Manufacturers turn to television retailers to launch new products
Oct. 17, 1997
NEW YORK (AP) _ When Kellogg Co. launched its new Cocoa Frosted Flakes, the company didn't unveil its product in a supermarket cereal aisle.
Instead, Kellogg's took its new product to television retailer QVC, where it promoted the crunchy chocolate cereal during a two-hour morning program and sold out of 3,000 boxes in 10 minutes.
``We showed the cereal, talked about it, tasted it,'' Kellogg's spokeswoman Karen Kafer said. ``What better publicity can you get?''
With the costs of traditional advertising and marketing soaring, companies consider television retailing a viable launch pad for new merchandise. The attraction of this relatively young medium is a low overhead and huge viewership potential that can't be matched.
``TV retailers are a great alternative to sell and publicize to consumers, especially when you can reach millions of people virtually free of charge,'' said Al Ries, a marketing consultant at Ries & Ries in Great Neck, N.Y.
Just a few years ago, television retailers like QVC and Home Shopping Network were best known for offbeat merchandise. Super mops and car cleaners were more likely to be found than Fendi shoes and IBM computers.
While these home shopping stations generated millions of dollars in sales, most mainstream manufacturers steered clear, continuing to offer their merchandise in traditional retail outlets. That, however, is changing as more companies test the benefits of selling on QVC and HSN, which both reach over 60 million homes through cable service operators.
In this era of downsizing and tight profit margins, cheap publicity is a highly sought-after commodity. There are no fancy lighting, scripts or special effects in television retailing, just the product and the hosts promoting it.
Microsoft Corp. launched two of its products on QVC. In 1995, 17,000 units of the much-awaited Windows 95 software were sold in three hours. Last August, 6,000 of its new Actimates Barney, an interactive plush doll, sold out in 36 minutes.
Also on QVC, Eastman Kodak launched its Advanced Photo System technology last year, selling nearly $1 million in film and cameras in 24 hours.
On HSN last fall, the video for the hit movie ``Independence Day'' was offered before it became available in retail stores. About 80,000 sold out in five weeks.
Kellogg's Cocoa Frosted Flakes made its debut on QVC last March.
Today, candy maker M&M/Mars is unveiling some of its new licensed products _ including apparel, collectibles and plush toys _ on QVC.
``We will know immediately if something is popular or desired by the consumer,'' said M&M/Mars spokeswoman Marlene Machut. ``It's a fast response that you can't get elsewhere.''