Electronic Retailer - October 2011 - 26

The Perfect Hybrid?
How many direct-response products become long-time staples in major retail chains but keep right on selling via DRTV commercials? There's one: ITW Space Bag.
BY JACK GORDON PHOTOS BY BRIAN DAVIS

i
26

In the ordinary course of events, successful direct-response products follow one of two trajectories. First, they can spike: When a DRTV campaign is a hit, a product that nobody ever heard of suddenly begins to sell like crazy. The spike lasts for a few months, or maybe a few years. Perhaps the product moves into the “As Seen on TV” section of some retail stores. But eventually sales fall off and the item disappears. Nancy Lazkani, CEO of Van Nuys, Calif., media agency Icon Media Direct, calls it the “in and out” route. It is the most familiar pattern for DR products. In the second trajectory, more rare but by no means unheard of, a hit DR product moves into retail and becomes a brand. If it continues to advertise at all, it does brand advertising, not DRTV. Lazkani points to OxiClean, maker of stain-removal products, as an example of a one-time DR marketer that made the switch. What you do not see in the everyday world is a product that launches on DRTV, migrates into retail in a major way, remains on the shelves of national chains such as Target and Walmart for a decade, but continues to maintain a successful, multimillion-dollar DRTV campaign. “Once you’re a brand, it’s very hard to maintain DR efficiencies and do retail at the same time,” Lazkani says. In her experience, in fact, only one marketer has done so in a major, consistent way.

It happens to be a client. Its name is ITW Space Bag.

A True Hybrid
ITW Space Bag, based in San Diego and with manufacturing facilities there and in nearby Tijuana, Mexico, makes a line of vacuum-sealable plastic containers for clothing, bedding, stuffed toys, and other compressible items. Pile several sweaters into a Space Bag, then suck out the air with a vacuum cleaner, and the bag compresses the sweaters into a much smaller space, making them easier to store. The clothing also is protected from air, water and insects. Betty JamiesonDunne, director of marketing for ITW Space Bag, says that after Hurricane Katrina devastated the Gulf Coast in 2005, the company received photos from people who reported that the only household belongings they had left were the ones stored in Space Bag. The bags now come in about 20 different sizes, styles and variations, including hanging and travel versions. More than 250 million individual items have been sold in 60 countries since the company’s founding as a DR enterprise in 1993. Space Bag now generates more than $200MM annually in worldwide consumer sales, Jamieson-Dunne says. More than 80 percent of sales come from retail outlets. Bed Bath & Beyond, The Container Store and QVC’s online store have carried Space Bag since the 1990s. Walmart picked them up in 2002,

followed closely by Target. Today, they also can be found at Walgreens, Costco, Kohl’s and elsewhere. But about 14 percent of total consumer sales still come from DRTV, JamiesonDunne says. And though the television campaign no longer turns a profit in pure DR terms, the Media Efficiency Ratio (MER) remains good enough that the campaign practically pays for itself. Or, at least, sales generated directly by the commercials recover most of the advertising expense, she says. She won’t disclose the average MER achieved. Suffice to say, however, that enough offsetting money comes in to the call center and the website to enable Space Bag to spend $6 million to $7 million a year on short-form DRTV commercials. That is far more than the company could afford to spend on straight brand advertising, JamiesonDunne says. And, of course, the DRTV ads work just like brand advertising to build awareness that spur sales in the retail stores. After all, as Lazkani puts it, “Awareness is awareness. People see the demonstrations [in the DRTV spots], then go to a store and say, “Hey, there’s Space Bag.’”

A Better Mousetrap
In 1993, a pair of California entrepreneurs named Jerry Sweeney and John Johns founded a company called New West Products Inc. to market their new line of space-saving, vacuum-sealable bags for clothing. Nothing like Space

electronicRETAILER | October 2011

Electronic Retailer - October 2011

Table of Contents for the Digital Edition of Electronic Retailer - October 2011