Elect 111 Direct Marketing – Chapter I

Defining Direct Marketing and

the Direct Marketing Process

JERIC L. PADSING
Instructor
Direct Marketing: Creating Customer Value and Engagement
Marketing is engaging customers and managing profitable customer
relationships. The twofold goal of marketing is to attract new customers by
promising superior value and to keep and grow current customers by delivering
value and satisfaction.

Marketing is the process by which companies engage customers, build strong

customer relationships, and create customer value in order to capture value from
customers in return.
Direct Marketing: Creating Customer Value and Engagement

Direct marketing consists of any marketing that relies on direct

communication or distribution to individual consumers, rather than
through a third party such as mass media.

MAIL

• KIOSKS
DELIVERY
TEXT CAMPAIGNS EMAIL • COUPONS
SYSTEMS USED
• PHONE CALLS
SOCIAL MEDIA
Direct Marketing: Creating Customer Value and Engagement

COMPANY

TARGET AUDIENCE
Direct Marketing: Creating Customer Value and Engagement
Direct Marketing: Creating Customer Value and Engagement

A direct marketing pitch that is delivered to the widest possible

audience is probably the least effective. That is, the company may
gain a few customers while merely annoying all of the other
recipients.

The most effective direct marketing campaigns use lists of targeted

prospects in order to send their messages only to the likeliest
prospects.
Direct Marketing: Creating Customer Value and Engagement
Advantages and Disadvantages of Direct Marketing

• Cost effective. Direct marketing has its appeal, particularly to companies

on a shoestring budget who can't afford to pay for television or internet
advertising campaigns.
• The main drawback with direct marketing, however, is the profile-raising
and image building that comes with a third party accrediting your brand.
• The effectiveness of a direct marketing campaign is easier to measure
than other types of advertising, since brands can analyze their own
analytics, track unique source codes, and tweak strategies effectively
without going through a middleman. The company can measure its
success by how many consumers make the call, return the card, use the
coupon, or click on the link.
Direct Marketing: Creating Customer Value and Engagement

The Direct Marketing Process: Creating & Capturing Customer Value

Direct Marketing: Creating Customer Value and Engagement
Understanding the Marketplace and Customer Needs

What do companies need to understand?

NEEDS,
MARKET VALUE & EXCHANGE &
WANTS AND SATISFACTION RELATIONSHIPS MARKETS
OFFERINGS
DEMANDS

• Research, • Products, • Marketers • Marketing occurs • Sellers must search

observe, and services and must be when people for and engage
interact to experiences careful to set decide to satisfy buyers, identify their
understand • Pay attention the right level their needs and needs, design good
customer to benefits of wants through market offerings, set
needs, wants, and expectations. exchange prices for them,
and demands experiences relationships. promote them, and
• Consistently deliver store and deliver
superior CV them.
Direct Marketing: Creating Customer Value and Engagement
Designing a Customer Value–Driven Marketing Strategy and Plan

How to design a customer value-driven strategy?

• Identify (who)
• Divide
• Target
• What customers will we serve
(what’s our target market)?

• How can we serve these • How it will

customers best (what’s our value differentiate and Value proposition is set
of benefits and values
proposition) position itself to the
Managers the brand promises to
should ask marketplace deliver to consumers to
satisfy their needs.
Direct Marketing: Creating Customer Value and Engagement
Preparing an Integrated Marketing Plan and Program

• The marketer develops an integrated marketing program that will actually deliver the
intended value to target customers. The marketing program builds customer relationships by
transforming the marketing strategy into action. It consists of the firm’s marketing mix, the set
of marketing tools the firm uses to implement its marketing strategy.

PRODUCT PLACE PRICE PROMOTION

Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Strategic Planning
• Each company must find the game plan for long-run survival and growth
that makes the most sense given its specific situation, opportunities,
objectives, and resources. This is the focus of strategic planning—the
process of developing and maintaining a strategic fit between the
organization’s goals and capabilities and its changing marketing
opportunities.

• Company-wide strategic planning guides marketing strategy and planning.

Like marketing strategy, the company’s broader strategy must also be
customer focused.

• The company needs to define a market-oriented mission.

Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Defining a Market-Oriented Mission

• A mission statement is a statement of the organization’s purpose—what it

wants to accomplish in the larger environment. A clear mission statement
acts as an “invisible hand” that guides people in the organization.

• Mission statements should be market oriented and defined in terms of

satisfying basic customer needs. Products and technologies eventually
become outdated, but basic market needs may last forever.
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Market-oriented Mission

“An online place to post pictures…”

“To give everyone the inspiration to

create a life that they love.”

“To create the world’s best software,

technologies, and devices.”
“To empower every person and
every organization on the planet to
achieve more.”
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Market-oriented Mission
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Market-oriented Mission
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Setting Company Objectives & Goals

• The company needs to turn its

broad mission into detailed
supporting objectives for each
level of management. Each
manager should have
objectives and be responsible
for reaching them.
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Designing the Business Portfolio

• Guided by the company’s mission statement and objectives, management

now must plan its business portfolio—the collection of businesses and
products that make up the company. The best business portfolio is the
one that best fits the company’s strengths and weaknesses to
opportunities in the environment.

• The major activity in strategic planning is business portfolio analysis,

whereby management evaluates the products and businesses that make
up the company. The company will want to put strong resources into its
more profitable businesses and phase down or drop its weaker ones.
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Planning Marketing: Partnering to Business Customer Relationships

• The company’s strategic plan establishes what kinds of businesses the

company will operate and its objectives for each.

• Marketing can’t go it alone in creating customer value. Under the

company-wide strategic plan, marketing must work closely with other
departments to form an effective internal company value chain and with
other companies in the marketing system to create an external value
delivery network that jointly serves customers.
Company Direct Marketing Strategy: Partnering to Build Customer Engagement, Value, Relationships

Planning Marketing: Partnering to Business Customer Relationships

THE ROLES OF MARKETING IN COMPANY’S STRATEGIC PLANNING

 It provides a guiding philosophy—the marketing concept—that suggests

the company strategy should revolve around creating customer value
and building profitable relationships with important consumer groups.
 It provides inputs to strategic planners by helping to identify attractive
market opportunities and assessing the firm’s potential to take advantage
of them.
 Within individual business units, marketing designs strategies for reaching
the unit’s objectives.
Elect 111 Direct Marketing – Chapter I

Thank you!

JERIC L. PADSING
Instructor