What You Need to Know About Direct Marketing

Two grey mail boxes on a city sidewalk. This image is being used as a thumbnail for a blog on direct marketing.
Two grey mail boxes on a city sidewalk. This image is being used as a thumbnail for a blog on direct marketing.

Direct marketing is arguably one of the oldest forms of promotion, going back to a time when it was simply a part of the sales and advertising process and formalized marketing was unknown. Yet, many modern marketers are still unsure how to define direct marketing. To answer that question, we have to take a look back at the tactic's storied history.

Customers – they wouldn’t have been called ‘consumers’ back then – living in far-flung places such as America’s West, Australia’s Outback, and Canada’s Frozen North received glossy brochures and catalogs from big retailers in the large towns and major cities.

These potential consumers were out of reach of direct selling; in other words the door-to-door and face-to-face selling common at the time. But, after perusing their brochures and catalogs, they used mail order to buy all manner of items ranging from farm implements to clothing, boots, and household knick-knacks. These were then delivered by whatever means were available for direct mail at the time – steam trains, camel trains, wagons, stagecoaches, riverboats, and more.

Interested in integrating modern direct marketing into your strategy? Read on and learn all you need to know about this tactic. 

Modern Direct Marketing in Practice

So, how does direct marketing differ today? Direct marketing campaigns have evolved to be part of the modern marketing and promotional mix and have embraced the most innovative marketing technologies of our era. But its basic principle remains the same: a promotional strategy that sends messages directly to the consumer and typically seeks to elicit a sale via direct response. There’s no advertising media involved and no visit to a brick-and-mortar retail store.

In earlier years it may have involved a direct mail response coupon that took weeks or months from the time of order through to successful completion of delivery to the client. Now it may encompass a toll-free phone number or click-through link on a social media ad, where orders can sometimes be fulfilled in minutes or hours – a speed that the direct mail practitioners of yesteryear could never have imagined. The potential for rapid response is one of the many advantages.

This field is also sometimes referred to by other names such as:

  • Direct-response marketing
  • Direct mail advertising;
  • Direct advertising;
  • Direct selling.

What is Direct Marketing?

Investopedia, which seeks to easily explain all things related to marketing, business, and economics, defines direct marketing as “any marketing that relies on direct communication or distribution to individual consumers, rather than through a third party such as mass media”. It adds: “The call-to-action is a common factor in much of direct marketing.”

So, the world of this marketer doesn’t involve big-budget national TV brand advertising, slick PR strategies targeting editorial coverage in the mainstream media, highly creative print advertising in the Sunday press, glossy magazine ads, or a billboard advertisement alongside a traffic-snarled highway.

Rather, this marketer’s approach is all about creating a direct interaction with the consumer. Expensive, mass market and vaguely targeted advertising campaigns using a middleman are out. It’s the sniper’s rifle versus the shotgun. One of the advantages for the marketer is precision targeting, whether to the business-to-business customer or the man or woman in the street.

Types of direct marketing

As marketing evolves, expect the direct marketing channels being used by a marketer to evolve as well. It has been that way since those early catalogs found their way into the hands of cowboys – but then gave way to ideas such as a discount sales coupon inserted into a magazine, as publications began to circulate more freely in the Wild West. Let's take a look at several of the most common direct marketing strategies:

  • Print
  • Telemarketing
  • Retargeting
  • Conversational marketing

In countries with efficient postal services, a marketer may find that printed catalogs and direct mail pieces still have a place (mostly in instances where customers have shown a preference for this form of direct advertising). But, even so, direct marketing has diminished in favor of more modern and cheaper digital channels. The realities of COVID-19 may finally signal direct mail marketing’s death-knell.

Telemarketing

Another older direct advertising channel available to marketing practitioners – namely telemarketing – continues to have a place in direct marketing efforts, however.

A cartoon illustration of a woman with a headset on and several makeup products she is marketing over the phone besides her

Image by mohamed Hassan from Pixabay 

The plethora of call center operations, whether in-house or outsourced to specialist call center companies, is a testament to the affinity that many a marketer still has for it. But the decreasing willingness of the consumer to answer unknown phone calls and the rise of call-blocking and spam caller-recognition technology may mean that traditional telemarketing is losing its advantages and is also heading, inexorably, towards extinction.

However, there are new forms of automated telemarketing already in operation. For example, location-based marketing systems may detect your phone as you walk past a particular store and generate a message offering a tantalizing discount on an in-store product, providing you purchase within the next 15 minutes, for example. If you take up the offer, the system may recognize your phone when you pass by a month from now and generate another, perhaps complementary, product offering.

Retargeting

Highly targeted (emphasis on ‘targeted’ as opposed to ‘spray and pray’) social media ads via platforms such as Facebook, LinkedInInstagram, and others are also widely adopted. Retargeting campaigns that use the above platforms, as well as the likes of Google ads, to remind past visitors to an e-commerce website to return and make an initial purchase – or another purchase – are a useful tool in direct marketing. Pop-up advertisements in a browser window that promote a targeted offer may be part of this line of attack. But beware of the nuisance factor, which is a critical disadvantage, and possibly skewed metrics since many click-throughs are accidental.

