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Special Columns
Arindam Chaudhuri, Editor-in-Chief, 4Ps B&M Chief Consulting Editor's Desk
Rajita Chaudhuri
K.K.Srivastava Guest Column
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RULE #4 : Direct Marketing– for better results, use it cautiously!
It might be the most talked-about ad-medium today, but customers hate it. still, marketers love it. 4Ps B&M explains the hope and dope called direct marketing.
Issue Date - 22/09/2011
Some choice offered by direct marketers is appreciated by the lot called “prospective customers”. Some more, amuses them. But a hundred-odd e-mails and messages that roadblock their gadgets and a hundred anxious marketers invading their lives with their acts of persuasion, rankles them. And this is the present day truth. But for all that you care to empathise with the consumer lot, the marketing fraternity won’t be found willing to buy your words, that describes this shelling (of ads) an act that forebodes disaster. Paradox is – numbers support their cause.

You thought it was all a matter of rubbing the buyers the wrong way? Actually, this blatant use of new age digital communication channels, achieves quite what is desired by the marketers. According to a 2010 study by the Direct Marketing Association in US, “Marketers, through both digital and traditional channels, spent $153.3 billion on direct marketing during 2009, which accounted for 54.2% of all ad expenditures in US. Measured against total US sales, the ad-expenditures generated $1.798 trillion in incremental sales!” Given that the proportion of marketing spend on digital media is set to rise in the years to come, the above findings have pleasant implications for those betting on the direct marketing route.

At the same time however, choosing to err on the side of caution is not always the right option to side with for the digital age direct marketers. Not when millions of dollars in marketing budget come to question. While it is difficult to dispute the effectiveness of direct marketing, a blindfolded approach to usage of this medium can result in reduced or even negative returns. You thought it increases recall? Think about it – what was the name of the insurance company that offered you a product via a call most recently? Or better even – did you care to read the entire message from the X, Y or Z real estate company that popped up on your mobile screen? Do you even recall what X, Y, Z stands for? Your answers form the basis of our argument – direct marketing over digital channels – should be used cautiously.

There are however newer mediums, which help direct marketers avoid the much-hated nightmare. Foursquare is one. It’s an application that combines geographical data of the consumer with his/her demographic data. Simply put, if you as a consumer happen to be registered with the app and visit a retail outlet (which has tied-up with foursquare), you’ll receive special discounts and privileges immediately from the retailer, based on your details registered with foursquare. Last year, McDonald’s USA managed to increase footfalls at its outlets by 33%, by giving out discount offers (coupons) via SMS to foursquare users.

Back home, Domino’s is setting quite an example. Its CRM process not only helps it retain customers, but also makes sure its pizzas are ordered more frequently to the same customer. The QSR sends customised discounts offers via SMSes, based on the users’ past purchases. Additionally, the company e-mails consumers, a customised menu every month, which has variants of the pizzas that feature regularly on their respective records of bills.

In the digital age, making history has become easier. The same can be said for direct marketers, who play by the rulebook. Which rule? Marketing helps and those who tread with caution always win – direct or indirect marketing. Always.

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