Direct Marketing

Explore the Strategy of Direct Marketing

direct marketing

Imagine yourself sorting through your daily mail. You have a few bills, maybe a magazine, a letter from your son at camp (unless he has e-mail access there), and assorted junk mail.

In the midst of your “junk” mail, one particular piece catches your eye, one advertising a techno gadget you’ve had your eye on for a while. And there’s a sale on it—all you have to do is enter the following code on the website…

What is direct marketing?

Direct marketing occurs when businesses address customers through a multitude of channels, including mail, e-mail, phone, and in person. Direct marketing messages involve a specific “call to action,” such as “Call this toll-free-number” or “Click this link to subscribe.” The results of such campaigns are immediately measurable, as a business can track how many customers have responded through a message’s call to action. (See also Reply Marketing)

In contrast, general advertising—for example, a billboard promoting a brand concept or product awareness—while seen by the customer, does not call for a specific response, and therefore cannot be easily measured. A marketer doesn’t know exactly how effective such a billboard is, or how many people are thinking about and buying the product because of the billboard. However, because of the specific call to action, he or she does know exactly how many people responded to a direct mailing.

Who employs direct marketing?

Components of Direct Marketing

  • Engagement of customers
  • Specific call to action
  • Means of tracking response

Retailers, credit card companies, media companies, technology companies, non-profit organizations—nearly every business uses some amount of direct marketing. The Direct Marketing Association (DMA) reported in 2010 that more than half of all advertising expenditures went toward direct advertising.

Direct marketing began in the 19th century with Montgomery Ward’s mail-order catalogues (See also Catalog Marketing). Direct mail campaigns expanded greatly after the creation of bulk mail rates in 1928. More recently, the development of e-mail has further increased the reach and scope of direct marketing.

The DMA, first established in 1917, is a trade organization that provides research, education and support for developing direct marketing. Its membership includes more than half of the Fortune 100 companies, as well as non-profit organizations. The DMA estimates that every dollar spent on direct marketing yields a return on investment of $11.73—compared with an estimated $5.23 for indirect advertising such as newspaper or magazine ads.

For what kinds of customers is direct marketing effective?

The most responsive customers to direct mailing (or e-mailings) are those who have opted in to mailing lists (for example, an online shopper buying a product checks a box marked “send me information on future promotions”). Such customers have already expressed interest in the company’s products, and pay attention to new products and sales. (See also Permission Marketing)

However, far more than just opt-in customers receive direct mailings. Non-targeted blanket mailings arrive daily in many mailboxes and e-mail accounts. Yet despite frustration with “junk mail” and “spam,” a high enough percentage of such mailings are acted upon. In fact, the percentages can increase when the advertising is targeted specifically at a particular community or group. Among African-Americans who receive direct mail, some three-quarters take the time to read what they receive instead of just throwing it away; while Asian-Americans open and read about 90 percent of all their direct mail.

How is a direct marketing campaign developed?

Direct Marketing Channels

  • physical mail
  • e-mail
  • telemarketing (phone)
  • short message service (texting)
  • broadcast faxing
  • couponing
  • direct response TV (commercials or infomercials)
  • insert media
  • face-to-face selling
  • door-to-door flyers/leaflets

Effective direct marketing begins with data. Marketers examine categories of customers or prospects they think will be interested in their product or service, and develop or procure lists for making contacts.

Lists can be obtained through public or commercial sources, and may represent all the people in a particular neighborhood, all the people who entered a contest drawing, all the people who opted in to a newsletter, a customer list from another business, etc. Such lists should not be used indiscriminately; instead, the data should be analyzed to create messages and offers that are likely to be relevant to these customers or prospects.

A direct marketing campaign may use multiple communications channels including mail, e-mail, phones, and face-to-face contact (See also Direct Mail Marketing). Different channels will be selected based on the target group. For example, a new restaurant might prefer distributing flyers or leaflets door to door, which saves money on mailing costs, targets the restaurant’s immediate neighborhood, and provides an opportunity for person-to-person engagement. Face-to-face engagement might also be used for in-store marketing. Home Depot In-Home Services, for instance, uses direct marketers in their stores to generate leads for various home improvement programs, such as cabinet resurfacing.

Often different communications channels can be combined. For example, a direct mail advertisement may include a QR (quick response) code, allowing recipients to immediately follow and engage the message online.

