Nosenchuck: Infomercials thrive during recession

The counterintuitive success of infomercials is directly correlated to a decrease in the price of media time, according to mechanical and aerospace engineering professor Dan Nosenchuck, who teaches a class on entrepreneurial engineering.

"Companies that engage in infomercials are operating with much higher margins," Nosenchuck said, given the lower cost of media and the increased sales. Because networks do not guarantee when infomercials will run, they generally qualify for lower rates than do standard commercials, according to a recent article in The New York Times.

The decline of media costs, combined with "a lot of companies … pulling out from their brand-awareness campaign[s]" in the current economic climate, means that more infomercials appear on television than did before, Nosenchuck said.

Pat Boos, senior vice president for broadcast, acquisition and marketing at Direct Holdings Americas, which licenses the brand Time Life, told the Times, "When someone pulls off the air, like a pharmaceutical or medical company or a sports company, the networks sometimes find themselves with last-minute dead space … We can come in and say, we've got a tape ready, we've got the product ready."

As large corporations have cut back on their advertising budgets, leaving gaps in network primetime, infomercials —also known as direct-response ads — have consistently filled spots on major networks. This increase is especially pronounced during major advertising periods, such as after the presidential-campaign season and after the holiday-shopping season.

Along with advertisement downsizing, Americans have also scaled back shopping trips in favor of staying at home. The result is increased television viewership and a thriving infomercial culture in the midst of financial crisis.

"Infomercials deal with direct response, not brand awareness at all. It's just a call to action," Nosenchuck said, noting that "an infomercial is an ad in and of itself — it's not an investment in a long-term campaign."

Nosenchuck added that an increased talent pool has also contributed to rising infomercial sales, as unemployed individuals who would otherwise have been employed in the corporate sector try their hand at creating new products. The "cost of developing infomercial-related products is relatively modest," he said.

The attraction of products advertised on infomercials is in the immediacy of the purchase. "Infomercials are based on supplying … a cost-effective solution to everyday problems," Nosenchuck said. Products of convenience — such as the stick-up light bulb marketed by Telebrands that "basically allows you to give light wherever you want it without calling an electrician" — appeal to Americans during a time when they are constantly searching for cost-cutting solutions.

Similar arguments apply to products that would "lead to significant gains in fitness and personal appearance," he added.

Assistant professor of psychology and public affairs Alexander Todorov said that the success of infomercials is influenced by viewers' perception of the advertisers' facial expressions, noting studies that have shown that attractive faces are better received by the public. "To the extent that this face matches the attributes of the product, the commercial will most likely be successful," he said.

Campaigns that show "beautiful people enjoying themselves who have no connection to the product" can also be successful as they create positive associations with the product, Todorov added.

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Infomercials, which advertise quick solutions to problems, rarely require the same amount of mental calculation as do products of greater expense and importance, leading to impulse buying. In some cases, Nosenchuck said, consumers do not even notice a problem they have until they view an infomercial offering a solution.

With less costly primetime media rates and increased television viewership, the infomercial industry is one of the few thriving in today's economy. "[People] like the fact that they got something that'll maybe save them more money or make them feel better about themselves," Nosenchuck said.