Report on Business - But wait, there's more!
October 02nd, 2013
Energized infomercial makers gear up for a softening economy
Ed Crain recalls vividly his first meeting with Jack LaLanne.
Well, who wouldn't? The bantam fitness guru walks into the office and starts doing what Mr. Crain describes as "push-ups in the chair."
Why? Because Mr. Crain is king of the infomercial, and he was about to film Mr. Fitness and his soon-to be-world famous juicer.
"We weren't selling a machine," Mr. Crain notes. "We were selling a way of life." To underscore this point, he adds of his own lifestyle: "I juice pretty much every day."
Mr. Crain's world is the world of direct-response TV. The market is fat ($14-billion in annual revenue in Canada) and, Mr. Crain is convinced, about to grow fatter on the back of a softened economy. "Our industry is going to have a wide-open playing field in the first quarter," he predicts, as a result of conventional brand advertisers cutting back in the U.S.
Just the other day he was filming a new commercial for Leg Magic, the "short skirt and shorter short solution," which will start to air in December. This is the second Leg Magic commercial for Mr. Crain's Toronto based company, Kingstar Direct Inc. More than two million units, advertised on the premise of attaining a sexy lower body through a simple lateral gliding motion, have sold worldwide; the commercial has aired in more than 30 countries.
And the Jack LaLanne juicer?
"We've done very well," Mr. Crain says. "It's been running for five years and we've made well over a millim dollars in royalties."
In addition to Kingstar Direct, Mr. Crain runs Kingstar Media Inc., which buys media time for infomercials for Canadian and U.S. clients.
Case in point: the Shamwow, a shammy being heavily pushed by Vince Offer, a pitchman in the classic mould of pitchmen. (Signature lines from the commercial: "Holds 20 times its weight in liquid"; "You'll be saying 'wow' every time you use this towel"; and, my personal favorite, "Are you following me, camera guy?")
"We started at $5,000 a week in media buying and some weeks have been as high as $60,000 to $70,000," says Mr. Crain of the Canadian media purchased for Shamow. "The U.S. media is running $500,000 a week, at a guess."
For Mr. Offer, a onetime producer ( The Underground Comedy Movie, which drew unfavorable reviews), the Shamow has brought stardom. "it's like he's a celebrity," Mr. Crain says. "Cab drivers in Vegas, they say, 'You're the Shamow guy!' "Next up: Master Moves. "ft's essentially a lazy Susan," Mr. Crain says. "You twist on it. We're after that somewhat stationary viewer who says I can't go out and run two miles."
Mr. Crain addresses what he prefers to call the "semi-checkered past" of the industry, summed up simply by the belief that at least some of the products don't work as advertised. He refers fleetingly to sketchy operators in the past who have "disappeared and off-shored the money." Even the legendary Philip Kives, founder of Winnipeg's K-Tel International Ltd., has written about his first foray into direct pitches, specifically a non- stick frying pan that left the non-stick coating stuck to the eggs instead of the pan.
As It happens, Mr. Kives is still in the game and readily recalls endless days pushing the Dial-O Matic slicer at the Canadian National Exhibition in Toronto.
Did It work? "It worked, but you had to make it work," he says. On the other hand, the hamburger-stacking Patty Stacker "worked perfectly," as shown on TV.
K-Tel's biggest seller was the lint-removing Miracle Brush-o-Matic. "Twenty-eight million sold worldwide," he says.
Is it true that he ran off to Australia with a beautiful blonde when he was pushing the Feather Touch knife?
"I was working the Calgary Stampede. I met someone from Australia and the next thing you know I was on a plane to Australia. ... 1 went to Australia and I sold a million knives in five months and I made a dollar a knife."
Direct-response TV is an industry with a million stories, not all of them amusing.
Mary Engle, associate director for advertising practices at the Federal Trade Commission in Washington, worked on what she calls the "ab sweep" when the trend in infomercials turned toward exercise equipment promising to bum calories at incendiary speed. In 1999, the FTC settled charges against Fitness Quest Inc., the Ohio based company behind the Abs Only Machine, the Ab Isolator and others. The settlement prohibited Fitness Quest, which distributes Leg Magic, from making claims in its advertising "unless they have competent and reliable evidence to substantiate them."
There have been numerous cases since, including the FTC's landmark complaint against Great American Products Inc., a Florida business that marketed sprays and dietary supplements promising a variety of anti-aging benefits In June, 2005, Great American and a sister company agreed to a federal court order requiring them to pay $20 million (U.S.) in consumer redress.
"We've targeted a wide range of different products," says Ms. Engle, who recalls the "pinhole eyeglass" craze of the '90s. "Instead of a lens they had plastic with a whole bunch of holes," she says. "They were supposed to improve your vision." They didn't.
The industry itself is on the case. The Electronic Retailing Association has been instrumental in directing complaints to the FTC via a program it created in alliance with the National Advertising Review Council. It was this group that turned over the Great American Products case to the FTC.
"It's an extremely important pillar of our attempt to differentiate white hats from black hats," says Rick Perry, the association's interim chief executive officer. No question, Mr. Petry says, that there have been some "bad actors" in the direct-response TV genre.
"Think about it. What other industry is relentlessly satirized by the likes of Saturday Night Live on a consistent basis? Between that and the worst players it creates a somewhat unfair and overriding perception of a genre of advertising that has actually been utilized by everyone from the likes of Kodak to Mercedes-Benz to Sony."
Next up? Ed Crain is headed to Vancouver to shoot a Master Moves commercial, coming soon to a television screen near you.