Assessing As Seen on TV products’ multibillion dollar staying power
Have trouble opening a can? They have a product for that. Want food to cook faster without burning? They have a product for that. Need a hose that doesn’t take up a lot of space when stored? Guess what? They have a product for that, too.
“They” are the handful of behind-the-scenes companies producing products under the As Seen On TV label. The companies that market As Seen On TV products are experts at generating excitement, awareness and enthusiasm for these “must-have” items right out of the gate. Yet, what most do not know is that hundreds of hours, if not more, go into the vetting and making of the next hot product.
Though As Seen On TV companies may spend millions of dollars on advertising for quick brand building and consumer recognition, in reality most of the revenue comes from retail sales. Often merchandised in high-traffic locations, As Seen On TV products appeal to impulse shoppers and, when executed correctly, can add significant incremental sales to retailers’ bottom line.
But the category’s marketers want retailers to be aware of one very important thing: partnering with quality companies is one of the most important aspects in building sales in this category. Unsuspecting retailers already have learned this the hard way and lost sales because of teaming up with companies offering cheaper counterparts.
Yet, how do retailers determine which As Seen On TV companies and products are best for their product mix? Experts said the most successful items share four distinct qualities: they engage, innovate and solve a common problem — all while appealing to the mass market.
Jeta Kaziu, director of marketing at Norwell, Mass.-based Harvest Direct, pointed out that her company is known for bringing original, innovative and quality products to the market, and it is these three qualities that help the company stand apart from many of the As Seen On TV companies. Some of the company’s latest hits include the Pressure Pro Pressure Cookers, DiamoTech pots and pans, Tornado F4 Can Opener and the Armor Garden Hose.
Harvest Direct is a key vendor at such major retailers as CVS Pharmacy, Walgreens, Rite Aid, Walmart, Target and Bed Bath and Beyond. “We are always looking for the next ‘big hit,’ and work with a wide range of inventors that bring innovative ideas to many categories, from housewares to fitness to kids and pets, but we also have an R&D division in house,” Kaziu said.
Housewares, garden and pet are three areas she predicts will continue to drive sales in the category this year.
Product innovation is the hallmark of this category and, according to Chris Ferguson, CEO of Edison Nation, based in Charlotte, N.C., innovation is happening faster than ever before. Edison Nation is best known for such products as Mister Steamy, Emery Cat, Gyro Bowl, Eggies, Hot Huez, Perfect Bacon Bowl and Party in the Tub.
Ferguson said watching the trends on crowdfunding sites illustrates just how quickly the early adopters will commit money for innovation that has yet to even make it to production. At the same time, the definition of “TV” has expanded, increasing the opportunities for exposure prior to retail.
When it pitched Happy Feet Massage Slippers and Ambervision sunglasses to the masses back in the ’80s, officials at Fairfield, N.J.-based Bulbhead, formerly Telebrands, knew from the consumer response that it was going to be the start of something big. Since then, the company has successfully marketed a number of other devices and gadgets that have gone on to become household staples. Among its most successful products are Star Shower Holiday Lighting, Ped Egg, Colorama coloring book therapy for adults, My Pillow, Red Copper Cookware, Pocket Hose, Atomic Beam and Hurricane Spin Mop.
According to company CEO and founder AJ Khubani, Bulbhead’s strategy follows a three-legged approach — find low-tech product ideas with mass appeal that can be produced inexpensively and whose value easily can be demonstrated. “This is an exciting business and that drives our company to always be on the lookout for the next big hit,” Khubani said.
For years, the company regularly held an Inventors Days at its corporate offices where everyday inventors were given the opportunity to pitch their ideas. For ideas that are given the green light, Bulbhead steps in and handles the rest, including product development, market research, manufacturing and merchandising. Moving fast is key, and once the product is advertised on TV, it typically appears on retail shelves in under two months.
In return for turning over their ideas, inventors receive a negotiated share of sales through royalties, with higher amounts being paid for items that have gone through development, have a patent or are being manufactured already.
Another company that has been around for nearly 20 years is Wayne, N.J.-based Ideavillage Products. Finishing Touch personal hair remover for women, the Micro Touch men’s personal groomer, Copper Fit Compression Sleeves and Snackeez 2-in-1 Snack and Drink Cup are just some of the products the company is most known for.
Its success centers around providing affordable, quality products that offer solutions to life’s everyday problems. Staying true to this strategy while employing aggressive national marketing and merchandising strategies has catapulted many of Ideavillage’s products to the top-performing
position in their class, company officials said. Support from such mass retailers also has helped drive interest.
Focus on quality and speed
The category has done well due to the stringent vetting process companies apply to ensure only the best ideas develop into As Seen On TV products. At Edison Nation, for instance, every product idea goes through a rigorous eight-step evaluation process, including web testing, in which a website is created to present the product to consumers. The data generated from there is used to understand the level of purchase intent for the product.
If the product successfully passes its web test, the product development team refines and finalizes the design and engineering of the item through prototypes until everything is working perfectly. “We have invested a significant [amount] of money in state-of-the art equipment, including 3-D printers, laser cutters and water jets to move this process along quickly,” Ferguson said.
And considering the average category product lifecycle is under a year in the drug channel and sales velocity is strongest out of the gate, getting items onto the shelf quickly is key. Given the margins and prices ranging from $10 to $60, featuring this high-
impulse category in such strategic places as power wings endcaps, or even its own section, has proven to be highly effective in capturing interest, especially for retailers in which space is tight.
Given the number of companies producing products for the As Seen On TV category, Kaziu’s advice is to work with companies offering the original invention. She said focusing on higher quality products will pay off in the long run in terms of repeat customers, low return rates and customer loyalty. Lastly, she said, follow the marketing plans in all platforms.
“While TV is still king, don’t forget to use social media connections to market these products,” Kaziu said.
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