Chapter 21

Managing Direct & On-Line Marketing

Winter 2000

Objective s • • • • • Growth & Benefits of Direct Marketing Customer Databases & Direct Marketing Major Channels for Direct Marketing Marketing in the 21st Century: E-Commerce Public & Ethical Issues in Direct Marketing 03/02 /16 21- .

Why Growth in Direct Marketing • • • • • • Market “Demassification” Effort of “Traditional Shopping” Continuous Access Next-day Delivery Specialty Items Increase in Computer Power 03/02 /16 21- .

Benefits of Direct Marketing To Customers To Companies Fun. Fun. Convenient Convenient&& Hassle-Free Hassle-Free Mailing MailingLists Listsfor forAlmost Almost Any Market Any Market Saves SavesTime Time Customized CustomizedOffers Offers Larger LargerMerchandise Merchandise Selection Selection Ongoing OngoingRelationships Relationships with Customers with Customers Timed Timedto toAchieve AchieveHigher Higher Readership Readership&&Response Response Alternative Alternative Media/Message Media/MessageTesting Testing Comparison ComparisonShopping Shopping Order OrderProducts Productsfor for Themselves or Others Themselves or Others Privacy Privacy 03/02 /16 Measurable MeasurableResponse Response 21- .

Reactivate Customers 03/02 /16 21- . Match Customers & Offers 3. Deepen Customer Loyalty 4.Uses for Databases 1. Identify Prospects 2.

Direct Marketing Channels Face-to-Face Face-to-Face Selling Selling Online Online Marketing Marketing Direct-Mail Direct-Mail Marketing Marketing Kiosk Kiosk Marketing Marketing Catalog Catalog Marketing Marketing 03/02 /16 Direct-Response Direct-Response TV TVMarketing Marketing Telemarketing Telemarketing 21- .

/16 $7.000 2d Year 80 renewals @ $70 $5.000 $2...000 100 new members @ $70 1st year “cost” $3.600 Two year “gain” 3d Year… 03/02 4th Year.Lifetime Value Cost of Campaign: $10.600 21- .

“Information Rich” Buyers Objective ObjectiveInformation Information Initiation Initiationof ofInformation Information Requests Requests Design DesignDesired DesiredOfferings Offerings Employ Employ“Agents” “Agents”or orSolicit Solicit Bids Bids Find FindSpecialized SpecializedThirdThirdparty partySellers Sellers 03/02 /16 21- .

Benefits of Online Marketing Consumers Consumers Companies Companies Convenience Convenience Quick QuickAdjustments Adjustmentsto to Market Conditions Market Conditions Information Information Lower LowerCosts Costs Fewer FewerHassles Hassles Relationship RelationshipBuilding Building Audience AudienceSizing Sizing 03/02 /16 21- .

Online Marketing Channels Electronic ElectronicPresence Presence Corporate CorporateWebsite Website Marketing Marketing Website Website Advertising Advertising Online Online Place PlaceAds Adsin inSpecial SpecialSections Sections of ofOnline OnlineServices Services Place PlaceAds Ads in inCertain CertainInternet InternetNewsgroups Newsgroups Buy BuyOnline OnlineAds AdsThat ThatPop PopUp UpWhile WhileConsumers Consumers are areSurfing Surfing Forums.Newsgroups Newsgroups&&Web WebCommunities Communities Forums: Forums:Discussion DiscussionGroups Groups on onCommercial CommercialOnline OnlineServices Services Newsgroups: Newsgroups:Internet InternetVersion Versionof ofForums Forums Web WebCommunities: Communities:Sites Sites Where WhereMembers Members Exchange ExchangeViews Views Online Online Using UsingE-Mail E-Mailand and Webcasting Webcasting Customers CustomersSend SendQuestions. Questions. Forums.Suggestions Suggestions &&Complaints ComplaintsVia ViaE-Mail E-Mail Webcasting: Webcasting:Automatic Automatic Downloading Downloadingof ofInformation Informationto toPC’s PC’s 03/02 /16 21- .

Challenges of Online Marketers • Limited Consumer Exposure & Buying • Skewed User Demographics & Psychographics • Chaos & Clutter • Security 03/02 /16 21- .

Public & Ethical Issues in Direct Marketing Irritation Unfairness Deception & Fraud Invasion of Privacy 03/02 /16 21- .