Wednesday, November 18, 2020

#114 Parade Space Advertising

#114 Blog Post – Wednesday, November 18, 2020

 

 http://dennyhatch.blogspot.com/2020/11/114-parade-space-advertising.html

 

Posted by Denny Hatch

 

MEET MARKETERS BETTING MILLIONS IN OLD-FASHIONED SPACE ADVERTISING


Over the past 40 years, Parade has been my favorite marketing magazine. Consider this October 25, 2020 issue:

• The most widely read magazine in America.

• Distributed free in over 700 Sunday newspapers nationwide.

• 42 million circulation with a readership of 54.1 million.

• This 20-page issue contains 14 full-color direct response ads.

• Retail cost of a full-page 4-color ad is $733,600.

• Many of these advertisers have been making big bucks from Parade for over 30 years.

• This is big-league, hi-stakes advertising.

• I love it!


A Look at Two Parade Direct Ads
To Find Ideas That You Can Steal
 

1. 

 

The Company:
Bradford Exchange was founded in 1973 as The Bradford Gallery of Collector’s Plates. They have been selling their tchotchkes for years in Parade.
    
In this issue of Parade alone are three full-page Bradford Exchange ads plus another from The Hamilton Collection—a Bradford subsidiary. This past Sunday's Parade contained three full-page Bradford ads.

 

The Product: 
“Limited Edition” tabletop 18”-tall Thomas Kinkaid “Holiday Sparkle” Christmas tree sprinkled with glittering snow, 20 shining silver ornaments, hundreds of fiber optic lights that “dance in brilliant colors” while it plays a medley of 8 favorite carols. More lights shine from within the sculpted village houses at the base circled by a merry little railroad train.
      (“Limited Edition” means limited to the number of people who ordered it.)

 

Two Ways to Order:
(1) Fill out the coupon. Find a blank envelope. Address the envelope. Insert coupon. Affix a stamp. Take it somewhere to mail it. (2) Order at bradfordexchange.com/27622

 

The Offer and Terms:
Send no money now. You will be billed. The price is in the middle of the ad copy—four installments of $37.50 for a total of $149.    
     Separately—at the bottom of the coupon—is an additional $19.99 “shipping and service” bringing the total to $169.98.
     By burying the added $19.99 at the bottom of the coupon in mouse-type (easily missed in the excitement of ordering) the customer will be thinking $37.50 rather than the whopping total of $169.98 (a possible deal killer).

    
On Bradford's receipt of your first installment, allow 4-8 weeks for delivery. In this era where customers expect "instant gratification" (e.g. Amazon's Tomorrow Delivery), the 4-8 weeks wait is a killer. But Bradford won't produce and ship a product without getting at least some cash up front.
     Satisfaction guaranteed or money back.
     Limit: one per order.
     Batteries not included. (Why not include batteries??? Batteries are cheap! These folks have waited up to two months for Pete's sake! Include 3 AAA batteries and let the customers enjoy this thing immediately!)

 

 The Coupon: 
Note: Signature required. Since this is a send-no-money-now bill-me offer, Bradford turns the coupon into a binding legal document.
Note: The mailing address is in the coupon top—not in the body of the ad. One reason: some consumers clip the coupon and take it up to their desk to fill it out, find an envelope and stamp. If the company’s address is in the body of the ad and not in the coupon, the customer won’t know where to send the coupon and the sale could be lost.
Note: The key# at bottom is highlighted in yellow—code for the product, the ad, the publication and the date. This is absolutely essential in direct marketing so you can track the profit or loss of that offer in that medium on that date.

     DH’s take:
The ad and coupon break a lot of accepted rules (see below). But pay no attention to the old rules here. Bradford has been using Parade for years. They know the readers. They know what sells. No doubt they have tested everything—type sizes, coupon sizes, offers, prices.

 

About “Send No Money Now”:
• This is a rarity these days when it's so easy to ask for a credit card number and not take a chance on a cumbersome back-and-forth bill-me situation.

• The Plus: "Send No Money Now" makes it much easier for the customer to order. No interruption of the ordering process by being forced to hunt up a credit card number and copying it onto the order coupon.

