Direct marketing and direct selling

Direct marketing is a system of marketing by which

organizations communicate directly with target customers
to generate a response or transaction. This response may
take the form of an inquiry, a purchase, or even a vote.
 Direct marketing:

• Direct marketing is the use of consumer direct channels to reach and

deliver goods and services to consumers without using marketing
middlemen.
• It helps the companies to opening dialogue directly between
themselves & the end consumers of their products.
• It is targeted at individual users rather than through intermediaries.
• Company markets through various advertising media that interact
directly with consumers, generally encouraging the consumer to
make a direct response.
 Cont’d

• In other words, direct marketing consists of direct communications with carefully

targeted consumers to obtain an immediate response.
• However, the ultimate purpose of direct marketing is to establish and manage
direct long term relationships with customers by capturing personal information
in a database.
• Marketer send birthday cards, information materials and small premiums to
certain customers.
ADVANTAGES OF DIRECT DISADVANTAGES
MARKETING
1. Selective Reach 1.Image factors.
2. Segmentation Capability 2.Irritation
3. Frequency Potential 3.Deception and fraud
4. Flexibility
4.Accuracy
5. Timing
6. Personalization 5.Content support
7. Economy 6.Rising costs
8. Measurement-of
Effectiveness
 Advantages
To Businesses:

• Direct marketing can help sales to grow when used along with sales promotions
and advertising campaigns.
• It is also useful for small businesses through guest books, visitors lists, and lists
of enquiries. These operations rely on repeat business.
• Direct marketing builds relationships; it is an important tool in customer
relationship management (CRM).
• It helps to measure response to campaigns to decide which media is most
profitable.
• It helps to find cost effective approach of media.
 To consumers:

• Home shopping can be fun, convenient & hassle free.

• Buyers get good services from the company like toll free numbers for purchasing
or ordering goods.
• It provides quick delivery of goods to the consumers.
• It saves time and introduces consumer to a larger selection of merchandise.
• Consumer can do comparative shopping by browsing through mail catalogs and
online shopping services.
 Types of direct marketing
• Direct selling
• Direct mail
• Telemarketing
• Internet selling
• Direct action marketing
• Catalog selling
• Television/ print media
• Cable TV
Forms of direct marketing:
Direct mail
marketing

Kiosk Catalog
marketing marketing

Television Telemarketing
 Direct mail marketing:

• It involves sending an offer, announcement , reminder or other item to a person

through mail
• Marketers send out millions of mail pieces each year, using highly selective
mailing lists.
• It is a popular medium as it permits target market selectivity, can be personalized,
is flexible.
• Cost involved is very high than the mass media but the people reached are better
prospects.
 Catalog marketing:
In this type of marketing seller prepares catalogues of merchandise or products
and sells directly to customers.

Catalogues are generally in printed form but can also be distributed in the form
of CDs .

To reduce printing and distribution costs catalogues are being increasingly made
online.

Products from various companies or vendors may be combined into a single

catalogue to provide a one point shop for customer looking out for a particular
type of product
 Telemarketing:

• Telemarketing is the use of telephone and call centers to attract prospects ,

sell to existing customers and provide service by taking orders and
answering questions.
• Companies use call centers for inbound telemarketing- receiving calls from
customers and outbound marketing- initiating calls to prospects and
customers.
• Effective telemarketing depends on choosing the right telemarketer ,
training them well & providing performance incentives.
• Advantages: Likely to replace more expensive field-sales call.
» Reduces amount of personal selling effort.
» Reduce field-force travelling calls.
• Telemarketing pioneer.
• It offers more than a thousand products backed by a 24*7 call
center.
• Diversified its operations by opening an online store.

 Cosmetic company L’Oreal India has a toll free number on

which it offers expert advice about looking good.
 Direct response marketing
Television:

• Direct marketing via television (commonly referred to as DRTV) has two basic
forms:
long form (usually half-hour or hour-long segments that explain a product in
detail and are commonly referred to as infomercials) & short form, which refers to
typical 30-second or 60-second commercials that ask viewers for an immediate
response (typically to call a phone number on screen or go to a website).

