As Seen on TV products get added exposure at retail; TV items complement store mix, expand category sales - items direct-marketed on television, then available in retail stores

Discount Store News, May 1, 1995 by Teresa Andreoli

NATIONWIDE DSN REPORT -- More Americans are snuggling up to the As Seen On TV product idea, based on results from a recent Gallup Organization study performed for The National Infomercial Marketing Association (NIMA).

About 30% of Americans have purchased a Direct Response Television Product DRTV item -- or what discounters call As Seen On TV products once the merchandise hits mass retail -- through an 800 number, at retail or from a catalog at least once, NIMA said.

"As Seen On TV products are important to our industry," said Larry Fine, senior vp, merchandising, Jamesway. "It's all plus-business that doesn't take away from other items on the shelves."

For example, he explained, there are no "miracle thaw"-type products already in the housewares aisles that will compete with the electronically marketed defrosters from Telebrands and Emson. And although there were mops before the Smart Mop, he had never seen so many mops fly through a store as when Smart Mop first took off.

"You've got to keep in mind that this is still an item business," Fine stressed, echoing the words of marketers such as Andy Khubani, president, wholesale operations for the Fairfield, N.J.-based, Telebrands.

"Ten thousand products are created and presented to marketers, about 100 make it to the television production stage, and five of these are winners at retail," Khubani said. The winning products can fall into just about any category, although housewares, health & beauty care, small electronics and exercise seem to be the hot beds. Telebrands is the leader of the hot one-shots such as Smart Mop, Dental White and Miracle Thaw.

Up until now, there's been no effort or success at real line extensions. For instance, Miracle Ear, a hearing enhancer, has not been followed by Miracle Pet Ear, Family Size Assortment Miracle Ear, Celebrity-Endorsed Miracle Ear, Urban Miracle Ear or Miracle Eye.

But that was before New York-based marketer Emson set out to change that perception with Brady Bunch TV mom Florence Henderson. What began as the Florence Henderson pasta maker item soon progressed into the Florence Henderson cookware line, then, through a joint venture of Emson, the actress and Wesson Oil, the Florence Henderson stoneware line.

"We're focusing on retail relationships to build innovative lines of patented products," said Larry Nussbaum, executive vp, Emson.

Relationships are paramount in dealing with the potentially wondrous 15-times-per-year turning industry, but can be made fragile when the product dogs come into retail and just sit.

"It's an educated guess on what will be a dog and what won't," said a merchandise executive from a Midwestern regional discounter. "The amount of advertising is critical."

This merchandiser admitted that the products are essentially hyped up gimmick fads that won't last a year, the closest exception being the Contour Pillow marketed by Direct To Retail, Natick, Mass.

He's not kicking any As Seen On TV gift horses in the mouth, though.

"These products add a lot of volume and good gross margin. We've all promoted them in circulars," he said, adding that the chain even invests in showing infomercial videotapes around the endcapped item.

Both Jamesway and the Midwestern chain tend to advertise As Seen On TV products together in the circular -- essentially branding the category. The Midwestern chain will sometimes run several pages of ads, with six to nine products on each page.

Jamesway attempts to enhance the presentation of the As Seen On TV products with a mini-palette showing 14 linear feet. The Midwestern executive said an endcap makes the best fit in his stores.

Both regionals advised that a key to success is to get on board with the product early, and both said having smaller-sized chains help facilitate that process.

"You've got to be able to move fast. Distributors understand they have to establish the item at direct response. Most have to understand that. The greedy ones invariably fail," the Midwestern merchant said.

RELATED ARTICLE: Everything Seen On TV to go public

ROCHESTER, N.Y. -- Everything Seen On TV, currently a two-unit chain in the process of going public, more or less lives up to its name.

With stores in Syracuse and Buffalo, New York, the 2-year-old retailer sells just what one sees on TV, with price points in tact.

"We don't get into the price wars. We sell the items for the price advertised on TV, minus shipping and handling," said Daniel Fasano, chairman and ceo.

Staff at the 2,500-sq.-ft. stores is well versed in As Seen On TV product, and can help shoppers chose the best shades of Perfect Hair, for example, an advantage he sees as superior to the self-service style of discounters. An added selling feature at the Syracuse store was TV monitors that played infomercials of some of the available products.

"We've been known to move volume three to five times faster than other retailers because of our knowledge," he said.

Everything Seen On TV is due to open its third store, at the Crossgates Mall in Albany, N.Y, before the summer. After going public, Fasano is considering a 40-store expansion over the next year.