INFOMERCIAL AUDIENCE CROSSES OVER CULTURES;POWERFUL MARKETING TOOL IS GROWING UNENCUMBERED BY GEOGRAPHIC BORDERS

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Looks like the U.S.-based National Media Corp. ought to change its name to International Media Corp.

The infomercial marketer is now selling products and media space in more than 215 million TV homes in the world.

"We're realizing very significant opportunities in the global marketplace," said Mark Hershorn, president and CEO of National Media Corp., Philadelphia. With a potential of 800 million TV homes in the world, National Media has set its sights on penetrating 300 million of them by yearend, and reaching 500 million within the next three years.

"Our goal isn't to be an infomercial company, but a global marketer that goes direct to the consumer through the TV," Mr. Hershorn said.

DEALMAKING

Reaching those consumers calls for a lot of dealmaking-which is exactly what National Media has been doing for the past year. Combined with its wholly owned subsidiary, Quantum International, National Media has formed alliances in New Zealand, the Middle East, South America, Europe and Japan. And the list goes on and on-reaching 56 countries and growing.

"Infomercials represent a powerful marketing vehicle that is not limited by geographic borders," Mr. Hershorn said. "U.S. manufacturers are in a fierce competition to create brands and infomercials that can create shelf space for products in consumers' homes on a global basis."

To do that, National Media is focusing on vertical integration-which translates not only into having a hand in the media ownership and distribution, but also in owning the creative programming.

Late last year National Media acquired Positive Response Television, Sherman Oaks, Calif., an infomercial production company, in a deal worth about $26 million. Earlier last summer National Media purchased another production company-Direct America, Oxnard, Calif.-and also formed an alliance with Inphomation Communications, Inc., Pikesville, Md., producers of some of the most successful infomercials ever filmed, including "Psychic Friends Network," "Helicopter Lures" and "Making Love Work."

"The next wave in TV selling is going to be international," said Don Davidson, senior-VP at Inphomation. "We believe in the next three to four years with Central and South America and Japan we can double our potential with international sales."

MOVING IN ON JAPAN

In less than one year, 11 Japanese TV stations have agreed to air infomercials to an audience reaching approximately 26 million homes-more than half Japan's population. That penetration is largely due to an alliance formed between National Media, which dubs existing infomercials into Japanese, and Mitsui & Co., Japan's largest trading company, which has access to most of Japan's TV stations.

"The international market is similar to what the U.S. market was in the mid-1980s," said Greg Renker, president of Palm Desert, Calif.-based Guthy-Renker, a large infomercial marketer that places many infomercials in the international market through National Media. "New cable and distribution systems are exploding around the globe. And for some reason, U.S.-produced infomercials work in Japan at staggering levels."

A WAY TO BEAT COSTS

The kinds of products that sell on TV appeal to a mass market and fall into categories that many cultures need, like cosmetics, personal care, fitness and kitchen items.

"Anything that will make people look or feel better are usually sure hits," said Mr. Renker. "It's human nature."

But cross-cultural demand for tooth whiteners and ab flexers aren't the only reasons infomercial marketers are flocking to international markets. The rising costs of media time in the U.S. are pushing companies to tap into less developed and less expensive media networks.

"Agencies in the States have had mixed results with infomercials because the domestic industry is tough due to high media costs," said Kevin Harrington, president of HSN Direct, another global giant (and international arm of the Home Shopping Network); which currently airs infomercial programming in more than 40 countries.

"Right now the greatest potential for infomercial and direct marketers is international," said Tim Hawthorne, president and CEO of infomercial agency Hawthorne Communications, Fairfield, Iowa, which together with Tyee Productions, Portland, Ore., created the award-winning "Martinettis Bring Home a Computer" spot for Apple Computer.

"With domestic media prices on the rise, international markets will be a great opportunity because media isn't purchased with cash upfront; media outlets become partners with the infomercial marketers," he said.

However, Hawthorne Communications is betting that major corporate advertisers-who have the money to spend on expensive media time-will get into the domestic infomercial game. Today, close to 15% of infomercial media time is occupied by major corporations, said Mr. Hawthorne. By the year 2000, he believes 85% of that time will be spent by corporations.

Mr. Hershorn at National Media takes it a step further.

"Corporate advertising via corporate infomercials could be very powerful in the United States," he said.

"But we're focusing on building up our TV audience. Down the road, we'll be able to put a product simultaneously into the homes of 300 to 500 million people around the globe. Now that's powerful."

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1995'S TOP-GROSSING INFOMERCIALS

THE INFOMERCIAL MARKETING REPORT'S TOP-GROSSING INFOMERCIALS

BY TELEVISION SALES ONLY.

1. HealthRider-ExerHealth Corp.

2. Psychic Friends Network-Inphomation Communications, Inc.

3. Fast Track-American Harvest Corp.

4. Abflex-Kent/Spiegel, Inc.

5. Jake's Hip & Thigh Machine-Fingerhut/Guthy-Renker, Corp.

6. Murad Skin Care-Murad Corp.

7. Kenny Kingston's Psychic Line-Gold Coast Media

8. PowerRider-Guthy-Renker, Corp.

9. Victoria Jackson Cosmetics-American Telecast

10. E-Force-National Media Corp. (tie)

10. Durashine Car Polish-The Media Group (tie)

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