Direct Marketing: what it is and how it works

Direct marketing is a very widespread form of advertising nowadays, used by commercial companies but also by bodies and agencies, and public and non-profit organizations. The aim is to communicate directly with specific customers, or those who have certain characteristics. Why is this type of communication so used today and what are the main tools of direct marketing? We will answer these questions in detail and also give some examples of the use of this well-known and excellent marketing technique.

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What is Direct Marketing: Definition

By direct marketing or direct response marketing, we mean the set of marketing activities aimed at building contact and interaction with a specific category of potential or real customers of a company. In essence, it is a type of commercial or marketing communication aimed at specific customers, even through a one-to-one relationship, without making use of intermediaries.

Direct Marketing Techniques

Direct marketing relies on one or more resources working together to get responses from a defined audience. In practice, it is based on direct communication (therefore without intermediaries) and feedback, i.e. return information. Let’s see what direct marketing techniques are.

  • Direct Mail: sending of emails to a precise target of suitably personalized advertising or promotional material, by mail, fax, email, sms, etc;
  • E-mail Marketing: it is one of the most effective web marketing tools available to those who want to promote their company or its products and services online. Classic emails or newsletters consisting of promotional or informative content are sent. They almost always have a Call To Action feature inside them.

direct marketing examples

  • Telemarketing: is a marketing technique carried out by telephone. It is based on a telephone interview, carried out on lists of names. It is aimed at having precise answers regarding a company’s proposal (outbound) and the systematic collection of information (inbound).
  • Direct sale: indicates the promotional activities (commercial or otherwise) put into practice by specific appointees. It provides face-to-face contact (usually on the street) as a privileged means of communication with potential customers.
  • Multimedia direct messages: it is a rather recent direct marketing technique, which exploits the so-called new media for promotional and commercial communications.

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Past and Future of Direct Marketing

Direct marketing was undoubtedly born before the advent of the Internet and web marketing. However, it is thanks to modern communication tools that it has evolved, including several new techniques. As strategies become more refined, understanding KPIs becomes crucial for targeting customers effectively.

While before direct marketing focused almost exclusively on face-to-face sales or telemarketing strategies, today it is presented through increasingly multi-channel solutions and strategies. Digital-first, of course.

direct marketing benefits

Consumers are now increasingly attentive to personalized communications, distinguishing them from mass ones. Today, the main task of the direct marketer is to create messages that are relevant, direct, and personalized for the recipient. Without a doubt, the potential of this marketing technique has grown but, at the same time, we are faced with increasingly sophisticated tools. Those who work in the sector must know them in depth to be able to use them to the fullest.

Method and Advantages of Direct Marketing

Direct response marketing differs from other types of marketing. Let’s see what its fundamental characteristics are and what it allows the companies that adopt it to do.

  • focus on the customer rather than the product;
  • segment according to the value that the customer has for the company;
  • develop the relationship with customers;
  • identify which people are most likely to respond;
  • establish the best offers to offer to customers;
  • test new ideas on the market with various A/B tests;
  • customize the campaign according to each customer.

It is certainly possible (indeed recommended!) to combine direct marketing strategies with other digital marketing strategies, to obtain more valid and homogeneous results. In the following paragraphs, we will deal strictly with the detailed planning of a direct marketing campaign.

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The 4 phases of a Direct Marketing campaign

The success of a direct marketing operation is based on an accurate planning activity that combines method and inventiveness. So let’s start with the ability to:

  • build/acquire complete lists of qualified customer names to be contacted;
  • effectively use at least 2 of the tools mentioned, namely email marketing and telemarketing.

So let’s see in detail what are the 4 phases necessary to plan an effective direct marketing campaign.

  1. set marketing objectives;
  2. develop and query the database;
  3. define direct marketing actions and tools;
  4. implement a direct marketing plan measurable in actions.

