DIRECT MARKETING

CHAPTER TAKEAWAYS
• Direct marketing vs. mass marketing
• Elements of DM
• Types of DM media
• Ethical principles in DM
WHAT IS IT?
• According to Direct Marketing Association, direct
marketing “is an interactive system of marketing
which uses one or more advertising media to effect
a measurable response and/or transaction at any
location.”

• One-to-one approach
WHAT IS IT?
• Produces an inquiry, a transaction & an immediate
response
• Asks for an action

• Direct interaction of marketer & customer, no

intermediary
• Includes:
• Direct mail, personal selling, direct-response television
or radio, mail-order catalogues, etc.
CHARACTERISTICS
• Interactive
• One-to-one
• Opportunity for personalization & relationship building

• Response-mechanism
• Respond to the offer, 2-way process
• Telephone numbers, coupons, business-reply envelopes,
etc.
CHARACTERISTICS
• Direct channel
• Location & intermediary are not an issue

• Database
• A storehouse of prospect/customer info
• Converted into objective, data-type format
• Sources: internal or external.
• Analysis based on database – recording, analyzing,
personalizing, measuring results, etc.
DIRECT MARKETING
Strengths Weaknesses
Highly targeted Expensive

Measurable Not suitable for large audiences

Personalization &
customization possible

Two-way communication

Relationship building
THE RIGHT PRODUCT CATEGORIES

• Products not available in stores

• Complex products
• Products with a clear perception of value
THE RIGHT PRODUCT CATEGORIES

• Products with a high worth

• Service-oriented products
• Products with an opportunity for cross-selling or
up-selling
• Products with greater customer involvement
THE RIGHT PRODUCT CATEGORIES

• Products with a larger need for info

• Products with an opportunity for market
research
• Products that a customer might want to buy
privately
ELEMENTS OF
DIRECT MARKETING
• The List
• A roll of prospects to target
• Prepared on the basis of a database
• Help provided by computers, e.g. merging & purging lists
• Types of lists
• House list: DM’s own customers; most valuable list
• Response list: people who have responded; target audience
• Compiled list: rented/purchased from a DM list broker
ELEMENTS OF
DIRECT MARKETING

• The offer
• Value for money or patronage
• More than just the product
• May include variables like price, maintenance or after-
sales services, shipping and handling, optional features,
acceptance of credit, time and quantity limits, free gift,
discount, guarantee or warrantee, etc.
ELEMENTS OF
DIRECT MARKETING

• The message
• Attention-grabbing piece
• Lures the prospect, gets him to learn about the offer
DIRECT MARKETING MEDIA
• Uses all mass marketing media & some more
• Direct mail
• Catalogues
• Internet
• Telemarketing
• Direct response TV or Radio
DIRECT MAIL
• One of the most popular
• Delivered by mail – posted, couriered or hand-
delivered personally
• Letter, package with a brochure, a business-
reply envelope, product samples, etc.
DIRECT MAIL
• Advantages
• descriptive, less competition, personalize-able, in-built
feedback mechanism, less wastage

• Disadvantages
• high cost but less wastage, junk mail, privacy concerns,
low response rates

• Mail design critical factor in grabbing attention

CATALOGUE
• Direct mail publication that shows the products to
be sold
• Contains all info needed to place an order
• Used when multiple products
• May be available for a fee
• Online catalogues
• No tight space restrictions, easy to make changes, less
costly
CATALOGUE DESIGN
• Display products in a striking setting
• Follow some order – least to most expensive,
products of a category, products per size, etc.
• Include all imp product info: product size, colour,
pricing…
• Pictures & colours enhance the look
• Image-building vs. merchandise list catalogues
THE INTERNET
• Convenient, flexible, less costly
• Websites offer a virtual store
• Can trim down expensive mail catalogues
• Customization, personalization & instant problem-
solving
• Aids in database building
• Network enhancing tools: web-based address
books, calendars & reminder svcs
THE INTERNET

• No touch & feel opportunity

• Transaction issues: credit card payments, network
or page errors, etc.
• Indian situation
• Will pick up with novel or hard-to-get items, secure
credit card transfers, higher Internet & PC penetration
DIRECT eMAIL
• Low cost, easy distribution, multiple formats,
personalization & customization

• Low response rates, considered as junk

• 2 important elements:
• The email list
• The email letter
TELEMARKETING
• Picking up in India
• Strengths: Fuse personal contact with mass
marketing, allow personalization, instant 2-way
communication
• Weaknesses: Highly personal & intrusive, costly,
‘Do-not-call’ lists
• Use when: real need, business need, exploring
personal contacts
TELEMARKETING
• Inbound & outbound telemarketing
• Inbound:
• Experienced after advtg spurt
• More effective
• Don’t bug w/ an IVR (Interactive Voice Recording)

• Outbound:
• By sales reps, hired call-centers or telemarketers
• Generate highest resistance
TELEMARKETING DESIGN
• Personal medium
• Live calls better than pre-recorded sales pitches

• Sales reps should be cordial, patient with

customers & well-informed

• Avoid complex messages involving calculation,

detailed info dissipation, demo, etc.
TELEMARKETING DESIGN

• Should have a strong benefit w/ product as the

solution

• It’s not always a sales call

• Brief message: 2-3 mins max

DIRECT RESPONSE ADVERTISING

• Direct marketing advertising through mass-media

• Magazines, newspapers, TV, radio

• Time & space limitations, compete w/ editorial

content, high costs
AN ETHICAL ISSUE!
• Abuse of privacy

• Personal, behavioural, psychographic & lifestyle

info obtained w/o knowledge or permission

• Sources: computer cookies, Internet usage,

checkout scanners, membership cards, credit
cards, etc.