A. Eicoff & Co.

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Founded by Alvin Eicoff, 1965; purchased by Ogilvy & Mather, 1982; continues to operate under its original name as a unit of WPP Group's OgilvyOne.

Alvin Eicoff launched A. Eicoff & Co. in 1965 in Chicago. It soon became recognized as one of the most successful TV direct-response advertising agencies. Although its ads were sometimes criticized for being tacky or cheap, few criticized the agency's results. By 1973, it was billing $30 million.

Eicoff developed a number of novel practices and major innovations in direct-response TV advertising, all designed to generate sales. At the time, most of these new ideas and methods were regarded as misguided at best; however, many later achieved widespread acceptance and became standard industry practices.

The TV pitchman

During the late 1940s and 1950s, Mr. Eicoff formulated the idea of using a pitchman to sell ads on TV much like a traveling medicine show or carnival barker. The agency used pitchmen to sell a number of products, including knife sharpeners, weed killers, fishing kits and food slicers.

The commercial lasted the length of the pitch, with added time for a tag. For example, if the pitch took 12 minutes, then the commercial was 15 minutes with a three-minute tag.

The TV pitchman started dying out in the early 1960s, when the Federal Communications Commission mandated a two-minute maximum commercial break. Eicoff, among others, later resurrected the pitchman in the infomercials of the late 1980s and 1990s.

The agency developed a consumer-oriented sales presentation that outlined the stages of a commercial, summarized by the acronym TPS: "tease 'em, please 'em and seize 'em." The idea was to tease the TV audience by showing a problem that generated a high level of concern; please the viewers by solving the problem with a unique product that consumers could not find elsewhere; and seize them with a sales offer that was too good to refuse and compelled the customer to buy on the spot.

Eicoff's commercials for M.B. Walton Inc.'s Roll-O-Matic mop exemplified the TPS approach. The commercial started the tease by showing the problem: a housewife laboring to mop a kitchen floor. The voice-over lamented, "One of the most tiring back-breaking household chores is scrubbing and waxing floors . . . the constant bending, stooping and straining to wring out your mop." The Roll-O-Matic offered a solution that pleased: "The no-stoop, no bend, self-wringing mop." The finale was an offer too good to pass up: "Buy it for only $9.95, try it for 30 days, stock is limited so call today, satisfaction guaranteed or your money back."

The key-outlet marketing concept, another tactic pioneered by Eicoff, offered a parallel advertising-distribution method of selling. The advertised product was sold to a selected chain, such as Atlantic & Pacific Tea Co., Woolworth Corp. or Walgreen Co., where the point-of-purchase display emphasized in big bold letters: "As advertised on TV." Sales were tracked and ad budgets adjusted based on market-by-market profitability.

The magic-number concept, another Eicoff innovation, referred to the maximum advertising expenditure allowable per sale of a product to generate a given level of profit. The theory was that if advertising expenses approximated the predetermined number, everything worked "like magic." Grant Co.'s Hair Wiz, for example, a product that cut hair to "save a trip to the barber," was priced at $2.98 and sold in key market outlets in 1966. The retailer received a 30% trade margin, leaving about $2.10. Then the costs, totaling $1, were deducted: production, 35¢ per unit; overhead and administration expense, 15¢; miscellaneous costs, 10¢; and targeted profit, 40¢. Once the costs were subtracted from $2.10, a magic number of $1.10 remained, which was the amount allowed for advertising to generate the desired profit per unit of 40¢. If 1,000 units were sold in each of 50 markets a week, total profits would exceed $1 million a year.

Sales-resistance theory

Eicoff's sales-resistance theory was based on research showing that there were times of the day and days of the week when consumers were more resistant to buying in response to advertising. Contrary to accepted direct TV advertising practices, the agency found that the more popular the show, the greater the sales resistance to the commercial—viewers did not want to be interrupted with a commercial break in the middle of their favorite TV shows.

Mr. Eicoff was convinced that sales resistance would be highest during prime time and lowest during late night. Moreover, since people were most mentally alert during the middle of the work week, sales resistance would be highest during this time. Alternatively, sales resistance would taper off toward the weekend. Thus, direct-marketing commercials aired late at night and near the weekend would encounter the least sales resistance because viewers were the most relaxed and had the fewest distractions. In addition, late night was also the least expensive time to buy commercial spots.

Eicoff also developed a corollary to the sales resistance theory, which the agency termed the "isolation factor." Simply put, isolating a commercial served to avoid the clutter created by several competitors sharing the two-minute commercial break. The agency thought this approach would also avoid confusing or irritating the viewer with multiple sales messages; it therefore positioned its ads as "the only salesman in the viewer's living room" during a commercial break.

Based on company research, Eicoff compiled a product marketing index, or PMI. The PMI provided an index number that compared TV markets based on the number of units of product sold by a given number of advertising dollars. The PMI considered such factors as number of TV stations, advertising rates, product prices, a variety of demographic indices, and seasonal or geographic influences to provide a rating of markets. The idea was that a given amount of advertising would sell 20 more units of product in a market having an index number of 120, with a base of 100, but 10 fewer units in a 90-indexed market.

Using the PMI, the value of various TV markets was rated not merely on viewer exposure or recall, which were the standard measures of advertising effectiveness, but on actual consumer sales.

Mr. Eicoff gave up managing daily operations as president of the agency to become chairman in 1981, then chairman emeritus the following year. In 1997, in recognition of his many contributions to the industry, he was elected to the Direct Marketing Hall of Fame. Ron Bliwas, who joined the agency as VP-new business in 1970, was promoted to to president-CEO in 1981, a position he held at the turn of the century.

The agency was purchased by Ogilvy & Mather in 1982 but continued to operate under its original name. At the close of the 20th century, under the umbrella of the WPP Group, it was one of Ogilvy's most profitable divisions. In 2001, Eicoff had $155.9 million in billings.

Mr. Eicoff died in March 2002 at the age of 80 from congestive heart failure.

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