DIRECT & DATABASE

MARKETING
 Direct & Database Marketing
Learning Objectives:
 Define “direct & database marketing” (DDM)
 Understand & apply DDM concepts and methods
 Understand concept of integrated marketing & the role
of DDM
 “Hands-on” practice with DDM software
 Implications of current events
DIRECT & DATABASE
MARKETING

“The New Direct Marketing is an information driven

marketing process, made possible by database
technology, that enables marketers to develop, test,
implement, measure, and appropriately modify
customized marketing programs and strategies.”

David Shepard Associates

DIRECT & DATABASE
MARKETING

 Consists of ways of thinking, principles and tangible

elements

 What are the tangible elements of direct marketing?

DIRECT & DATABASE
MARKETING
Direct Marketing’s Tangible Elements

 The database itself

 Communications that invite a direct response

 Direct distribution of goods

DIRECT & DATABASE
MARKETING
Possible definitions:

“Any activity which creates and exploits a direct

relationship between you and your customer”
Drayton Bird, 1989

“Direct marketing is a way of acquiring and keeping

customers by providing a framework for three
activities: analysis of individual customer information,
strategy formation, and implementation such that
customers respond directly”
Alan Tapp,
2004
DIRECT & DATABASE
MARKETING

The Database - Interactive Marketing’s Essential

Difference:

 who our customers are

 what they buy

 leads to what they want from us

 how much they are worth to us

=> create relationships over time?

HANDLING CUSTOMERS ‘OVER
TIME’

 Your database allows you to understand your customers

history with you and so predict their future needs
DIRECT & DATABASE
MARKETING
General marketing: product focus
 build a brand and advertise it
 distribution to retail
 customer initiates buying

Direct & Database marketing: customer focus

 get to know customer because you start recording
your transactions with them
 maybe distribute direct
 company initiates contact
DIRECT & DATABASE
MARKETING

Similarities: in the initial stages of strategy

formulation

General marketing & DDM marketing:

 New product development

 Strategic thinking (SWOT)
 Research methods and testing
DIRECT & DATABASE MARKETING
GM vs DDM differences = in the content &
execution of the strategy

General Marketing:

 communications uses mass media to build brands

 sales promotions in retail environment
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content & execution of
the strategy

Direct & Database Marketing:

 Uses mass media when addressing new prospects
 Uses personal media-direct mail, telemarketing, when
developing relationships with existing customers
 Focus on customers, rather than products
 get to know customer because you start recording your

transactions with them

 maybe distribute direct
 company initiates contact
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content &
execution of the strategy

General Marketing: measurement

 Market research techniques to understand &
predict customers’ likely behaviour

Direct & Database Marketing: measurement

 Marketersanalyse behaviour to predict best
responding people & the best offers to make
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content & execution of
the strategy

Direct & Database Marketing:

 Is more expensive, on a per-customer basis

 A way of buying a closer relationship customer

 First individual information
 Subsequent precision & control in customer contact
I.e., Marketers analyse behaviour to predict best responding
people and the best offers to make
DIRECT & DATABASE MARKETING
A Complete System of Marketing:

 market analysis and research

 segmentation and positioning
 making an offer
 media and communication
 creating relationships

… are all done within a database marketing

framework
DIRECT & DATABASE
MARKETING

3 levels of direct marketing:

 DDM drives the business

 DDM drives all or part of the marketing strategy

 DDM is used within the communications mix

DATABASE MARKETING: 3 BROAD
TYPES OF APPLICATION

DM 1. ‘Stand alone’

2. Integrated
DM
DM
3. ‘Peripheral
DIRECT & DATABASE
MARKETING
Reasons for growth:

Social:
 Fragmentation of society

 Proliferation of media

 Greater consumer sophistication

 Consumers want to be in control

DIRECT & DATABASE
MARKETING
Reasons for growth:

Business:
 Ever more competition
 Drive for cost-effectiveness
 Interest in consumer retention & loyalty
 Continuing drop in computer processing costs
DIRECT & DATABASE
MARKETING
DDM Advantages:

 Lead grading
 Customized targeting at the right time

 New information & past results help formulate strategy

DIRECT & DATABASE
MARKETING
DDM Advantages:

 Information can drive new programs & fuel new revenue

sources
 Information can foster new services & generate repeat
orders
 Ongoing communication efforts can increase customer
loyalty