DIRECT MARKETING: WHAT IS A DIRECT MARKETING METHOD

According to marketing research, over 40% of consumers say they keep emails in their inbox to review information. Almost one-third occasionally forward emails to acquaintances, and more than 80% of respondents said they find content received through email marketing useful.

The core of this type of business promotion is direct communication with the target audience without intermediaries. If recipients of such advertising are carefully selected, this method can be convenient for customers and beneficial and easily measurable for marketers or business owners.

What is being discussed?

• What is direct marketing?
• What is the difference between direct and indirect marketing?
• Types of direct marketing
• How to develop a direct marketing strategy?
• Pros and cons of direct marketing methods
• Conclusions

What is direct marketing?

Direct marketing is a form of advertising where a company or specialist communicates directly with their pre-selected clients using various channels, such as email, social media notifications, messenger apps, and phone calls. This promotional method is also called response marketing, as it involves quick feedback from the client.

“Direct marketing is based on treating the customer as an individual, involves feedback, and does not use intermediaries for communication.” “Direct marketing”,—Wikipedia

The use of direct marketing began with catalog distribution back in the 15th century. Venetian publisher Aldus Manutius created a book catalog, and English gardener William Lucas sent his customers a seed catalog with prices. In 1744, Benjamin Franklin distributed a catalog of scientific and educational books.

In 1861, Welsh businessman Pryce-Jones distributed catalogs of his products, allowing orders to be placed from anywhere in the country. The products were delivered by rail, making it the world’s first business to enable mail-order deliveries via railway.

In 1967, Lester Wunderman, while working with brands like American Express and Columbia Records, was the first to define the concept of direct marketing. Later, direct marketing—especially direct mail—became one of the most popular forms of advertising.

What is the difference between direct and indirect marketing?

Direct marketing and indirect marketing are different approaches to advertising that are often used together. Both methods aim to inform potential customers about a brand’s products or services, but they differ in methods and objectives.

• Direct marketing involves directly reaching a specific audience with a personalized message designed to trigger a response or action.

The primary goal is to increase sales. This can be done through email, telemarketing, or social media. The method is personalized and can be easily measured by the number of responses received. Directly contacting clients encourages them to take specific actions, such as making a purchase, booking a consultation, or subscribing.

The effectiveness of direct marketing is determined by metrics such as response rate, conversion rate, and customer lifetime value (LTV).

• Indirect marketing influences the target audience by gradually preparing them for interaction.

By creating and distributing entertaining, informative, branded, or promotional content, indirect marketing works to increase brand awareness. The primary goal of promoting a business through indirect methods is to build a positive brand image, strengthen customer loyalty, and establish trusting relationships with potential buyers.

The key difference between direct and indirect marketing is the level of targeting and immediacy. Direct marketing is aimed at immediate response from a limited customer base, while indirect marketing has a broader reach and focuses on gradually building brand recognition and reputation. Through indirect marketing, companies gain brand ambassadors and generate user-generated content.

The most effective marketing strategies combine both direct and indirect tactics, with the ratio depending on the promotion channel and various factors.

Types of Direct Marketing

Direct marketing can be focused not only on target groups but also on individual customers. In Western marketing, it includes BTL activities—methods of direct influence on buyers. This includes tastings, presentations, loyalty programs, giveaways, coupons, etc. All these methods can significantly increase sales in the short term.

Many American and European marketers also consider contextual advertising and SEO (search engine optimization) as types of direct marketing. However, since neither of them contains personalized messages, and organic traffic growth does not bring immediate sales, it is difficult to classify these methods as direct marketing. Nevertheless, they are often part of general direct marketing strategies on the internet.

Main Forms of Direct Marketing

• Personal Sales: This involves direct contact between the seller and the buyer. Communication can take the form of business meetings, product presentations, or consulting on services.
• Email Campaigns: Email series help achieve various goals, not just quick sales. These can include informing about company updates, educating through valuable content, and creating or refining the target audience profile through surveys, quizzes, and polls.

After registering for the Feedly service, the user receives an email from the company’s CEO with the question: “Tell us how you heard about Feedly and what you hope to achieve”.

