Direct Marketing

Direct Marketing (Idea)

Rapidly growing area in marketing. A variety of direct response media are used to convey the communications message.

Direct Marketing

a total set of activities where the seller attempts to get a direct action response-for example, a purchase, schedule an appt. It employs many aspects of marketing, i.e. research, segmentation, advertising, etc.

Direct Marketing Media

the tools that direct marketers use in the communications process.

Growth of Direct Marketing because...

- the catalog

- the use of consumer credit cards

- direct-marketing syndicates

- the changing structure of the American market

- technological advances

Role of Direct Marketing in the IMC Program- Advertising

- D.M. is in itself a form of advertising. Mail, print, or TV, the direct response offer is an ad. Can sometimes support the direct selling effort. i.e. tv ad to support in-store sales.

Role of Direct Marketing in the IMC Program- Public Relations

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

Role of Direct Marketing in the IMC Program- Personal Selling

- companies often use telemarketing and or direct marketing to generate sales.

Role of Direct Marketing in the IMC Program- Sales Promotions

- many local merchants send out mailers announcing sales and promotional offers.

Direct Marketing Objectives

- Direct marketers most often seek a direct response but may be used for other purposes: to build an image, maintain customer satisfaction, and inform and/or educate customers in an attempt to lead to future actions.

Developing a Database

- One of the most important parts of the direct marketing program is the development of a database. The database is the foundation from which direct marketing decisions evolve.

Database are used to perform the following functions

- Improving the selection of market segments

- Stimulate repeat purchase

- Cross-sell

Direct Marketing Strategies and Media

Direct marketers generally pursue either a

1.) One-Step Approach or a

2.) Two-Step Approach

in developing media strategies.

Direct Marketing Strategies and Media- One-Step Approach

- the medium is used to directly obtain an order. i.e.direct response television ads.

Direct Marketing Strategies and Media- Two-Step Approach

- more than one medium may be used, the first effort screens or qualifies buyers and the second generates the response. Various direct response media include: 1. Direct mail 2. Catalogs 3. Infomercials 4. Teleshopping 5. Print Media 6. Telemarketing

Direct Marketing Strategies and Media- Two-Step Approach:: Direct Mail

- Mail order sales exceeded $44 billion in 2009, more monies have been spent in the medium than any other. Keys to the success of direct mail are the mailing list and the ability to segment markets.

Direct Marketing Strategies and Media- Two-Step Approach:: Catalogs

- over 13.5 billion catalogs were mailed in 2009

Direct Marketing Strategies and Media- Two-Step Approach:: Informercials

- the lower cost of commercials on cable and satellite channels has led advertisers to a new and very effective form of advertising.

Direct Marketing Strategies and Media- Two-Step Approach:: Teleshopping

- the major sopping channels in the United States-QVC, and the Home Shopping Network. Together they account for billions of dollars in sales, and there seems to be no indications that this medium is reaching maturity.

Direct Marketing Strategies and Media- Two-Step Approach:: Print Media

- magazines and newspapers are difficult media to use for direct marketing. In addition, the benefit of an immediate response is not as apparent.

Direct Marketing Strategies and Media- Two-Step Approach:: Telemarketing

- Almost $334 billion worth of sales took place through telemarketing phone calls in 2009. Telemarketing has been hurt by the do not call lists, through the business to business sector remains strong.

Direct Selling

- involves the direct, personal presentation, demonstration and sales of products and services to consumers in their homes.

Direct Selling: Examples

1. Repetitive person-to-person selling- Amway/ Mary Kay

2. Non-repetitive person -to-person selling- Encyclopedia Brittanica

3. Party Plans- Tupperware/PartyLite Gifts

Evaluating the Effectiveness of the Direct Marketing Program

- used in addition to other means of measurement of effectiveness, direct marketers also measure cost per order (CPO).

Cost Per Order

- the marketer knows almost instantly whether or not the advertisement is working.

Direct Marketing: Advantages

1. Selective Reach

2. Segmentation Capabilities

3. Frequency

4. Flexibility

5. Timing

6. Personalization

7. Cost Efficiencies

8. Ability to Measure Effectiveness

Direct Marketing: Disadvantages

1. Image Factors

2. Accuracy

3. Content Support