• Infomercials promote products that are complicated or technologically advanced,

or require a great deal of explanation.
Company promotes the concept of home shopping by a way of media and
television advertisements of various products by showing their features, use and
advantages.
A toll free number is flashed on the television screen when infomercials are
screened.
The consumer can call the number for the demonstration and delivery of the
product.
Kiosk marketing :

Kiosk- A small, temporary, stand-alone booth used in high-foot-traffic areas for

marketing purposes.

 A kiosk will usually be manned by one or two individuals who help attract
attention to the booth to get new customers.

Kiosks are machines kept in shopping malls and other such places by
organizations to spread the information and generate orders from customers who
visit such Free standing, semi-permanent display or retail outlet, within a large
retail establishment or a shopping mall
 Ambi Pur , a perfume company dealing in room fresheners organized a kiosk marketing
campaign in the Nirmal lifestyle, Mumbai.

 Attracted a lot of parents who came in with their children and stopped by the kiosk & got
information about the co.

 The objective of the campaign was to create awareness about the product among the target
consumers, mainly the households.
Merit Demerit
1. Selective reach. 1. Image factors.
2. Segmentation capabilities 2. Irritation
3. Frequency 3. Deception and fraud
4. Flexibility. 4. Accuracy
5. Timing 5. Content support
6. Personalization. 6. Rising costs
7. Costs.
8. Measures of effectiveness
Disadvantages :

Irritation Unfairness

Deception Invasion
and fraud of privacy
 Direct selling:

It is the sale of a consumer

product or service, person-to-
Traditional selling person, away from a fixed retail
location.

Direct sellers are not employees

of the company but are
independent contractors, also
referred to as consultants or
distributors who market & sell the
products or services of a company
Direct selling in return for a commission on
those sales.
WHAT IS THE ROLE/FUNCTION OF DIRECT
MARKETING IN IMC

1. Combining Direct Marketing with Advertising

2. Combining Direct Marketing with Public Relations
3. Combining Direct Marketing with Personal Selling
4. Combining Direct Marketing with Sales Promotions
Combining Direct Marketing with Advertising
Obviously, direct marketing is in itself a form of advertising.
Whether through mail, print, or TV, the direct response
offer is an ad.

It usually contains a toll-free or 900 number or a form that

requests mailing information. Sometimes the ad supports the
direct-selling effort.

For Direct-response ads or infomercials are also referred to in

retail outlet displays. Sometimes an advertisement will be sent
through direct mail.
Combining Direct Marketing with Personal Selling
Telemarketing and direct selling are two methods of personal
selling .

Nonprofit organizations like charities often use telemarketing to solicit

funds.
As you will see, for-profit companies are also using telemarketing with
much greater frequency to screen and qualify prospects (which reduces
selling costs) and to generate leads.

Direct-mail pieces are often used to invite prospective

customers to visit auto showrooms to test-drive new cars; the
salesperson then assumes responsibility for the selling effort.
Combining Direct Marketing with Sales Promotions

How many times have you received a direct-mail piece notifying you of a sales
promotion or event or inviting you to participate in a contest or sweepstakes?

Ski shops regularly mail announcements of special end-of-season sales. Airlines

send out mailers or emails announcing promotional airfares.

Nordstom and other retail outlets call their existing customers to notify them of
special sales promotions.
Each of these is an example of a company using direct-marketing tools to inform
customers of sales promotions.
In turn, the sales promotion event may support the direct-marketing effort.
Databases are often built from the names and addresses acquired from a promotion,
and direct mail and/or telemarketing calls follow.
Combining Direct Marketing with Public Relations
Public relations activities often employ direct-response techniques.

Private companies may use telemarketing activities to solicit funds for charities or
cosponsor charities that use these and other direct-response techniques to solicit
funds.

organizations engaging in public

Likewise, corporations and/or
relations activities may include toll-free numbers or website
URLs in their ads or promotional materials. Direct mail has also been
shown to be effective in recruiting job candidates.
GROWTH OF DIRECT MARKETING
A number of factors have led to the increased attractiveness of this
medium for both buyer and seller:
•Technological advances. The rapid technological advancement of the electronic media and of
computers has made it easier for consumers to shop and for marketers to be successful in
reaching the desired target markets.
•Miscellaneous factors. Number of other factors have contributed to the increased effectiveness
of direct marketing, including changing values, more sophisticated marketing techniques, and the
industry’s improved image. These factors will also ensure the success of direct marketing in the
future. The variety of companies employing direct marketing demonstrates its potential.
•Consumer credit cards.