• The Minus: You have to set up a billing system as opposed to the ease of receiving cash (or credit card number) with order.


Rules Broken:
• Only two ways to order: mail and Internet. It makes sense give customers ways to order that are most comfortable to them: mail, Internet, 800# phone and (if possible) a nearby retail store (where you can see the actual product).

"Type smaller than nine-point is difficult for most people to read."  —David Ogilvy

"Never set your copy over a gray or colored tint and never set copy in reverse (white type on a black background). The old school of art directors believed that these devices forced people to read the copy; we now know that they make reading physically challenging." —David Ogilvy


     Note about the two broken rules above.
The type in this ad is tiny throughout—my guess 5-point or 6-point, plus the entire ad is in white type reversed on a blue background. This combination blows David Ogilvy's rules on type (above) out of the water. In short, very tough to read. Yet the Bradford Exchange has been advertising successfully in Parade for many years. They must know what they are doing.

• The only logical conclusion is that the product is so beautiful, compelling and fun—with intricate design, dancing lights, music and action—customers will struggle through the difficult-to-read copy and place an order. After all they know and trust Bradford Exchange and happily order from them.

• To read some of the mouse-type body copy of the ad, go to www.bradfordexchange.com/27622

 

2.


I don’t recognize these folks—either from past issues of Parade or anywhere else. My opinion: the order mechanism is correct in every way.

No Rules Broken
“Always make it easy to order.” —Elsworth Howell, CEO Grolier Enterprises

Four ways to order:  (1) Phone, (2) Coupon, (3) Online and (4) Retail—CVS, Amazon, Rite Aid—“Located in the Pain-Relief Section. (OFFER NOT GOOD IN STORES)”

• Large readable type throughout.

• Special bonus: Buy 2, get 1 Free.

• 2-Day Shipping. (Immediate gratification.)

• 90-day money-back guarantee.
• Rapid pain-relief GUARANTEED!

• Includes testimonial from a happy customer (look under the giant $13.33 top right).
• If you can fit in one or more testimonials, use them; they are an extra salesperson in your presentation and should increase response
.

 

One of the Most Successful Space Ads in History


In 1951, working from her kitchen table in a tiny apartment, newly married Lillian Katz ran this little $495 black-and-white ad in the mail order section of Seventeen Magazine.

 

She generated 6,400 orders and $32,000 in sales. Katz—a 5-foot-1-inch dynamo—changed her name to Lillian Vernon and spent the next 50 years building a catalog business with annual sales of $250+ million.

 

A Formula to Determine Selling Price and Breakeven
Let’s say you are running a space ad for $1,200 to sell a $40 product. You have paid for the creative; your ad is standing and ready to run. Your markup is five to one; in other words, your cost of goods sold is $8. You will accept cash with order (check or money order) or a credit card. No bill-me option. Let’ say shipping costs are a wash. For example, add $5 for shipping and handling that costs $5.

 

Revenue per order                                     $40.00

Cost of goods sold                       $ 8.00

Reserve for returns (15%)           $ 6.00

General & Administrative (15%)   $ 6.00

 (Includes credit card processing)

*Profit (15%)                              $ 6.00

Total costs                                  $26.00      26.00

Allowable cost per order                             $14.00

 *Profit is always included and is treated as a cost.

You spent $1,200 for an ad. Divide the Allowable Cost per Order ($14) into $1200 and you need 86 orders to break even.


Takeaways to Consider

• Small space ads are a great way to test a new product or service.

• Never test a publication that does not have direct response ads.

• Go where your competition goes. Chances are they have tested there and it works for them.

• Always design the ad with the coupon at the bottom outside of the page so it is easy to cut out or tear out. If your artist puts the coupon in the middle of the ad or next to the gutter, find another artist.

• Always start by testing small in regional editions. Example: in its heyday, TV Guide had 120 regional editions. You could test one metropolitan edition and one rural edition for a few grand and see if your offer is profitable.

• Can you test regional editions of Parade? Tell your space buyer to check it out.

