Direct Marketing: Features, Functions, Growth,

Advantages/Disadvantages, And Direct Marketing Strategies.

 
Promotion: Meaning, Importance, tools used,
Conventional/unconventional, drawbacks,
push pull strategies, Co-operative advertising, Integration with
advertising and publicity
 
Public relation/ Publicity:- Meaning, Objectives, tools of public
relations, Public relation strategies, Goals of publicity, Corporate
Advertising – Role, Types, Limitations, PR Vs Publicity.
Direct marketing is a form of advertising which allows businesses and
nonprofit organizations to communicate directly to customers through a
variety of media including cell phone text messaging, email, websites,
online adverts, database marketing, fliers, catalog distribution,
promotional letters and targeted television, newspaper and magazine
advertisements as well as outdoor advertising.
Growth of direct marketing:
The following factors have led to the growth of direct marketing:
• The change in the lifestyle and technology advancement
• More women in the workforce
• Credit card explosion
• Response
• Fulfillment
• Toll free number
• Technological advancements
• Avoiding waste
Features of Directing marketing:
1. It goes directly to an identified person or a household
2. The goal of direct marketing is different type of actions
3. The results can be measured with precision
4. Direct marketing is interactive
5. Makes use of customer database

Functions of Directing marketing:

6. To get sales needs
7. To help build new customers
8. To retain or increase the business from new customer
9. To improve selection of market segment
10. To stimulate repeat purchase
11. To generate goodwill
12. Generates direct order
13. Prompts information requests (leads)
14. Generates store or business traffic
15. Builds and maintains a consumer database
 Thwaites and Shron (1994), in a study of the financial services industry,
rank direct marketing’s benefits based on their value to UK financial services
institutions as follows:
• Cross-selling 44%.
• Lead generation for sales force 28%.
• Up-selling current and new products to existing customers 24%.
• Keeping customers sold on product/service 15%.
• Selling to new prospects 13%.
• Generation of retail traffic 8%.

Peltier et al (1994), in a study applied to private hospitals in the United

States, identify the four most important objectives of using direct marketing.
According to Peltier’s (1994) findings, these objectives rank as follows:
• Increasing hospital awareness 70%
• Lead generation for current programs/services 64%
• Promoting special events 63%
• Image enhancement 57%
Advantages of Direct Marketing:
1. Greater accuracy in targeting consumers
2. Timing can be controlled to maximize impact
3. Competitors are less aware of activity
4. Provide more opportunities for feedback from consumers thus improving
subsequent marketing activity
5. All outcomes are precisely measurable
6. Segmentation capabilities
7. Frequency
8. Flexibility
9. Personalization
10. Costs
11. Reduce lead generation costs.
12. Convert leads into sales.
13. Eliminate profit-killing price discounts.
14. Earn the business of quality clients who advocate your business.
15. Improve your client relationships.
16. Get profitable and repeat sales.
Disadvantages of Direct Marketing:
1. Image factors
2. Accuracy
3. Content support
4. Rising costs
Direct Marketing Strategies
Types of media and strategies used in direct marketing are:
1. Direct mail
A. Catalogues
A. Outer envelope
B. Letter
C. Broucher
D. Insert
E. Business reply envelope
B. Mail packages

2. Broadcast media
3. Infomercial
4. Internet marketing
5. Face-to-face selling.
6. Catalogs.
7. Telemarketing.
8. Direct-response advertising.
9. Kiosk marketing.
Sales promotion
Sales promotion is the process of persuading a potential customer to buy
the product. Sales promotion is designed to be used as a short-term tactic to
boost sales – it is rarely suitable as a method of building long-term customer
loyalty. Some sales promotions are aimed at consumers.

