Entrepreneur:

If you’ve ever watched cable television late at night or early in the morning, you’ve seen these “ads.” Favorites seem to be weight loss programs, exercise equipment, secret health cures and wealth-generating systems. However, I’ve seen everything from knife sets and car-cleaning cloths to tools.

Here are five steps to help you avoid a costly mistake when considering direct response advertising:

1. Ask who pays for the television production, you or the company. Note how difficult it is for you to get clear information about the company’s terms. If you hang up and realize you don’t really know what you’ll be paying, that’s a red flag.

2. Insist on two inventor references: one that was successful and one that was not. Then speak with the references yourself.

3. Examine any contract very carefully and be leery of exclusivity clauses, especially when you are footing the production bill.

4. Ask if the organization is a member of the Electronic Retailing Association. You can look the company up online too.

5. Contact ERA to confirm the company’s membership and ask if there have been any complaints. And if you’ve had a negative experience, report your complaint to Katy White at the ERA at (703) 841-1751.

Photo by Photofunia.

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