Sizing Up the DRTV Industry
There has been a blur in recent years between Direct Response Television (DRTV) and Brand advertising which has raised many questions and few answers. Is the DRTV industry growing or shrinking? How large is the industry? How can the DRTV industry define itself and the different types of DRTV execution that exist today?
As you’ll learn in this two-part series, the size of the DRTV industry has been grossly under-estimated by main stream television research companies based on an antiquated definition of DRTV. On behalf of DRMetrix, I look forward to sharing with you ground breaking research which is shedding light on these important topics.
When I began working in the industry in 1989, the definition of DRTV advertising was limited to television commercials selling products via 1-800. Brand advertisers never used 800 numbers nor did they provide any other way for consumers to directly respond to their television commercials. Accordingly, it was very easy to differentiate Brand from DRTV. The lines began to blur in the early part of the last decade when the DTC Pharmaceutical industry started using 1-800 numbers in television commercials. During this period, I lobbied leading television research companies to evolve their definition of DRTV but they remained committed to an antiquated definition of commercials selling products ‘not available in retail’ via 1-800. Even as some DTC advertisers adopted traditional DRTV methods such as tracking consumer response via different 1-800 numbers and purchasing DRTV ‘ROS’ media schedules, the research companies nevertheless continued to treat such commercials as “Brand” rather than “DRTV”.
The approach taken by the television research industry has left the DRTV industry without the tools to define itself. Quite literally, the term “direct response television” describes when a television commercial includes a method for consumers to respond. The art of DRTV management involves attributing consumer response back to individual media using a variety of approaches. Some methods are obvious, such as the use of different 1-800 numbers, while other methods are not, such as employing TV-to-web attribution techniques. Lead attribution helps to make television advertising more accountable and drives higher levels of optimization in media buying and creative development. These have long been the hallmarks of DRTV Advertising.
Over the years, as DRTV has become mainstream, we have witnessed advertisers such as Nutrisystem, Keranique, Novo Nordisk, Treasure Island, Home Advisor, Lifelock, Zip Recruiter, and many others using different phone numbers and/or web based promotion codes to track leads back to individual network buys. There has been a clear shift to make television advertising more accountable. Results minded advertisers spend considerable time and investment to craft and test different creative approaches in the hunt for better ROI. The high cost of television media drives the need for higher levels of campaign optimization and the largest performance based campaigns will attribute their success to the implementation of long standing DRTV techniques. Nevertheless, the television research companies have continued to treat many of these commercials as “Brand” instead of “DRTV”.
There is no easy way to know when advertisers use branded web addresses, and/or toll free numbers, whether they are employing lead attribution techniques to make their television advertising more accountable. However, there’s no denying that more are doing so than ever before. The proliferation of lead attribution companies and technologies in recent years stands as testimony.
DRMetrix’s approach to help define the larger DRTV industry has included a five-year research and development effort to build a state-of-the-art DRTV ad monitoring platform called AdSphere. Using the latest Automated Content Recognition (ACR) technology, AdSphere has identified and tracked over 20,000 DRTV creatives that have aired over 16 million times. Pattern and optical character recognition technologies analyze new commercials to determine if they include any combination of toll free number, web address, SMS, and/or mobile app response call-to-action. As new commercials are discovered and registered, they are given one of the following classifications: Short Form Products, Lead Generation, Brand/DR, or 28.5 minute. Commercials using a vanity call to action (think vanity toll free numbers and/or web addresses, etc.) are assigned to the brand classification “Brand/DR”. Commercials that advertise a product for sale using different 800 numbers, web addresses with different promotion codes, etc., are assigned to the classification “Short Form Products”. 28.5 minute commercials are assigned to the classification “28.5 Minute”. All other commercials, using different 800 numbers, web addresses with different promotion codes, and/or different SMS codes are assigned to the classification “Lead Generation”. For the first time, the DRTV industry has the means to measure and define DRTV execution across these industry classifications.
What’s coming up in part two of this series?
The results of AdSphere’s short form DRTV research study for 2016 and estimated valuations of DRTV expenditures for each short form industry classification. The DRTV industry has grown into a multi-billion-dollar industry and for the first time we’re going to learn how much larger is it compared to what traditional research companies have estimated. Stay tuned, the results are going to surprise you.
Of course, data like this requires that we also recognize and celebrate the accomplishments of leading DRTV advertisers across all industry classifications. In that spirit, we are looking forward to sharing with you the award winners for the inaugural 2017 AdSphere Awards which will take place at the Response Expo in April. It’s an exciting time to be part of this industry!