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Which Factors Primarily Influence the Number of Infomercial Hours
A Commercial Television Station Airs?
By:
Jan LeBlanc Wicks
Department of Journalism
116 Kimpel Hall
University of Arkansas
Fayetteville, AR 72701
501-575-6304
[log in to unmask]
OR
1314 Hillcrest Avenue
Fayetteville, AR 72703
501-521-2319
Which Factors Primarily Influence the Number of Infomercial Hours
A Commercial Television Station Airs?
75-word Abstract
The goal of this article is to determine which factors primarily
influence the number of infomercial hours a television station airs.
Results suggest that network affiliation, the number of viewer
complaints, the number of fringe infomercials (e.g., selling baldness
cures) aired, market size, audience size and restricting infomercials
to
certain dayparts are primary influences. Findings suggest that
managers
at Fox and non-network affiliated stations could face negative
consequences for airing more infomercials.
Which Factors Primarily Influence the Number of Infomercial Hours
A Commercial Television Station Airs?
150-word Abstract
The goal of this article is to determine which factors primarily
influence the number of infomercial hours a television station airs.
Recent Federal Trade Commission actions against some infomercial
advertisers suggest that airing certain "fringe" infomercials can result
in viewer economic injury. Stations airing more infomercials might
inadvertently be more likely to expose their viewers to economic
injury.
Results suggest that as the number of infomercials aired increases, the
number of viewer complaints increases, the number of fringe
infomercials
banned decreases, the station is less likely to restrict
infomercials to
certain dayparts, market size increases, station audience size
decreases
and the station is more likely to be a Fox or independent station.
So,
managers at Fox and non-network affiliated stations could face
increasing viewer dissatisfaction and other negative consequences for
airing more infomercials than network affiliates.
Which Factors Primarily Influence the Number of Infomercial Hours
A Commercial Television Station Airs?
Introduction
Television stations nationwide have begun airing infomercials since the
Federal Communications Commission (FCC) lifted its ban on
program-length
commercials (Revision, 1984) and relaxed its deceptive advertising
guidelines for clearing (or deciding whether to accept) ads for
broadcast (Elimination, 1985). The goal of this article is to determine
which factors primarily influence the number of infomercial hours a
television station airs. (Infomercials are defined as paid
program-length advertisements selling various products and services,
excluding political, children's and bartered programs.)
Since the FCC lifted its infomercial ban, the Federal Trade Commission
(FTC) has alleged that deceptive claims were made in infomercials
selling "fringe" products like baldness cures. Airing these fringe
infomercials can result in viewer economic injury. For example, the
FTC
required one infomercial advertiser to pay $1.5 million in consumer
redress (Twin Star, 1990). So, stations airing more infomercials may
be
more likely to expose their viewers to economic injury (Wicks,
1991a).
Previous research suggests that stations affiliated with ABC, CBS and
NBC were less likely to air infomercials and more likely to ban
fringe
advertisements (Wicks, 1991a). Yet no study has jointly examined
these
and other factors suggested by the literature to influence the
number of
infomercial hours a station accepts. So a national mail survey was
conducted to discover the variables associated with the number of
infomercials aired. Results may reveal which types of stations seem
more likely to expose consumers to economic injury. Managers can
compare their stations' infomercial clearance practices to results to
decide whether changes are needed in the number or type of
infomercials
they accept for broadcast.
Review of the Literature
When the FCC lifted its infomercial ban, it noted that market forces
and the individual judgment of managers would prevent the broadcast
of
too many commercials (Revision, 1984). A literature review and
confidential, in-depth personal and telephone interviews with a total of
six general, sales and program managers at VHF and UHF, affiliated
and
independent stations were conducted to examine these and other
factors
which may influence the number of infomercials a station accepts.
The managers who were interviewed said that they felt obligated to air
infomercials if competing stations in the market did, supporting the
FCC's assertion that market forces play a role in infomercial
acceptance. This behavior mirrors economic theory predictions of
competitive behavior in a concentrated market. Many local TV markets
are oligopolies -- a concentrated market structure having a few
competitors who recognize their interdependence and consider each
others' reactions when making product decisions (Scherer, 1970). Yet as
cable penetration increases, and markets become more competitive,
stations appear to air more infomercials (Wicks, 1991b). So, stations
in more competitive markets may air more infomercials.
Market size may also influence the number of infomercials a station
accepts. More commercial time is sold to national or regional spot
advertisers by stations in larger markets (e.g., top 20; Wicks, 1991a,
1991b). As a result, larger market stations probably air more
infomercials.
