Direct marketing is advertising aimed at individuals. A lot of people confuse direct marketing with sales promotion, which is not true. Sales promotion involves giving discounts, gifts or other things to encourage buyers to make a purchase. It is used to bring in the customers to check the products before deciding on whether to buy or not.
Direct marketing refers to promoting products and services directly to your target market. It requires the creation and distribution of marketing materials such as postcards, pamphlets, ads and other such items. Whether you are selling goods or services, direct marketing can help you reach the right people with the right message at the right time.
Why is direct marketing important?
- It helps marketers reach customers fast. A direct marketing campaign is sure to reach the potential customer quickly. For instance, a marketer can create an email marketing campaign now, and merely two hours later, it will be in the recipients’ inbox.
- It is an efficient promotion strategy. Unlike other strategies, direct marketing allows companies to create targeted campaigns that reach audiences that are genuinely interested in their products or services. This focused nature of these campaigns ensures maximum efficiency when sending out promotional messages. With direct marketing, marketers are saved from sending advertising content to regular lists that are not refined in any way.
- Direct marketing can be customized. Direct marketing allows businesses to create personalized messages using customer data. For example, a company can access useful information such as age, income range, reading and browsing habits, etc. and then use this data to create tailored marketing content for their prospects and existing customers.
- Direct marketing allows to measure its efficiency. Companies and businesses that implement direct marketing techniques can track the success of their campaigns by analyzing things such as the number of customers who have responded to their ads, the revenue earned, and the overall return on investment. Moreover, direct marketing enables marketers to learn how much their prospects are willing to spend on particular products or services.
Features of Direct Marketing
Since direct marketing strategies are focused on communicating a brand message directly to customers, certain characteristics help us differentiate this type of promotion from others.
- Targeting. Direct marketing is successful only if it targets the right people. If you’re going to promote your offer to your entire audience, you risk spending much money in vain. For that reason, direct marketers work with the most interested customers and rely on segmentation tools.
- Database segmentation. Marketers divide their customer base into small groups with some common characteristics which include age, gender, occupation, location, interests, needs, income, etc. This allows them to craft highly personalized offers that will be relevant to each segment.
- Tracking responses. Without monitoring customer responses, you will never know which strategies perform best for your brand. Online direct marketing channels allow users to easily respond to marketing campaigns as well as they let brands to monitor the entire process. Users can communicate with companies via emails, social media channels, chatbots, etc.
Put your advertising dollars to the best use
Unlike mass marketing such as TV ads, direct marketing appeals to a smaller group of likely customers.
Phone calls are a very effective direct marketing tool, as they allow a business representative to speak directly to a current or prospective customer.
Because it allows a more personal interaction, telemarketing works well for both the seller and the buyer.
A company can connect better with their customers by way of a direct human-to-human conversation. One can:
- Explain product attributes.
- Answer questions.
- Overcome objections.
- Reach out to a larger number of people than with personal sales calls.
You can also track and tabulate the performance of your telemarketing team.
2. Promotional emails
Almost half the world uses email, of which 200 million are Indians. It is an extremely effective way to reach out to your target audience — wherever they might be.
Email gives you the advantage of creating personalized messages that directly address the recipient’s concerns.
Personalized emails build rapport, helping you both add new customers and retain the existing ones.
Email lists are usually gathered via a signup form you place on your website, blog or social media pages. It is important to only send emails to those who have chosen to receive such marketing communications.
An email is a very flexible instrument that lets you send plain text and graphics along with attachments. You can also scale up an email campaign at will, as well as track and measure its success. Experts recommend every email includes a call-to-action in it to push response.
Editor’s note: GoDaddy Email Marketing is an all-in-one tool for creating, sending and tracking promotional emails.
3. Text messaging
Texting is the fastest and most convenient way for a business to reach out to its current and future clients anywhere, any time. People are known to respond much faster to a text than to an email or a phone call.
The potential of texting as a means of direct marketing cannot be underestimated in a country like India, with its 337 million smartphone users.
The principal advantage of texting is that a huge majority of the recipients of text messages read them within minutes of receiving them, leading to a very impressive ROI. Besides, with people always carrying their phones with them, texting is a great way to send time-sensitive messages. You can use information about your customer’s past purchase behaviour to send a targeted text message at an opportune time — say, during a sale.