Conversational marketing

Other common channels used in direct marketing at the moment include:

  1. Letterbox drops
  2. Direct distribution via leaflet handouts
  3. Email
  4. Text messaging;
  5. Chatbots.

In addition to this, WhatsApp has also become a useful channel for the marketing of businesses. WhatsApp Business is free to download and was built with the small business owner in mind. Examples of direct marketing on WhatsApp include:

  • Coffee shops posting menus and accepting take-out orders
  • Dog groomers taking bookings
  • A maternity goods shop posting special offers and taking orders from its customer base of new moms
  • A real estate agent posting details of new property listings in a specified area
A sample WhatsApp text thread between a business, Sandra's Cakes, and a customer

Source: WhatsApp

 Be aware of untargeted use of all of these channels, especially on a frequent basis. When used incorrectly, this form of promotion merely becomes junk or spam and will not be read, but simply discarded. Certainly, few things will alienate potential new customers more than bombarding them with marketing messages that are irrelevant. And this leads me nicely onto the pros and cons of using a direct advertising approach.

Direct Marketing Advantages and Disadvantages

AdvanatagesDisadvantages
#1More efficientCan be time-consuming
#2More personalizedHas a negative perception
#3Easy to measureDoesn't support an up-market strategy

Advantages

Let's first walk through the main advantages of direct marketing.

More efficient

Targeting a specific audience that you know is likely interested in your product or service means less wastage, no big advertising placement costs from TV channels or media publications, and a lower cost per sale.

More personalized

Extremely high levels of personalization are possible with direct advertising. This is more than simply addressing a person by name. For example, the offer may be hyper-personalized and tailored by knowing:

  • What work people do;
  • The car they drive;
  • What sports they play;
  • What professional sports teams they support;
  • Where they like to go on holiday.

Easy to measure

Because the offer typically requires a specific response within a stipulated timeframe, it is relatively easy to measure the success of the campaign compared to traditional advertising. Direct response marketing mechanisms may include:

  • A toll-free number;
  • A dedicated email marketing address;
  • A dedicated postal address for direct mail responses:
  • A keyword that must be texted to a specified number;
  • A click-through to a particular landing page.

Measurement produces data. And in our modern world data – more specifically actionable data – is vital. If you’re effectively managing and monitoring your response rate you should be able to produce valuable data such as customer names and contact details, where they live, gender, age, what products they’re interested in and what they’ve recently bought. Plus, ideally, an opt-in to future marketing messages and therefore more cross-selling opportunities. This is pure gold if you’re in marketing!

Disadvantages

Now, let's take a look at a few of the disadvantages of direct marketing.

Building a marketable database is time-consuming

Acquiring and maintaining useable databases for your direct marketing campaigns requires ongoing effort and investment. This has become even more pronounced in EMEA as national legislators increasingly require a formal opt-in to make the process legal, for example, GDPR. A lot of effort is required to get permission to include someone in your customer database and to ensure that opt-outs are taken off lists timeously. Penalties for transgressions can be harsh.

The ongoing effort required to build and sustain a direct advertising database is among the disadvantages. But when you’re successful it has enormous advantages and will boost your marketing.

It gets a bad rap!

Despite various initiatives by associations to ‘clean up’ the industry, educate the consumer on their rights, and even to change the name of this form of marketing – for example, the Direct Marketing Association in the UK has rebranded itself as the Data and Marketing Association – many people still have a negative view of the industry and refuse to engage with what they regard as “junk” calls, emails, direct mail, text messages, and other approaches.

The negative perception is one of the key disadvantages.

It doesn't support positioning strategies

Direct marketers tend to concentrate on the marketing offer, whether product or price-focused, in order to solicit an immediate response. Therefore, it’s not well suited to marketing that requires brand and image building. That said, if the brand building is being accomplished by other elements of the mix (e.g., print, television, or billboards), it’s important that your direct marketing strategy complements that, rather than contradicts it.

For example, if your brand-building promotes an upmarket image but your email marketing message is full of slang and smutty innuendo, it will be at odds with this.

Direct Marketing Examples

Around the world, there are numerous examples of innovative and successful action plans. During this section, we'll walk through standout direct marketing campaigns that caught our eye.

Royal Australian Air Force

Facing tough competition for new graduates from private sector employers, The Royal Australian Air Force (RAAF) decided a few years ago that it should turn to marketing to help recruit some of the country’s best and brightest young radio technicians.

To achieve this goal, the RAAF and its agency attended university events and engineering expos and distributed branded DIY FM radio kits to final year students. The kits had everything required to build the FM radio – except instructions. After using their skills and expertise to assemble the radios, students were able to tune into a dedicated radio channel that broadcasted information about radio engineering careers in the air force.

As a result, Air Force FM helped find the most skilled recruits and also put the RAAF brand into homes across the country. Talk about making waves (pun intended)!

