This presentation shall help you with the basics of the Direct Marketing to boost Revenue. As a management faculty this presentation was prepared for academic purposes having practical insights.
2. What is Direct Marketing?
Direct Marketing is both marketing and sales.
Direct Marketing is the translation of one-on-one, face-
to-face selling into broad reach media.
Definition: Any advertising activity which creates and
exploits a direct relationship between you and your
prospect or customer as an individual.
3. Difference from other activities?
General advertising speaks to people en masse. It does
not try to isolate them as individuals. Nor does it
normally demand immediate action.
Sales promotion is designed to achieve an immediate
effect on sales. It does not build relationship.
Public relations employs media controlled by others.
Packaging is again devoid of any relationships.
4. Direct Marketing is always selling
Product / Service / Next Step
Response
Continued Engagement
5. Mass Targeted
Competitive Attention Selective Attention
Breadth Depth
Remember Respond
Impression Decision
Pay for Everyone Pay for Targets
General Advertising and Direct Mail –
A Simple Comparison
Advertising Direct Marketing
6. Two Important Factors in DM
Pre-selection
Refining the target based on pre-existing
level of interest
The Offer
What does it take to provoke response?
7. The Relative Power of Media
Likeability
Demands Time
Expensive
Weakness
Face-to-Face
Strengths
Sight
Sound
Eye Contact
Body Language
Interaction
Demo Ability
One-to-One
Provides Time
Pre-selection
No Attention Competition
Chemistry
8. Sight
Pre-selection
Low attention competition
Strengths
Direct Mail
Easy not to engage
4 seconds to involve
Postal system dependent
Weaknesses
List dependent
The Relative Power of Media
9. The Relative Power of Media
Sound
Some Chemistry
Interaction
One-to-One
Pre-selection
Low Attention Competition
Strengths
Interruptive
Requires Time
Annoying
Weaknesses
Telephone (Outbound)
11. Some Unfortunate Truth About
Direct Marketing
The more we need people to read (listen, watch), the less willing
they are to do so.
The more resistant the universe, the more expensive the cost of
buying sales time (choice of medium, and devices within each
medium; offer)
Cost of persuasion power is inversely proportional to the level of
pre-existing interest within a prospect universe
The more it costs to acquire a customer, the less valuable the
customer.
12. Sales Support – The Sales Sequence
The sales sequence is the set of decision steps
necessary to close a sale matched with a set of
communications designed to provoke each step.
Direct Marketing tools are typically used to narrow
the universe to “qualified prospects” .
DM sells the next step in the sequence.
The cost of acquisition is the total cost of all the
contacts at each step necessary to provoke a single
decision to the next step.
13. Cost of Acquisition in a Sales Sequence
Step1:
Lead Generation
Step 2:
Qualification
Step 3:
Sales Call
Vehicle: Direct Mail Vehicle: Telephone Vehicle: Personal Selling
10,000 500 Universe: 50
Cost/Contact: 1.00 Cost/Contact: 10.00 Cost/Contact: 200.00
Response Rate:
5%
Conversion to Appt. :
10%
Conversion to Sale: 25%
Cost/Conversion:
10,000/500 = 20
Cost/Appointment:
500 x 10 = 5,000/50 = 100
Cost/Sale:
50 x 200 = 10,000/13 = 770
Total Cost of Acquisition = 20 + 100 + 770 = 890
14. Common Sales Sequences
Mail/Ad Phone Mail/Email Phone P Sales
Generate
Interest
Qualify
Decision
Authority
Determine DM
Provide
information
or quote
Set
appt.
See
rep
Phone Mail/Email Phone P Sales
Generate
and Qualify
Id decision
Provide Info
Confirm Call
Back
Answer Q’s
Set appt.
Demo
Close
Sell the next step.
16. Selection Factors
Consumer Lists
Age / Income
Sex / Marital Status
Homeowner
Type of apartment
Interests
Presence of children
Geographical (zip,
county, state)
Business Lists
Standard Industry Details
Employee Size
Annual Sales/Revenue
Title
Any other information
Corporate information,
number of years in business
Geographical (zip, county,
state)
Tel / Fax / E-mail / Web
Credit information
17. Few Envelope Formats
Window Envelopes
Plastic Card
Invoice
Personal
Odd Size
Certified
See Through
Dimensional
Invitation
Handwritten
Readers Digest Used
funny stamps and
impressive stamps in
their Direct Marketing
Campaigns
18. Letter Planning and Structure
The Opening
The Body
The Close
The Signature
The P.S.
