Two months after the crtc lifted the time constraints on infomercials, the much-anticipated demand for long-format commercial production has yet to swing into full motion.

Agencies and production companies alike were excited last November when the federal regulator allowed infomercials to be broadcast on private stations, day or night. But a lack of billing structure and a hesitation on the part of investors to commit to steep up-front costs have stunted the production of infomercials in a hurry-up-and-wait stage.

Agencies and production houses are unsure of how they’re to be paid for infomercial production, says Lisa Brown, a Toronto-based infomercial consultant and writer.

There is no educated guess on how much return can be expected from a front-end investment that runs between $250,000 to $450,000, says Brown. It’s possible to bill a flat fee, but since there’s no gauge to measure the success of a new medium, it’s difficult to know how much to charge or how to factor in the product value.

‘The markup isn’t the same on diapers as it is on cars. Agencies could make a portion of sales or residuals from the number of calls received plus base fee, but then again, how do you budget for a percentage of calls when no one knows how many calls you might receive.

‘There’s no mechanism or policy for infomercials. This thing is totally back-end driven and nobody knows how they’re going to get their share,’ says Brown.

Sarah Ker-Hornell, executive producer for L.T.B. Productions, says production companies are poised and ready for action, but are looking for some rules to follow. ‘If you don’t know how to bill it, you’re not going to jump,’ she says.

Structural problems will work themselves out with the first generation of risk-takers willing to put money up-front to test the viability of infomercials on the Canadian market, says Ker-Hornell.

Brown, former executive producer of The Know Show on the short-lived Consumer Savings Network, confirms that the interest is definitely out there. The majority of last year’s top 15 advertisers have expressed interest in the medium, but few have committed to taking the plunge, she says.

The writer of eight infomercials for Fortune 500 companies like General Motors, the Royal Bank, and Dupont, Brown says more than half her work comes through Toronto-based Production Partners. As one of a handful of experts on infomercial production, she is busy fielding questions from agencies and production companies who need answers for some curious clients.

At the production level, reaction to the relaxed rules on infomercials varies. Some, anticipating an increase in demand, are gathering information, like ltb for whom Brown is working as a consultant.

Other production houses are going to greater lengths to prepare, including Damast Gordon and Associates, which hired Jim Grosso in May as an in-house infomercial expert. Grosso, a producer on Dave Nichols’ groundbreaking President’s Choice infomercials, is overseeing infomercial production at dga.

dga just completed an infomercial for The Second Cup, which was in the works before the crtc November announcement. Susi Patterson, dga general manager and executive producer, says there’s not a huge demand for the long-format commercials yet.

‘It’s not full blown-out crazy. People are looking at their advertising dollars and trying to decide whether to spend.’

At the agency level, some are preparing for an infomercial boon while others don’t yet perceive a need for information on the subject. Brown is sitting on a new infomercial task force at an undisclosed agency, Young and Rubicam has formed an infomercial department, while several of the bigger agencies are reportedly looking into developing a more structured organization for infomercial productions, should demand for them increase.

On the other hand, agencies like Chiat/Day and Bates Canada are reporting no increase in interest in the infomercial market.

In the u.s., Chiat/Day is actively pursuing the infomercial market, but at the Toronto office, head of broadcast Bette Minott, hasn’t perceived a lot of interest in the subject and says she hasn’t been asked to research the medium.

Similarly, Mary Falbo, executive vice-president, director of media at Bates, hasn’t seen the need to explore the medium yet, although she expects more infomercials on the air in 1995, highlighting more mainstream products than knives and vegetable cutters.

‘But right now, nobody seems to be moving fast. There’s not been the rush by advertisers to do infomercials. There’s a typically Canadian wait-and-see attitude, but when one takes the risk and is successful, others will follow,’ she says.

Besides constructing a functional fee structure, Brown says another challenge the agencies face is finding talent skilled at writing a 30-minute commercial instead of a 30-second spot. Infomercials are a precarious mix of advertising and programming that challenge agency writers who don’t have a lot of experience writing in long format, she adds.

An investor willing to take a risk on a project would start the ball rolling. It’s difficult to find a company that wants to spend six figures on a project utilizing unproven media, says Brown. The fact that it’s a money-up-front proposition makes it that much more difficult. ‘It’s the investor that takes the risk, which is the agency on behalf of the client, but with the client’s money.’

While currently jammed in the planning stage, Canadian infomercials will see daylight, Brown predicts. It’s taking time to get the ball rolling, but Canadians reportedly spent over $100 million last year on products advertised on u.s.-based infomercials, says Brown, so the market is out there, and advertisers know it.