Hey Guys,
Over the past several weeks I’ve been testing a new to me advertising medium, TV. I wanted to put up a blog post and share the results so far with this process. It’s my hope that we can all learn from this journey. In this, I’ll be outlining the entire process I used, the marketing involved, the commercial itself as well as the results (the good, the ugly and my interpretation of how things went).
I believe there’s some lessons to be learned here, regardless of what you’re marketing and how you’re currently marketing your products/services.
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It’s important to note that my knowledge of using TV is extremely limited. I’ve had only one prior experience back in early 2005, but the context of that experiment was completely different. That was for a 30 minute infomercial (which is 22 minutes of actual airtime). What I’ve been testing recently is for a 60 second standard commercial.
During this test, there were a total of 112 spots aired over a 4 week period (spread out fairly evenly from week to week, as you can see from the “post log” images provided below). All spots ran between 12 and 4:30 AM (Pacific time)in Phoenix, AZ on channel 3, KTVK.
Let’s get started…
The overall structure of the campaign looks like this:
1. Commercial airs
Here is the actual commercial that aired
2. TV viewer goes to website discussed in commercial for a free report (it’s delivered immediately in a PDF format).
3. All leads received a phone call within 24 hours of submitting their details on the website (www.MyNewFreeReport.com).
4. At that point, they’re invited to a call explaining more information about our product offerings and solutions to meet their needs, based upon their struggles.
This first commercial run, took place to the Phoenix, AZ market. It was exposed to a total of 1,810,000 homes. The estimated reach (actual viewers that were exposed to the commercial) is 201,000. I purchased a total of 112 spots at $25.00 per – for a total spend of $2800.00.
Let’s do a breakdown of the number of leads generated on a weekly basis. Below, to put things in context I’ve included images of “post logs” – the purpose of these is to show the advertiser where their money is going by sharing the exact time the spot ran (you’ll see as well in the far right column of the image, the specific show that the commercial ran within).
You’ll also see I analyzed the data based upon the formula of how many leads did each run produce on average to get a good gauge of how each week performed so I could compare weeks and “frequency”, which I’ll discuss in more detail shortly.
Week #1:
Ran a total of 30 spots.
It generated a total of 12 leads
Number of leads per run = .4 (number of leads generated divided by total spots the commercial ran, 12/30 = .4).
Cost Breakdown: 30 commercial airs times cost per run of $25 each = $750.00
Cost per lead: $750.00 divided by 12 leads = $62.50 per lead.
Week #2:
Ran a total of 28 spots.
It generated a total of 9 leads
Number of leads per run = .32 (number of leads generated divided by total spots the commercial ran, 9/30 = .32).
Cost Breakdown: 28 commercial airs times cost per run of $25 each = $700.00
Cost per lead: $700.00 divided by 9 leads = $77.77 per lead.
Week #3:
Ran a total of 30 spots.
It generated a total of 20 leads
Number of leads per run = .66 (number of leads generated divided by total spots the commercial ran, 20/30 = .66).
Cost Breakdown: 30 commercial airs times cost per run of $25 each = $750.00
Cost per lead: $750.00 divided by 20 leads = $37.50 per lead.
** This was by far the best of the 4 weeks from a cost per lead standpoint. **
Also, in the screenshot below of the image for week #3, it’s showing total spend of $700.00 (I’m not sure why Channel 3 put that, but should be $750.00 total spend for that week as it aired 30 times (30 times $25 per air = $750.00). Looking at the bigger picture though, it’s pretty irrelevant either way and doesn’t define or make/break the campaign whether it was $700 or $750 spent.
Week #4:
Ran a total of 28 spots.
It generated a total of 7 leads
Number of leads per run = .25 (number of leads generated divided by total spots the commercial ran, 7/30 = .25).
Cost Breakdown: 28 commercial airs times cost per run of $25 each = $700.00
Cost per lead: $750.00 divided by 7 leads = $107.14 per lead.
Here’s the screen shots of the run times and what not. These are screen shots taken directly from the emails I received from my TV media buyer and Channel 3 TV. If it’s tough to see, just click on the image for the larger version.
Week #1
Week #2
Week #3
Week #4
All in all this has been big time eye opening experience for me and there’s been a few key lessons learned here.
One of the interesting things is that when you look at the data for week #4, it totally went against the grain. When using TV, there’s what’s called “frequency” and it works very similar as radio, print, billboard advertising, etc. The logic is, the more your audience has seen your message, the more likely they are to responding to it.
You see this with online marketing as well. The first or 2nd time that someone sees your product, maybe they don’t buy it. Maybe the 4th or 5th time, they do.
