Direct Advertising and Database Marketing - PowerPoint PPT Presentation

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Direct Advertising and Database Marketing

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Title: Direct Advertising and Database Marketing


1
Direct Advertising and Database Marketing
  • 13

2
Did you know?
  • The industry average for direct mail is a meager
    0.3.

3
Some staggering facts ...
4
Chapter Thirteen Objectives
  • Explain direct marketing and the reasons
    underlying its growth
  • Describe the characteristics of direct-response
    advertising
  • Discuss the distinctive features of direct mail
    advertising

5
Chapter Thirteen Objectives
  • Explain the role of databases
  • Perform lifetime value analyses of database
    entries
  • Discuss the features and advantages of outbound
    and inbound telemarketing
  • An introduction to CRM

6
Direct Marketing
  • Direct Marketing
  • An interactive system of marketing
  • which uses one or more advertising
  • media to effect a measurable response
  • and/or transaction at any location

7
Distinctions Among Various Direct Concepts
Marketing
Indirect Marketing
Direct Marketing
Direct Response Advertising
Tele- marketing
Direct Selling
Direct Mail
Other Media
8
Growth of Direct Marketing
  • Societal changes
  • Computer technology and database management
  • Niche marketing

9
Direct Response Advertising
  • How different is it from mainstream advertising
  • Definite offer
  • All information necessary to make a decision
  • Includes a response device

10
Direct-Response Advertising
  • Illustration of
  • direct- response
  • advertising

11
Direct-Response Advertising
  • Another illustration
  • of direct- response
  • advertising

12
Direct Response Advertising
West Virginia Tourism
Fahlgren
13
Cannes Gold - 2002
  • Reaching the parents pockets through the childs
    dreams!

14
The Importance of an Idea!
  • If your campaign doesnt have a big idea, it
    will pass like a ship in the night.
  • David Ogilvy

15
Importance of an Idea!
Simple ideas are easily explained.
Simple ideas last a long time.
Simple ideas are easily recognized.
16
BIG, simple ideas translate across media very
easily.
SMSs, posters, TV commercials
Increased Church Attendance 75
17
Why Direct Advertising?
  • Customer Retention
  • Building Loyalty
  • Referral Programs
  • Increase Depth / Cross-sell

18
Direct Mail
  • Direct-Mail Advertising
  • Refers to any advertising matter sent
  • directly to the person whom the marketer
  • wishes to influence

19
Direct Mails Distinctive features
  • Targets specific markets
  • Measures success immediately
  • Permits personalization
  • Gains prospects undivided attention
  • No constraints on size, color, form
  • Relatively simple and inexpensive to change ads

20
Trend Toward Direct Mailing
  • Rising expense of television advertising and
    increased audience fragmentation
  • Unparalleled targeting of messages to desired
    prospects
  • Increased emphasis on measurable advertising
    results
  • Consumers are responsive

21
I hate rules!
22
10 guidelines for an effective DM
  • Is there a unique and interesting idea?
  • Does the idea meet the creative brief? Does it
    match reality?
  • How quickly is the benefit perceived?
  • Is the benefit in the headline supported by the
    visual?
  • Will the visual execution stop the reader and
    make her read on?

23
10 guidelines for an effective DM
  • Is the headline stated in an imaginative and
    memorable way?
  • Is the message relevant to the reader?
  • Is the copy written so that other people want to
    read it and respond?
  • Does the reader know how to respond?
  • Is the mailing consistent with the brands
    qualities / image?

24
The Role of Database
Target best prospects for offering
  • Databases
  • allow
  • a company to

Offer varied messages
Create long-term relationships with customers
Enhance productivity
Calculate the lifetime value of a prospect
25
Lifetime Value Analysis
  • Customer Lifetime Value
  • The net present value (NPV) of the profit
  • that a company stands to realize on the
  • average new customer during a given
  • number of years

26
Lifetime Value Anaysis
Customer Lifetime Value
27
Lifetime Value Analysis
  • Retention Rate
  • Referral Rate
  • Sales Volume
  • Direct Costs
  • Marketing Communication Costs

28
Two types of Mailing Lists
House lists
External lists
  • Based on a companys own internal list of present
    or prospective customers
  • Methods used to obtain database information
  • In-pack promotion
  • Registration programs
  • Rebate programs
  • Telemarketing

29
Two types of Mailing Lists
House lists
External lists
  • House lists of other companies
  • Compiled lists lists compiled by a company for
    its own purposes or lists purchased from another
    company that specializes in list compilation
  • Compiled lists are not as desirable because no
    information about the willingness of a person to
    purchase by mail

30
Catalog Marketing
Retail Catalog
Full-line merchandise
Consumer specialty
Industrial specialty
31
Why Catalog?
  • Saves time
  • Appeals to consumers who are fearful of shopping
    due to concerns about crime
  • Leisurely decisions
  • Toll-Free numbers
  • Comparable quality and prices
  • Guarantees are attractive

32
Where is catalog marketing at?
  • Catalog marketing has reached the mature
    life-cycle stage
  • Novelty of catalog scanning worn off
  • Costs of catalog making increased
  • Third-class postal rate and paper price increased

33
Outbound and Incoming Telemarketing
  • The dominant form of direct marketing

Outbound
Incoming
34
Outbound Telemarketing
  • Opening new accounts
  • Qualifying advertising leads
  • Servicing existing business, including reorders
    and customer service

35
Outbound and Incoming Telemarketing
  • The dominant form of direct marketing

Outbound
Incoming
36
Outbound and Incoming Telemarketing
37
Toll-Free (800) Numbers
  • Request product or service information
  • Place direct orders
  • Express complaints or grievances
  • Request coupons or other sales-promotion
    materials
  • Inquire about the nearest dealers or outlets

38
Toll-Free (800) Numbers
  • Prominent display
  • of 800-Number

39
Dial-It (900 Numbers)
  • Update customers about services that are subject
    to frequent changes
  • Sports information
  • Weather updates
  • Travel information
  • However, dark side of 900-number
  • sleazy sex operations, contest scams

40
The Importance of perseverance
  • A Classic DR case

41
Before losing a customer for life!
  • American Express Case
  • Problems of acceptance
  • with merchants
  • Warm Cold audience
  • Telemarketing
  • One-on-one
  • Pride goes before a fall
  • 7 postal response
  • 35 telephonic response

42
CRM
  • So, whats new?

43
What we need is an education in the obvious, not
an explanation of the obscure.
  • - Oliver Wendell Holmes

44
A new breed of customer
  • More discerning
  • Less Loyal
  • Less inclined to go steady than before
  • More difficult to reach
  • Harder to retain

45
The Challenge
  • To attract new and profitable customers
  • To form tighter ties with existing ones
  • To optimize the relationship over their lifetime

46
CRM
  • Not a software program
  • Customized one-to-one customer experience
  • Not based on historical purchasing power
  • Potential for long term loyalty to the brand
  • Not database marketing
  • Efficient use of technology intelligent data
    management
  • Segmented and customized communication

47
Saab 9-5 Direct Mail Questionnaire
  • Direct mail questionnaire

48
Saab 9-5 Direct Mail Response to Questionnaire
  • Response to direct mail questionnaire

49
Outbound Telemarketing
  • 8 Factors to consider
  • Importance of face-to-face contact
  • Geography
  • Economics
  • Customer decision criteria
  • Number of decision makers
  • Nature of the purchase
  • Status of the decision maker
  • Evaluation of the specific selling tasks

50
Direct-Response Advertising
Direct response advertising
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