Direct and Multichannel Marketing

Be able to understand how a company can use Direct Marketing for diff products/services

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Direct Marketing Basics

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creative strategy plan including marketing and creative components

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identify best practices and non-practices of offers

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Advantages/ Disadvantages of Direct Marketing ****KNOW!!!!****

ADVANTAGES induces an immediate response results are measurable strategies are testable (control vs test) precision targeting, less waste research messages/offers can be personalized less media "clutter" flexibility database development DISADVANTAGES cost (some media) accuracy image factors content support perceived risk privacy concerns

designing a direct marketing test

Control Randomization Statistically-valid sample size

what direct marketer's commonly test

Products and Services Media Offers/Propositions Copy Platforms Creative Formats Timing/Seasonality

Data mining uses

REVENUE UP, COST DOWN Discover patterns, trends, and relationships Predictive tool (i.e. next best product, fraud or credit risk analysis) Identify the best customers & segments Examples: Cluster analysis Market basket analysis Neural networks... ***Prizm***

definition of a list

Record of information Includes people, businesses, groups, associations, etc. Can be: mail, phone, email Rented, NOT purchased Seeding

What is Direct Marketing

a database-driven interactive process of directly communicating with targeted customers or prospects using any medium to obtain a measurable response or transactional via one or multiple channels

understand and be able to define Life Time Value and what it can be used for

an assessment of the value of your customers over the period of time that they remain a customer. This value is calculated in terms of the discounted value of $. *used to help evaluate programs/strategies *Customers Lifetime Value [Lifetime Estimate (future periodic Revenue - costs)] Ways to increase LTV increase retention rate increase referral rate increase customer spending rate decrease the direct costs decrease the marketing costs MORE? incentives spend more/per visit shipping hit minimum decrease marketing costs mailing to online

why has Direct Marketing grown?

credit cards - faster, convenience, security, rapid electronic fund transfer printing technology - more advance/cheap changing consumer lifestyles - travel more expensive, comm less (mail, tel, internet) women working = shopping chore cuz less time so more convenient = better *personal computers - most, recording keeping, work operation, model building. great speed, low error, low cost neg aspects of retailing - parking, safety, long walking, long waiting lines b2b, availability of lists/data, changes in society, global competition, neg aspects of retail, development of technology media fragmentation conditions, evolving economy, focus on relationships more

Issues for evaluating internal/external lists

issues for internal lists: Know what you need Mail-list system Collect information List maintenance Duplicates Manage, manage, manage

Understand and be able to define Recency, Frequency, Monetary (RFM) and what it can be used for

Varies depending on how important each variable is in relation to each other Profiles behavior by value scoring of customers in your database in terms of: Nearness of last purchase (recency) How often they purchase (frequency) Amount of purchase (monetary)

What can research be used for in direct marketing

*Primary - specific to prob/objective (observations, surveys, interviews) *Secondary - outside (data, #s, research) *Qualitative - in depth info from sm #, investigates the why and how of decision making, not just what, where, when. *Quantitative - #s, DATA via statistical, mathematical or computational techniques A survey looks at things the way they are to measure product preferences or determine future buying intentions An experiment or test measures the effect of change 1. A survey looks at things the way they are. An experiment looks at cause & effect (if I raise prices what happens to sales?). 2. Before looking for information, you must define the problem you need the information for. Be as clear as possible in defining your problem. This will help you look for the right information. 3. Investigate variables that have the potential of making an impact on your performance. Avoid looking at trivial things. Direct marketers build databases from facts, relying not so much on responses derived from survey, but more on conclusions derived from experimentation.

developing a multi-channel contact strategy in particular the first five aspects of the article

1. build a customer journey map for your key segments 2. establish a clear creative development process 3. develop a response management implementation plan 4. personalization management is critical 5. automation - look at nurturing and triggered messaging plans

TRENDS IN DM LISTS (VIDEO)

1. increase in robust target options hobbies, lifestyle interests, etc. 2. increased use of automated direct marketing tools target geo areas, securely place orders, plan campaigns, time & target 3. Reaching out to outlying geographic areas look beyond local market, saturated lists, new cust in new communities, expand market share 4. use of more targeted saturated lists that are more targeted selection options to chose roots they wish to saturate. 5. data enhancement on the rise demographic data into files and analyzing the results.

importance of graphics/visuals

Design and Graphics: Help create mood and feeling Attention getting (& holding) The ultimate goal is to stimulate action and to generate measurable response! **Benefits explain how product attributes meet customer needs. **Create an image of what the product can do for the customer. **Sell benefits in a manner that matches a customers motivation.

