As a former marketing professor and current direct, social media and digital marketing consultant, I am often asked about old school direct marketing and its rules, terms and analytics.
I created this simple direct marketing primer for a client who was looking to enter the direct mail space.
About the author:
Jim Gilbert, is the CEO of Gilbert Direct Marketing, Inc, and President of The non-profit networking and education organization - The Florida Direct Marketing Association.
Jim is a former adjunct Professor of Marketing teaching at Miami International University.
He can be reached at jim@gilbertdirectmarketing.com, or follow him on twitter: @gilbertdirect. or Linkedin: www.linkedin.com/in/jimwgilbert/en
2. "There is only one valid definition of business
purpose – to create a customer. Companies
are not in business to make things…but to
make customers.”
-- Peter F. Drucker
3. Direct Marketing (DM) is an interactive
system of marketing that:
Uses one or more advertising media to effect a
measurable customer response
Or transaction at any location
And stores information about that event in a
database.
4. Database used
to capture
response (and
non response)
Data to be used
for future
decision making
and targeted
promotions! Database
Demographic/lifestyle
data
Customer contact data
Transaction data
7. Two way communication between customer or
prospect and company.
Sometimes called interactive marketing.
No middle man.
Copy writer is the “sales person”.
Measurable, database always used. Direct marketer
always accountable.
8. LifetimeValue (LTV): the net revenue stream generated by a
customer, or customers over time. Includes all income less
expenses. (also known as cLTV)
Direct Response Advertising:The strategic and tactical element of
direct marketing that includes, direct mail, print ads, direct
response television and internet promotions.
RFM (Recency, Frequency, Monetary), an analysis and list
selection tool that allows for targeting prospects and customers
from a customer database from best to worst.
Select: a segment of a list or database. A subset of the the total
universe. Usually used to drill deeper into as list to increase
results. For instance, more recent names (selecting last 6 months
will provide better results than older names.
9. Indirect path to final
consumer.
Product manufacturer “loses
control” of the sales cycle.
Manufacturer let’s go of
responsibility.
Advertising and branding
lead the way.
Not very efficient!
Final Consumer
Retailer
Wholesaler
Manufacturer
10. Direct path to final consumer.
Manufacturer retains control of
the sales process.
Manufacturer responsible for
success and failure.
Direct response advertising
leads the way.
Branding seen as secondary to
getting orders, leads, web visits,
etc.
Efficiency gained via
understanding full sales cycle.
Results & ROI
Manufac
turer
Consumer
11. List or database
Target customer
Direct response
promotion
Response and
Analysis
Decision
making/Research
12. Advocate
Multi buyer
Single buyer (try-er)
Prospect
The goal of
the direct
marketer is to
move people
higher up in
the hierarchy.
Each level has
a progressive $
value attached
in terms of
worth the the
company.
13. Generate new customers at the lowest
possible cost per acquisition.
Maximize customer lifetime value via
repeat purchases.
The goals of every direct marketing
organization need to be exclusively
focused around the above!!!
14. The process must start with
customers:
Who are they?
What do they need and want?
Where are they located?
When are they ready to buy?
How much will they buy? How often?
Why do they buy?
15. Direct Mail Marketing is a “test and roll”
business!
Test the smallest quantity possible.
Use response and statistical analysis to project results over
entire universe
Most test list orders between 5,000 – 10,000
Selections: drill down into list and allow for most bang for
list renter buck (tightest match to your customers)
Selections add revenue to list order.
17. For success, Concentrate your efforts as follows:
40% on finding the right list that most closely matches
your target market. (Lists are CRITICAL to your success)
40% on developing the most compelling offer you can to
stimulate your target market market to respond.
20% on developing creative that “speaks” your offer
benefits in the most meaningful way to your target
market.
▪ Includes media, vehicle, layout, design, format, copy.
18. Presented by Gilbert Direct Marketing, Inc.
Email:
jim@gilbertdirectmarketing.com
Blog:
http://gilbertdirectmarketing.com/
Linkedin:
http://www.linkedin.com/in/jimwgilbert/en
Follow me onTwitter:
http://www.twitter.com/gilbertdirect/