•The changing structure and the market. One of the major factors contributing to the success of
direct marketing is that so many are now “money-rich and time-poor
Direct-marketing syndicates(association/collectivity). Companies specializing in list
development, statement inserts, catalogs, and sweepstakes have opened many new
opportunities to marketers. The number of these companies continues to expand, creating even
more new user
 Sales Promotion

“A direct inducement that offers an extra value or incentive for

the product to the sales force, distributors, or the ultimate
consumer with the primary objective of creating an immediate
sale.”

An extra A tool
A tool to to
incentive to buy speed
speed up up sales
sales

Targeted to
different parties
DEFINE SALES PROMOTION
Sales promotion has been defined as “a direct encouragement that
offers an extra value or incentive for the product to the sales force,
distributors, or the ultimate consumer with the primary objective of
creating an immediate sale.”

Activities involved in consumer-oriented sales promotion include

sampling,
couponing,
premiums,
contests and sweepstakes, refunds and rebates, bonus packs, price-offs,
frequency programs, and event marketing. These promotions are
directed at consumers, the end purchasers of goods and services, and
are designed to induce them to purchase the marketer’s brand
Exchange offer

Scratch and win offer Bonus offer

Price-off offer
 Sales Promotion Tools
Consumer-Oriented Trade-Oriented
Samples Contests, dealer incentives

Coupons Trade allowances

Premiums Point-of-purchase displays

Contests/sweepstakes Training programs

Refunds/rebates Trade shows

Bonus packs
Packs Cooperative advertising

Price-off deals

Frequency
Loyalty programs
programs

Event marketing
FREE SAMPLES

These are distributed to attract consumers to try out a new

product and thereby create new customers. Some businessmen
distribute samples among selected persons in order to
popularize the product.

Common examples - shampoo, washing powder, coffee

powder, etc.
 Premiums

Premium: an offer of an item of merchandise or service

either free or at a low cost that is an extra incentive for
customers

Two Types of Premiums

Self-liquidating Premiums:
Free Premiums:
require consumer to pay
Only require purchase of the
some or all of the cost of the
product
premium
 COUPONS

Sometimes, coupons are issued by manufacturers either in the

packet of a product or through an advertisement printed in the
newspaper or magazine or through mail.

These coupons can be presented to the retailer while buying the

product. The holder of the coupon gets the product at a discount.

Best example for this is coupons distributed by the pizza

restaurants like dominos, pizza hut, etc
Contests and Sweepstakes

Contest: a promotion where consumers compete for prizes or

money on the basis of skills or ability. Winners are
determined by judging entries or ascertaining which entry
comes closes to some predetermined criteria

Sweepstakes/games: a promotion where winners are determined purely

by chance and cannot require a proof of purchase as a condition for entry.
Winners are chosen by random selection from a pool of entries or
generation of a number to match those held by game entrants.
 BONUS REWARDS/ POINTS

Certain retail shops will have a scheme which will require the
customer to be a member of the shop and to acquire
membership card for the same.

And every time the customer makes a purchase bonus points are
added to the card and at the end of the year gifts are given for
the points earned.

Example – coffee day bonus points card, Moore super markets,

Reliance fresh.
 MONEY BACK OFFER/ REFUNDS

Under this scheme customers are given assurance

that full value of the product will be returned to
them if they are not satisfied after using the product.
When customers doubt the quality or reliability of
your product or service, offer a money-back
guarantee. Give a detailed explanation of eligible
returns and refunds available for customer reference.
Eg : Telebrands shopping
PRICE OFF DEALS / DISCOUNTS
Sampling
Marketers use various sales promotion techniques to meet the objectives just
discussed.
Sampling involves a variety of procedures whereby consumers are given
some quantity of a product for no charge to induce trial .

