Direct marketing involves direct communication with targeted consumers to elicit an immediate response. It uses various methods like direct mail, telemarketing, digital media, and text messaging. There are three main players - advertisers who sell products/services, agencies who handle advertising strategies, and consumers who are recipients and potential buyers. Direct marketing allows targeting specific consumer groups and personalizing messages. While it can be cost-effective and measurable, it also faces challenges like low response rates, intrusiveness, and competition from other marketing messages. Database marketing helps direct marketing efforts by storing consumer profiles and transaction details for targeted campaigns.
Direct marketing involves direct communication with targeted consumers to elicit an immediate response. It uses various methods like direct mail, telemarketing, digital media, and text messaging. There are three main players - advertisers who sell products/services, agencies who handle advertising strategies, and consumers who are recipients and potential buyers. Direct marketing allows targeting specific consumer groups and personalizing messages. While it can be cost-effective and measurable, it also faces challenges like low response rates, intrusiveness, and competition from other marketing messages. Database marketing helps direct marketing efforts by storing consumer profiles and transaction details for targeted campaigns.
Direct marketing involves direct communication with targeted consumers to elicit an immediate response. It uses various methods like direct mail, telemarketing, digital media, and text messaging. There are three main players - advertisers who sell products/services, agencies who handle advertising strategies, and consumers who are recipients and potential buyers. Direct marketing allows targeting specific consumer groups and personalizing messages. While it can be cost-effective and measurable, it also faces challenges like low response rates, intrusiveness, and competition from other marketing messages. Database marketing helps direct marketing efforts by storing consumer profiles and transaction details for targeted campaigns.
Direct marketing Direct Marketing: Direct communications with carefully targeted individual consumers to obtain an immediate response.
Direct marketing is the activities involved in distribution of products,
information and promotional benefits to target consumers through interactive communication. It covers a wide array of methods, including the following: direct mail telemarketing electronic media (internet, interactive cable TV) catalogue marketing inserts (leaflets in magazines) door-to-door leafleting text messaging. Players in Direct Response Marketing Three main players are involved In Direct Response Marketing. The Advertisers: A large number of firms are now engaging in Direct Response Marketing. They usually sell products or services through Phone, Mail or the Web. The Agencies: The Agency is known for taking a group-up approach to marketing, getting involved in researching the company as well the product before making a single Ad. Usually agencies provide all the tactics or approaches of advertisement to the advertisers. The Consumers: Consumers are recipients of direct-Mail, e- Mail, Phone calls etc. and order products via mail, telephone or computer. Media decisions of DM The direct marketer has a range of media that can be used to reach target audiences. Direct mail is material sent by post to a home or business address with the purpose of promoting a product and/or maintaining an ongoing relationship. Telemarketing is a marketing communications system where trained specialists use telecommunications and information technologies to conduct marketing and sales activities. Inbound telemarketing occurs when a prospect contacts the company by telephone, whereas outbound telemarketing involves the company calling the prospect. Mobile marketing (the sending of short text messages direct to mobile phones) is extremely successful. Marketers now send out messages to potential customers via their mobile phones to promote such products as fast food, movies, banks, dresses etc. Direct response advertising appears in the prime media such as television and the press but is different from standard advertising since it is designed to elicit a direct response such as a request for further information, an enquiry or an order. Usually a tool free telephone number is provided so that interested parties can contact the company. Media decisions of DM
Catalogue marketing is the promotion and sale of goods through catalogues
distributed to agents and customers by mail or at outlets. Infomercial is a long commercial that ranges from 30 to 60 minutes. Many infomercials are produced by the advertisers and are designed to be viewed as regular TV shows. Electronic teleshopping is an online shopping and information retrieval service accessed through personal computers. For example, QVC, the home shopping channel, has started iQVC, an Internet home shopping channel that complements its cable TV channel and adds incremental sales. Direct selling is the direct, personal presentation, demonstration, and sales of products and services to consumers in their homes. Avon, Cutco and Tupperware are some of the best-known direct-selling companies in the United States. Advantages Some of the strengths of direct marketing include: Targeting: Sender can send specific messages to particular groups of customers and potential customers based on demographics and buying behavior. The more targeted campaigns, the more successful they are likely to be. Personalization: Reach audience with a personal touch. Direct mail or email can be addressed to a specific person, and even include details like past orders. A phone call can engage a customer in conversation to start building a relationship with your business. Affordable: Tactics like email marketing or leafleting can be very cost effective. Most direct marketing will be more cost effective than mass media advertising campaigns. Measurable: If marketing messages ask the recipient to take a particular action or use a specific voucher code, it can easily track the success of campaigns. This can help to plan future campaigns. Informative: Detailed information on products, services and prices could be delivered unlike other forms of advertising. Disadvantages Some of the downsides to overcome when using direct marketing include: Intrusive: Many people find direct marketing annoying and intrusive. This is especially true of telemarketing and door-to-door sales. Some people dislike marketing mail and consider it to be junk mail. If consumers find the marketing tactics annoying , it can create a negative brand association and make them less likely to buy. Environment: Using leafleting or paper-heavy direct mail campaigns can be bad for the environment. To