Direct Marketing: The Dialogue Builder

A big advantage of Direct Marketing over

Advertising and Sales Promotion:

Advertisin
Advertisin
gg and
and
Sales
Sales
Promotion
Promotion Direct
Direct Very
Marketing
Marketing Interactive
Direct Marketing

Direct marketing:
An interactive, database-
driven messaging system that
uses a range of media to
motivate a response from
customers and prospects
Direct Marketing

44 Primary
Primary Media:
Media: Mail,
Mail,
Telephone,
Telephone, Email,
Email, Infomercials
Infomercials
(a
(a short
short film,
film, usually
usually for
for television,
television,
which
which advertises
advertises aa product
product oror
service
service in
in an
an informative
informative way)
way)
Direct
Direct 44 Primary Media:
Primary Media: Mail, Mail,
Marketing
Marketing Telephone,
Telephone, Email,Email, Infomercials
Infomercials

Also
Also Known
Known As As Direct
Direct Response:
Response:
Because
Because ItIt Is
Is Two-way
Two-way in
in Nature
Nature
Direct Marketing’s Strengths

Interactive
Interactive

Direct
Direct
Marketing
Marketing Measurable
Measurable
Strengths
Strengths

Fast
Fast and
and Flexible
Flexible
What Are Direct Marketing’s Strategies?

Front end strategies

Delivering the message

Back end strategies

Handling consumer responses and
delivering the product
Front & Back End Components

Front
Front End
End
Components
Components

Targeted
Targeted The
The
The
The Offer
Offer Databases
Databases Response
Response

Back
Back End
End
Components
Components

Customer
Customer Privacy
Privacy
Fulfillment
Fulfillment Service
Service Protection
Protection
The Offer

The offer: Everything, both

tangible and intangible,
promised by a company in
exchange for money or some
other desired behavior
An Offer From an Exclusive Resort

+
IMC In Action: 1-800-Flowers
IMC In Action: 1-800-Flowers

Challenge: Promoting
Promoting and
and delivering
delivering flowers
flowers
nationwide
nationwide

The
The use
use of
of an
an IMC
IMC program
program featuring:
featuring:
•• TV,
TV, radio,
radio, and
and direct
direct mail
mail messages
messages
Answer: delivering
delivering the
the offer
offer
•• 1-800-FLOWERS;
1-800-FLOWERS; web web site,
site, handling
handling
responses
responses
•• 2,500
2,500 local
local florists
florists fulfilling
fulfilling orders
orders

Results: Named
Named “top
“top gift
gift site
site on
on the
the web”
web”
Direct Mail

Direct mail: One form of

direct response advertising that
uses mail rather than other
media to deliver a brand offer
An Example Of a Set Of Materials In a Mail Package

+
Strengths And Limitations Of Direct Mail

Strengths
Strengths Limitations
Limitations

•• Addressability
Addressability •• Postage
Postage cancan be
be costly
costly
•• Can
Can receive
receive more
more •• Some
Some offers
offers can
can be
be
attention
attention than
than costly
costly to
to produce
produce
advertising
advertising Vs. •• Complex
Complex offers
offers can
can
•• Not
Not as
as much
much clutter
clutter as
as require
require long
long lead
lead times
times
advertising
advertising
•• Message
Message can can be
be
tailored
tailored to
to any
any size
size or
or
shape
shape
Telemarketing

Telemarketing: The practice of

using the telephone to deliver a
brand message designed to create a
sale or sales lead
Controversial… … but Big Business

43 Billion
A Range of Automated Phone
System Options
Strengths And Limitations Of Telemarketing

Strengths
Strengths Limitations
Limitations

•• Personal
Personal ••Human
Human callers
callers can
can
•• Addressability
Addressability be
be costly
costly
•• Interactive
Interactive Vs. ••Intrusive
Intrusive
(unwanted
(unwanted calls)
calls)
How Can Direct Marketing Efforts Be Evaluated?

List
List Types
Types Offer
Offer Values
Values

Frequency
Frequency of
of Testing
Testing Creative
Creative
Exposure
Exposure Approach
Approach

Media
Media Mix
Mix
Used
Used
Ultimate Test: Effectiveness

Number
Number of
of responses
Number
Number of
responses
of offers
offers mailed
mailed = Response
Response
Rate
Rate

5 / 100 = 20

Total
Total cost
cost of
of mailing
Number
Number of
mailing
of sales
sales made
made = Cost
Cost
Per
Per Sale
Sale

Rs.1,000 / 5 = Rs.200
Insight: Tracking Customer Costs/Profits

Direct marketers are very proficient

tracking their costs and profits
because the medium is the easiest
to measure in terms of cost per
sale. One rule of thumb: in most
direct-marketing programs, a
customer isn’t profitable until the
third time he or she buys.
Think About It

Email Campaign
IfIf you
you had
had to
to design
design an
an e-mail
e-mail campaign
campaign for
for
your
your organization,
organization, how
how would
would you
you make
make itit
appealing
appealing and
and not
not just
just annoying
annoying spam?
spam?
Tales From the Real World

The public often wonders: “how did they

get my name (or address, phone number, or
email account)?”

In the real world, it’s fairly easy to acquire a

database list of many different types of
individuals. In fact, it’s amazing how specific
some of the lists can be. Some examples of lists
offered for sale by a list broker in their catalog:
“accupuncturists,” “golfers,” and “nuclear
physicists.”
Final Note:

• The increasing amount of clutter

and privacy concerns suggests that the
Direct Marketing winners will be those
organizations who:
• Are creative in making their appeals
stand out
• Are sensitive to consumer privacy
concerns