Every direct marketing campaign should feature a specific call to action. Often this is for an immediate purchase (“Pick up the phone and call right now to order”), but it doesn’t have to be—it could be a preliminary step leading to a sale. A direct marketing effort might acquire stronger leads for a particular sales force, perhaps calling customers to schedule appointments for consultations. Other calls to action might involve a “sale” that isn’t a financial one, such as when a non-profit organization uses direct marketing to recruit volunteers.

All direct marketing communications must include some method with which to track responses. A call to action might direct customers to call a specific number exclusive to that campaign, or to click on a link to a website with a landing page that exclusively handles responses from a given campaign (See also Post-Click Marketing). Direct marketers use the response-rate data to gauge how effective their communication is, and whether or not it needs to be changed for the next release. Such data is not only used to adjust the immediate campaign, but is also coordinated with data from other campaigns in order to present the direct marketing team with a better overall picture of their target markets. The data can then be used to more effectively optimize communication for specific market segments.

Acting on feedback from a campaign is essential for effective direct marketing. Poor direct marketing only wastes resources on a low rate of return and annoys prospective customers. In fact, an overabundance of blanket marketing has resulted in laws that make all direct marketing more difficult. For example, laws require direct marketing communications to include an opt-out option, and entirely prohibit certain methods or times of contact. Besides such legal actions, private industry has also responded to customer annoyance with spam by providing e-mail filters that block such marketing. Therefore, wise direct marketers must be careful to avoid frustrating prospective customers, and work to target them with relevant and useful messages and promotions that will be received not as “spam,” but as good business information.

What career titles work with direct marketing strategies?

Media Planner / Analyst

What do they do?

  • identify the channels of communication to be used in a direct marketing campaign
  • procure lists, print space, and TV/radio time
  • create marketing materials to be employed in a direct mail campaign
  • analyze the results of a direct marketing campaign, and make recommendations

Education and experience:

What Kind of Salary Can I Expect?

  • Media Analyst
    median salary: $71,000
  • Mailing List Broker
    median salary: $42,000
  • Telemarketing Executive
    median salary: $68,666

Sources: cbsalary.com and indeed.com

Media planners and analysts need at least a bachelor’s with a background in media and communications; some job postings require a master’s degree. They must demonstrate strong communications, organizational, and analytical skills. Analysts must be efficient at finding, analyzing, and monitoring information, and capable of reporting that information clearly to others.

List Broker / Compiler

What do they do?

  • capture data from commercial and public sources to create mailing/marketing lists for direct marketing campaigns
  • compile databases that can produce marketing/mailing lists based upon target criteria
  • buy/sell lists to different companies, and help companies select the best lists
  • help plan direct marketing campaigns, and analyze responses

Education and experience

List brokers need at least a bachelor’s degree in marketing or a related field. They must have experience in developing sources for names, and some methodology for improving the accuracy of lists; as well as successful sales experience. Strong computer and communications skills are required.

Telemarketing Executive

What do they do?

  • plans, organizes and manages a company’s telemarketing campaign
  • writes or reviews telemarketing scripts
  • coordinates script writing, testing, list procurement and preparation, and client reports
  • coordinates call center managers, trainers, and other subordinates in the campaign

Education and experience

Telemarketing executives must possess at least a bachelor’s degree in marketing, business administration, or a related field, and demonstrate strong communication and management skills. Prior experience must demonstrate management success, and may include telemarketing, customer service/retention, or advertising.

How can a marketing school help you in this field?

Effective direct marketing is fundamentally about communicating a clear and persuasive message. Marketing programs train students to practice and develop communications and presentation skills, allowing them to better implement direct marketing campaigns.

Communications courses teach students how to connect to audiences through a wide variety of channels, including print, radio, TV, and digital media. Instructors provide valuable feedback on how to improve your skills and adapt your message according to audience responses, allowing you to present an effective call to action in a variety of different ways.

A marketing program will also teach you how to acquire and interpret meaningful data, including how to obtain and analyze marketing lists. By applying the right analytical and statistical tools, you’ll be able to target a direct marketing campaign in order to increase the rate of response, and consequently, the return on investment.

To learn more about what a marketing school can do for you, take action now by requesting information from schools with degrees in marketing, and make the first step toward your new career.

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