Each of these phases contains several steps, i.e. steps to be taken for their correct implementation.

what do mean by direct marketing

1. Set marketing goals

In this first phase, it is important to set the marketing objectives that the company/organization wants to achieve. Among these objectives, the most important is certainly:

  • better understand the needs of its customers and therefore know exactly what they expect;
  • acquire new customers;
  • support any sales network in carrying out commercial activities;
  • maintain relationships with existing customers.

2. Develop and query your database

Once the objectives have been established, the second fundamental step to take in a direct marketing campaign is to collect and archive useful and relevant information regarding current and/or potential customers. Essentially, it’s about designing and building a comprehensive marketing database.

The latter will contain valuable information on who the customers are, and what their socio-demographic and behavioral characteristics are. It will then be important to define what preferences they have, how profitable they are, and how and when they interact with the company/organization.

There are some general principles to be inspired by to create an effective database, which guarantees a certain utility of the archived data. A performing database must have:

  • clear and predefined information classification criteria
  • unique identification of customers
  • no duplication of information
  • constant updating of information

Building the database

The data needed to build a database can vary according to the market in which one is operating. However, some of this data can never be missing.

  • Identification data (of the end customer or the company)

When dealing with a consumer customer, the most important data to enter are name, surname, telephone, fax, e-mail, residence, capital/province, etc.

For a business customer, on the other hand, it is a question of storing data on the company name, company name, complete address, telephone, fax, general e-mail, website, social pages, etc.

  • Contact details

In the case of a business-type customer, it will be necessary to archive, in addition to the identification data, also the data relating to the contact person.

The contact person is the person with whom, within the company, contacts are established and maintained (e.g. name, surname, company role, availability times, etc.)

  • Demographic or dimensional data (respectively of the end customer or the company)

As regards the demographic data that can be entered for a consumer customer, we have income, gender, profession, and educational qualification. The dimensional data of a business customer are legal nature, sector of activity, turnover, and number of employees.

  • Behavioral data

This data originates from the interaction between the company and the customer and can be summarized in 4 distinct categories, based on recency, frequency, monetary value, and types of products/services purchased.

Query the database

Once all this information has been collected, to plan the direct marketing campaign it is necessary to query the database to understand which customers to address the planned promotion activity. In particular, there are formulas for querying the computerized customer archive. Let’s look at them briefly.

  • RFM (Recency. Frequency, Monetary). These are, in order, the date of the last purchase, the frequency of purchase, and the total amount of purchases.
  • FRAT (Frequency, Recency, Amount, Type). It means, respectively, the frequency of purchase in a given period, the date of the last purchase, the purchase amount, and the type of product or service used.

direct marketing steps

3. Define direct marketing actions and tools

After identifying the customers, it is necessary to identify the actions and tools to be used to convey the promotional message. As we have already mentioned at the beginning of this article, there are different direct marketing techniques. Let’s review them, going into more detail.

  • segmentation, i.e. the division of heterogeneous customers into more homogeneous subgroups;
  • cross-selling, new products/services, similar or completely different from those acquired so far, are offered to people on the customer list;
  • continued sale. You offer customers the renewal or purchase of a particular product/service;
  • customer care. The set of initiatives that aim to take care of and maintain a lasting relationship with customers;
  • measuring the lifetime value of a customer. Measurement of the present and future value of customers. The ultimate goal is to make investments in communication activities more efficient. It is important to cultivate relationships with the most profitable customers, who buy more frequently.

Once the action to be implemented has been defined, the company can make use of the current interactive marketing tools, ie mailing (including direct mail and e-mail marketing) and telemarketing.

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4. Implement a measurable direct marketing plan

Before launching the direct marketing campaign, it is necessary to evaluate the timing for each of the contact phases to be put into practice. In particular, we will define the start date and period in which to conclude the first contact and a possible second contact.

In the final part of the campaign, i.e. after the defined time frame has passed, it is important to measure the results obtained. The company will specifically evaluate the profits and benefits that the direct marketing campaign has brought. This operation is essential to consider any improvements that can be applied to future campaigns.

