Telebrands CEO keeping firm tuned into buyers’ demands
Monday, October 18, 2010 12:00 AM
By Jared Kaltwasser
A.J. Khubani has built a multimillion-dollar marketing business on a 90 percent failure rate.
The founder, president and CEO of Fairfield-based Telebrands Inc. has made a career out of finding and marketing inexpensive gadgets on television and in retail stores. But the products that become a hit — like AmberVision sunglasses, the Pasta Boat and the Windshield Wonder — are easily outnumbered by the misses: Nine out of 10 products chosen for a test marketing run fall flat.
“I have 27 years of experience,” Khubani said. “You’d think that I would be right more frequently. Sometimes the products I like the most are the ones that fail. And the ones I don’t think are going to make it, like PedEgg, end up being very big.”
Success for Khubani, 50, came quickly. In 1983, he bought an ad in the National Enquirer to sell a $10 portable radio. He broke even, and was hooked.
“It was very exciting to write the ad, place the ad, and then have people actually respond to what you’ve written,” he said. “It feels good. Based on what I wrote, people were sending me money.”
In 1985, Khubani turned a profit. In 1987, he bought his first TV ads.
The next year, Khubani set his sights on selling his top product — AmberVision sunglasses — on retail shelves. “As Seen on TV” was unheard of then, and Khubani’s concept wasn’t well received until he made his pitch to Carteret-based Herman’s Sporting Goods. The buyer was about to say no, too, when his boss walked by and asked what Khubani was selling.
“His boss said, ‘I see it all over TV,’” Khubani said. “‘Give him a test.’”
Herman’s ordered 200 pairs. The glasses flew off shelves and days later, Herman’s ordered 200,000. Other retailers took notice.
These days, Khubani’s the one deciding which products to take a risk on. Inventors flock to Khubani, whose fame has been magnified by his recurring role on Discovery Channel’s “Pitchmen.” He now holds “American Idol”-style Inventors Days, where the most promising of the thousands of submissions he receives annually get five minutes to try to sell the product to Khubani, his wife and a third judge.
Avinandan Mukherjee, marketing professor at Khubani’s alma mater, Montclair State University, said Khubani’s willingness to be the face of his company has benefited Telebrands. “Very few companies have got a CEO as presentable and as active and out there in the media as he is,” Mukherjee said. “He really consciously goes out and does this PR on behalf of his company, and has done it remarkably well.”
Mukherjee said Khubani, who regularly speaks at MSU, freely discusses his successes and failures, including the company’s 2000 filing for Chapter 11 bankruptcy after over-producing what turned out to be an under-selling abdominal exerciser.
Khubani has also lent his name to the New Jersey Ad Club’s “Choose Jersey Talent” campaign, which encourages businesses to hire home-grown talent.
“It’s rare to find somebody who has been so successful who maintains his balance, his approachability and his gracious leadership,” said Daryl Rand, Ad Club board member.
Next month, Khubani will be inducted into the Advertising Hall of Fame of New Jersey. Gary Denburg, an Ad Club board member and past president, said Khubani revolutionized direct-response marketing.
“He certainly has redefined it and proved that it can be extremely profitable as well as a successful form of entertainment,” Denburg said.
Lately, business has been booming: Recession-weary retailers are devoting more shelf space to Telebrands’ low-price gadgets, and TV stations — which run Telebrands’ ads for lower rates when they have unsold ad time — have been awash in “remnant” time, quadrupling Telebrands’ ad runs and sending sales on a dramatic upswing. All told, the brand has seen an estimated 80 percent increase in sales since the recession.