Promotion - direct marketing

Author: Jim Riley  Last updated: Sunday 23 September, 2012

Introduction

Direct marketing is concerned with establishing an individual relationship between the business offering a product or service and the final customer.

Direct marketing has been defined by the Institute of Direct Marketing as:

The planned recording, analysis and tracking of customer behaviour to develop a relational marketing strategies

The process of direct marketing covers a wide range of promotional activities you may be familiar with. These include:

• Direct-response adverts on television and radio
• Mail order catalogues
• E-commerce (you bought this marketing companion following tutor2u’s direct marketing campaign!)
• Magazine inserts
• Direct mail (sometimes also referred to as “junk mail”)
• Telemarketing

Direct mail

Of the above direct marketing techniques, the one in most widespread use is direct mail.

Direct mail is widely thought of as the most effective medium to achieve a customer sales response.

Why?

• The advertiser can target a promotional message down to an individual level, and where possible personalise the message. There are a large number of mailing databases available that allow businesses to send direct mailing to potential customers based on household income, interests, occupation and other variables

• Businesses can first test the responsiveness of direct mailing (by sending out a test mailing to a small, representative sample) before committing to the more significant cost of a larger campaign

• Direct mailing campaigns are less visible to competitors – it is therefore possible to be more creative, for longer

However, direct mail has several weaknesses:

• A piece of direct mail is less “interactive” than a television or radio advert, although creative packaging can still stimulate customer response

• Lead times to produce direct mailing campaigns can be quite long

• There is increasing customer concern with “junk mail” – the receipt of unsolicited mail which often suggests that the right to individual privacy has been breached.

The Direct marketing database

Direct mailing is based on the “mailing list” – a critical part in the direct marketing process. The mailing list is a database which collects together details of past, current and potential customers. A properly managed mailing database enables a business to:

• Focus on the best prospective customers

• Cross-sell related products

• Launch new products to existing customers

How is the mailing database compiled?

The starting point is the existing information the business keeps on its customers. All forms of communication between a customer and the business need to be recorded so that a detailed, up-to-date profile can be maintained.

It is also possible to “buy” mailing lists from elsewhere. There are numerous mailing list owners and brokers who sell lists of names. The Internet, directories, associations and other sources are good sources.

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