5.Direct and Online Marketing

7/31/2019 5.Direct and Online Marketing

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Direct and Online Marketing


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What is Direct Marketing?

Direct marketing is the use of

consumer-direct channels to reach anddeliver goods and services to customerswithout using market middlemen.


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DIRECT MARKETING

The Net, Telemarketing, Mailers are all channels ofDirect Marketing Direct Contact between a company &its customers

Effectiveness can be measured because direct feedbackavailable from customers; eg. how many respond to acall/mailer/net

A database is maintained; main requirement for

competitive advantage


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DIRECT MARKETING

Growth and Benefits

Phenomenal growth with latest technologies being used; globalscale, web-based marketing, e mail marketing

In traditional media, a lot of wastage & cost effectiveness issuspect : DM zeroes in on target

Now products are continuously being launched & these have toreach customers quickly

Customers want companies to design products according tospecifications, so they want to interact directly

There are issues of information privacy & physical privacy


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Direct Marketing Channels

Direct mail

Catalogs

Telemarketing

Other direct response


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Constructing a Direct-Mail Campaign

Establish objectives

Select target prospects

Develop offer elements

Test elements

Execute

Measure success


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DATABASE MARKETING

Marketing by effective use of consumerinformation

e.g.

age of car, banks offer loans,

age of children educational loans, creditcards, educational software


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DATABASE MARKETING

Helps customers evaluate markets

identify customer segments & prospects

search for other customer segments with wants &

needse.g.

Holiday Company can market Puri as honeymoondestination or for old people

identifies tastes & needs whether company is getting maximum business from a

customer

opportunities to provide insight into various markets


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RFM Formula forSelecting Prospects

Recency

Frequency

Monetary value


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Elements of the Offer Strategy

Product

Offer

Medium Distribution method

Creative strategy


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FORMS OF DATABASEMARKETING

Catalog Marketing : Companies send catalogs givingdetails of products, and expects response byphone/post

Retailers use it Charagh Din, Burlingtons, Amazon

Company

Marketer has to consider whether a product is pricedright in catalog, whether customers would buy a

product through catalog, whether it can be depictedproperly, whether it can be shipped properly;

Costs are reduced $ 14 vs $ 34


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Telemarketing

Communicates with customers through telephones;needs highly trained staff; aimed at people who areprospective customers for building long-termrelationships rather than immediate sales (tele sales)

Makes calls at customers convenient time; makesappointments for sales people to follow up; improve

in telecommunication; results in companies beingintegrated with telephones; use of third party service

providers (call centres)

FORMS OF DATABASEMARKETING


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Types of Telemarketing

Telesales

Telecoverage

Teleprospecting Customer service and technical

support


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Kiosk Marketing

Kiosks or electronic touch screens which sure

customers information about products/services ofcompany; requires small space 4 sq. ft., operate24/7, eg. Railways, Infosys, ATMs

Convenient for shoppers in retail

FORMS OF DATABASE MARKETING


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Television

Direct Response Advertising

At-home shopping channelsTV programmes where various products aredisplayed, demonstrated & tries to obtain orders;customers can shop from convenience of their

home; very popular in the US

Videotext


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Other Media

Newpapers, Magazines, Journals, PCs, leaflet etc.Unlike in other Media, customers cannot be addressed

individually; eg. in magazines sports are targeted forwide audience, so targeting may be lost. Coupons getbetter response whether in magazines/paper; mobilephones are becoming popular media



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Components of the Mailing

Outside envelope

Sales letter Circular

Reply form

Reply envelope


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Interactive Marketing

Tailored messages possible

Easy to track responsiveness

Contextual ad placement possible

Search engine advertising possible

Subject to click fraud

Consumers develop selective attention


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Public Issues in Direct Marketing

Irritation

Unfairness

Deception/fraud

Invasion of privacy


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Direct Marketing in India

Cosmetic companies use Direct Marketing 70% ofsales force are women; AMWAY is a big name inDirect Marketing

Major areas of growth : financial services, telecom,credit cards, insurance, automobile, homeappliances, entertainers, (Happy Zone), Foodproducts, holiday sharing


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Direct Marketing in India

Fair response in urban areas; resistance in ruralareas

TV home shopping catching on

Mail order not very popular; delivery in damagedcondition, delays

Popularity of telemarketing in generating sales leads


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ONLINE MARKETING

Internet has revolutionized business

Goods / services / products can cross

international barriers at click of mouse Powerful technologies : Data mining,

Satellite telecom, Mobile telecom, IVR


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Online Promotional Opportunities

Websites

Microsites

Search ads

Display ads

Interstitials

Internet-specific

ads and videos

Sponsorships

Alliances andaffiliate programs

Online communities Email

Mobile marketing


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Advantages of OnlineMarketing

Disadvantages

a) reach large customer base

globally

a) people not accustomed

onlineb) can shop fromhome/workplace; convenient

b) reluctance to give creditcard details

c) can compare to competitors

c) customers want to touch

& feel good

d) direct interaction betweenuser & seller

e) no traditional stores costs

f ) can count exact number ofcustomers visiting site


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e-Marketing Guidelines

Give the customer a reason to respond

Personalize the content of your emails

Offer something the customer could notget via direct mail

Make it easy for customers tounsubscribe


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Online Advertising

Forums : discussion group on commercial website thatlink users to libraries, chatrooms

Newsgroups : Customers can praise/expressdiscontent about a product (Yahoo)

Bulettin Boards : Electronic notice board where mailssent, discussions held

Web Communities : Users who want to shareinformation online through message boards (eg. yahoogroups)

E-mails : Should be targeted carefully

Web Casting : Broadcasting through Internet; usersent information after his consent

Documents

5.Direct and Online Marketing