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Direct Marketing – Consumers and Sellers deal with each other directly versus

through a wholesaler or retailer


Colgate, Xerox, IBM, Sierra Club

Advantages
-Allows collection of relevant information from customers
-Makes it more convenient
-Marketer controls product, not a wholesaler or retailer
-Advertising is easier to comprehend
-Allows flexibility in form and timing

Disadvantages
-People don’t want to buy something without seeing it (clearly changing now)
-Too many magazine and phone calls can get annoying
-Unable to reach everyone in a market (improving with improvement of databases)

5 STEPS
1. Objectives and Strategies
a. Identify potential customers
b. Motivate customers to come to an event
c. Illicit the ordering of products
2. The offer
a. Buy-one-get-one-free
b. Supported by more advertising
2.5 Message and Media Strategy
c. Show comparisons between other products
d. Personal feel
e. One-step versus two-step offer
3. The Response/Order
a. Main aim is for people to take action – namely buy
b. This part makes that easy and clear as possible
4. Fulfillment and Customer Maintenance
a. Getting product to customers
b. Maintain customer relationship
5. Relationship Building/Evaluation

Database Marketing – Heart of Direct Marketing


Helps monitor and predict trends in consumers. Works to record and compile
names, results based on advertising, the measurement of purchasing performance
and provide continuing communication.

1. Lists
a. Lists based on demographics, psychographics and geographic
breakdowns
b. Can merge lists to target more and more specific audiences
c. House List – Already buyers
d. Response List – those who respond
e. Compiled List – specific categories
2. Data Driven Communication
a. Communicating to already established list of object buyers
b. COMPUTERS + HISTORY SEARCHERS
3. Customer Relationship Management
a. Find links between customers transactions and characteristics
b. Allows identification and good treatments for most loyal/most
profitable customers

Key Players

1. The Advertisers
a. More than 12,000 firms
2. The Agencies
a. Advertising Agencies
b. Independent Agencies
c. Service Firms
d. Fulfillment Houses – Making sure consumers receive things on time
3. The Media Companies
a. Mail
b. Phone
c. Internet
d. Email
4. The Customers
a. Believe it can be annoying yet convenient

Tools of Direct Marketing

1. Direct Mail – Print advertising message for product or service


a. Advantages
i. Tells story
ii. Engages attention
iii. Personalizes the message
iv. Builds in feedback
v. Reachers the unreachable
b. Disadvantages
i. Negative perseptions
ii. Cost
iii. Mailing List
iv. Response Rate
v. Vulnerability
c. Design is key
2. Catalogs
a. JC Penny, LL Bean
b. Allows more selection
3. Telemarketing
a. Inbound – Consumers call
b. Outgoing – Firm calls
4. Direct-Response Advertising
a. Print Media
b. Broadcast Media
5. The Internet
a. ONLINE SHOPPING

Integrated Direct Marketing – The Future

1. Linking the channels


a. Linking different types of media
2. Creating Loyalty

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