1. Have a clear view of what direct marketing is.
Direct Marketing is a way of acquiring and keeping customers by providing framework for three activities: analysis of individual customer information, strategy formation, and implementation such that customers respond directly.
2. Understand its importance in contemporary marketing.
Problems with broadcast media – Impersonal timing & message.
Problems with print media – Waste of reach.
Technical reasons for growth in direct marketing:
– Internet & Web 2.0, Proliferation of media.
Social reasons for growth in direct marketing:
- Consumer sophistication.
- Consumer wants to be in control. - Fragmented society and diverse lifestyles.
Business reasons for growth in direct marketing: Broadcast marketing, e.g. TV less effective. More focus on customer retention than acquisition Cheaper computing and telcoms costs. Greater competition, e.g. banks. 3. Understand its role within the wider marketing framework.
Direct links to integrated marketing communications tools: Sales promotion Public relations Personal selling Broadcast media
Common problems with online sites: No face-to-face when buying products. Customers Googling to find cheaper prices. SOLUTION – building loyal relationships through direct marketing/email and personalising sales to add value.
Three levels of direct marketing: Direct marketing drives the business. (Direct Line Insurance) Direct marketing drives part of the business. (British Airways) Direct marketing is used within the communication mix. (the university sector)
4. Know what a database is.
What is a database? a collection of data records in a list that can be manipulated by software. Data record an entire set of information about (people (individual level) B2C or companies B2B) data field, e.g. Name, purchase history, age, address, gender, past communication, response history for B2c as well as employee numbers or type of industry etc. for B2C.
Software needed to target efficiently in personalised way: Generate customer lists to target Historical response data Predict purchase propensity 5. Know what data to hold and where to get it.
Typical Consumer Data: - Name – Email -Phone – Address -Age -Children -Lifestyle -Credit rating -Account number -Purchases -Payment method -Source of recruitment – Campaign responses -Reading/viewing habits.
Typical Business Data: - Company name - Email - Phone - Address - Website - ABN number - Contact 1 - Contact 2 - Contact 3 - Revenue - Number of employees - industry
Where to get data?
Direct contact companies – (internal sources) customer service department, response to direct marketing prospects, billing sales transactions.
List purchase – (Commercially available e.g. lifestyle databases.)
New contact channels – In-store offers, subscriptions details, events/promotions wanting a response, credit cards details, product registration, warranties.
Database Management Issues: Entering accurate data , e.g. validate and de-duplication Continuous management over time, e.g. internal and external(bureau)? Different perspectives from: Marketers, It, Managers. Manage the applications e.g., typos, wrong persons identity
6. Be aware of legal constraints.
Databases and Privacy The “Privacy Acts” are data protectionlaws which regulate the collection, use and disclosure of personal information about individuals, they do not proetect privacy of the individual in broader sense
Topic 2 Analysing And Using Databases
Compare segmentation applications.
Database Segmentation Strategies: Using purchase data to define segments. Allocating marketing budget by predicted future dollar spend. Maximise response to direct campaign by targeting most