By: Aulia and Ani
• Dictionary of
Marketing Terms, Peter Bennett defines direct
marketing as:
the total of activities by which the seller, in effecting the exchange of goods and services with the buyer, directs efforts to a target audience
using one or more media (direct selling, direct mail, telemarketing,
direct-action advertising,
catalogue selling, cable TV selling, etc.) for the purpose of soliciting a
response by phone, mail, or personal visit from a prospect or
customer.
• Direct Marketing is a system of marketing by which organizations communicate directly with target customers to generate a response or
transaction.
VS
Direct marketing is one of the fastest-growing forms of promotion in terms of dollar
expenditures, and for many marketers it is rapidly becoming
the medium of choice for reaching consumers.
• Direct marketing uses a set of direct-response media, including direct mail, telemarketing, interactive TV, print, the Internet, and other
media. These media are the tools by which direct marketers implement the communications
process.
The Growth of Direct Marketing
• Direct marketing has been around since the invention of the printing press in the 15th century. Ben Franklin was a very successful direct marketer in the early 1700s, and Warren Sears and Montgomery
Ward (you may have heard of these guys) were using this medium in the 1880s.
• The major impetus behind the growth of direct marketing may have been the development and expansion of the U.S. Postal Service,
which made catalogs available to both urban and rural dwellers.
• Catalogs revolutionized America’s buying habits; consumers could now shop without ever leaving their homes.
A number of factors in American society have led to the increased attractiveness of catalogue , for both buyer and seller:
1. Consumer credit cards :
• It is estimated that over $1.23 trillion was charged on credit cards in the year 2001.
• A high percentage of direct purchases do use this method of payment, and companies such as American Express, Diners Club, MasterCard, and Visa are among the heaviest direct
advertisers.
2. Direct-marketing syndicates.
• Companies specializing in list development, statement inserts, catalogs, and sweepstakes have opened many new opportunities to
marketers. The number of these companies continues to expand, creating even more new users.
3. The changing structure of American society and the market.
• One of the major factors contributing to the success of direct marketing is that so many Americans are now “money- rich and time-poor.”
• At the same time, the increased popularity of physical fitness, do-it-yourself crafts and repairs, and home entertainment have reduced the time available for shopping and have increased the attractiveness of direct purchases.
4. Technological advances.
5. Miscellaneous factors.
The Role of Direct Marketing in the IMC Program
• Direct-marketing activities support and are supported by other elements of the promotional mix, they are:
1. Combining Direct Marketing with Advertising
2. Combining Direct Marketing with Public Relations 3. Combining Direct Marketing with Personal Selling 4. Combining Direct Marketing with Sales Promotions 5. Combining Direct Marketing with Support Media
1. Combining Direct Marketing with Advertising
2. Combining Direct Marketing with Public Relations
3. Combining Direct Marketing
with Personal Selling
4. Combining Direct Marketing with Sales Promotions
5. Combining Direct Marketing with Support Media
Direct-Marketing Objectives
• The direct marketer usually seeks a direct response. The objectives of the program are normally behaviors—for example, test drives, votes,
contributions, and/or sales.
• Not all direct marketing seeks a behavioral response, however. Many
organizations use direct marketing to build an image, maintain customer satisfaction, and inform and/or educate customers in an attempt to lead to future actions.
Developing a Database
• To segment and target their markets, direct marketers use a database, a listing of customers and/or potential customers.
• Research by the U.S. Postal Service showed that 65 percent of the companies surveyed rely on their internal databases for marketing purposes.
• This database is a tool for database marketing—the use of specific
information about individual customers and/or prospects to implement more effective and efficient marketing communications.
Functions of Database :
1. Improving the selection of market segments
2. Stimulate repeat purchases 3. Cross-sell
4. Customer relationship management
Sources of Database Information
• The U.S. Census Bureau. Census data provide information on almost every household in the United States. Data include household size, demographics, income, and other information.
• The U.S. Postal Service. Postal Zip codes and the extended four-digit code provide information on both household and business locations.
• List services. Many providers of lists are available. The accuracy and timeliness of the lists vary.
• Standard Rate and Data Service. SRDS provides information regarding both
consumer and business lists. Published in two volumes, Direct Mail List Rates and Data contains over 50,000 list selections in hundreds of classifications.
• Simmons Market Research Bureau. SMRB conducts an annual study of customers who buy at home via mail or telephone. It compiles information on total orders placed, types of products purchased, demographics, and purchase satisfaction, among others.
• Direct Marketing Association. The direct marketers’ trade organization promotes direct marketing and provides statistical information on direct-marketing use. The DMA’s Fact Book of Direct Marketing contains information regarding use,
attitudes toward direct marketing, rules and regulations, and so forth.
STRATEGIES
• one-step approach
Direct marketing media used directly to obtain an order
• two-step approach
multiple efforts used to generte a respone. First effort is used to screen, qulify or interest potential buyers. Follow-up used to achieve order or close the sale
Media
• Direct mail
• catalogs
• Broadcast media
• Print media
• Telemarketing
• Direct selling
• Electronic teleshoping
Direct mail
A marketing effort that uses a mail service to deliver a promotional printed piece to your target audience . www.businessdictionary.com
• List of goods or services on sale with
their description and prices published as a printed document, or as an electronic document (e-catalog) on internet or on a
diskette, CD, DVD, etc.
www.businessdictionary.com
Catalogs
Broadcast Media
• Spreading an advertising message or signal over a wide area (or to all connected devices) without specific
targeting.
Unlike narrowcasting, broadcasting employs
a shotgun approach in dissemination of information. See also multicasting and unicasting.
www.businessdictionary.com
Printed media
Telemarketing
• Contacting, qualifying, and
canvassing prospective customers using
telecommunications devices such as telephone, fax, and internet. It does not include direct
mail marketing.
www.businessdictionary.com
Electronic teleshoping
VIDEO: Electronic Teleshopping
Direct selling
• face presentation, demonstratioFace to n,and sale of products or services, usually at the home or office of a prospect by
the independent direct sales representatives.
Employed by firms such as Avon, Mary Kay, and
Tupperware, direct selling differs from network
marketing in that it offers little or
no incentives for recruiting ever increasing number of sales
representatives.
www.businessdictionary.com
there are three forms of direct selling
1. Repetitive person-to-person selling. The salesperson visits the buyer’s home, job site, or other location to sell frequently purchased products or services (for
example, Amway).
2. Nonrepetitive person-to-person selling. The salesperson visits the buyer’s home, job site, or other location to sell infrequently purchased products or services (for example, Encyclopaedia Britannica).
3. Party plans. The salesperson offers products or services to groups of people through home or office parties and demonstrations (for example, Tupperware and Party Lite Gifts).
Direct Selling
Advantages and Disadvantages of Direct Marketing
Advantages
• Selective reach
• Segmentation capabilities
• Frequency
• Flexibility
• Timing
• Personalization
• Costs
• Measures of effectiveness
Disadvantages
• Image factors
• Accuracy
• Content support
• Rising costs
Sources:
• George E. Belch and Michael A. Blech , ADVERTISING AND PROMOTION: An Integrated Marketing Communication Perspective, Sixth Edition, PDF
• www.businessdictionary.com
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