4. Targeted online display ads
In today’s times it is not a question of whether one will opt for online display ads, but when. This is just as true of India, where 500 million people use the internet. Any business, regardless of size, cannot keep postponing the decision of tapping into the vast and enticing Google Ads and Facebook ad networks.
For any Indian business eying a global market, online ads are the best way to achieve highly specific targeting at a low entry price. It lets it target very precise niches, thereby gaining them a competitive advantage. Besides, online display advertising lets one quantify ROI and calibrate one’s ad campaign, increasing or decreasing your spending according to the success achieved.
One might have imagined that newsletters wouldn’t amount to much in the era of instant communication and social media updates. But businesses continue to use newsletters to inform and educate their prospects and customers.
Newsletters work well because they are the cheapest way of delivering quality information to one’s prospects and customers.
Modern desktop publishing software makes it quite easy to produce well-formatted and visually appealing newsletters that can be mailed to a dedicated email list. These can be sent out regularly to create a binding relationship with prospects and customers.
A call to action
Direct marketing commonly uses incentive-based information where it offers consumers a benefit to acting on. Called a call to action (CTA), they depend on your industry and the target consumers.
Examples of CTAs are:
- Click the link
- Visit our website or store
- Call us to get more info on our products or services
- Subscribe with your email address
- Purchase here
- Register your interest
- Limited-time coupon
- Sign up now
- Invitation-only event
- Discounted membership
- Make a booking
The benefits of using direct marketing
There are several benefits to businesses using direct marketing. I will talk about some of those now.
Marketing is measurable
The first significant benefit of direct marketing is measurable results.
Direct marketing is more straightforward to measure than many other types of advertising. With a process called data mining, firms can use analytics to improve their results.
Online, firms use pixels to measure campaign results, such as identifying who has clicked on an advert or used a unique discount code.
Physical mail drops are harder to measure. Still, any noticeable increases in sales of items over the campaigns can be attributed to the advertising.
The most important deliverable is whether there is an overall return on investment for the campaign.
As well as measuring the effectiveness of your marketing, you can test new markets and trial new products or services.
“Successful direct marketing initiatives require firms to predict the behaviour of specific individuals.” (Allenby, Leone & Jen, 1999)
Marketing becomes optimised
By monitoring and analysing their processes, firms can improve future campaigns’ success by tweaking their strategy.
Firms can use small direct marketing campaigns to test marketing effectiveness, such as test A / B tests. They can try different variants of the ad’s components, such as subject title, images, call to action, or even when they send out a campaign.
New products can even be tested on small market segments before mass marketing to evaluate customers desire for those products and services.
“Instead of promoting to customers indiscriminatively, direct marketing studies customers’ characteristics and needs, and selects certain customers as the target for promotion.” (Ling & Li, 1998)
Marketing is targeted
Indirect marketing uses marketing techniques broadcast to random audiences. Direct marketing, on the other hand, focuses on targeted lists of prospective customers.
Marketing targets the most likely prospects, which improves the response rate. For example, for a supermarket sending out the weekly specials, this will be location-based. It makes sense to focus marketing efforts on the people most likely to give results, right?
Direct marketing becomes more profitable the more targeted it becomes. You do not want to waste money marketing to people who will not be customers. Your marketing becomes junk mail or spam to these people.
Creating targeted audiences requires database segmentation. Segmentation is the process of dividing the customer base into small groups with some common characteristics.
People are grouped based on their criteria such as age, income, location, gender, occupation, interests and buying patterns.
Marketing is personalised
Because firms target marketing to a specific audience, marketing is also personalised to those customer segments’ needs.
Firms use information about their audience, such as age, income, and consumer behaviour, to create tailored marketing content. We want the audience to react, so firms must customise their message to increase their chances of resonating with the specific audience.
High conversion rate
Because direct marketing usually involves research to identify and focus on the customers most likely to purchase, it has a higher conversion rate than other marketing forms.
Furthermore, email marketing tactics are only contacting previous customers or people who have opted to receive advertising.
The audience already has a real interest in the firm and is more likely to convert again.