The personal interviews suggest how the individual judgment of managers
affects the number and type of infomercials aired. Personal ethical
beliefs and the desire to protect station image in order to avoid
viewer
complaints affect infomercial clearance. Station image was
generally
protected by avoiding the preemption of regular programming and
screening infomercials to ensure that the products or services
advertised appeared useful. And managers want to avoid airing
infomercials with misleading claims or selling items that "look like a
rip-off."
Personal ethical beliefs also prevented the interviewees from accepting
certain fringe infomercials. Plus, historical and contemporary
government actions temper ethical judgments because the FCC linked
airing infomercials to a licensee's obligation to serve the public
interest, convenience and necessity as early as 1946 (Public Service,
1946).
This link was strengthened in 1973 when the FCC banned infomercials
(Program-Length, 1973). Broadcasters had aired infomercials allegedly
misrepresenting the ease of raising chinchillas in the home for
profit.
The FCC instuted overcommercialization actions (for example, see Mid
New
York 1973; Rush Broadcasting 1973) and the FTC pursued actions
alleging
deception (for example, see Ken-Chilla 1970; Silver Pride 1970) in
response to the chinchilla infomercials. At the time, the FCC said
airing infomercials was tantamount to subordinating programming in the
public interest to programming in the interest of salability
(Program-Length, 1973). Since the ban was lifted, the FTC has charged
some infomercial advertisers with making deceptive claims for
"fringe pr
oducts like baldness cures, miracle weight loss products,
get-rich-quick
schemes, and the like" (Consumer Protection 1990, p. 93; Nu-Day
1991;
Synchronal 1991; Twin Star 1990; Phillips, W., 1990; Thompson, W.,
1990;
FTC v. California Pacific 1989; J S & A 1989; Pantron I, 1988).
The FCC also relied upon the First Amendment when it deregulated
commercialization practices and lifted the infomercial ban. The FCC
wanted to avoid regulating program content and give local stations
the
flexibility to experiment with commercial time units like
infomercials
(Revision, 1984). Managerial concerns about former FCC displeasure
with
airing infomercials may be eased by more recent FCC concern with
protecting broadcasters' First Amendment rights.
Organizational policies influence a manager's ethical decision making
as well (Trevino, 1986). Written guidelines (e.g., banning the
acceptance of fringe infomercials or restricting infomercials to certain
dayparts) influence infomercial acceptance (Hunt, Wood & Chonko,
1989).
Parsons and Rotfeld (1990), Rotfeld, Abernethy and Parsons (1990)
and
Wicks (1991a) report that TV stations having written clearance
policies
are more likely to reject advertisements, including infomercials
(Wicks,
1994), than stations without written standards. However, having a
written code was not a significant factor in rejecting ads by radio
stations (Abernethy, 1993). Some interviewees noted that their
stations
restricted infomercials to certain dayparts rather than ban them.
Affiliation status or categorizing stations by network affiliation
(Owen & Wildman, 1992) is another organizational factor which may
affect
the number of infomercials accepted. Network affiliates (stations
affiliated with ABC, CBS or NBC, which usually broadcast on the VHF band
and historically attracted larger audiences locally and earned
higher
revenues) appear more likely to ban infomercials and air fewer of
them
(Wicks, 1991a, 1991b) than independents (stations unaffiliated or
affiliated with Fox which usually broadcast on the UHF band, excluding
satellite stations and stations airing only religious or home
shopping
programming. Fox affiliates are grouped with independents because
they
do not carry network programming during all late night, overnight
and
weekend dayparts when infomercials often air.).
One of the managers interviewed said it was easier for independent, UHF
stations to "get away with" airing infomercials because independents
serve smaller audiences and fill more airtime. Affiliates have less
airtime to fill because they carry network programming much of the
broadcast day. Affiliates appear more likely to have written clearance
standards and to ban advertisements for fringe products (Wicks,
1991a).
Abernethy (1993) notes that radio stations "with more conomic power
may
be more willing to use that power to protect their audience by
rejecting
more false or tasteless advertising" (p. 24). Thus, the local
network
affiliates may air fewer, and fewer fringe, infomercials, perhaps
restricting them to certain dayparts, to avoid complaints from their
larger audiences. The local Fox and independent stations may air more
infomercials because they have more airtime to fill and fewer
viewers to
offend.
