Direct marketing is one of the oldest forms of promotion. It was around long before we had media advertising, and long before we even considered marketing a strategic function. But with so many new and exciting marketing methods, do you really know what direct marketing is?
How does direct marketing work?
Traditional advertising on the television or in the newspaper has a mass audience, thus the messages are devised to appeal to a wide array of people, most of whom will never become customers. But if we think about this as falling on one end of a spectrum, direct marketing will be right on the other side.
Direct marketing is any promotional message coming straight from an organisation to some promising prospects.
Unlike advertising, direct marketing is far more personal. It is in an umbrella term covering a range of marketing activities where an organisation promotes something directly to a potential customer.
Common examples of direct marketing include telemarketing and email marketing. According to the Direct Marketing Association of America, such techniques are most often used in B2B marketing strategy, however, almost a third of B2C campaigns include a direct marketing tactic.
Direct marketing campaigns generally begins with a list of known and potential customers. This may include your own customer database, but can also include new potential customers, known as prospects.
Different techniques bear a range of results
Campaigns are generally measured by their return on investment. This means reducing the cost of each sale or action the campaign initiates and increasing the amount of responses it garners. In US dollars, the cost per acquisition of new customers was $19 for direct mail, slightly cheaper for mobile and social media campaigns, as low as $11 dollars for email marketing but significantly more expensive for telephone leads, according to the DMA.
However, telephone response rates were almost three times higher than direct mail leads, and around 100 times better than email. However, email did offer the greatest return on investment, followed closely by telephone leads.
The main thing to recognise here is that not all techniques will yield the same results, but it also has a lot to do with the quality of the contacts. Remember that in principle direct marketing should be contacting a chosen few, not just a random selection of consumers.
For more information about how you can reap the best returns from direct marketing, contact The Prospect Shop today.