'Tele-shopping' cable show takes viewers into local stores, offices.

A new twist on national home shopping networks and long-form infomercials is making inroads in Southern California.

In its version of infomercials -- which are commercials that run for a half-hour or more and are presented in non-traditional advertising formats -- Hermosa Beach-based HomeTown Shopping Show Inc. is carving a niche in the home-based "teleshopping" market by showcasing local products and services in a half-hour daily program that airs via leased-access time on six cable systems in the region.

The HomeTown Shopping Show, a privately held venture that rolled out 18 months ago, begins with the same premise as QVC and Home Shopping Network -- that consumers prefer to shop from their homes and will warm to the interactive direct response format of tele-shopping. Its novel approach adjusts the concept to make tele-shopping a viable advertising medium for local and regional merchandisers and service businesses.

Each half-hour show consists of 26 separate 60-second advertorial mini-programs featuring the individual advertisers, including an 800 phone number for direct response sales from viewers while the show airs.

For small local and regional advertisers, observed Frank Kilpatrick, president of HomeTown Shopping, "We're more cost-effective in many cases than buying cable directly. And our direct response TV is favorably positioned in comparison to other media local advertisers favor, like Yellow Page ads and weekly newspapers."

For consumers, too, the HomeTown Shopping Show offers some benefits missing from national home shopping efforts, said Kilpatrick. "Nearly 41 percent of their product mix is jewelry; the next largest is women's fashion. Ours is a little bit more like going into a local mall and having a wider variety of things to shop for."

And in the wake of a May 9 FCC ruling allowing cable operators to retain fees paid by home shopping shows rather than passing the revenues back to subscribers in the form of reduced cable fees, there are more business opportunities for both local and national home shopping shows, according to such industry observers as John Mancell, an analyst with Paul Kagan & Associates, a media and consulting firm.

"When the FCC said, 'You can keep your home shopping fees,' there's no longer a disincentive for a cable operator to carry a home shopping network," said Mancell.

The HomeTown Shopping Show was the brainchild of Pam Roberts and Hugh Malay, both former broadcast journalists. Roberts, a former KABC-TV fashion/lifestyle reporter and later a co-host of J.C. Penney's venture in home tele-shopping, was impressed by the potential of home shopping but not its reality.

"People are looking for ways to interact with their television, and I thought home shopping was the direction shopping is going. You could sell hundreds of products in a matter of minutes," recalled Roberts. "But I kept watching this channel (QVC) and it didn't have a whole lot on it and there wasn't good programming."

Moreover, she said, "I believed we had reach a fork in the road for home shopping -- national vs. local. With local, there is no wasted airtime -- and the advertiser is really targeting a specific, local market."

Roberts envisioned home tele-shopping as a broadcast equivalent to mail order catalogs, but better.

"We did a lot of research on catalogs," Roberts said. "Trying to get a catalog into the right home and then into the right hands, with no duplication, is costly -- and a huge waste of resources. In our own case, my fiance and I sometimes get the same catalog duplicated two or three times.

"It's wasteful," she said. "Television is a more efficient way to deliver shopping information and products."

Yet, catalogs' appeal to consumers who still like to shop but who, said Roberts, "are sick of fighting the crowds and traffic and who are worried about just being out" is an appeal matched by direct response home tele-shopping.

Roberts and Malay both had strong production backgrounds, in addition to their on-air broadcasting experience, and actually launched the program in 1992 with little more than a business plan. The pair didn't do a pilot, but rather plunged right in, sold the ads, shot the show and placed it on cable.

The following year they brought in partners: Kilpatrick, to do marketing and overall management, and Linda Posner, now the vice president for sales. The initial capitalization by the partners, said Kilpatrick, was "less than $200,000 in cash and a lot of sweat."

The program's production is on a two-week cycle, each showing airing twice a day, with 26 shows scheduled per year. Each half-hour show costs HomeTown between $500 and $700 to produce. It is basically a series of hosted interviews, how-to segments and reviews of the advertisers' products or services.

The show can be geared to an individual advertiser's need to skip appearing in, say, Long Beach, so each of the cable systems airs a slightly different version. HomeTown Shopping pays the cable operator for the programming times, typically a fee of $40 to $100 for each half-hour.

The benefit to the cable operator, aside from the leased-access fees, is that there's no work involved for the operator in producing the shows.

For the advertisers -- small companies like restaurants, local family tourist outings, real estate agents, home repair services and the like -- the cost is relatively low. For instance, an eight-week contract to appear in Palos Verdes costs about $1,600, while a 14-week contract for the Long Beach system is about $3,800.

Kilpatrick also points out that advertisers avoid TV commercial production costs plus the cost of "call capture" when viewers call in to buy a featured product.

"While we capture the calls," added Kilpatrick, "we do differ from the national shows who own the merchandise and warehouse the stuff. We don't own the merchandise, and we don't fulfill the orders. We just capture the calls."

One client, Mike Homaizad, owner of a three-shop chain of dry cleaners, Classic Cleaners, in the South Bay, lauds the HomeTown Show as "an excellent investment for my business."

He said, "I've experienced a real surge. Since I've been tracking on my computer, I've had 130 to 140 new customers each week for the past seven weeks at my three stores."

Next on HomeTown Shopping Show's horizon: expansion to other regional cable systems via a licensing, syndication or franchising concept. By year-end, said Kilpatrick, the company hopes to, in effect, sell its format to non-competing cable operators, training local personalities as the local hosts.

Partner Roberts said, "I don't know if we're going to 'franchise' it or 'cookie cutter' it, but our criteria as we roll out and expand in other cities is that the cable system has to be good for us to be interested."