Direct Marketing

Zaeem Mirza

What Direct Marketing Is Not?

- Direct marketing is called something else - Direct marketing equals direct mail - Direct marketing equals junk mail

Clearing Up Misconceptions

Direct Marketing is an interactive marketing system that uses one or more advertising media to effect a measurable response and/or transaction at any location

Definition

Interactive System Measurability Of Response Non-Location Specific -

Key Elements And Importance

- Complex Marketing Environment - Fragmentation Of Society - Proliferation Of Media - Greater Consumer Sophistication - Decreased Customer Loyalty - Marketing Costs Are Up, Need For Cost Effectiveness - Advertising Budgets Are Shoestring - Marketers/Clients Demand More Accountability - Continuing Drop In Processing Costs - ROI-based Medium

Why Direct Marketing?

The Development Of Direct Marketing

The Varied Approaches To Direct Marketing

Direct Marketing Drives The Business

Stand-alone Direct Marketing

Direct Marketing drives part or all of the marketing strategy -

Integrated Direct Marketing

Direct Marketing is used within the communications mix -

Peripheral Direct Marketing

Benefits Of Direct Marketing

Mass Marketing Type Knowledge Offering Product Distribution Communication Promotion Message Economy Average Customer Customer Anonymity Standard Product Mass Production Mass Distribution Mass Advertising Mass Promotion One Way Message Economies Of Scale

One To One Marketing Individual Customer Customer Profiling Customized Product Offering Customized Production Personalized Distribution Personalized Messages Personalized Incentives Two Way Message Economies Of Scope

Share
Focus Strategy

Share Of Market
All Customers Customer Attraction

Share Of Customer
Profitable Customers Customer Retention

Mass Marketing vs One To One Marketing

Direct Marketing Special Competencies

Database Marketing

The sum total of all the information that an organization keeps. It could thus comprise information stored in various computers, files, tapes, and even hand written data such as letter and memos -

What Is A Database?

A database is a collection of data, organized logically and managed by a unifying set of principles, procedures, and functionalities, that helps guarantee the consistent application and interpretation of that data across the organization -

What Is A Database?

A marketing database is a organized collection of comprehensive data about individual customers, prospects, or suspects that is current, accessible, and actionable for such marketing purpose as lead generation, lead qualification, sale of a product or service, or maintenance of a customer relationship -

Marketing Database

A marketing database is a comprehensive collection of interrelated data serving multiple applications, allowing timely and accurate ondemand retrieval of relevant data, having a data management system independent of applications -

Marketing Database

Understand Events Uncertainty Innovation SWOT Customization Database Development Enhance Customer Loyalty Effective Media Formulation Of Strategy

Need For Database Marketing

Segmentation Complete Information Accessible/Shareable Data Usable Technological Orientation

Characteristics Of A Good Database

Deciding Which Customer Should Receive Particular Order

Identifying Prospects

Customer Purchase Reactivation

Deepening Customer Loyalty

How Companies Use A Database?

Storing Customer Data

Database Software

Typical Database

Master Customer File Operational Database Customers Database Marketing Database Data Warehouse Data Mining

Types/Functions of Databases

Sequential Files Relational Database -

Database Architecture

Relationship Marketing

Relationship Marketing means the marketing activities aimed at building long term relationship with people and organization that contribute to the companys success

The focus business-to-business marketing has shifted from one single transaction to over all buyer-seller relationship a focus known as relationship marketing

Relationship Marketing

Marketers try to build a long term win-win relationship with valued customers, dealers, distributors, and suppliers Relationship marketing results in strong economic, technical, and social ties amongst the parties The ultimate outcome of relationship marketing is the building up of a unique company asset called marketing network

Relationship Marketing

Identify key customer meriting relationship marketing Assign a skilled manager to each key customer Develop a close JD for the Relationship Manager Appoint an overall manager to supervise all Relationship Managers Each relationship manager should develop a long range annual customer relation plans

Relationship Marketing Program

Integrated Marketing Communications aka IMC

Product

Price

Promotion

Distribution

Advertising

Personal Selling

Consumer Promotion

Public Relation

Direct Marketing

Integrated Marketing Communication Mix

Situation Analysis Marketing Objectives Marketing Budget Marketing Strategies Marketing Tactics Evaluation of Performance

Marketing Plan

DM programs afford a company the opportunity to make one to-one contacts with current customers and potential customers These contact points are times to spell out, reinforce, and promote the firms image and theme Beyond simply selling goods and services, DM program can utilize the information developed in various database to make sound connections with customers of all types DM is especially valuable to the marketing team looking for ways to complement and supplement the IMC efforts such as advertising, personal selling and consumer or trade promotions

DM As An IMC Tool

Life-time value of customers

The total net contribution that a customer generates during his or her life time on a house list.

The net present value of all future to overhead and profit.

Life-time value of customers

 Future Forecast Revenue Expenses Profits Cost of Capital

Factors Of Customers Life-Time Value

LTV = Ci /(1+d)i
Where, C = the net contribution from each years marketing activities. d = Discount rate. i = the expected duration of relationship (in years)

Calculating the LTV

 In deciding how much a particular organization is willing to spend to recruit each new customer Choosing media for initial customer acquisition Setting selection criteria for marketing Investing in the reactivation of lapsed customers An asset value to the marketing database

Benefits of LTV Analysis

One of the key jobs of a direct marketer is to make that the creative message is placed where it is seen or heard by the right people At the right time In the right environment With the right frequency and weight

Direct Media Strategy

Direct Marketing Methods And Media

The Advantages of Direct Mail

- Selectivity - Personalization - Flexibility - Isolation - Response rates

Direct Mail

Types of catalogs
- Consumer Catalogs - Business Catalogs

Catalogs

The most successful commercials offer a bargain, guarantee satisfaction, and make the product easy to order. Each of these reduces the risk the consumer may perceive in placing the order by making the shopping experience easy, convenient, safe, and economical

Direct-Response Television Commercials

Benefits from print media

Longer shelf life compared to direct mail - Pass-along readership potential - Regional and demographic segmentation Print also allows direct marketers to widen their customers base to non-mail order buyers -

Direct Response In Print Media

Direct Marketing In Magazines

Significant uses of Telemarketing Selling, including outgoing and incoming calling

Setting qualified appointments Generating lead advertisements Surveying Providing customer service Advertising And Public Relations Pursuing collections

Telemarketing

Wrapping Up