Demtel

Last updated

Demtel International
IndustryMarketing and Distribution
Founded1985
Founder
  • David Hammer
  • Warwick Doughty
DefunctMay 11, 2001 (2001-05-11) [1]
FateDissolved
Headquarters
Sydney
,
Australia
Key people
ProductsConsumer goods
Parent International Media Management Holdings Ltd.

Demtel International (commonly shortened to Demtel) was an Australian home shopping and marketing company best known for television informercials during the 1990s. The name Demtel was a portmanteau of "demonstration television". [2] As well as launching the media career of presenter Tim Shaw, Demtel's ubiquitous presence on commercial television during its peak saw the name as well as various marketing tactics and slogans used by the company being adopted as tropes in Australian vernacular.

Contents

History

Demtel International was first registered as an Australian company in 1985, [3] founded by Warwick Doughty and David Hammer, who had formerly worked with the local subsidiary of international marketing company K-tel. [4] During the early 1980s, the Demtel name had been used to market a catalogue of compilation albums, working with artists including Gene Pierson and minor record companies. Pierson was encouraged by David Hammer to come up with "something really crazy", resulting in the 1983 album Beatle Barkers . On the back of Demtel's television marketing campaign the novelty album, consisting of tracks by The Beatles performed by an ensemble of dogs, sold 860,000 copies. [5]

In 1988, the Department of Business and Consumer Affairs took Demtel International to court over misleading advertisements that misrepresented plastic costume jewellery as genuine, valuable items. The company, which sold more than 70,000 units of the stock was fined $12,000. [6] Despite this, the company recorded sales of $6.9 million in 1989–90, a figure which grew to $19.6 million in 1992-93 even as the nation endured an economic recession. [4]

Between 1992 and 1995, Tim Shaw presented Demtel's infomercials, which received as much as 23 minutes of air-time per day. [2] Demtel had seen the success of Ron Popeil's infomercials in the United States that used phrases like "But wait, there's more!" to great effect. In Shaw, they had an Australian to become the face of the company and deliver the same lines. This proved to be highly effective, driving sales of over 1,000,000 steak knives and 600,000 compact discs during his time with the company, while Shaw himself gained national fame and recognition as "the Demtel man". [2] In 1994 it was reported the company spent around $10 million per year on TV advertising. [4]

In July 1993, Demtel was sold by Hammer and Doughty to International Media Management (IMM), an ASX listed company with intentions of developing it into a stand-alone cable TV home shopping network. [7] Within a year of sale, reports emerged of late payments to creditors by Demtel and legal disputes with the previous owners, causing IMM's share price to plummet. [7] Amid ongoing legal disputes between IMM and the former owners relating to royalties and commissions, [4] Shaw parted ways with Demtel in 1995. He was replaced by veteran talk-show host Don Lane. [8] Shaw revealed in 2019 that despite the company's success during his time as their spokesman, he received only $200 from Demtel for each informercial he appeared in. [2]

In November 1995, IMM launched The Value Channel on the Galaxy subscription television service, with Lane signed to host some of the programming. [9] With IMM now focussing on this venture, Demtel's popularity waned in the late 1990s, competing with the rise of online services and emergence of dedicated home shopping networks. The company was wound down and liquidated in 2001. [1]

An investigation by the Australian Federal Police into IMM's Chief Executive Officer Michael Milne would result in his conviction for tax fraud and money laundering in 2008. These charges related to a 13-year period, including falsifying his personal tax returns while in charge of Demtel. [10] In November 2010, he was sentenced to four years and nine months in prison. [11]

Products and marketing

Demtel's business model involved purchasing bulk quantities of products, which it marketed by a telephone-order home shopping service, directly handling distribution from a central warehouse via regular post. [4] Products were sold with a "no questions asked, money back guarantee", and were often bundled to create extra value and urgency. A common offer involved the inclusion of six free steak knives if the customer called within 15 minutes of the infomercial airing on television. [2]

Products marketed by Demtel included kitchen knives, compact disc collections, pocket cameras, run-free pantyhose and other kitchen utensils. The infomercials themselves were usually between one and two minutes and included demonstrations of the product. [2] Demtel's model was effective at creating consumer demand, but this left it vulnerable to competition from discount retailers who could stock the same products. This allowed discount retailers to quickly respond by undercutting Demtel's prices in store and making products immediately available to customers. [4]

