The Series B round for Witherspoon’s Draper James brand was led by San Francisco-based Forerunner Ventures.
IdeaVillage Products Corp. is using infomercials at its web site and attached to e-mail marketing messages as a way to extend the impact of the infomercials.
At IdeaVillage Products Corp., infomercials are central to its strategy of introducing unusual but useful products like the Finishing Touch personal hair remover and the Handy Stitch handheld sewing machine. The TV advertising programs produce sales that amount to double the cost of the infomercials themselves, says Jordan Pine, director of marketing for IdeaVillage. “For every dollar spent on advertising, we take in two dollars in sales,” Pine says.
But the windfall in infomercial direct sales and profits is only intended to run several months to a year, as the early interest generated by TV gives way to a broad availability of IdeaVillage’s products in stores. Now IdeaVillage has found a way to increase direct sales during that short window of opportunity, and at even lower cost, by combining infomercials with e-mail and the web, Pine says.
IdeaVillage refers consumers to a product-ordering web page through the placement of the IdeaVillage.com address in an infomercial, search engine results, online banner ads and e-mailed marketing messages. The banner ads and e-mail messages are attached to rich media infomercial tapes, which allow consumers to immediately click on and view an infomercial. “The web is more cost-effective,” Pine says. “More people are comfortable buying over the web than ordering over the phone after seeing an infomercial.” Web view-to-order rates run about 30%, Pine says.
Although he doesn’t have comparable hard data to show view-to-order rates for orders placed over the phone, he figures the web offers a higher sales conversion rate because it enables consumers to avoid the prospect of being upsold, which he says many find uncomfortable. “People feel they don’t have as much control on the phone because they’re concerned they’ll be up-sold,” Pine says. “But on the web, if they don’t want to be upsold, they just close out the upsell windows.”
IdeaVillage outsources its web marketing to Livemercial Inc., which links infomercial tapes to e-mail and banner ads. Livemercial also provides a link from each infomercial to a product-ordering web page. Pine attributes much of his web success to the combination of having e-mailed infomercials link directly to a product-ordering page.
The effectiveness of the multi-prong web strategy has pushed the web’s share of direct sales to 25% or more, up from 2% under an earlier web strategy of forwarding infomercial viewers to an online shopping mall that included IdeaVillage.com, Pine says.
In a separate infomercial strategy, Infomercial Partners-a startup joint venture of Infomercial Monitoring Service Inc. and SmartVideo Technologies Inc.-plans to begin providing this fall around-the-clock on-demand streaming video of more than 200 infomercials through a new web site, IMSTV.com.