Direct marketing strategies allow producers to receive a better price by selling products directly to consumers (Uematsu & Mishra, 2011)
Direct marketing can be a small fraction of mass marketing costs because it eliminates the need for a middleman, such as an advertising agency. Moreover, because the audience chosen for a campaign is small and targeted, this also reduces the cost. Direct marketing can be done on a tight budget and still achieve results.
Enhanced customer loyalty
Direct mail is an excellent tool for building and maintaining relationships with customers and prospects because it is personalised.
Firms can combine direct marketing with customer loyalty tactics to increase the bond further. Examples of loyalty strategies include special discount offers, sending birthday messages and invites to ‘exclusive’ sales events.
Direct mail can be successful in re-establishing relationships with former customers who have not consumed it for a while.
Direct marketing strategy
As a marketing strategy, firms such as banks, insurance companies, and the retail industry increasingly use direct marketing. It can be a very aggressive form of marketing, so firms must carefully plan and implement it.
As the target audience should be people who have expressed interest or are likely to be interested in what you have to say, you need to develop contact lists. Having a robust database of customers and potential customers is key to the success of direct marketing.
“In direct marketing, this knowledge is a description of likely buyers or responders, and is useful in obtaining higher profit than mass marketing.” (Ling & Li, 1998)
It is vital to maintain an organised database and customer records. Data mining can provide an effective tool for direct marketing, discovering useful information about customers to be used in campaigns.
Campaigns are personalised to these audiences to capture their attention with relevant offers.
Direct marketing methods
There are several marketing methods firms can use to reach their customers. Many were named above. This section will outline some of the popular forms.
It entails giving loyal customers membership cards. Customers can then use these cards to access price discounts, free trials, and other offers. Combine your direct marketing methods with your loyalty program.
“Retailer direct marketing typically includes coupons or promotions bundled together with an advertising message.” (Lund & Marinova, 2014)
The use of discounts through advertising media is called couponing, which can be an excellent way to elicit a response from targeted customers. Firms can send coupons by mail for customers to take in-store to receive a discount or a digital version.
Coupons are downloaded and printed or shown on the customer’s mobile phone. Firms can distribute digital coupons via company websites, social media, texts, or email.
Delivering advertising inserted into shared media is called insert media. Often a one-page ad is inserted into other physical communication media, such as catalogues, newspapers, or magazines.
For this strategy to work effectively, it needs to be targeting the right audience. For example, an automotive store would not want their insert media inside women’s gossip magazines. The target audience should align.
Direct mail uses the mailbox of potential customers to deliver advertising materials. Campaigns often focus on people in a specific geographic area or customers on a marketing list.
There are several different types of direct mail. Types of direct mail are circulars, leaflets, or flyers distributed to everyone in the advertiser area.
This method can work well for local businesses whose products or services appeal to a broad audience. It is common with financial services, consumer goods and travel and tourism industries.
Catalogues, on the other hand, are usually only sent to consumers with a previous interest.
As well as letterbox drops could be handouts to people in the city or shopping malls. Postcards and envelope mailers are also standard direct mail methods.
One of the more well-known and traditional direct selling methods, door-to-door, has a salesperson go out and knock on the door of homes. It can be a very laborious and frustrating job, with people not home or answering the door rudely when they see the salesperson.
It is common for real estate salespeople to find a property to list to satisfy buyers looking in a particular geographic area. Telecommunications and utility companies often employ a salesforce to use this method as one-on-one communication can be highly persuasive.
Door hangers are another form of door-to-door, which is a more passive form. Salespeople hang fliers over the door, and no actual interaction takes place.
Sending promotional material to users via their mobile devices is mobile marketing. It is a very low-cost way to reach the target audience. A targeted method as firms creates the database with customers and other interested people.
Firms send messages via text, including information about sales, links to website specials, appointments or information about the order status.
Creating a chatbot for websites or social media messaging apps helps brands automate answering customer questions with relevant answers. Commonly chatbots are designed to reach out to people browsing the page automatically and can even collect orders.
In summary, the article has explored direct marketing as an advertising tool for businesses.
I have discussed some of the benefits of using direct marketing, such as being measurable and targeted.
I define twelve direct marketing methods to give tips on integrating direct marketing into your marketing strategy. Not every direct marketing method will suit every business.
The purpose of direct marketing is to develop direct relationships with customers and prospects. The method used to achieve this is a range of marketing products and techniques that are used to reach a target audience directly.