Advertising opens the door to endless commercial opportunities for businesses. Today there are many ways to use and apply it, both online and offline.
Either way, every campaign is created to improve the customer experience, build customer loyalty and support customers throughout the buying process.
We explain it below
What is direct marketing?
Philip Kotler, considered the father of modern marketing by the AMA (American Marketing Association), defines direct marketing in ‘Principles of Marketing’, the book he co-wrote with Gary Armstrong, a professor at Northwestern University, as “direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships”.
For Kotler, direct marketing is a comprehensive approach to advertising because it combines communication and distribution channels, bringing them together in a single medium.
Direct marketing is actually a new form of commercial communication that is used alongside initiatives such as promotions to make them more effective. In fact, the main goal of direct marketing is not the sale itself, as it aims to grow the customer base and build as much user loyalty as possible.
It can also be used for other purposes, such as encouraging repeat purchases, shaping opinions or growing a brand’s follower base.
Types of direct marketing
As we mentioned earlier, direct marketing brings communication and distribution channels together and puts them at the service of businesses. Some of the options and types are:
Emailing
Sending commercial communications by email has many advantages when it comes to personalizing messages, thanks to segmentation. Digital catalogs and regular newsletters with offers, discounts and promotions are some of the most common uses. At Mailrelay, we know all these strategies very well.
Online marketing
Direct marketing can be offline, but the multiplier effect of the online world opens the door to a wide range of options, such as ad campaigns, social media advertising and custom audiences.
Direct SMS messages
These short texts are great for announcing one-off promotions and commercial initiatives that take place over a short period of time.
Banners
Direct digital advertising that grabs the user’s attention and makes interaction easy.
Discount coupons
Personalized letters to customers or brochures sent by post. If you choose this option, you need to take printing and distribution costs into account.
Telemarketing
Basically, it consists of calling customers on the phone to offer them a product or service.
This initiative involves preparing the database beforehand and, afterwards, analyzing the responses, counting them and measuring effectiveness. That is why it is more short-lived: calls take up people’s time and can only be repeated a couple of times before they become annoying.
How to use direct marketing
Direct marketing achieves high conversion rates on small budgets.
If you have a large subscriber database, you can use it for a loyalty initiative by sending discounts or promotions.
This knowledge, combined with lead segmentation, is especially useful for campaigns because, as well as sending valuable and relevant information, you can measure reactions and fine-tune your sales strategies.
Here are some tips for putting direct marketing into practice:
- Use attractive messages that capture attention and interest
- Spark curiosity about your product
- Build engagement with your followers and be creative
- Use your product’s benefits as hooks
- Personalize and tailor your communications to each individual
- Make it easy to interact with your messages and cut response times
- Become the solution to your recipients’ problems
- Build simple, agile and effective communication processes
- Include suggestions and tips: the community really values useful information
As you’ve seen, direct marketing goes beyond meeting response rate expectations.
In fact, it has a lot to do with brand image and branding. Generally speaking, you can use it to have conversations with your customers and measure the reactions your campaigns generate.
You can also identify new cross-selling opportunities and discover other key parameters for analyzing buying behavior.
When you design a strategy, remember to choose the right channel, because the physical contact of postal mail, an email notification and social media posts are completely different things.
Anyway, if you’re not sure, try it, test and adjust: in the digital world, decisions can be made practically on the fly.
Benefits of direct marketing
The main benefits of direct marketing include its ability to build a direct relationship between organization and consumer: a close contact that cuts out intermediaries and becomes a very valuable strategy for businesses, because they build two-way relationships with their customers and can get to know them better.
Another benefit is that it can be measured through cookies, browsing analysis or tracking pixels.
Parameters such as cost per order and response rate are used to quantify campaigns and make them more effective. Direct marketing also offers the following benefits for businesses and recipients:
· For brands, it means optimizing the budget, adjusting budgets, improving sales and achieving goals more efficiently, among other things.
· When it comes to customers, it lets you build a base of potential customers to target with a product/service. Having a clean database makes the campaign more effective and makes it easier to send individualized messages tailored to each person. It can also be used to win back former customers and reach new users by offering them attractive promotions or rewarding their loyalty and repeat purchases.
In terms of price, direct marketing is an alternative to traditional advertising with a lower cost and a greater impact.
Segmentation (gender, age, profession…) increases the chances of reaching more people and generates a higher return on investment. From a business point of view, direct marketing opens up new ways of communicating with customers and a greater ability to analyze and measure results.
Examples of companies that use direct marketing
Companies such as Amazon, eBay, Dropbox and Netflix are direct marketing specialists.
Although these are large organizations with big budgets, below we describe different types of campaigns and initiatives you can apply to your own projects.
- The SpaceX campaign that sent a Tesla Roadster into space (2018) drew millions of viewers to its launch. The impact was such that thousands of articles were published and more than half a million conversations were generated.
- Netflix started out buying content from third parties to add to its sales catalog and then upload it to the platform. From there, it works to get to know its consumers better by offering them personalized content; it is now producing its own content. In the United States, it goes one step further and offers its videos on Blu-ray through a subscription.
- In Spain, Mercedes-Benz ran a campaign with Correos, the Spanish postal service, for its Smart cars to showcase their greener side. They wanted to create interactivity with a mailing based on a recyclable brochure and to convey the message “if the Smart is the greenest car in the world, let’s start with its communications”. Once they had read it, recipients had to crumple it up, plant it in a pot and water it every day. Within a few weeks, what had been a piece of paper would turn into a beautiful plant. With this initiative, the brand managed to get recipients involved and won recognition from international advertising associations in the form of several awards.
- Another famous campaign is Burger King’s multichannel ‘Home of the Whopper’ campaign with Google. The digital ad triggers the voice controls of the Google Home smart device, which then reads out the ingredients of its famous burger.
- In Spain, NH Hotels has managed to reach consumers through personalized campaigns of fewer than 100 people in 30 different versions. An example of segmentation taken down to the last detail.
- Leaflet drop campaigns around commercial events such as Black Friday, Back to School or Christmas have also proven effective. At the end of last year in Spain, Geobuzón published a report with the following figures: the number of leaflets distributed exceeded 300 million by the end of the year, and printed material distribution grew by 7.3% compared with 2017, when a total of 278 million leaflets were distributed. On top of this positive trend, 60% of respondents say they usually keep leaflets, while 40% only use them to find out about new products, services and points of sale.
- Other examples are Ikea’s leaflet campaigns with its annual catalog of furniture and home accessories, or Media Markt’s new leaflet format backed by transmedia advertising.
- The multinational sportswear brand Adidas uses a direct marketing strategy to celebrate its customers’ birthdays. To do this, it sends a personalized message on such a special day with birthday wishes and a reward: a 10% discount along with special offers.
Conclusions
By now you have a good idea of the many possibilities direct marketing offers and how it can be applied in practice.
With all this in mind, the most important thing is to apply what you know about this technique to the reality of each business project. There are many and varied initiatives, and the chances of making direct marketing profitable are very high.
To plan your strategy, size up the situation based on the analysis and segmentation of your database, and take great care over the message you are going to convey to your audience and how you are going to address them.
This is where a large part of the campaign’s success lies, because consumer reactions are no longer in your hands and are harder to predict. All you can do is engage with them by catching their attention, although their response may hold plenty of surprises. Either way, be prepared for it and minimize the risks with a plan B.