19. Writing Leads for Letters – How to Start
A strong, startling fact, research result, something true of
their industry
Establish a connection
referral
similar occupation
status as a customer, etc.
recognition of status as a donor/contributor
Tell a story
A quote
Reference a competitor
21. The Three Phases in the Lifetime
of a Customer
1
Phase
2
Phase
3
Phase
Relationship
Formation
Reinforce Decision
Key to Source
and Channel
Relationship
Cultivation
Personalize
Build Trust
Quantify Potential
Relationship
Management
Cross-Sell
Fit Value Proposition
to Customer Needs
22. The Second Transaction is Critical
Customers are converted or lost in the first 30 – 120 days
Create positive early experiences that cement the
relationship
Fast shipping, delivery
Project Loyalty from early behavior
Provide opportunities for additional transactions while
interest is high
Use communication to drive behavior and the
relationship
23. Retaining/ Growing the Relationship at the
Lowest Cost
Customers Mailings
A - Diamond 12x
B - Gold 8x
C - Silver 7x
D - ? 6x
24. Recipients of Direct Mail
Customers
Have pre-existing interest, Will read more copy
Require less costly mail
Mailing to customers generates $ and improves retention
Prospects
Pre-existing interest is “likely”
Requires more expensive mail to buy readership
Resistant to reading (looking for a reason to stop)
Relevance is key
Influencers
25. Unfortunate Truths - Direct Mail
People read direct mail, looking for a reason to stop
The margin of error on direct mail is greater than in any other
medium.
Special interest offerings tend to do best in direct mail, but the
more specialized the interest, the more limited the growth potential
(requires product proliferation – old/new/same).
There is an inverse relationship between degree of pre-existing
interest and cost per response.
There is a direct relationship between readership and response.
People are not dying to hear from you.
Very little body copy is ever actually re-read.
26. Formulate your strategy
What is your overall business activity
What is your positioning?
What current marketing activities do you conduct?
What is the state of your database?
Have you sold the concept of Direct Marketing within your
organization?
Where exactly Direct Marketing should fit in your organization
28. Various Mediums available
Direct mail
Door to door drop
Newspapers
Magazines
Broadcasters: TV, Radio.
Telephone, Fax
Posters
Newsletters
Web as powerful medium………….Video mailers / Pod cast
30. Successful Direct Marketers
American Express
Readers Digest
Eureka Forbes, Amway, etc.
Banks: HDFC, ICICI, Barclays and many others
Insurance companies: LIC, TATA AIG, MAX
Book Publishers: Sage Publications, etc
Magazines: India Today, Money Life, Business Today
Advertisements: Times of India, Sakal, etc.
31. The Last Premise
Focus on Them
“You can make more friends in 2 months
by becoming interested in other people
than you can in 2 years by trying to get
people interested in you.”
Dale Carnegie
33. Q&A - Contact
Avinash MurkuteAvinash Murkute
Mobile: +91-9822698070
E-mail: avinash@galaxy4u.in
Web: www.galaxy4u.in
--------------------------------------------------------
Doubt is the key to knowledge.
Notas do Editor
I can get you interested.
I only need to know you have a need – that’s why qualified leads are based on need and where ________________?
not interested
30 minutes
With 4 seconds distraction, etc. is is virtually impossible to get people interested – the key is to find people who have an interest and reinforce it. No matter how targeted the message, if we can’t find the __________ we can’t use the medium.
1. And, really, they’re at different points in the dereg process…awareness, visibility of choice, as well as interest in/willingness to switch varies as well.
2. This means some people will be left out,and we have to find a way to play that to our advantage.
3. But I want you to think about the word promise. Because what there does not seem to be a lot of in the energy market is promising. And it represents an ownable point of difference for New Power.
1. And, really, they’re at different points in the dereg process…awareness, visibility of choice, as well as interest in/willingness to switch varies as well.
2. This means some people will be left out,and we have to find a way to play that to our advantage.
3. But I want you to think about the word promise. Because what there does not seem to be a lot of in the energy market is promising. And it represents an ownable point of difference for New Power.