The 8 Characteristics of Direct Marketing

Posted by Dave Olesen on May 2, 2017 9:22:02 AM

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8CharDMtop.pngRegardless of the tools or techniques, direct marketing communications typically have eight characteristics though all are not prominent every time. Let’s take a look at each one. I would encourage you use them as a checklist for your own use.

Target Audience
Whether it is by using your own customer records, survey information or other research, a specific target audience has been identified as most likely to be interested in your product, service or cause. Targeting may be based on a relatively simple data point such as the current relationship to your business or a very complex study using an outside market research firm.

Data Driven
Customer data you have collected supports every aspect of direct marketing communications and there are multiple points where the data is used.

  • Targeting: Whether the intended recipients are past, present or potentially
    future customers or constituents, they are known. Marketing mailing list data
    supports a reasonable assumption that they may be interested in your product,
    service or cause.

  • Addressing: Data used to reach these people will almost always exist in the
    form of filtering criteria (as with social media), a customer list of email addresses
    or postal addresses or telephone numbers. Very often, a list of similar data
    selected using criteria such as age, location, income, interests and more will be
    purchased and an entire industry supports this activity.

  • Messaging: Data used within the natural language of a communication piece
    itself will usually include information relevant to the recipient such as his or her
    name or something known about the recipients’ interests or purchase behaviors.
    For example: “Dear Wendy, You purchased a new Toyota two years ago. Now is
    an excellent time to trade it in because…”

  • Measurement: Simple response counts, sales or other direct signals back to the
    business are tracked and used to measure the return on investment (ROI).

One-to-One Communication
The extensive use of data (and “big data”) for targeting, addressing and the creation of relevant messaging work together in an attempt to attain a certain level of closeness and intimate association with recipients.

For example, let’s assume that you receive a letter in the mail that offers a life insurance policy to cover your newborn baby and guarantees that a portion of the premium will grow into a savings account that can be used to cover college expenses. How does this business know you have a newborn baby? How do they know you want your newborn to attend college some day? Notice the closeness or intimate knowledge of your life situation.

Personalization reinforces one-to-one communication and enhances relevancy and meaning for recipients. There is a clear relationship between perceived relevancy and meaning and subsequent recipient engagement .

It’s vital to remember that it is people who purchase products and services and it is people who join causes. Even if the purchaser is another business, it is people who influence and ultimately make the purchase decision. As such, most direct marketing attempts to communicate a personalized message.

Compelling Offer
I deliberately added the word “Compelling” with "Offer" because this is often overlooked. Studies have clearly shown that consumers respond to offers that appear to be more compelling than those that don’t – even if the net economic impact is the same. Much has been learned from the psychology of retail pricing. For example, $1.99 is not perceived as $2.00 and people tend to purchase more when an offer says “3 for $10” rather than $3.33 each. Perception matters and 40% off with a limit of 100 sounds like a better deal than 20% off with a limit of 200.

Call to Action
Like any other work, it is easy to become complacent in marketing. This is why we often see CTA’s that read “Call now” or “Call today and save!” Both attempt to have the recipient take action but, are they the best that can be done? Let’s examine CTA’s more closely.

Have you ever wondered why the vast majority of advertising messages include phrases such as “While supplies last”, “Limited time only” or “Sale ends tomorrow?” It’s because people respond to scarcity and, related to scarcity, are deadlines.  An effective CTA is motivational – not just instructional. The vast majority of people know how to search the internet, send email and use a telephone. They need to be motivated to respond.

Direct Response
You’ve already seen that Direct Marketing messages seek to create a one-to-one relationship with members of a target audience. To facilitate this relationship (and relationship is a very big word here), recipients should be given the opportunity to directly respond.

This can be as easy as providing recipients with a web page to visit, an email address to reply to or a telephone number to call. At the risk of injecting confusion, Response Marketing is also often called Relationship Marketing. One can understand why because the goal is to create a close relationship between the business or organization and the consumer or constituent. A direct relationship is the railway that leads to a close relationship. Treated properly, the relationship deepens over time and lifetime value grows. We will talk more about lifetime value, later.

Response Tracking
Part of your initial planning should include your future strategy be for those who respond and those who do not.  That said, there are at least two reasons why direct marketing communications should have a direct mail response rate tracking mechanism.

First, it’s important to know if the person you reached out to actually responded. Though it can’t always be a complete certainty that the person who replied to an email, filled-out a website form or
sent a response card was, in fact, the intended recipient, the vast majority of responses will be valid. This information is vital as you execute your “next steps.”

 Second, all marketing budgets are limited regardless of the size of the organization. Every marketing communication method requires an investment of time and money. It’s simply prudent to measure the return on the investment and weigh it against other options available to you.

 Have questions about Direct Marketing? Feel free to reach out by email or connect with me on LinkedIn.

Direct Marketing

Topics: Marketing Strategy