Three Uses For Direct-Marketing Videos

Begin thinking about how to use video for marketing your product or service by understanding three basic types:

• Video Direct-Mail; you mail your video directly to a targeted list
• Video Direct-Response; you send your video to prospects who request it after seeing your "free video" offer in another media (e.g., an infomercial, a direct-mail brochure, a magazine ad, an Internet homepage)
• Video Premium; you offer a video either free or at a significant discount as a purchase incentive

Each one of these types has its most appropriate applications. For instance, to build traffic quickly, a twin cities grocery chain uses video direct-mail when they open a new store. They send videos directly to most of the households in their sales area, because they know that consumers shop where they are familiar. It's hard for people to go into a new store and orient themselves to a new layout, different graphics, etc. Essentially, the video takes them on a personal tour, in the comfort of their own home, at whatever hour of day or night they want to go. That makes potential customers feel comfortable trying the store, so comfortable that up to 40% of them come in (response varies with incentives; 40% achieved with a video including a $5 off your $25 purchase if you bring this video in offer).

Video direct-response makes most sense for companies with limited audiences (e.g., for big-ticket items, exercise equipment, recreational vehicles). By allowing customers to self-select the target audience, video becomes a very cost-effective tool. Lexus automobiles, for example, knows that only a small percentage of the population will be interested in purchasing one of its luxury cars. So they started with a print piece offering a free video. From the 11% who responded, an amazing 5,500 cars were sold - over an 8% conversion rate for a truly big-ticket item.

Giving a premium as a purchase incentive is a time-honored promotional tool that needs little explanation. Videos make exceptional premiums due to their high perceived value, and the high percentage of homes with VCRs (over80%). Time-Life and Sports Illustrated are noteworthy examples of businesses that have exploited the potential of video premiums to the fullest. Generally, video premiums are most cost-effective when a company has existing video footage (e.g., bloopers) to edit.