• Telemarketing—making calls to potential customers or existing buyers who are interested in a sales offer. Some companies, like internet providers and financial organizations, also practice cold calling, which is usually less effective because managers call people who have not previously shown interest in the product.
• Text marketing (SMS with a link to a website or app, push notifications). The response conversion rate in this case is usually quite high because consumers constantly use their mobile phones and often open even seemingly unimportant messages.

Direct sales can cause a very negative reaction if the client base includes non-target consumers. However, if business processes are well-organized, this form of marketing helps companies connect with customers and learn about their needs and problems by sending relevant offers and increasing conversion and customer lifetime value.

How to develop a direct marketing strategy?

Direct marketing is a well-planned communication with customers. To create an effective strategy, a marketer should consider various factors, including the characteristics of the target persona, the context in which the message is received, market conditions, the likelihood of competing offers, and trends in online business promotion.

Here are the main steps in developing a direct marketing strategy:

Defining the target market and creating a customer profile

Understanding who the audience is helps determine which channel to use for the campaign and to choose the best format for ads, design, and the tone of voice for emails, presentations, or other materials. In telemarketing, a detailed description of the typical customer helps to create the ideal conversation script, thinking in advance about how to handle objections.

The narrower the target audience, the more specific the strategy should be. Although the reach is smaller, the important metric—conversion—increases. Thus, the return on investment (ROI) also improves.

Competitor analysis

Make a list of competitors in your niche and related industries that actively use direct marketing. You can create a physical mood board or use Canva or other design tools to highlight the most striking ideas. A brainstorming session can also work well here: organize a discussion and create a collection of creative emails and messages. It is advisable to refer to international sources and adapt them for your audience.

The simplest way to get familiar with competitors’ direct marketing is to subscribe to their newsletters. This way, your email inbox will become a library of fresh ideas that you can improve and adapt to your clients’ preferences.

Choosing channels

When looking for effective platforms to communicate with consumers, you should answer several questions:

• Where does my target audience spend time online? How often do they read emails?
• How do you make sure that emails are opened and read to the end? What calls to action will be most effective?
• Can my company’s representatives meet with clients or participate in offline events?
• What is the appropriate budget for direct marketing for my business? How many emails should I send every month?
• What is the goal of direct marketing in my case? What should I write to customers about?

You can choose multiple channels and combine them, or start with one. Catalogs are the oldest form of direct marketing, and they should only be sent to those consumers who have already shown interest in the company’s products or services. In contrast, social media is a modern and practically universal platform for direct marketing.

Developing offers

What can you offer to your target market? At the first stage of interaction, it could be a lead magnet or discounts. Gradually, clients should be guided toward more expensive purchases, increasing the company’s average order value. It is important to plan a series of messages in advance, where each email is a logical continuation of the previous one.

Preparing materials and tools

At this stage, you will need the help of a copywriter, designer, and other specialists. To prevent emails from going to spam, you need to register with one of the email marketing services and learn how to use it. For social media, the correct sending algorithm is also important, as mass messaging in Direct could result in the account being banned.

Testing and Improvement

As with any marketing campaign launch, direct marketing results must be monitored. To ensure maximum effectiveness, emails need to be adjusted based on recipients’ reactions. Most email marketing services provide statistics on open rates and link clicks.

“You should focus on how many users converted and where they stopped on the conversion path. This can indicate problematic areas that need to be addressed, such as a lengthy form, unclear text, or a missing call to action (CTA).”—“How to Build a Robust Direct Marketing Strategy [+ Examples]”, Martina Bretous

The success of direct marketing depends on the quality and relevance of the offer, the format and design of the message, and the timing of its delivery. Therefore, testing the days of the week and hours that are most effective in terms of open rates is a mandatory part of the analytics process.

Pros and cons of direct marketing

Direct marketing allows companies to promote products or services that have just entered the market and are unfamiliar to consumers. Thus, direct marketing is less dependent on a strong brand and is aimed at motivating potential customers to take the desired action.

This approach is particularly effective for spontaneous purchases. You are unlikely to weigh all the pros and cons before buying a creative set as a gift for a child. If a message describes a completely new solution for preschool development with a great discount and a limited-time offer, a young mom interested in such products won’t monitor the brand’s reputation but will likely respond to the offer.

