The Business Behind Infomercials
The Business Of Selling
We've all seen quite a few infomercials over the course of our lifetimes, and chances are you've been intrigued by an item or two. Why not let a decorative glass bulb water your plants for you, or store all your sweaters under the bed in a suctioned, flattened bag? While infomercials have a bad reputation for being cloying, annoying, and occasionally misleading, they and their products are big business.
Using As Seen on TV logo has become an especially profitable way to increase awareness of a direct response mail order product, and As Seen on TV products are also now being sold all over the net through countless web vendors. Many products are now even available at traditional retail outlets, where they sell at a brisk pace. The As Seen on TV products are also being bolstered in popularity by their new status as pop culture fodder. Who hasn't laughed out loud at the "ShamWow guy" Vince Shlomi as he implored you to start slapping your troubles away with the As Seen on TV product the Slap Chop? Billy Mays' recent tragic death has played a role in the As Seen on TV pop culture phenomenon as well, as web tributes to the TV salesman have popped up on many websites and blogs.
So much excitement would not surround As Seen on TV products if they weren't extremely profitable. While most industries have been squeezed by the recession, As Seen on TV products continue to sell at a healthy clip, and advertising for the products has seen increased spending.
Telebrands, probably the largest supplier of As Seen on TV products, is worth over $100 million. Discerning exactly how much is being made off of these products and which medium (TV, web, or retail) is most profitable, however, it is a difficult business due to the wide variety of independent vendors that have proliferated on the web. Part of the secret to the As Seen on TV profitability is their clever pricing. You may have noticed that infomercials never seem to give an exact, full price for the product being offered. Usually the item is offered for several small payments, or a price is offered for multiple items "plus separate shipping and handling." This is a calculated move on the part of the hucksters, who understand the psychological aspect of buying using smaller increments. Even though the price isn't any cheaper simply because it is broken up into small increments, it still feels that way to the buyer. Infomercials and web based As Seen on TV vendors also use false scarcity methods and time constraints to goad people into buying impulsively. The items also sell for more obvious reasons: many solve common problems, or at least claim to solve these problems, such as the Purse Hook, which keeps purses and small bags from being left on the floor, or the popular Ped Egg, which not only shaves calluses but traps the debris.
For more about profits please visit our Finances section on GKBusiness.
