E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Direct TV marketing—infomercials—can teach a lot to Internet retailers, and vice versa, argues Jack Kirby, chair of the ERA.
With some notable exceptions, the marriage between TV and web commerce has yet to solidify, at least when it comes to most major brands. But trade group the Electronic Retailing Association and Jack Kirby, the association’s Board chairman since September 2003, are out to change that.
With long experience in direct TV and an understanding of the web’s possibilities, Kirby has a vision of something quite different, a world in which the Internet and direct response TV would routinely harness each other’s strengths in the cause of consumer marketing. “People don’t view themselves as a web consumer, a TV consumer, a radio consumer or a catalog consumer-they just see themselves as a consumer,” Kirby says.
Boosting its outreach
Accordingly, the ERA, historically focused on direct TV marketing, is now boosting its outreach to Internet retailers with efforts such as expanding programming geared toward web retailers at its annual and spring conferences. In the same vein, it’s increasing data specific to web retailing in its annual marketing research study slated for release in April.
ERA is turning up the volume on the fact that it supports a strong government affairs effort on issues of interest to web markets, such as spam, privacy, and Internet taxes. A new membership director has prioritized expanding membership among Internet as well as radio direct marketers, and the ERA is seeking to help that along by creating the category of affiliate membership for members of allied professional organizations, something it’s discussing with several trade groups. Meanwhile, it’s actively pursuing Internet companies such as AOL, whose interactive division joined in November.
So what possibilities does the world of direct response TV and membership in an industry group most often associated with infomercials hold for Internet retailers? Sharing knowledge and integrating capacities equals more marketing power for both sides, says Kirby. “TV is a powerful and emotional medium that has great reach. The web has great depth and speed to create a transaction, and it’s convenient. If you can marry them by driving traffic back and forth between them, you have one plus one equals five,” he says. “Marketers who use different mediums have a lot they can teach each other.”
Kirby cites three overlapping trends as the basis for the rise of electronic commerce in all its forms. The first is technology, starting as far back as the telephone. “People got a catalog in the mail, and they could call a toll-free number to order. Twenty-five years ago with the Home Shopping Network, people had a television set and a telephone with which they could order. That was electronic commerce,” he says. “It’s gotten a lot more sophisticated since then and the web in the ’90s was the next wave of it.”
Consumers have adapted to those developments, making the changing patterns of consumer behavior a second trend that is helping to develop electronic commerce. The increasing diversification of media is a third trend that feeds into electronic commerce as marketers try to connect with consumers across a wider network of media choices they can dial up or tune into.
The mainstream convergence of Internet and TV marketing may seem a long way off to web marketers more focused on the day-to-day struggle with the bottom line. But through his career, Kirby has demonstrated a knack for recognizing when opportunity is knocking while others are still trying to figure out who’s at the door.
After starting professional life as a TV news and radio talk show producer with tours of duty on CBS Night Watch, the Larry King show and the Charlie Rose Show, Kirby moved into TV program development. At a TV station in Santa Barbara, Calif., in the late 1980s, he got acquainted with some early direct TV marketers who were using the station’s facilities to produce infomercials. To the forward-thinking Kirby, the concept of using TV to sell directly to consumers was an answer to a rising trend that was starting to cut into spot advertising revenue: media fragmentation that was diluting the ad revenues to be generated from any single outlet.
While he grew up watching five TV stations in his hometown of Boston, by the time Kirby reached Santa Barbara, the TV channel universe numbered more than 60. “Today we’re in a 500-channel universe with digital satellite broadcasts,” he adds. “The web exploded in the mid 1990s, and radio has always been diverse because of the many formats that exist. Media is fragmenting, and it’s going to be harder as a broadcaster or cable caster to make money in the future unless you can figure out a way to take viewers and turn them into customers.”
The unique ingredient
Kirby signed on to bring his TV production experience to the infomercials, launching a business that he sold to National Media Corp., a global direct response marketing company, in 1995. Eventually he became that company’s president and later went on to head up HSNi, the interactive division of Home Shopping Network, where he played a major role in building HSN.com. He currently is CEO of direct marketing company Continuum Commerce.
While companies like HSN and QVC have been interactive for decades via telephone and television, the web brings something new and unique to the marketing mix, Kirby points out. Unlike time- and space-constrained TV, the web can provide expanded information to answer any of thousands of questions a customer may have about a product or service. “When you are driving traffic to a specific web site, but using the conventional medium of the day, TV, to do it and create commerce at the site, it’s very powerful,” he says.