The development of transactional television By Earl D. Greenbur

One year ago, I organized a brainstorming session with my colleagues to create a name for our company and the word "transactional" was thrown into th

In less than a year from the rounding of Transactional Media incorporated, the word “transactional” has become frequently used to describe all sorts of programming previously called interactive. The primary difference between interactive and transactional has to do with cause and effect. Transactional programming ultimately results in sell through activity–a purchase or acquisition of property or information through an interactive process.
At the recent NATPE (National Association of Television Program Executives) Convention, there was a flurry of activity and discussion about the transactional environment. Joan Rivers, in association with QVC and Tribune, had a series test that was rumored to be in preparation for national sale. ABC’s late night test with TMI, “Nitecap”, had still not been resolved. Infomercial personality Mike Levey announced the development of a new daily talk show. Hearst Distribution announced its foray into the transactional arena. All American Distribution was selling a sports shopping program with Johnny Bench. Woody Fraser (creator of “Good Morning America”, “The Mike Douglas Show”, “The Home Show”) was rumored to be developing a new transactional vehicle for syndication. In addition to the many show concepts in play, there were principals from many of the major infomercial companies aggressively covering the convention floor, looking to understand the complex world of selling mainstream television.
What it all comes down to is that on the electronic media playing field, the contestants now include players from direct response, infomercials, catalogue sales, and home shopping. With ever-decreasing advertising revenue, and the increased fragmentation of viewing leading to lowered ratings, there is a scramble — a sometimes maddening scramble — for additional revenue streams. This helps to explain the almost nationwide proliferation of infomercials and direct response spots. It further explains why the traditionally conservative players at Cap Cities were willing to take a gamble on “Nitecap”.
The verdict is still out on “Nitecap”. Phil Beuth, President of Early Morning and Late Night Programming for ABC, still believes in the underlying principles of the program. There were very positive ratings stories to be told during the limited four-week run, but not enough to put the program in immediate play with Letterman and Leno. Seriously, though, there was measurable growth in many of the more than 50 test markets. From a sales standpoint, there was some initial disappointment. Our fantasy for strong, out of the box, self-liquidating sales and profits was not realized during the brief test; however, we received significant and meaningful information that helped us accomplish our larger goal of creating a new programming genre.
The weightiest lesson learned on this particular program was that at least three to six months are needed to properly prepare the product sourcing elements. Forget about jumping head first into this kind of format! “Nitecap” had at least one item for sale per night, sometimes two, and the sourcing company could not adequately keep up with the needs and the creative demands of the program. As a result, we created a separate sourcing consortjura which works to fulfill the needs of programs such as “Nitecap” and “The Mike Levey Show”.
Outside of the shopping television arena (i.e., QVC and HSN) product selling on formatted television is unique. Viewers watching entertainment programming need to be eased into transactional activity smoothly and carefully -utilizing entertainment programming techniques, not blatant direct response techniques — the smart sell as opposed to the hard sell. This is another lesson to be learned from the “Nitecap experiment”.
This all leads to an inevitable question: can entertainment and shopping programming be combined into a successful format for broadcast and cable television? The answer is a resounding yes! Already, “Live With Regis and Kathy Lee”, “Oprah”, “Larry King”, “The Tonight Show”, and “The Home Show” are all engaged in selling product in an indirect fashion. (Even “Saturday Night Live” has proven to be a potent vehicle for generating sales of record albums.) All of these are very strong programs for the marketing and selling of books, movie theater tickets, houseware and kitchen gadgets and other assorted products. 800 information lines on these programs amply demonstrate the programs’ selling power, thereby proving the effectiveness of combining entertainment and transactional programming.
Transactional programming has taken QVC and HSN to the next level. Programs with stronger production and entertainment values are the logical segues to attracting a larger, broader-based viewership. And as with the shopping experience, the infomercial has been taken to the next level, via a smooth combination of entertainment and selling programming. “The Ringers”, a new infomercial for Bell Atlantic Corporation created through Jordan, McGrath, Case & Taylor, is a half-hour commercial utilizing all the elements of a sitcorn. The program sold six or seven different services provided by Bell Atlantic, and ran successfully in test in Baltimore. There seems to be a real future for the corporate longform format. This bodes well for the advertising agency community — always in search of innovative marketing tools.
The 30-minute format could well prove to be the most articulate and cost-effective way for advertising agencies to communicate a client’s message. It is not by accident that several Madison Avenue firms already have infomercial consultants and reps on board. Saatchi and Saatchi has formed a joint venture arrangement to explore the application of infomercials to its client base.
The world of electronic retailing, which has been around since the inception of television, has grown by leaps and bounds since the advent of deregulation, which has allowed transactional TV to grow in a way no one expected. The growth in numbers of new programs (i.e. infomercials), however, has not been matched by creative growth. The next three years will probably witness a corresponding surge of creativity in program formats and execution that will reinforce the importance and staying power of transactional longform television for decades to come.
Broadcast and cable networks, QVC and HSN have all begun to carefully examine this new source of revenue and programming in a manner serious enough to justify more than a suspicion that transactional television is here to stay.
Copyright Adweek L.P. (1993)