(a) Are these “Only Available on TV” products so bad, they can’t sell them in stores where people can readily make returns? What gives? And (b), what’s the deal with infomercials? Can anyone be so dumb as to watch a product plugged for 30mins (and believe it)? Yet, they do all right, I guess, don’t they?
If you manufacture something in small quantities, it’s hard to get national retail chains to carry it. If people buy it from you from TV ads or over the internet, you don’t have to pay retailers their sizable cut. And if your product is of dodgy or fraudulent quality, customers demanding a refund have to jump through more hoops to get their money back through the mail than just returning it to the corner store.
Many shopping malls have an “As Seen on TV” store, where stuff primarily sold on TV is available.
I bet that they don’t depend on people actually watching an entire 30 minute infomercial - rather they’ve got 30 minutes during which anyone surfing through that channel may see something that catches their eye (“Wow, he’s got great abs. What is he doing to look like that?”), if only for a minute, and they’ve got their 1-800 number/website on constant display to take advantage of those drive-bys.
Marketing.
They are playing on the meme that if it’s on TV, it must be true, honest, good stuff, worth every penny, etc. Same applies to the web (“Hey, I saw it on the Internet. It must be true.” Just ask any Nigerian scammer.)
Also, a lot of products that start out as infomercial goods are eventually moved to shelf space at retailers, or other companies make similar products to sell. Some of the products are low quality, some are quite decent. Infomercials have a high advertising ROI; there’s nothing shady about breaking into the market through an efficient method.
It’s all about low cost + “shipping and handling” which is what brings them a huge profit margin. If they sell to a retailer at a "suggested price of $19.99 they will have to get it to the retailer’s distribution center for less than $10.00 so the retailer can turn around and make a profit by selling off their brick and mortar shelves at $19.99 or less.
If the scumbags that air the infomercials can sell it to you at $19.99 + $5.99 S&H (which actually costs about $2 or $3 dollars) they make a ton more money. Yes, there is the cost of the infomercials but, at volume, it is easy profit. They buy time at a discount that no reputable business wants. Produce the product for $2.00 and sell it on an infomercial for a $15+ profit or sell it to a retailer for $9.00 at a $7.00 profit. What would you do?
90% of the time, the stuff is just junk and doesn’t work the way they represent it.
TLC had a reality show, Pitchmen that took you into the world of infomercials. Inventors would demonstrate products to Billy Mays and Anthony Sullivan. They’d select the ones they thought could be marketed on tv and develop the commercial.
What I found interesting was the price. $19.95 is the magic price point for a 2 minute spot. Usually the inventor would say the item should sell for $50 or more. Anthony Sullivan always insisted on doing whatever was necessary to sell it for $19.95. They’d farm out the manufacture to Korea or China and use cheaper materials. If they couldn’t meet the $19.95 price point, it was a deal breaker.
That’s why so much of the tv products in those 2 min commercials are so cheaply made. Now, items in the 30 min or hour spots could sell for more. Like the Ronco Showtime Rotisserie and other items. Those are more expensive, but they’re still cheaply made.