avoid this, and any negative impact on brand image, use recycled materials or try email campaigns. Low response rates: direct marketing response rates tend to be around 1- 3%.When seller reach a consumer who isnt interested in his products or services, it wastes money and they are likely to find it irritating. Need to use more targeted lists as opposed to sending out mass messages to minimize this. Competition: It can be hard to make specific message stand out when the recipient receives high number of marketing emails or direct mail. Cost: Tactics like telemarketing and direct mail may have high financial and resource costs. Database Marketing Direct marketing activity requires accurate information on customers so that they can be targeted through direct mail or telemarketing campaigns. This information is stored on a marketing database which comprises an electronic filing cabinet containing a list of names, addresses and transactional behavior. Information such as types of purchase, frequency of purchase, purchase value and responsiveness to promotional offers may be held in the database. This allows future campaigns to be targeted at those people who are most likely to respond. Database Marketing Database marketing is defined as an interactive approach which uses individually addressable marketing media and channels (such as mail, telephone and the sales force) to: (a) provide information to a target audience; (b) stimulate demand; (c) stay close to customers by recording and storing an electronic database memory of customers, prospects and all communication and transactional data. Contents for a comprehensive database Database Information Typical information stored on a database includes the following: 1. Information on actual and potential customers. Basic data such as names, addresses and telephone numbers enable customers to be contacted. 2. Transactional information. Such information as frequency of purchase, when the customer last bought and how much was bought for each product category may be stored. 3. Promotional information. Data covering what promotional campaigns have been run, customer response patterns and results in terms of contact, sales and profiles can be stored on a marketing database. 4. Product information. Information relating to which products have been promoted, how, when, where and associated responses can be held. 5. Geo demographic information. Information about the geographical areas of customers and prospects and the social, lifestyle or business categories to which they belong can be stored. Importance of database marketing 1. Direct mail. A database can be used to store customer information for mailings. 2. Telemarketing. A database can store telephone numbers of customers and prospects. Also when customers contact the supplier by telephone, relevant information can be held, including when the next contact should be made. 3. Loyalty marketing. Highly loyal customers can be drawn from the database for special treatment as a reward for their loyalty. 4. Campaign planning. The database can be used as a foundation for sending consistent and co-ordinated campaigns and messages to individuals and businesses. 5. Target marketing. Specific groups of individuals or businesses can be targeted as a result of analyzing the database. 6. Marketing evaluation. By recording responses to marketing mix activities, for example, price promotions, special offers on products and direct mail messages, the effectiveness of different approaches to varying consumers and market segments can be evaluated. The Role of DM in the IMC Program 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. 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. 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. For-profit companies are also using telemarketing with much greater frequency to screen and qualify prospects (which reduces selling costs) and to generate leads. Combining Direct Marketing with Sales Promotions company use direct- marketing tools to inform customers of sales promotions. 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. DIRECT MARKETING CAMPAIGN DIRECT MARKETING CAMPAIGN 1.Identifying and understanding the target audience. The target audience is the group of individuals at which the direct marketing campaign is aimed. For consumer markets the target audience may be described using market segmentation variables such as age, gender, social class and lifestyle. Population census data are used to classify households according to a wide range of variables such as household size, number of cars, occupation, family size and ethnic background. For business markets, the target audience will be described as the type of organization that the direct marketer wishes to target and the type of individual within each organization who should be reached. DIRECT MARKETING CAMPAIGN 2.Setting campaign objectives Campaign objectives can be set in different ways: a. Financial objectives : sales volume and value, profit, return on investment. b. Communication objectives : awareness, stimulate trial, positioning of brand in consumers minds , remind and reinforce. c. Marketing objectives: customer acquisition, customer retention, number of orders, response rate (proportion of contacts responding). DIRECT MARKETING CAMPAIGN 3.Creative decisions In order to achieve their level of success, companies need to produce an effective creative brief which includes the following: a. Target market analysis. Target consumers will be identified, profiled and their needs and buyer behavior analyzed. b. Development of the offer. Potential offers should be pre-tested with the target audience to establish their attractiveness. This can take the form of small-scale individual tests. c. Message communication. In direct mail the offer can be communicated by the envelope as well as the internal contents. Recipients must also be told clearly how to respond. Including a free phone number as well as the usual freepost envelope can increase response. d. Action plan. An action plan focusing on when the campaign is to run, how often and recommendations regarding the most appropriate media to use needs to be drawn up. DIRECT MARKETING CAMPAIGN 4.Media decisions The direct marketer has a range of media that can be used to reach target audiences. Direct mail, telemarketing, direct response advertising catalogue marketing and the internet are the different media used in direct marketing. DIRECT MARKETING CAMPAIGN 5.Campaign execution and evaluation Once the creative and media decisions have been made, the action plan will be executed. This may be done in-house or through the use of a specialist direct marketing agency. The campaign should be evaluated against clearly defined objectives which include: sales volume and value; response rate (the percentage of contacts responding); number of enquiries; number of new customers; number of existing customers re-buying;