Timing is key with any marketing, in any marketing. It’s not about when WE want the transaction (or the lead or whatever action it is that you’re seeking), it’s about relevancy for your PROSPECT or customer.
Anyway, traditional thought is that with each week as the “frequency” was increasing, so should the total number of leads generated per run. This really didn’t happen. Week 3 was certainly the best with an average cost per lead of $37.50, but week 4 was nearly 300% higher, coming in at over $107 per lead.
Although it’s interesting, I wouldn’t consider this a full data set either. There’s not enough data here to prove or disprove the whole “frequency” thing and this easily could be an abnormality that would likely be smoothed out if I ran the same commercial another 200 or more times, while changing no variables.
Another takeaway for me was that the $2800 spent on this first run, wasn’t enough to take much away and analyze.
PROFIT/LOSS
SPENT: $2800
LEADS GENERATED: 48 (Total)
Sales: 1 order at $1297.00 and 2 orders at $47.00
Total Sales: #1391.00
Profit/Loss: ($1409)
I’m actually extremely encouraged by this. As, at most, this data was generated over the past roughly 4-5 weeks, there may or may not be more revenue to be generated from this little experiment.
The Current Biggest Dilemma:
The biggest current problem with the campaign is the lack of prospects that we’re able to communicate with via phone. We’ve only spoken with a total of 4 or 5 prospects. I’m working on this to increase that number. I’d like to see us actually speaking with 30% or more of the leads compared to the current approximately 10%.
The 2nd commercial will be totally different, but running in the same market. We’ll begin testing the next version during the first or second week of August. I should have another update about 4 weeks after that one starts airing.
They’ll still be going to the same website, but the creative side of the commercial will be nothing like the current version. Once I analyze which is producing more leads/results, I’ll be taking this to another 4 markets in different states (likely, Houston, all of Utah, San Diego and parts of Florida). The ultimate goal is to scale up into prime time instead of midnight to 4:30 AM, which is when it’s currently running. This is done because the cost component changes drastically when you enter prime viewing times or you’re running on the larger (regional or national) networks. I’m essentially testing the process and creative side on a smaller scale before ramping up – you should be doing this as well, regardless of how/where you’re marketing your products and services.
I hope you’ve enjoyed this update and gained some insight from it. Be sure to share it on Facebook, Twitter, etc using the below buttons so others can learn from this!
{ 8 comments… read them below or add one }
Terry,
This is a great blog post. Very informative, well structured and I can tell you’ve put quite a bit of time into this commercial process. Mind sharing how much it cost to produce the sketch commercial?
Thanks!
Brian
Good question Brian – I paid exactly $1,000.00 for the production of this commercial. Pretty low budget – the guys at Video Media Productions is who I used. I’ve done biz with them for years whether it’s video editing, green room services, production, still shoots, etc. http://videomediaproductions.com/
I don’t get a kick back for this plug (shame on me).
Terry
Thank you Terry for sharing this … one that you are always looking for ways to test an advertising arena, that you embrace it w/ all your gusto – we can all learn just from that, and that you’ll share it for all of our benefits as well … THANKS !
Terry this is incredibly generous of you. It looks like it’s going to be a really expensive exercise and I hope it works out.
So far it doesn’t look great and the contactability of the leads is pretty poor. I’m still thinking that free pre-sold referrals are likely to be the best way to go because they’re so targetted, highly contactable, and of course the number of them is so controllable.
I look forward to seeing more results.
Wow, Terry! What a learning experience. I love the sketch. I have seen this type of ad before and I feel it is very effective to have someone think in images.
So far, I think this little venture of yours is successful considering your leads are being shown your ad during the middle of the night and not prime time. LOL. The connect rate stinks….but you got a hold of of 5 and 3 bought something…not bad stats considering it is a trial campaign.
That’s the point though…it is a relatively medium for you, a new campaign that needs to be tweaked by testing out different variables of the campaign. Timing of the ad (time of the day, timing of the year or month), timing of call backs, frequency .. may all be important? They say, most adults need to see something 7 times before they take action – which makes 3 is really interesting.
Looking forward to learning more! Thank you so much for sharing your detailed results.
Terry, you’re the man! Thanks for all you do brother!
Hey Terry!
Hats off to you… for telling ALL the truth! This being the 1st post of yours I have read I was curious as to how this post would end. I am curious to see what comes from the follow up. Thanks
@ Barbara – you nailed it – there’s SO many variables that can be tested. It’s a whole lotta fun figuring out what works and what doesn’t…and trying to understand the “why” behind it.
Thanks Brian and Tyron! Will keep you all updated on the next run.
Terry
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