequently in need of using these poor-appearing and poorly priced advertising units to achieve or come close to their sales objectives. The other side of the coin — those who consider the glass to be half-full — represents a totally different perspective. Direct-response advertising in their view is built upon success. A direct-response advertiser does not come back to a medium that hasn’t been productive. Therefore, the incidence of direct-response advertising on a particular channel is indicative that that channel works in terms of achieving the particular action or actions that the direct-response advertiser is seeking. These can be anywhere from an actual sale via an 800 number or some other mechanism to store traffic or writing in for a brochure. The people who view direct response as a positive advertising category do realize that a direct-response advertiser will probably try anything once. They also know that these advertisers will only come back to that medium if it has worked successfully within their cost-per-order or cost-per-action frame of reference. The availability of this kind of arrangement is particularly attractive for new channels just getting on the air or existing channels that are looking to obtain some revenue during the nonpeak advertising hours. One thing that has changed considerably is the caliber of the creative work for direct-response advertising. Few will not agree that there has been a significant infusion of higher-quality, better-production-value commercials coming out of new categories of direct-response advertising. Leading this quality charge are the advertisers of prescription drugs. Significant top Fortune 500 companies are involved in these messages and their creation is both strategic in orientation and up-class in production values. The use of direct-response advertising does not eliminate the use of demographic, psychographic, daypart and/or program environment factors as part of the media selection process. These factors relate to the knowledge that the advertiser or agency has about their product or service and can be used to make the initial jump ball a little bit more specific in its spot selection. They can also be used to refine a second-level jump-ball attempt or to fine-tune a continuing direct-response buy to see if even greater returns from the already satisfactory ones can be achieved. For the cable industry, there is one very particular relationship to direct response which comes from the activities of local retailers in each local cable systems marketplace. These retailers have limited concern for media math and from the point of view of many agency planners and buyers appear to be relatively unsophisticated in their methods of selecting advertising media and creating a price-value relationship for media buy selections. In fact, retailers may be more sophisticated and better in tune with the marketplace. They are consequently able to make wiser judgments regarding how much to pay for local advertising. They are not averse to paying more per thousand (CPM) than they do for local broadcast. This is often due to the fact that their key measure is whether the cash register rang the day after the spots ran. These results often support a higher evaluation for local cable than for local broadcast. The targeted nature of so many of the cable spot placements has the potential of making the message more targeted and consequently more productive. No matter how you categorize it, there are many reasons for direct-response advertising to exist and probably to grow. The use of response mechanisms in advertising clearly helps to fight the image cited by John Wanamaker about a hundred years ago when he said, “I know that 50% of my advertising is wasted. I just don’t know which 50%.” Joe Ostrow recently retired as president and CEO of the Cabletelevision Advertising Bureau and is now a consultant to that trade organization.