For holiday 1999, many pure-play e-commerce marketers with capital to burn spent lavishly on TV commercials touting the convenience and “coolness” of online shopping. But holiday 2000 saw such catalogers as CDW Computer Centers, J.C. Penney, Talbots, and Victoria’s Secret promoting their multichannel muscle on prime- time TV spots.
Although catalogers contacted said they weren’t bargain hunting, some may have received better rates in holiday 2000 than they could have in 1999. “The marketplace was soft in fourth quarter 2000,” says Jon Mandel, comanaging director for New York-based MediaCom Worldwide, a unit of Grey Advertising. “Pricing is below 1999 levels by 5%-6%. So catalogers could pick up some good deals.” Various sources estimate the average cost of a 30-second prime-time spot as $200,000.
CDW Computer Centers, a $2.56 billion computer marketer, ran numerous commercials during the Mets-Yankees World Series games in October and has since appeared regularly on nationally and regionally televised National Football League games.
Don Gordon, CDW’s vice president of advertising, says the commercials effectively reach the company’s target audience. “Our research indicates that people who buy computer products for small and medium-size businesses are predominately male, upper income, and have a strong propensity to watch sports on TV,” he says. The Vernon Hills, IL-based CDW’s sales grew more than 50% in 2000, while net income improved more than 70%, giving the company the budget to advertise more.
In September, Plano, TX-based general merchandise cataloger/retailer J.C. Penney launched a brand image campaign for its catalog, stores, and Website, based on its multichannel mantra “it’sallinside.” The campaign included a TV ad blitz. “Although our TV ads have been pretty consistent during the years, this campaign is a major part of our repositioning,” says Penney spokesperson Stephanie Brown. Penney commercials emphasize to customers that they can shop at all three channels; past ads focused primarily on Penney’s stores.
Talbots’ biggest campaign ever Hingham, MA-based classic women’s apparel cataloger/retailer Talbots this past fall rolled out its largest TV ad campaign ever, says spokesperson Margie Myers. “Prior to the fall, we had tested national TV ads in major markets and selected national cable-TV markets,” she says, “but we had never before had such an extensive national network broadcast presence.”
Since 1998, the $1.3 billion Talbots has periodically run ads regionally on cable networks such as A&E, Lifetime, and HGTV, which lure mostly female viewers. But with the company’s sales for the first 43 weeks of fiscal 2000 up 21% from the previous year, and with profit for its third quarter ended Oct. 28 up a whopping 75%, Talbots increased its overall marketing budget from $74 million in 1999 to $89 million.
Talbots ads appeared on Today (NBC), Good Morning, America (ABC), and The Early Show (CBS) throughout the fall/holiday season. Talbots ads also ran on prime-time spots on the three major networks as well as on Fox, Myers says.
Some turn off on TV Of course, not every large multichannel marketer booked TV ads last fall/holiday. Although it had run commercials in 1999, in 2000 apparel and sporting goods cataloger L.L. Bean cut its TV ads. The $1.1 billion Freeport, ME-based Bean’s only TV presence throughout fall/holiday 2000 was in joint promotions with Subaru for the L.L. Bean edition of the Subaru Outback.
“TV is a good branding tool in that it conveys so many things a newspaper or magazine print ad can’t,” says Dave Holmblad, Bean’s director of acquisition and advertising. “But even though TV worked for us last year, we decided it was too expensive to do it” in 2000.
Spiegel Group, the $1.5 billion owner of the Spiegel and Newport News catalogs and the Eddie Bauer catalog/retail chain, has done periodic TV advertising in the past but for now relies primarily on print ads to supplement its catalogs. “Most of our advertising is geared toward getting customers to request a catalog,” explains spokesperson Debbie Koopman. “You get a higher return on investment [with print advertising], because you can preselect your targeted audience better.”
But television does enable you to promote your brand – and with it, your customer service expertise – to a vast audience, enthusiasts says. And service is typically a huge advantage that multichannel marketers – or “three-tailers,” in the parlance of Randy Ronning, J.C. Penney’s president of catalog and Internet – have over pure-plays.
Ronning believes more three-tailers will use ads to promote their guarantees. “We’ll promote the assuredness that we are the ones who can deliver what you want when you want it,” he says. “I believe there would be a lot of disappointments during holiday 2000, and you just can’t let that fall through the cracks, because customers will be very unforgiving.”