DEM: the most effective direct marketing tool

Of all the direct marketing techniques and tools we have mentioned, it is certainly worthwhile to dwell on email marketing and in particular on DEM (Direct E-mail Marketing). The DEM is now widely used by companies and organizations to promote, sponsor, and invite the user to purchase specific products/services.

most effective direct marketing tool

We are also talking about one of the peculiar tools of digital marketing. In times when the internet and social networks are all the rage, direct mailing with all its recent facets remains a fitting tool for reaching potential customers.

Direct mail and e-mail marketing activities are widespread due to the high reactivity they generate in users, the excellent profitability they offer, and the fact that they offer the possibility of being able to send ad hoc offers in real-time to potential customers whether they are individuals or companies.

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Direct marketing examples

It is not easy to know concrete examples of direct marketing in detail: the data referring to the campaigns carried out are rarely disclosed publicly. Without this premise, we still find some well-known examples of direct-response marketing that have been successful. Also in this case we will talk about direct mail and e-mail marketing. They are the most used strategies today, the most effective, as well as the richest in reference case studies. We present these examples below.

Buzzfeed: Wide choice of content

Buzzfeed is an online page that deals with sharing scientific content. The techniques he uses to create attractive titles are very famous. In the context of email marketing in particular, Buzzfeed makes intense and professional use of segmentation. Users can subscribe to newsletters on various topics: books, politics, gastronomy, do-it-yourself, celebrities, etc. In this way, it manages to offer each of its users exactly the info they are looking for. There is also a daily service focused precisely on the information of the day.

Furthermore, Buzzfeed uses a good practice of transparency towards its subscribers: in fact, the latter is informed of how many emails they will receive and on which days. This protects the interest in the news and the desire to remain subscribed.

Finally, Buzzfeed emails are considered extremely appealing both visually and content-wise. These are short, intelligent, and attractive messages that achieve the intent of this famous website: to attract web traffic.

direct marketing example: buzzfeed food newsletter

Pinterest: user experience between email and website

Another famous example is Pinterest. This social network has created a consistent user experience for users between the website and the emails they receive. Here too the visual content is enhanced, judged attractive, and pertinent on both fronts. This model greatly benefits the site in email marketing activities. After all, as we know, a good visual part is already the starting point for involving the user through simple e-mail.

type of direct marketing

Uncommon Goods: leverage positive user feedback

A good email marketing campaign must be supported by social proof. It must have those elements that tell us who has already purchased certain content and was satisfied with it. This good practice guides consumers in the process of choosing goods, encouraging them to buy products.

Uncommon Goods is a more than valid example. The company in question focuses on showing the testimonials of other users thus ensuring the success of email marketing campaigns on specific dates, such as anniversaries and holidays.

Twitter: stimulate users by recommending interesting content

A last noteworthy example is certainly Twitter, which has been creating email marketing campaigns for quite some time in which the most frequent actions carried out by the users we follow are documented. In addition, Twitter recommends trending topics and popular posts. Emails titled “What’s happening on Twitter” or “Popular in your network” are intended to prompt users to interact more with each other and on the platform in general.

Conclusions on Direct Marketing

We have seen in this article what direct marketing is and how it works, then focusing on known examples related in particular to direct mailing. We, therefore, conclude this mini-guide with 5+1 practical advice aimed at those who want to do direct marketing effectively.

  1. Immediately choose the most appropriate tools for the campaign you want to implement;
  2. Remember to follow (at least indicatively) the direct marketing planning phases;
  3. Always prefer modern digital marketing tools (far more effective than traditional ones);
  4. Create and disseminate inspiring content;
  5. Find out about industry news, to always be prepared and up-to-date;
  6. Get informed and stay updated. Are you passionate about all this and do you want to make it your job? You can choose to attend the digital marketing course, which will allow you to acquire all the skills necessary to address the topics we have seen in this mini-guide. You can also focus on a vertical specialization with the direct marketing course.

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