Let’s look at some other advantages of direct marketing.

Personalization

Although the number of sent messages can be enormous, direct marketing often allows for personalizing messages by adding the recipient’s name at the beginning. This increases engagement levels.

The content marketing platform BuzzSumo uses email marketing to invite potential clients to online events:“Don’t feel unprepared as you get ready for 2024. Listen to industry leaders who are at the forefront of marketing innovation. They will discuss and answer your questions about the future of the industry and everything you need to know about creating and distributing content, PR, and artificial intelligence.”. The email starts with addressing the subscriber by their first name.

Measurability

Direct marketing is attractive to marketers because its results can be measured quickly and accurately. If a company sends out 1,000 offers by mail and 100 subscribers respond, it is easy to calculate that the conversion rate is 10%. This metric is known as the response rate. It is one of the many clearly measurable performance indicators in direct marketing.

Click-through statistics are very important in email marketing, as well as in messaging apps and social media. In online direct advertising, this can be easily tracked using UTM tags. You just need to add the email source parameter to the relevant link created in a tag generator. The previously mentioned platform, BuzzSumo, uses this method to track clicks from emails to the website.

Thus, you can even test where to place a button in the email to maximize the click-through rate. To do this, use several labels with slight differences.

Clear call to action

A CTA is an essential part of direct marketing, and it boosts the results of sales, seasonal discounts, or promotions tied to specific dates.

Affordable pricing

Direct marketing is popular among both large corporations (since they no longer need to build or improve their brand reputation through indirect methods) and companies with limited budgets. If you cannot invest much in paid search ads, content marketing, or influencer partnerships, start with occasional direct advertising. This approach helps keep the business afloat and generates profit.

Return on investment (ROI)

Direct marketing has fewer unrealized hypotheses than indirect advertising. Using specific target audience lists allows you to contact only those who are interested in your sales offers, thereby reducing unnecessary costs. Mailings can be customized to pet owners, fitness center visitors, or small business owners. This allows marketing campaigns to be tailored to the needs and preferences of their customers, without random people being added to the database. Of course, to do this, you need to regularly activate subscribers and delete contacts who don’t open messages or respond to them in any way.

Direct marketing, like any type of promotion, has its drawbacks.

The difficulty of attracting new customers

If your product is unknown to the audience and its quality isn’t proven, it’s better to combine direct advertising with media publications, maintaining a blog with SEO best practices, and running paid ads on social media and Google.

Annoyance

Some customers may feel irritated by a stream of notifications or emails. This can lead to a negative attitude toward the brand and lower chances of engagement.

Spam filters

With the advancement of email and social media, spam filters have become more sophisticated, making it harder for businesses to reach their target audience. Internet providers and email service providers may block messages even if someone has subscribed to receive them.

The problem is that legitimate direct mail can have the same characteristics as spam. The risk of messages being marked as spam can be minimized by using specialized mailing tools and adhering to legal guidelines when drafting emails. Failure to follow these rules can result in penalties and harm the brand’s reputation.

If consumers are offered free product delivery for trial purposes, specify who will cover the return shipping costs and outline the return process. Provide subscribers with a convenient way to contact a company representative. And, of course, a link to unsubscribe should be placed at the bottom of the email. Companies often include a brief explanation of why the person is receiving these emails and links to social media.

Considering all the strengths and weaknesses of direct marketing, you can develop and implement the most effective communication strategy with your customer base.

Conclusions

Direct marketing is a business promotion method that involves communicating directly with customers. Its main goal is to increase sales, so a clear call to action is essential. Direct marketing eliminates any intermediaries between the seller and the buyer.

The effectiveness of direct marketing is easier to measure than media advertising or other brand promotion methods. However, the best results come from combining direct and indirect advertising. If the target audience already has some awareness of the company through content and paid ads, they are more likely to respond to emails, social media messages, or even offline product presentations.

A direct marketing strategy should be based on customer data, such as demographic information, social status, personality type, purchase history, online behavior, and more.

The main metrics for measuring the results of direct marketing are response rate, conversion rate, and customer lifetime value. By tracking these indicators, a company can continuously improve its direct marketing strategy.

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