Meanwhile, the mail-order business was changing. In 1984, Ronald Reagan had lifted restrictions that limited the number of commercial minutes per hour, a move that gave rise to the modern infomercial. It didn’t take long for Khubani to realize that TV offered direct-response possibilities that his print ads couldn’t touch, and that his gimmicky products were well suited to the infomercial arc: Show the wrong solutions. Show the Telebrands solution. Tout the additional benefits of the product. (The StickUp Bulb doesn’t get hot, the Flat Fold Colander doesn’t let nasty sink water back up onto your pasta.) For some devices, show testimonials from “real people,” for others—particularly medical implements—an expert in a white coat. Sweeten the deal by cutting the price in half or doubling the order for the same price, or throwing in a second gizmo for no extra charge. And always end with an imperative: Call now.
With the help of what he now deems a “corny” TV graphic of UV rays entering a human eyeball, his Ambervision shades became an actual household brand, his first. “I was playing blackjack in Atlantic City with my wife, and the dealer asked me what I did for a living, and when I said I sold Ambervision glasses, he said, ‘Oh, I know those glasses,’” says Khubani. “It started happening all the time.” Khubani cashed in on their as-seen-on-TV fame by selling the specs to Herman’s Sporting Goods, Wal-Mart, Kmart, and Target. By 1992, he’d moved 15 million pairs.
In 1998 (the year of the Great American Steak House Onion Machine, which slices onions into floral blossoms), the Khubanis started construction on a 21,000-square-foot home in Saddle River. “A nice house,” says Khubani.
At the mall, Khubani pays close attention to the kiosks that sell things like backpacks, acne cream, and Celtic jewelry. “Small entrepreneurs run these kiosks,” he explains. “They react quicker to hot items.”
He stops in front of a rack teeming with hair extensions of all shades and textures. The clerk comes over, a young Asian girl, with a mass of bronze ringlets attached to her head. “That’s the product, right? It looks great. How well does this sell?” The clerk shrugs. He turns to me. “It’s an instant hairstyle, and it would make a great TV demonstration, a great before and after,” he says. What he doesn’t like is the variety—customization might be a trend in other businesses, but for him, it’s a headache. He walks on.
The next kiosk is more promising, with flexible, waterproof, thin computer keyboards.
“Why would anyone want to buy this?” Khubani demands, by way of greeting the clerk. “Everyone has a keyboard. Why would they need this one?”
“You can clean it, if you spill coffee on it, it’s no problem. You can fold it up, and it’s portable, very portable,” says the clerk.
“How’s it selling, pretty well?”
“It’s best selling,” says the clerk. “It’s not an item you can find in a lot of places.”
“You take American Express?”
“That’s exciting,” Khubani says to me, carrying away his booty in a plastic bag. “You can spill on it, and that’s a good TV demonstration. See? We just found a product. It’s not that hard.” (Several weeks later, however, Khubani is no longer excited: “I took it home and played around with it. It was cumbersome to use, and it was odd trying to type on it. I thought the consumer satisfaction would be fairly low, so we dropped the idea without any further investigation.”)
The hard part, in fact, is accurately predicting demand, which Khubani’s test-launches sometimes fail to do. To roll out five new items, as Khubani will do this year, he’ll film infomercials for at least twenty and try each one out for a week. Each trial needs to generate double its advertising costs to make it to a full launch, which involves buying millions of dollars in national advertising time and ordering between a half-million and a million pieces.
Not all products that test well ultimately succeed. In 2004, Khubani lost millions on AirPress Massagers, bright-blue plastic space boots that stimulated muscles when inflated. After a strong debut, he ordered $7 million worth. But demand fell off quickly, the phone stopped ringing, and those that did sell had a leak. “I thought the market for massage was bigger than it is,” he says.
Too much inventory isn’t the only thing that takes a chunk out of Khubani’s bottom line—sometimes he doesn’t have enough. Over the past seventeen years, Khubani has had to write checks to the Federal Trade Commission on three occasions, totaling $925,000, to settle allegations that the company had violated the law by failing to ship orders on time, notify consumers about delays, and make prompt refunds. One year, when he hit the market with a magnetic duster whose static properties were activated with a swipe across a TV screen, he couldn’t get the plumes fast enough to satisfy the crushing demand—and his phone system clogged up as well.