The United States leads the world in consumer spending, thanks in part to the world’s biggest media market. But regardless of supply, media rates are growing, and the category has gone beyond the one-off hit to take over entire aisles of retail space.
As a result, many companies are taking their successes into overseas markets, where new TV networks, new consumers, and retailers hungry for foot traffic are making direct response products big sellers with the most American of sales strategies—DRTV.
“The As Seen On TV category is mature in the United States,” says Poonam Khubani, vice president of TeleBrands International and president of International Edge in Fairfield, New Jersey. “But in many markets overseas, it is in its infancy and still growing.”
Universal Appeal
What sells overseas often looks very familiar to what sells in the United States. Marketers look for products with “universality”—items consumers everywhere can use. “We focus on things with an international appeal,” says Amir Takulj, president and CEO of Thane Direct, which has made sensations out of items such as the H2O Mop X5 Steamer and FlavorStone Cookware on six continents. “Generally, hard goods in the housewares, cleaning, health and beauty, and fitness categories [are] products that can be marketed in any country around the world.”
Similarly, TeleBrands has taken proven winners such as the PedEgg, MyPillow, and Instabulb to more than 120 markets worldwide; London-based JML Direct has rolled out its FastFit ironing board covers and Bellvia shapewear in markets as far as Malaysia and Thailand. “The characteristics of a hot product are the same everywhere,” says Ken Daly, JML’s CEO and ERA Europe’s treasurer. “I can’t think of a product that has worked well in the U.K. that hasn’t worked elsewhere.”
Certain products won’t make the trip, however. Thane avoids media items such as DVDs, which incur substantial upfront costs to translate into local languages; TeleBrands leaves most of its popular pet products at home, since few cultures treat dogs and cats with as much reverence as Americans do.
Skincare and supplement products typically have additional regulations. “Every country has its own requirements for ingredients that can and cannot be imported into the country,” Khubani says. “To go through that approval process can take anywhere from two to four years.”
This process is a disincentive to developing a campaign and taking a product worldwide. “If there are regulatory challenges with a particular product, we will generally not get involved,” Takulj says. “It will reduce your chance of success. It’s a game of numbers, and you will put your money where you think you will get the most return.”
Overseas Strategies
With smaller media markets and burgeoning consumer classes, guaranteeing return demands a classic DRTV strategy, with successful television testing leading to retail rollout. “Our experience is that a product is only successful if the TV campaign is successful, and the same story carries in the overseas market,” Khubani says.
International markets have largely skipped telephone sales in their accelerated embrace of DR, however, with consumers preferring to buy from a trusted local retailer. As a result, marketers must have the partnerships in place necessary to deliver products as promised. “It is absolutely fundamental to have people on the ground who understand the market,” Daly says. “TV is expensive, and you’re not getting DR sales to pay for it.”
Of course, marketers must translate the packaging, creative, and other materials into the native language if they want a product to perform. “Generally, in the test phase, we will not tailor the campaign to cultural differences. We will only translate the show and make the product compliant with local laws and regulations,” Takulj says. “When the show rolls out, we will record local testimonials and local B-roll.”
While the messaging stays the same, cultural differences often come into play in creative. Middle Eastern markets may require a full revamp. “We cannot show skin in certain markets in the Middle East,” Khubani says. “We have to work with diagrams and images that depict what we want to show, keeping in mind the cultural limitations. It is a big challenge [to] adapt to the limitations of a culture and yet make a product successful.”
Counterfeiting is a constant problem, she adds, and marketers must be willing to fight infringement from the moment a product ships. “It’s almost like the counterfeiters watch to see what’s successful here and counterfeit those products,” Khubani says, and intellectual property protections vary widely. “We have lawyers in every country. We don’t have a choice. If we do not protect IP, the counterfeiters will have a field day.”
Geopolitical and economic crises can also disrupt a foreign market overnight. A recent border dispute and recession in Cyprus left distributors without enough money to buy product; the Ukrainian market is on hold indefinitely. “People are not going to think about buying impulse products when there’s a chance that their country might go to war,” Khubani says. “They are going to cover their basic needs and hold onto their savings.”
The complexities can be mind-boggling when a company takes multiple products into multiple markets. “It’s like having more than five juggling balls in your hand,” Khubani says. “Imagine all of those balls are different products. We have to not only juggle them, but also make sure that each of [them] finds a home. It is not easy, because each market has its own requirements.”
Market Ready
Some countries are more DR-ready than others, including the U.K., Australia, New Zealand, Canada, and Mexico. But South America, Eastern Europe, Southeast Asia, China, and Korea are coming up fast—and each presents its own requirements. “The way the business is set up and run in the United States is often very hard to replicate,” Takulj says.
For example, continuity offers are hard to maintain overseas (and in some places, prohibited), and the free trial is an almost uniquely American strategy. “They want a firm offer,” Takulj says. “You tell them the price and take an order.”
Even among Western countries, differences affect how DR travels. Britain has stringent truth-in-advertising laws demanding proof not just that weight loss occurred, but how much was due to the product in question. In Germany, consumers rarely use credit cards. “They want an open invoice, which, for our industry, doesn’t work,” says Mark Thurgood, managing director of Thane U.K. “You need your cash upfront to cover shipping and TV costs.”
One thing is universal, though: DRTV drives retail sales. Thane sold 1 million H2O Mop X5s in the U.K.—that’s one for every 15 households—using more than 200 hours of TV time per week and ads that tagged its respected retail partners. “When we launch the TV campaign, the retail sales go up that afternoon,” Thurgood says. Robert Dyas stores, for example, “were doing 150 units on a Saturday. We turned on the long-form TV, and that number instantly jumped to 450 units in a day. And not only are we selling a high-ticket item, they are gaining new customers.”
Since launching in the Netherlands, JML has sold 25 million FastFit ironing board covers using DR ads and in-store videos in 1,000 retail outlets. “In Singapore, we launched on TV again, and it sold like hotcakes,” Daly says. The company is building a presence across Europe and Asia, and last year, formed JML Direct Thailand to drive retail traffic in that country. “With the promise of a TV campaign with their name on it, retailers find it difficult to say no.”
Brand Building
Retail and DR are converging even faster overseas than they are in the United States, leading many multinationals to place a new emphasis on brand. “DRTV is the engine that drives Web traffic and store traffic,” Takulj says. “Phone traffic has become insignificant and unimportant. Recognizing that, we have rebranded and created a whole new look for Thane. Internationally, people pay a lot more attention to brand than we tend to do in the United States, [where DR] tends to be hit-driven.”
Thane introduced a new brand logo last year, which it includes on ads and packaging in every language and market segment. JML also includes its logo on all packaging, and breaks lines down into “name” subbrands. “It gives the consumer the confidence that the product is great quality,” Daly says. “At Asda [supermarkets], we have an endcap with a screen on the top and the JML logo.”
With the vast majority of sales logged at retail, multinational DR marketers need to be just as accountable as consumer products giants like Procter & Gamble or Nestlé. A brand builds trust among consumers—trust in a known, recognizable, and reliable parent company. And it also offers opportunities to upsell.
“We’re trying to make it more of a brand operation,” Thurgood says of Thane U.K. “I will happily sell you a mop, but I will also offer you six months’ worth of parts and accessories, and some fragrance to make it easier and nicer to use. We’re branding entire shelves of Thane product, with the [ads’] call to action tagging retailers. It’s DR in a box.”