Direct marketing solicits an immediate action such as an order, application or registration. It’s evolved since its early catalog beginnings (Does anyone remember the massive Sears Roebuck catalog?) and now encompasses digital, social media and mobile. To help you better understand direct marketing as it’s currently practiced, here are the ABCs of direct marketing.
- A is for acquisition marketing (a fancy name for attracting new prospects and converting them to customers.)
- B is for branding (yes contrary to popular belief, branding is important for direct marketing!) It’s also for backend. This is where the rubber hits the road in terms of sales performance.
- C is for catalog, a print version of your product offering that’s delivered via mail to your prospects and customers. C is also for Call-to-Action (or CTA for short!); it’s goal is to rouse prospects to purchase. Don’t forget creative that involves branding, benefits, a call-to-action and relevant response channels.
- D is for direct response, another name for direct marketing; direct mail, specifically marketing that arrives in your physical mailbox; and digital marketing, any marketing delivered via an online platform or involving an interactive response channel including mobile. D is also for database marketing which is critical for direct marketing’s tracking and analysis.
- E is for email marketing. Email’s at the core of every direct and digital marketer’s toolbox. It enables marketers to leverage their housefile of email addresses to drive sales cost effectively.
- F is for Friend-Get-Friend offers, promotions that encourage customers to persuade friends to buy. In return, both friends received a bonus. Freemiums are another direct marketing option. These give-aways get recipients to open direct mail.
- G is for guarantees that are often part of direct marketing offers. The best-known options are satisfaction guaranteed and money back.
- H is for housefile, the postal and/or email address database at the heart of every direct marketing firm. These addresses are assessed in terms of recency, frequency and monetary to project customers’ buying behavior.
- I is for inserts. These are the advertising pieces included with your bills, catalogs and packages. At a minimum, include inserts to promote your products in your packages.
- J is for junk mail as direct marketing is not-so-affectionately called by people who don’t want to receive it.
- K is for know your customer. Direct marketers build complex models to predict customer activity.
- L is for lifetime value. This measure shows how much money to invest in acquiring new customers. Acquisition costs should be equal to or less than the value of the profits the customer brings in adjusted for the time value of money. L is also for leads that B2B marketers acquire and need to convert.
- M is for metrics to track your marketing’s effectiveness. Today, mobile marketing provides targeted information for consumers when and where they need it. (BTW, it’s not limited to smartphones and it’s not just text messages!) Lastly, there’s the traditional direct marketer’s mail quality, the number of pieces actually sent after the merge purge eliminates duplicates.
- N is for niche. Since direct marketers can target specific buyers, they can reach small niches that may not be profitable otherwise.
- O is for offer encompassing different elements to motivate prospects to buy.
- P is for promotion, including the promotion code for tracking purposes. Two classics are Buy One, Get One Free and Free Shipping and Handling. It’s also for prospects, potential buyers who still need to be converted. P is also for past buyers who no longer purchase and must be persuaded to buy again.
- Q is for QR code, a new way to provide additional information and allow prospects to respond to your marketing via a smartphone.
- R is for response as in response channel, how prospects connect with your firm, and response rate, the number of people who respond divided by the number of people reached. R is also for retention marketing or how you keep customers happy and buying from your organization. (It’s much less expensive than finding new prospects.)
- S is for social media. Its various formats extend how direct marketers connect with new prospects, current customers and past buyers. S is also for shipping and handling, the cost to send customers their merchandise.
- T is for testing, David Ogilvy’s favorite word. It’s at the core of direct marketing. Marketers continually try to improve results.
- U is for Unit Order Size, a metric tracking how many units are sold from an average order. It also stands for unique selling proposition since direct marketers must also distinguish their offering from the competition.
- V is for value that all marketers must deliver or customers won’t come back again. V is also for videos that extend a marketer’s content and show customers how a product looks and can be used.
- W is for websites where most customers transact with retailers. It provides pre-sales information, ordering capability (regardless of how prospects first hear about you) and post sales support. W is also for win-back, where marketers persuade past customers to purchase from them again. It’s cost effective since you have the prospect’s information and can result in a second lifetime value.
- X is for x-factor, the unknown element every marketing program has.
- Y is for YouTube, a social media tool that direct marketers can use to extend their reach with videos.
- Z is for zip codes that are important for postal mailings, at least in the U.S.
Direct marketing’s greatest strengths are its ability to track and test the various elements of the marketing mix and to adapt to changing options. Using traditional direct marketing methods enables today’s marketers to test the use of new and evolving technologies and media via an array of new devices. What other important elements would you add to this direct marketing list?
Big tip of my hat to my colleagues at DMA:2011 where I’m teaching, presenting and attending. Here are some related articles.
Photo credit: Joyosity via Flickr