A cardboard box that has been converted into an FM radio

Photo credit: GEORGE PATTERSON Y&R Melbourne

Kit Kat Chunky bar

Wanting to promote their Chunky bar, a brand extension of the traditional flat Kit Kat that breaks easily into quarters, Nestle owned Kit Kat created a direct mail piece that looked similar to the card that postmen leave behind when they’re unable to deliver a package.

While typically the message would say the package couldn’t be delivered because it’s too big for the letterbox, in this instance, the Kit Kat branded card said it couldn’t be delivered because it was ‘too chunky for your letterbox’.

Recipients were then directed to their local newsagent, where they could present the card to get their free Chunky bar. The promotion won a Wood Pencil Direct Mail award because it drove awareness, encouraged trial of the product and had the added benefit of increasing foot traffic to local stores selling the item.

A promotional mailing that KitKat sent to people letting them know that they could pick up a sample of the new candy at a local newsagent

Photo credit: D&AD Awards

Harry’s grooming products

Harry’s – a company that sells personal grooming products in the U.S., Canada, and the U.K. – decided to use a simple email approach to help it make inroads into the market when it was still a fledgling brand.

Twelve Harry’s employees sent promotional emails to everyone in their personal and professional network, with the request that each recipient, in turn, forward the email to their network. Because the emails were coming from a known person, there was high uptake.

In addition, when email recipients clicked the link in the email, they were taken to a Harry’s landing page. People who were willing to share the landing page on their personal social media platforms received free Harry’s products.

Within a week, the brand had a customer list of 100,000 people, which was achieved via very cost-effective direct marketing methods.

Direct Marketing Tips to Get Started

Learn from the experts as to how to enhance your direct marketing campaign and maximize your ROI. Here are some useful tips.

Define your target audience

Good direct marketers know that it’s all about narrowcasting rather than broadcasting. Be clear as to the audience you want to reach and then tailor your message accordingly.

Consider factors such as:

  • Age
  • Gender
  • Home language
  • Profession
  • Marital status
  • Education level
  • Income
  • Ethnicity
  • Religion
  • Where they live
  • Hobbies and interests

 Depending on your requirements, your ideal target market definition may include all, or only one or two, of these. And, obviously, you should know their names and how to spell them correctly.

Personalize as much as possible. U.S. research published in 2018 by Epsilon, a company focused on data and technology, found that 80% of people are more likely to do business with an organization if it offers personalized experiences, and 90% indicating that they find personalization appealing.

Playing devil's advocate, Lester Wunderman, the legendary Madison Avenue ad man widely considered to be the doyen of direct marketers, believes that relevancy is more important than being personal. “Personal may offend. Relevancy never will,” he once advised - and he has a point, so we recommend walking the fine line between relevancy and personalization.

In some countries, readymade high-quality mailing lists are often available for purchase and could be quicker and more cost-effective than developing your own. But one of the disadvantages is that these may be limited to only a few parameters. For example, you may get a mailing list of all medical doctors in a specific area, but this may not contain information on gender, age, marital status, etc. Legislations like GDPR put a stop to buying such lists in Europe, so bear that in mind too.

Ensure your plan is measurable

One of the benefits of direct-response marketing techniques is that they are so measurable.

Think about what you want to measure, how you want to measure it, how frequently you want to measure it, and what would represent success. For example, do you want to measure what response channels the target market prefers (e.g., dedicated phone number vs email marketing click-throughs vs direct mail responses)? Or is the only measurement you care about confirmed money-in-the-bank direct sales?

If the promotion is planned to run for a month, for example, perhaps measure the results weekly. That way you can tweak your offering according to what’s working and what’s not.

Also, be clear on what would constitute a successful promotion. If you get 1,000 people requesting a call-back by a sales consultant, is that good enough for you? Or is 3,000 product sales the minimum requirement?

Be specific with your approach

Be direct, but not rude. It's important to be clear and straightforward as to what you want the potential customer to do, this is a ‘direct’ stratagem, after all – and you also require a prompt and measurable response.

If you’re a teeth-whitening clinic, for example, you don’t want to simply say how wonderful your dentists are and suggest people visit the website sometime in the future to find out more. Instead, you want them to make an appointment now, via a specific response channel, to book a free consultation and redeem a 10% discount on their first treatment.

Use the data to improve future courses of action

You’ve measured everything during the promotion, so now you have invaluable data. Analyze it for key insights that will be useful in directing your future efforts.

If the key insight is “well, that was a waste of time”, don’t be too disheartened. Companies have spent millions on big-budget TV ad campaigns and run them for possibly years without knowing whether they’re achieving the desired results!

Direct marketing has the potential to be as successful now as it was well over a century ago when it was serving the needs of people in some of the remotest regions of the planet. Even more so, given the range of new communication channels that deliver increasingly efficient and cost-effective ways to link products with consumers. These channels will continue to evolve – often in ways we can’t yet foresee – but the principle won’t: to communicate a relevant proposition directly and efficiently to an appropriately targeted customer in order to achieve the desired response.

If you know of a current campaign that’s making waves, let us know about it by tweeting us @Meltwater.