Direct marketing refers to an advertising campaign that presents information about a company and the products and/or services that it offers to a targeted group of people. It eliminates advertising “middlemen”, as companies present marketing materials to consumers who are likely to become buyers. In this article, we will provide a in-depth description of direct marketing, including examples and the benefits that it offers.
Direct marketing is one of the original forms of advertising. With this form of marketing, businesses and organizations across various industries communicate directly with targeted customers via a different media channels. If you have ever received a phone call from a telemarketer or an email from a business that you have previously purchased an item from or filled out a survey for, you have experienced direct marketing in action.
Though consumers often find direct marketing tactics a nuisance, if done properly, it can be a highly effective way for a business to grow its customer base.
How Does Direct Marketing Work?
Direct marketing is exactly what it sounds like: marketing professionals reach out to the base market of a business (existing customers or possible customers) personally. For example, marketers might make a phone call (telemarketing) or send an email (email marketing) directly to every individual who has been pinpointed as their market base. Direct marketing can also employ mass media, such as ads in magazines or infomercials.
The key to direct marketing is a call to action, a message that encourages those who are targeted by this type of marketing to take some sort of action. Examples of actions that those who are targeted by direct marketing are asked to take include:
- Making a phone call to a company
- Clicking on a link provided in an email promotion
- Responding to a survey
- Filling out a response card
- Make a purchase
- Request more information
Companies that employ direct marketing campaigns use the information they receive from respondents to measure the effectiveness of the campaign. This form of marketing is most effective when businesses utilize targeted lists of potential customers that have been created using available marketing information that divides prospects into groups of people that are the most likely to take interest in the products and/or services the companies offer.
Strategies Used in Direct Marketing
Direct marketers employ several strategies in order to reach their targeted customer base. Some of the most commonly used strategies include:
- Email. This direct marketing strategy targets potential customers via their email. Lists of email addresses are harvested and compiled from various sources, including social media sites, websites, purchases that consumers have made online, and forums that pertain to the company’s industry. Some companies require people to provide their email address before they are granted access to a website. Companies then develop emails that contain calls to action and send them out to the email addresses they have compiled.
- Phone calls. More commonly known as telemarketing, this form of direct marketing involves advertisers making phone calls to prospective clients. Non-profit organizations often use this strategy as a way to ask people who may be interested in their cause for donations. Businesses that are selling products or services also use telemarketing to reach out to prospective clients for the sole purpose of making sales and increasing their success.
- Mail. Companies also use the mail for direct marketing purposes. Advertisements are sent out to prospective clients via their physical mailing address. Advertisements often include catalogues, coupons, surveys and questionnaires.
Other types of directly marketing can include making door-to-door solicitations, promotional stands on curbsides or at fairs or festivals, television marketing (infomercials, in particular), text messaging, and voice mail marketing from robo callers that leave pre-recorded messages.
The Benefits of Direct Marketing
Direct marketing offers some distinct benefits over other types of marketing. For example, unlike mass marketing, which involves advertising to a non-specific group of people, advertisements through direct marketing are presented solely to the people who are believed will have a need or an interest in the products or services that a company offers. In other words, there is more of a chance that those who this form of marketing reaches will end up taking the action that direct marketing requests; making a purchase, completing a questionnaire, or clicking on a link, for example.
Some other key reasons why direct marketing is more successful than other forms of marketing include:
- It’s more cost-effective. Instead of spending money trying to reach a large, non-specific audience that may or may not be interested in a company’s products or services, advertisers are only spending money on reaching a targeted demographic that would be likely to make a purchase.
- It’s a better return on investment, as there is a greater chance that a purchase will be made by those who are targeted by direct marketing.
- The messages made in direct marketing can be personalized. For example, marketers can include the names of customers in an email or on a flyer that is sent in the mail. This makes recipients feel as if they messages are made just for them.
- It can be measured. This form of marketing employs several methods of tracking the success of campaigns. This allows marketers and business to improve the tactics that they use for future campaigns. For example, if one email campaign doesn’t yield the results that are intended, marketers can hone future emails, making them more appealing to prospects and therefore increasing the success of a future campaign.
The Downside of Direct Marketing
Though direct marketing can be extremely successful, there are some downsides associated with it. Some of the most notable cons of this form of marketing include:
- It can be considered a nuisance. For example, many consumers find that receiving phone calls from telemarketers are highly annoying. As such, they can add their name to a no-call list, which will prevent marketers from being able to make contact with them. This depletes the number of targets that a direct marketing campaign can reach.
- The response rates of a direct marketing campaign can vary widely. For example, the majority of those who have received an email from a direct marketing campaign may never respond to it. In turn, this makes the flow of potential customers difficult to predict.
- If a campaign is ineffective, it can be extremely costly; particularly if ineffective campaigns happen often. Moreover, in order for a direct marketing campaign to be effective, a company has to maintain an accurate database of prospective customers. Doing so can be very expensive to maintain.
Tips for a Successful Direct Marketing Campaign
In order to ensure the success of a direct marketing campaign, businesses and marketers should employ certain strategies. Here’s a look at some tips that can help to improve the effectiveness of direct marketing.
- Make your customer database your top priority. A direct marketing campaign cannot exist if it does not have a strong list of targeted customers as its foundation. It is crucial to keep your database up-to-date and accurate at all time. Why? – Because your customer database keeps tabs on previous purchases and provides insight into buyers’ behavior. An updated database makes it easier to reach your audience in a way that will encourage them to respond. It also helps you determine who you can up-sell and cross-sell to.
- Add some personalization. This is a crucial component of an effective direct marketing campaign. When messages are personalized, they are more relevant, which makes those who you are targeting more likely to complete the action that you have specified, such as making a purchase. Some tips for making direct marketing campaigns more personalized include adding the names of individual recipients to the emails that they receive, using their names when they are being called, and sending out flyers that include a personalized salutation.
- Create a memorable design. Make your messages stand out by creating a memorable design. For example, if you are using email marketing, your emails are more likely to stand out from the crowd of other marketers if they contain eye-catching and engaging subject lines and the email message itself has a great layout.
- Sell solutions, not products. If you really want to catch the attention of your audience, market solutions to their problems; not your products or services. For example, someone who is working on a home project is interested in finding a way to get it done faster. While you may be selling a drill that a customer could use on the project, don’t market the drill; advertise the fact that you have a solution to his problem: getting his job done faster.
- Don’t forget the basic elements. It’s crucial for every direct marketing message, no matter what medium you are using, to contain three key elements:
- The offer
- Information that will encourage recipients to accept the offer
- A way for recipients to respond to the offer
Should You Consider Direct Marketing
That depends on your business and your goals; however, direct marketing has proven to be a highly successful tactic for various types of businesses and organizations across various industries.