Premiums
Premiums are a sales promotion device used by many marketers.
A premium is an offer of an item of merchandise or services either free or at a
low price that is an extra incentive for purchasers.

A contest is a promotion where consumers compete for prizes or money on the

basis of skills or ability.

A sweepstakes is a promotion where winners are determined purely by chance; it

cannot require a proof of purchase as a condition for entry.
Refunds and Rebates
Refunds (also known as rebates) are offers by the manufacturer to return a portion of the
product purchase price, usually after the consumer supplies some proof of purchase. Consumers
are generally very responsive to rebate offers, particularly as the size of the savings increases

Price-Off Deals
Another consumer-oriented promotion technique is the direct price-off deal, which
reduces the price of the brand. Price-off reductions are typically offered right on the package
through specially marked price packs.
Trade orient promotions
1.Trade Allowances Probably the most common trade promotion is some form
of trade allowance, a discount or deal offered to retailers or wholesalers to encourage them to
stock, promote, or display the manufacturer’s products.
Types of allowances offered to retailers include buying allowances, promotional or display
allowances, and slotting allowances.

2. Buying Allowances A buying allowance is a deal or discount offered to resellers in

the form of a price reduction on merchandise ordered during a fixed period. These discounts
are often in the form of an off-invoice allowance, which means a certain per case amount or
percentage is deducted from the invoice

3.Contests and Incentives Manufacturers may develop contests or special incentive programs to
stimulate greater selling effort and support from reseller management or sales personnel.
4. Promotional Allowances Manufacturers often give retailers allowances or discounts
for performing certain promotional or merchandising activities in support of their brands. These
merchandising allowances can be given for providing special displays away from the product’s
regular shelf position, running in-store promotional programs, or including the product in an ad
 Effective POP Displays

• Integrate the brand’s image into the display.

• Integrate the display with current advertising and promotions.
• Make the display dramatic to get attention.
• Keep the color of the display down so the product and signage stand
out.
• Make the display versatile so it can be easily adapted by retailers.
• Make the display re-usable and easy to assemble.
• Make the display easy to stock.
• Customize the display to fit the retailer’s store.
Eg: Mobile Sims,toothpastes etc.
Co-operative advertising
Agreement between a manufacturer and a member of distribution chain
(distributor, wholesaler, or retailer) under which the manufacturer shares a
certain percentage of the member's advertising and promotion costs, or
contributes a fixed sum.

Cooperative advertising is advertising where a retailer or a wholesaler share

the costs of an advertising campaign with the manufacturer of the product
being advertised. Manufacturers often will set up an annual fund to use for
cooperative advertising when the opportunity arises.

Agreement between two or more marketers with complementary products

(such as cosmetics and toiletries) or different seasonal sales cycles (such as
raincoats and winter coats) to promote or sell each other's products with
their own. Also called cooperative marketing or co-marketing.
Corporate Advertising
Promoting the firm by enhancing its image, assuming a position on
a social issue, or seeking involvement from the market.

Its objective is to build a firm's corporate image, reputation, and

name-awareness among the general public or within an industry.
See also institutional advertising.
 What is corporate advertising ?
Corporate Advertising - A form of
institutional advertising focusing not on a
An extension of the PR function
particular product or product range but on the
organization itself.
Does not promote a specific
product or service
The primary purpose is promoting the name,
image, personnel, or reputation of a
company, organization, or industry.
Promotes the organization
 Objectives :
1. To create awareness about the existence of the company & purpose for which is
had been established.

2. To give it a recognizable identity.

3. To give a sense of belonging to the employees & the internal public.

4. To project an image of the organization amongst the external publics as one,

which was helping to ensure a fair distribution of vital but scarce commodity.
 Objectives of Corporate Advertising

Create a positive
image for the firm

Communicate the
Establish diversified
organization’s
company’s identity
viewpoint

Objectives

Help newly
Boost employee
deregulated
morale
industries

Smooth labor
relations
 Types of Corporate Advertising

• Corporate ad looking like a product ad which encourages

people to trust and enjoy dealing with the company.
• Corporate ad to convey specific information to the public
& at the same time to promote the organization.
• Image advertising allows companies to differentiate
themselves from rivals.
• Many companies use corporate advertising to
strengthen their identities following structural changes.