Research Question
In summary, the literature review suggests that market factors
influencing the number of infomercials a station airs are market
concentration, cable penetration and market size. The factors
comprising a managers's judgment are whether accepting an infomerical:
violates a manager's personal ethical values; is likely to generate
viewer complaints; serves the public interest; and is consistent with
the First Amendment guarantee of free speech. Organizational factors
affecting the number of infomercials accepted include the need to
fill
unsold airtime, affiliation status, written infomercial guidelines,
restricting infomercials to certain dayparts, the number of fringe
infomercial types banned and audience size.
While past research has examined the effect of some of these variables
on the number of infomercials accepted (Parsons and Rotfeld, 1990;
Wicks, 1991b), no study has examine all of these variables in tandem.
Nor have predictions about which factors primarily influence the
number
of infomercials accepted been made in past research. Therefore, the
study question is posed as a research question.
Research Question # 1:
Which factors are primary influences on the number of infomercials
a station accepts?
Methods
A mail survey was chosen because questions about the number of
infomercials a station airs might be considered sensitive. The FCC once
banned infomercials and had commercial time restrictions. Mail
responses provide anonymity and encourage candid responses (Babbie,
1983). All commercial television stations listed in the 1991
Broadcasting/Cablecasting Yearbook (excluding religious, home shopping
and satellite stations which simply carry the signal of another
station)
were included in the sample so results would be generalizable to
stations nationwide. Sales managers were surveyed because they oversee
the sales and traffic departments, which are responsible for ad
content
and selling and scheduling ads (Wicks, 1991a, 1991b).
Three pretests were conducted to ensure that the questionnaire
appropriately measured constructs of interest, was easily and correctly
understood, and was easy to complete in less than 10 minutes. Two
follow-up mailings were conducted to minimize non-response (Dillman,
1978). Regression analysis was used to examine the research question
so
the effect of each independent variable (IV) could be assessed on an
all-other-things-being-equal basis. Plus, both continuous and
categorical variables can be used in regression. The IV correlations
were examined and the IVs were regressed on each other to test for
multicollinearity.
No problematic relationships were found (Pedhazur, 1982; Tabachnik &
Fidell, 1983).
The factors regarding a manager's ethical values and public interest
considerations were measured as follows. Respondents were asked to
indicate whether they had personally thought about whether an
infomercial "Violates my personal ethical values" and "Serves the public
interest, convenience and necessity" when deciding whether to refuse
an
infomercial for broadcast. Respondents were asked whether the
"First
Amendment guarantee of free speech," and to "Fill unsold airtime"
were
reasons why their station accepted infomercials. Responses to these
items were coded categorically (e.g., Fill unsold airtime is/is not a
reason why my station accepts infomercials).
Finally, other factors identified as possible influences on the number
of infomercials a station accepts were: affiliation status (network
affiliated ABC, NBC or CBS stations vs. independent and Fox stations);
whether infomercials were restricted to certain dayparts; and
whether
the station had written infomercial guidelines. Responses to all of
these items were coded as categorical variables (e.g., the station
does/does not have written infomercial guidelines).
Respondents were also asked what the average number of viewers who
complained about infomercials per month was. Results were entered as a
continuous variable in the regression. The literature review
suggested
that the more fringe infomercials a station aired, the more likely
it
was to air more infomercials (Wicks, 1991a). So a list of the
products
and services sold in infomercials, as well as common types of fringe
infomercials, was generated by interviewing the managers, watching
infomercials and reviewing television listings and Federal Trade
Commission documents. The fringe infomercial categories were: hair
restoratives, bee pollen products (e.g., for alleviating allergies and
impotence), sunglasses, weight loss products, anti-aging
preparations,
government grants for starting small businesses, increasing personal
wealth, financial/investment plans, success in life goals, health
products, credit problems/improve credit rating and disinfectants.
These categories were included in a list with others often sold in
infomercials to disguise question intent. Respondents were asked to
report the total number of types of infomercials which were banned by
their stations. An open-ended option was provided to discover any
other
banned types omitted from the list. The total number of fringe
types
banned was generated and included as a continuous variable.
The Herfindahl-Hirschman Index was used as the measure of market
concentration or competition because it increases as the number of firms
decreases and inequality among firms rises (Scherer, 1970; Litman,
1985). It was calculated by summing the squared shares for the 6 a.m.
to 2 a.m. time period, Monday through Sunday, of local commercial
television stations in each market or Area of Dominant Influence (ADI)
(Arbitron, 1990). Cable penetration, defined as the percent of
television households in an ADI which subscribe to a cable system, was
included. Market size was represented by the number of TV
households in
the station's ADI (Arbitron, 1990; Bates 1988). All were entered as
continuous variables.