• Check out my Blogpost #34, How to Steal an Idea and Destroy a Fledgling Business to see how this was done in the past.

• Arithmetic is key to your success. Know it cold.

“In direct marketing, two rules and two rules only exist. Rule #1: ‘Test everything.’ Rule #2: ‘See Rule #1.' ” —Malcolm Decker

• In direct marketing figure on a 9-to-1 markup. 11-to-1 is better.

• Never go it alone. Always hire an expert to guide you and place your ads.

“I have never paid retail for an ad in my life.” —Iris Shokoff, Iris Shokoff Associates, N.Y.

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Word Count: 1540


 You Are Invited to Meet Denny Hatch: http://dennyhatch.blogspot.com/2020/03/87-geezer-fast-yoga.html

At age 15, Denny Hatch—as a lowly apprentice—wrote his first news release for a Connecticut summer theater. To his astonishment it ran verbatim in The Middletown Press. He was instantly hooked on writing. After a two-year stint in the U.S. Army (1958-60), Denny had nine jobs in his first 12 years in business. He was fired from five of them and went on to save two businesses and start three others. One of his businesses—WHO’S MAILING WHAT! newsletter and archive service founded in 1984—revolutionized the science of how to measure the success of competitors’ direct mail. In the past 55 years he has been a book club director, magazine publisher, advertising copywriter/designer, editor, journalist and marketing consultant. He is the author of four published novels and seven books on business and marketing.

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10 comments:

  1. Denny, It was great to walk down memory lane with you calculating the required break even points for a DM solicitation. And seeing the names "Bradford Exchange", and Lillian Vernon offered a brief respite from the daily digital onslaught we experience. Sadly many do not connect these two worlds. The digital space was supposed to be the ultimate DR medium. Lots of sound and fury, torrents of data, so little insight. Rather sad.

    ReplyDelete
    Replies
    1. Richard,
      WHERE ARE THE MENTORS????
      Thank you for taking the time to comment.
      You are spot-on with your take on digital space (and digital marketing/advertising in general). It’s all about technology, data and dweebery. More to the point: IT’S ABOUT A TOTAL LACK OF MENTORS! When the Internet appeared in the late 1908s, it expanded exponentially, and marketers went on a hiring spree and companies geared up and filled slots with lotsa young hotshots. When we geezers showed up, we were shown the door. “This is a new medium and a new paradigm,” we were told. “The old rules don’t apply. This is marketing with new rules and we make the rules. Now bugger off!”
      These new rule-making hotshots hired hotshots like themselves with no knowledge of how direct marketing works. And the new hotshots hired newer and younger hotshots.
      You and I grew up with mentors. I did a post on my mentors; I was damn lucky to have had a number of them and was damn lucky to be smart enough to learn from them http://dennyhatch.blogspot.com/2019/06/58-11-mentors-who-changed-my-life.html
      What few of these techies realize is the old rule of direct marketing—direct mail, space, telemarketing, headlines, copy platforms, offers, arithmetic etc., etc.—all are relevant in digital marketing.
      Do keep in touch!

      Delete
  2. Indeed, Richard. The Bradford ad brought back some wonderful memories of when I booked similar ads in Parade for the Danbury Mint and the Postal Commemorative Society (MBI), where I worked 30-plus years ago. High risk ads for sure ...but boy, did they generate lots of orders! It's nice to know these ads are still working for them. And yes, Richard, the 20 and 30 year old digital folks can run circles around me when it comes to technical knowledge about online marketing, but when it comes to classic direct response knowledge and understanding why people respond the way they do, most of them still have a lot to learn.

    ReplyDelete
    Replies
    1. Michael,
      Thank you for taking the time to comment. Check out my reply to Richard Hren above and the lack of mentors.
      Yeah, this was a walk down memory lane. Remember TV Guide—those fat little issues with our favorite ad formats: carboard insert with facing page. Grolier sold a ton of Dr. Seuss books and Columbia House sold a ton of records. Did you know Bud Pironti who put the Parade show on the marketers’ map? Fascinating guy. Ah… the good old days! Do keep in touch! Cheers.

