Direct Marketing is a branch of marketing that communicates directly to target markets via ‘addressable media' such as mail, telemarketing and e-mail. It differs from advertising in that it does not communicate via third party media such as TV, radio and print. Database marketing is an evolutionary refinement of direct marketing using computer databases that are continually updated with customers and prospects records such as buying history, demographics, personal preferences and so forth. It is most effective when used as an ongoing process. It is a powerful, more targeted cost effective tool compared with mass media, which have immense wastage.
The main benefit of database marketing is the ability to target your marketing and promotional programs to prime prospects unlike other media, which are difficult to assess since there is no direct response from the consumer. With database marketing you can measure the results and continue to refine your tactics and strategies.
You can also personalise your communications and even vary the message according to different sub-sectors of the target group.
The main forms of direct marketing are:
Direct mail
Broadcast e-mail
Broadcast fax
Telemarketing
Telephone messaging
Direct mail allows the marketer to design mailers in many different formats. Some of these are catalogues, self-mailers (a folded item that requires no envelope), postcards, dimensional mailers (in many different shapes and sizes). Within these and other formats, there is ample scope to use creativity to get the recipient's attention. Disadvantages of direct mail is wastage resulting from the 'junk mail' reputation when overused, labor intensiveness in sorting and handling and the high cost of postage in some countries.
Broadcast e-mail is rapidly growing in popularity and is effective where databases with recipient permission are maintained. E-mail messages are often designed in the same way as web pages and have links to the marketer's web site. Common users of broadcast e-mail are companies with strategies designed to maintain links with existing customers, shareholders, club members and the like. Other users of broadcast e-mail are operators of loyalty programs such as those used by travel agents, book stores, car dealers, travel agents and the like. Companies that sell direct to the public or businesses (such as Dell Computers) use the medium very effectively.
It is the Internet's version of direct mail. This is fastest growing form of database marketing as today's computer database and spreadsheet programs have simplified the process so that it is low cost and can be generated quickly.
Sending e-mail to people without their consent is known as ‘spamming and is illegal in some countries. For this reason marketers usually generate their databases by asking customers' and prospects' permission when they are purchasing a product or service, entering a competition or other promotion or express interest in receiving special offers or updates from a facility in the marketer's web site (on-line registration). Even then it is necessary to give people an “unsubscribe' option each time a communication is addressed to them. Broadcast fax is a variation of broadcast e-mail in which faxes are sent to customers and prospects via a database of fax number contacts.
Telemarketing In telemarketing, as the name suggests, marketers contact customers and prospects via telephone usually from a specially set-up call center. One of the attractions of telemarketing is the speed with which campaigns can be executed. While direct mail is cost-effective, it is relatively slower than telemarketing because of the logistics involved. Telemarketing also lends itself to products and services that are complex to buy, such as to switch Telco providers, promote a financial service or to solicit donations to charities. Telemarketing allows a company representative to use persuasion and to explain any complexities.
Telemarketing can take two main forms.
• Outbound telemarketing: Through using auto diallers and predictive diallers, call centres can call a large number of customers in a short period of time.
• Inbound telemarketing: Promotions and offers made when a customer calls the center in response to other advertising.
One of the disadvantages of telemarketing is a negative consumer attitude to this form of unsolicited promotion, which are often regarded as 'nuisance calls'.
SMS Telephone Messaging This similar to broadcast emailing using mobile phone technology to send SMS messages to consumers from a central database. It is a growing emerging direct marketing technique that has accelerated since the rollout of 3G technology.
Direct and database marketing is often carried out by specialist service providers The services provided by these companies includes the maintenance of mailing lists and the production of mailing pieces.
Emerging channels Pay TV is being promoted as the technology solution of the future that will deliver direct response via television.
Direct response A related form of marketing is direct response marketing. In direct marketing, the marketer contacts the potential customer directly, but in direct response marketing the customer responds to the marketer directly. Its most common form today is via TV infomercials in which consumers respond via telephone or Internet with credit card in hand. Other media, such as magazines, newspapers, radio, and e-mail can be used to elicit the response, but they tend to achieve lower response rates than television.