Audience and market size were measured using net weekly circulation and
the number of television households in a market. Net weekly
circulation
is an estimate of a station's audience size or the number of
unduplicated television households that watched a station for at least
five minutes at least once during the test week
((Broadcasting/Cablecasting Yearbook, 1991). It measures the reach
of a
television station and reflects intra- as well as inter-market
viewers
(Litman, 1980). Market size is the total number of households in a
station's ADI (Arbitron, 1990; Bates 1988). Both variables were
entered
in the regression as continuous
The dependent variable was measured by asking respondents to report the
average number of infomercial hours their station aired per week.
Responses were entered as a continuous variable in the regressions.
Results
The mail survey had a response rate of 57.1 percent (491 of 859
stations surveyed). Respondents comprise 43.4 percent of the commercial
TV stations in this country (491 of 1131; Broadcasting & Cable
Marketplace, 1992). Ninety-five percent of respondents report that they
accept infomercials for broadcast (468 of 491 respondents = 95.3%).
The
average number of infomercial hours all respondents report airing
weekly
is 3.7, with network affiliates airing 2.5 hours and Fox and
independent stations airing 5.6 (t=-7.43, df=442, sig=.000).
Respondents seemed to be reasonably representative of the survey
population. For example, 60.9 percent of respondents accepting
infomercials were network affiliates (285 of 468), while 38.2 percent of
respondents were independents (179). This figure is similar to
actual
proportions, as network affiliates represent 62.1 percent of the
commercial television stations in this country (702 of 1131) and
independents 37.9 percent (429).
The majority of respondents report accepting infomercials because they
are a source of additional revenue for the station (455 of 468 =
97.2%).
The original intent was to include this additional revenue item in the
regression, but it was dropped because virtually all respondents
selected it, revealing no variability. So the uniformity of responses
would threaten the singularity of the regression matrix. Evidently,
all
types of stations appreciate the extra revenue airing infomercials
generates.
Research Question #1 asked which factors are primary influences on the
number of infomercials a station accepts. The regression equation
was
significant (see Table 1) and suggests that network affiliation, the
number of viewer complaints, the number of fringe infomercial types
banned, restricting infomercials to certain dayparts, audience size and
market size are of primary importance.
Discussion
Most stations accept infomercials because they are a source of
additional revenue. Regression results suggest that as the number of
infomercials aired increases, a station is more likely to be a Fox or
independent station, the number of viewer complaints increases, the
number of fringe infomercials banned decreases, the station is less
likely to restrict infomercials to certain dayparts, market size
increases and station audience size decreases. It appears that managers
at independent stations must accept more types of infomercials for
the
additional revenue generated. Apparently, these managers must risk
the
increased viewer complaints and potential viewer economic injury
that
accompany airing more infomercials, especially fringe infomercials.
Managers should consider what the long term effect of airing more, and
fringe, infomercials on the image of independent stations will be.
As
the number of cable channels increases, viewers are likely to turn
to
other programming choices. Viewers may think to themselves, "Why
watch
a thirty-minute commercial when I have lots of other choices? This
station only wants to make money; it isn't concerned with what I want
to
watch. Nor is it concerned with protecting me from rip-offs." So
airing more, and more fringe, could lead to a significant loss of
viewers and station revenue for Fox and independent stations. Future
research might test this assertion.
Conclusion
Study results suggested that Fox and independent stations with smaller
audiences must risk viewer discontent and air more, and possibly
more
fringe, infomercials. While airing more infomercials in and of
itself
may not be a serious problem now, it may become one in the future.
The
increasingly competitive information market may provide too many
alternatives for disgruntled viewers. Hopefully, managers at
independent stations can find ways to generate the extra revenue needed
without incurring the wrath of viewers. References
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Table 1
Regressions (standardized beta coefficients)
DEPENDENT VARIABLE
Average Number of Weekly Infomercial Hours
INDEPENDENT
VARIABLES
Violates ethical values .047
Serve public interest -.070
First amendment -.069
Fill unsold airtime .011
Network affiliation -.208***
Restricted to certain
dayparts -.105*
Written guidelines .085
Average number of
viewer complaints .219
Number of fringe
infomercial types banned -.106*
Market concentration or
HHI .002
Cable penetration .034
Audience size-NWC -.113*
Market size-TVHH .271***
ADJUSTED R SQ. .210***
Note: *p<.05, **p<.01, ***p<.001
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