Cultural impact

Politics

Use of "Demtel", often in a disparaging way became a popular trope in Australian politics. Usually, this is a reference to empty spin or election sweeteners. Demtel references occur in political commentary and analysis [12] as well as in parliament itself, with many examples including:

Sports

In Australian rules football, the term "steak knives" is sometimes used to describe a deal sweetener, particularly in relation to player drafts. [17] This is a direct reference to Demtel's promotional offer of free steak knives to incentivise a deal. [18] A player may be referred to as a "steak knife" if they are included as part of a trade between players of higher value, such as in the case of Collingwood's Jack Crisp. [19] [20]

See also

Related Research Articles

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References

  1. 1 2 "Notice of resolution Demtel International Pty Limited (In Liquidation)". Commonwealth of Australia Gazette . 29 May 2001. p. 1131. Retrieved 10 May 2024– via National Library of Australia.
  2. 1 2 3 4 5 6 Dennehy, Luke (8 May 2019). "Demtel salesman Tim Shaw talks his favourite infomercial and his run-in with Scott Morrison". news.com.au. Retrieved 10 May 2024.
  3. ↑ "Demtel International Pty Ltd ACN 002 986 165". Connectonline. Australian Securities and Investments Commission . Retrieved 10 May 2024.
  4. 1 2 3 4 5 6 Shoebridge, Neil (7 November 1994). "As seen on the small screen, in a store near you" . Australian Financial Review . Retrieved 10 May 2024.
  5. ↑ Baker Fish, Bob (29 April 2014). "Beatle Barkers: 'Dogs don't tend to hold the note when they howl'. Interview by Bob Baker Fish". Cyclic Defrost . Retrieved 10 May 2024.
  6. ↑ Chesterfield Evans, Jan (23 June 1988). "Demtel fined $12,000 for false advertising" . Australian Financial Review . Retrieved 10 May 2024.
  7. 1 2 Syvret, Paul (15 September 1994). "But wait, there's more - bad blood" . Australian Financial Review . Retrieved 10 May 2024.
  8. ↑ Taylor, Matt (1 September 1995). "But wait, there's more to Don Lane". Canberra Times . Canberra, ACT. p. 26. Retrieved 10 May 2024– via National Library of Australia.
  9. ↑ Lamberton, Hugh (29 August 1995). "Australians prefer electronic media to print: ABA survey". Canberra Times . Canberra, ACT. p. 3. Retrieved 10 May 2024– via National Library of Australia.
  10. ↑ Moran, Susannah (3 March 2012). "Michael Milne on $30million charge in Wickenby tax inquiry". news.com.au. Retrieved 10 May 2024.
  11. ↑ "Demtel man Michael Milne gets no relief". The Daily Telegraph . 1 March 2008. Retrieved 10 May 2024.
  12. ↑ "Revenge of the Shoppers". New Matilda. 6 December 2006. Retrieved 11 May 2024.
  13. ↑ Binnie, Kerrin (18 August 2010). "Bligh blasts LNP over 'Demtel' website". ABC News . Retrieved 10 May 2024.
  14. ↑ Pryor, Geoff (Creator) (23 December 1995). The Demtel man (none). National Library of Australia. Retrieved 10 May 2024.
  15. ↑ Joe Ludwig, Senator for Queensland (12 October 2006). Parliamentary Debates (Hansard) . Commonwealth of Australia: Senate. p. 11.
  16. ↑ Hanson, Pauline (9 March 1998). "Speech by Pauline Hanson MP to the Australian Parliament - Grievances debate". Pauline Hanson's One Nation . Retrieved 10 May 2024.
  17. ↑ Bowen, Nick (1 December 2013). "Goldstein shoots down top-four dreaming". AFL.com.au. Retrieved 11 May 2024.
  18. ↑ Shortis, Stephen (3 June 2021). "AFL top 100: The best set of steak knives ever". theroar.com.au. Retrieved 11 May 2024.
  19. ↑ Gabelich, Josh (14 July 2018). "Collingwood's Jack Crisp is the trade steak knife that has become a genuine gun". Fox Footy . Retrieved 11 May 2024.
  20. ↑ Gabelich, Josh (27 December 2018). "Why new Melbourne recruit Kade Kolodjashnij is far from a set of steak knives". Fox Footy . Retrieved 11 May 2024.
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