© 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Hero Honda To Hero Moto Corp.
 Cause Related Marketing

Cause related marketing:

is a form of marketing whereby companies
link with charities or nonprofit
organizations as contributing sponsors.

• Social service ad to establish reputation.

• Institutional ad devoted to building customer attitudes relating to the organization.

© 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

 STANDARD CHARTERED Mumbai Marathon

• Promotes Health

• Promotes various causes

• Generates charity funds

• Improves Brand image

Advocacy advertising
… Promote a position on an issue rather than the firm directly
Advocacy Advertising Example
Maruti Suzuki celebrates the festival called life

• The agency was tasked with executing a commercial that would underline the
leadership of the Maruti Suzuki brand

• The deep relationship that existed with the Indian car buyer, based on the
immense trust and goodwill earned over decades of delivering quality and
service.

• The brief is grounded in the emotional benefit they deliver

• A drive into a better day, a better way of life

• Thus the brand finds natural place with the Indian families in their most joyous
celebrations of life and relationships
 Marketing
STRATEGIES •Push
• Strategy

Pull
Strategy
A “push” promotional strategy makes use of a company's sales force and trade
promotion activities to create consumer demand for a product.
The producer promotes the product to wholesalers, the wholesalers promote it to
retailers, and the retailers promote it to consumers.

A good example of "push" selling is mobile phones, where the major handset
manufacturers such as Nokia promote their products via retailers such as
Grameenphone. Personal selling and trade promotions are often the most effective
promotional tools for companies such as Nokia
-
for example offering subsidy on the handsets to encourage retailers to sell higher
volumes
 Push Strategy

• Creating the network of resellers,

agents, brokers, representatives
You can use the Push Strategy in the following cases:

1. Your product is popular and does not involve deep

customization

2. You are new on the market

3. you have tainted reputation, you can "borrow" mediator’s

reputation

4. You're not going to stay long in this market and the release
of this product is temporary
 Pull Strategy
• Selling by yourself
A “pull” selling strategy is one that requires high spending on
advertising and consumer promotion to build up consumer
demand for a product.

If the strategy is successful, consumers will ask their retailers for

the product, the retailers will ask the wholesalers, and the
wholesalers will ask the producers.
"Public Relations is distinctive management function which
helps establish and maintain mutual lines of
communication, understanding, acceptance and cooperation
between an organization and its publics;
DEFINE PUBLIC RELATIONS
It is the dimension of communication which is specifically concerned with establishing and enhancing goodwill
between an organization and the various publics with which it seeks to communicate. It’s integrated with
advertising, sales promotion and so on.
The planned and sustained effort to establish and maintain
The definition of PR:
goodwill and mutual understanding between an organization and its publics
OBJECTIVES OF PR
1. Increase awareness of the company;Increase awareness of the brands or services
2. Reinforce the business objectives of the organization;
3. Identify and explain company policy;
4. Provide a focus of attention on those issues which are important to thecompany;
5. Encourage external debate on those issues;
6. Help to change opinions to those which are favourable to the organization;
7. Assist the process of changing attitudes towards the organization and its operations;
8. Create positive attitudes towards the company's products and services;
9. Help in the building of the reputation of an organization;
10. Motivate staff and enhance the recruitment process;
11. Help restore the credibility of a company, particularly after some specific crisis;
12. Reinforce the marketing and sales efforts;
Strategies of Public Relations
1. Credibility
2. Assessment of the needs, goals and capabilities of target
audiences.
3. Complementary roles of mass media and interpersonal
communication
4. Selection of appropriate media for target audiences
5. Breaks through the clutter
6. Image building
7. Get over consumer resistance
 Conclusion :

• In this era of competition no company can rely on single direct marketing form.
• So companies use one of the form of direct marketing or a combination of these
marketing forms in order to stand out of the rest.
• For example :AVON