Types of Sales promotion

• Free gifts
• Discounted prices
• Joint promotions
• Free samples
• Vouchers & coupons
• Buy 1 Get 1 free
• CRM
• Merchandising
• Finance Deals
Importance of Sales promotion:
A)  IMPORTANCE TO CONSUMER
a. Sufficient product knowledge
b. Availability of product at reduced prices
c. Increase in consumers buying confidence
d. Increases in the quality of goods purchased
e. Higher slandered of living
f. Minimize exploitation
B)  IMPORTANCE TO PRODUCER / MANUFACTURE
g. Increases in sales
h. Regular sales of seasonal product 
i. Improve effectiveness of advertisement and personal selling
j. Cooperation from middlemen 
k. Demand for product & services 
l. Able to capture new market 
m. Increase in goodwill 
n. Direct control 
o. Effective steps to face the competition
p. Improvement & new uses of the production
C) IMPORTANCE TO DEALERS/ MIDDLE MEN
a. Facilitates larger sales :-
b. More facilities & assistance:-
c. Direct relation with customers :-     
                                        
 D) IMPORTANCE TO THE SOCIETY & THE NATION
The importance of sales promotion programme for the society & the nation
can be summarized as below :-
d. Increase in standard of living the people.
e. Increase in employment opportunities.
f. Development and expansion of transport, communication, banning,
insurance and warehousing facilities.
g. Increase in Gross National Product and per capita income.
h. Creation of healthy competition in national and international trade, etc.
Conventional/unconventional
Conventional methods
Conventional advertising is the main types of advertising that have been done
in the past. This includes newspapers, magazines, radio, TV and billboards.

Tools and techniques of Conventional methods

Consumer oriented Trade oriented
• Catalouges • Dealer incentive
• Samples • Volume discount
• Coupons • Training programme to dealers
• contests/sweep stakes • Trade show
• Demonstration at different place • Road show
• Discounts • Exhibition
• Bonus packs (bigger quantatity) • Best display award and reward
• Price off (25%) • Trips abroad
• Event sponsorship (pepsi, coco-cola • Free gift
etc) • Slotting allowance
• Easy installment scheme
• Exchange offers (Exchange old for
new)
Non-Conventional methods:
Unconventional advertising, often referred to as guerrilla marketing, often
consists of creative, low-cost marketing methods used by small businesses to
temporarily promote a product or service.

Tools and techniques of NON-Conventional methods:

Tools Examples
Game show Family fortune, Khul jaa sim sim
Quiz programme Tata cubilces, Milka biscuits
Surprise visit by Pepsi used actor Madhavan
celebrities to consumer's
house
Domestic Tour Sun TV conducts promotional effort every year during
summer in collabarationwith brooke bond’s ‘3 roses tea
powder
Foreign trips Maruthi, Hyundai
Surprise gifts to existing Passport scheme by Hero honda
customers
Push And Pull strategies,
Push strategy

A push promotional strategy involves taking the product directly to the

customer via whatever means, ensuring the customer is aware of your brand at
the point of purchase.

“Taking the product to the customer”

Examples of push tactics:

• Trade show promotions to encourage retailer demand
• Direct selling to customers in showrooms or face to face
• Negotiation with retailers to stock your product
• Efficient supply chain allowing retailers an efficient supply
• Packaging design to encourage purchase
• Point of sale displays
Pull strategy

A pull strategy involves motivating customers to seek out your brand in an

active process.
“Getting the customer to come to you”

Examples of pull tactics:

• Advertising and mass media promotion
• Word of mouth referrals
• Customer relationship management
• Sales promotions and discounts
Co-operative advertising
Cooperative advertising

Cooperative advertising is advertising undertaken jointly by a manufacturer of a

product and either a wholesaler or retailer. The manufacturer will contribute a certain
amount of funds for the advertising campaign subject to certain conditions for the
advertising of its product.
Or

Cooperative advertising involves paid advertising messages with costs shared by

retailers and manufacturers. Retailers often initiative the pursuit of co-op ads with the
point being that the retailer and the manufacturer benefit when end customers buy the
products the manufacturer makes and the retailer sells.
Or
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.
Types of Cooperative advertising:
1. Horizontal mode
2. Ingredient-sponsored mode
3. Vertical mode