      Delete
    2. I can recall at the very dawn of digital marketing, sitting in a meeting with the dweebs that were building web sites, landing pages, and banner ads. I began discussing the need for some simple A/B testing....you would have thought I was speaking ancient greek. They also usually were annoyed the words like "free" and "limited time offer" usually boosted click through rates more than their fancy graphics. Yes, fun times. And I rarely said 'I told you so'...rarely but not never.

      Delete
  3. Denny - another terrific piece from you. I'd like to consider myself young and what most young whipper-snappers don't know is how powerful these 3 words are: Success leaves clues. And knowing and following you - a living treasure - is something I consider to be a blessing.

    One quick thought about collecting no funds today. It could be an FTC issue in that we may not be able to collect a dime until the day we ship. Now there may be rules around it - and 4 months ago I would already have that answer, but sadly our in-house counsel passed from COVID. He knew the FTC rules sideways, backwards and inside out... Rest in peace Rob.

    A subject that I send to you and your bride Peggy - please stay safe and well. And our Thanksgiving blessing is having the living treasures themselves - the Hatches in our lives!

    ReplyDelete
    Replies
    1. Will, Thanks for taking the time to write.
      The FTC rule says you cannot collect money if you can’t fulfill within 30 days. Bradford hedges it bets by saying send Installment @1 and wait 4-to-8 weeks. However, if the ad bombs and they scrap the project, they simply won’t send the first bill for Installment #1. They have not asked for money.
      In the case of a dry test, you can say send no money now. Or… you can say use credit card only and your card will not be charged until we ship.
      These scenarios are, of course, dry tests (testing a product that does not yet exist, and may never exist if the ad bombs.
      Either way, you must send a “delay” letter or an explanation that the factory in China burned down.
      Incidentally, all letters to customers should be warm, fuzzy and written by a trained and mentored copywriter, not some jerkwater clerk in the shipping dept.
      Do keep in touch!

      Delete
  4. G'day, Denny. Nice old-time ad review. Parade Magazine ain't what it used to be - just too many ads and not enough editorial for a real magazine. Not really like the old days when there was more content.

    Here's my take, and y'all can take it or leave it… The Muscle Cramp ad has kind of fuzzy math: Buy 2 get two free for a cost of $39.98! Hummm let's see - $39.98 divided by 4 = $9.99 each. Don't know where they are getting a cost of $13.33 each from? Also looks like the numbers column would lead the rushed reader to add up all the figures in the column.

    I could be wrong here but the ad has some compliance issues as well. I'm not sure you can say “Pain” in a nutraceutical ad - which implies a disease, and that you can cure it. That's why today's Arthritis print ads say "eases joint discomfort.” If I could say “Ends Arthritis Pain” I could make my clients very happy with a huge response to each placement. Well, I could… but if we got caught…

    ReplyDelete
    Replies
    1. Jeffrey,
      No quarrel with your critique or arithmetic. The point of this column was about how to make it easy and painless to order.
      Your last line piqued my curiosity:
      >>“If I could say “Ends Arthritis Pain” I could make my clients very happy with a huge response to each placement. Well, I could… but if we got caught…”<<
      “But if we got caught…”
      Are you suggesting that as a freelance copywriter who wrote some illegal copy at the behest of the client, the copywriter could be liable and maybe fined or sent to jail?
      One of the joys of freelancing is being able to fire clients. And if you smell a rat, you can fire the guy and still pay your bills with other clients.
      Do keep in touch!
      Cheers.

      Delete
  5. Another super article, as always, Denny

    Two comments:

    1. Your allowable cost per order (ACPO) model showing the number of orders for breakeven includes as a 'cost' the desired profit but fails to explain how very important this is. I'd be happy to send any of your readers an excel model that helps them calculate both the ACPO and the number of responses they need to 'break even' with the pre-reserved profit. Simply email: pjrosenwald@gmail.com with the words, ACPO Please.

    2. In Brazil, almost all products can be paid for with credit cards in interest-free installments. The credit card companies make this easy. Why don't the American cards follow the example of their Brazilian subsidiaries? It would make life so much simpler.

    ReplyDelete