various aspects of things that can be changed

EXAMPLES Layouts Illustrations & Photographs Involvement Devices Type Paper Ink Color

identify elements of an offer

Elements of an Offer Product/Service Price Credit Options Shipping & Handling Unit of Sale Optional Features Future Obligation(s) Incentives Time Limits Quantity Limits Guarantees

copy appeals

Emotional (Irrational and may focus on love, pride, joy, humor) mental state of mind which goads us to make a decision 'by the heart' Rational (Logic & reasoning) aimed at the mind of the customer and set him thinking logically regarding the message contained in the ad. Moral (Ethics and target feelings of what is "right" or "proper") These are directed at the sense of judgement of the prospect between right and wrong and are mostly used in social awareness advertising as in adult education, polio vaccination,child abuse, drugs awareness etc.

identify and be able to compare/contrast diff types of data 1. internal/external database info 2. transactional and non-transactional data 3. fufilment data and marketing data 4. four diff types of non-transactional data

INTERNAL DATABASE INFO: diff departments (acct,marketing, customer service, research, etc.) and sources (purchase orders, bills, shipping records, customer inquiries, warranty cards, surveys, etc.) EXTERNAL (3rd party) DATABASE INFO: use bc sometimes cust don't wanna share with us classified based on characteristics: 1. compiled data - demographic/ psycho-graphic 2. response lists - lists of ppl/orgs that respond to offers (mail order catalog buyers, subscriptions, charitable donors, sweepstakes) 3. modeled data - generated from statistical analysis such as customer clustering (classify customers based on purchase patterns, demograph, and psychographics) TRANSACTIONAL: want to receive ****marketing - ne thing used to market to customers (emails click on) *****fulfillment - billing, credit, paypal NON-TRANSACTIONAL (warrenty cards) 4 diff types: 1. behavioral data (non transactional) 2. preference - comm (email, call, online) 3. attitudinal - survey, attitude based 4. demographic

list types

Internal House lists Check list: (develop demo & psychographic profiles, list maintenance schedule. backup & storage, RFM analysis, cross selling, determine contact rate, continually tested) External Check list:(contact a number of diff brokers, collect and provide the necessary demo & pscycho to help find the best list, select the format of the list, test how well the list performs, test projected results against actual results) Response Lists Buyer lists Attendee/Membership/Seminar lists Subscription lists Donor lists Credit card holder lists Merged database lists Direct competitors lists (if available) Compiled Lists Consumer compiled lists Consumer lifestyle enhanced lists Business compiled lists *UNLIKE INTERNAL AND RESPONSE LISTS, COMPILED LISTS CAN BE PURCHASED AND USED AN UNLIMITED AMT OF TIMES

Key factors in list selection

List selection: Who is on the list? What is the level of affinity? What is the origin of the names on the list? Are they known buyers? When did they last buy? How much do they spend? How fresh are the names?/When cleaned?

Importance of the list

Lists are vital to businesses bc it allows you to maintain contact with you customers and remind them of YOU. cant rely on customer loyalty or do nothing ne more. have to interact. They also represent 40% of direct marketing basics!

evaluate the effectiveness of an offer

MUST: Be Believable Promote involvement Be Creative

Multi-, Cross-, and Omni-Channel/Marketing sophistication curve ***ESSAY***

Multi-channel (good) multiple channels to advertise and sell *retail store, a web site, a mail order catalogue, or direct personal communications by letter, email or text message Cross-channel (better) consistent messaging across more than one channel *Use of one marketing channel (such as direct mail or internet) to support or promote another channel (such as retailing). take into account customer preferences and engage recipients on their chosen platform and via their preferred medium. *Makes it easier for them to be contacted Omni-Channel (BEST) highest sophistication constantly satisfied across all channels THERE IS NO OMNI (macy tries) SAME experience in all channels

list cleansing issues

Perform prior to mailing: Standardize (normalize) data Edit & reformat Merge/purge Verify & correct timely, expensive, could do incorrectly,

discuss the use and impact of databases in DM

database defined - a list of customer names to which the marketer has added additional info in a systematic fashion KEY TO STRONG RELATIONSHIPS use: profile customers retain best customers thank customers perform marketing research generate new customers send customized offers IMPACT: retain most profitable customers with high lifetime value!, not just "any customer"

Difference btw DM and mass advertising & convergence

direct marketing: - have to respond in someway to get product (they get info) MEASURED individual has huge control distribution added value marketing place = media (online) GOAL = get a response repletion w/ in same price MORE perceived risk! traditional advertising: MEASURED in sales/awareness, brand image, mass audience market place = gas station, store not as much control! Convergence: web URL, txt in codes, QR Codes, use of hashtages