ADVERTISING Direct Marketing

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					                 ADVERTISING:
                 Direct Marketing



March 24, 2010         Advertising   1
                 Direct Marketing Defined



     “Any medium where a seller can
     contact prospective customers
     and then accept the orders”


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                 Direct Marketing




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                       Top 10 Direct Industries
                                              $ Billions
             Nonstore retailers    115.2

                     Real estate    55.2

General merchandise stores          50.4

Auto dealers/service stations       47.3

   Membership organizations         40.6

     Insurance carriers/agents      39.3

  Food and kindred products         35.3

                 Health services    34.9

        Depository institutions     29.4

                  Entertainment     28.8


                                   0%                    5%   10%   15%
                                    Percentage Annual Growth 1994-1999
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             The Growth of Direct Marketing
                 •   The catalog
                 •   Use of consumer credit cards
                 •   Direct-marketing syndicates
                 •   The changing structure of the
                     North American market
                 • Technological advances
                 • Other factors
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                            History of Credit
     •   1812 NY co. begins selling furniture on "installment."
     •   1831 The first building and loan association is formed.
     •   1856 Singer allows buyers a sewing machine for $5 down.
     •   1889 Installment plans are listed in dictionary for the first time.
     •   1910 The Sears catalog decries the "folly" of buying on credit.
     •   1911 Sears abandons its cash-only policy.
     •   1919 General Motors helps buyers finance car purchases.
     •   1924 3/4 of cars purchased in the US are bought on credit.
     •   1950 Diners' Club introduces its credit card.
     •   1958 American Express and Bank of America (VISA) cards.

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                       Direct Response Media
                 •   Direct Mail
                 •   Catalogs
                 •   Broadcast media
                 •   Infomercials
                 •   The Internet
                 •   Print media
                 •   Telemarketing
                 •   Electronic teleshopping
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             Advantages of Direct Marketing

            Segmentation capabilities
            Good reach (selective, too)
            Control over:
                 • Frequency
                 • Timing
            Measurability
            Personalization potential
            Cost efficiencies
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          Disadvantages of Direct Marketing

                 • Image factors
                   • “Cheesy”
                 • Accuracy
                   • No one “regulates” direct mail
                 • Fairly expensive
                   • Traditional support required

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                     Telemarketing

    Telemarketing generates $6 billion in sales annually.


                     Call Centre


                 Inbound            Outbound



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                 Use of 800 and 900 Numbers

           Order-taking
          90
          80
          70         Customer
          60            list
 % of
comp- 50                  Sales tool           Advertising
 anies 40                               Relation.
          30                             Mtkg.
          20
          10
           0

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                  Quote of the day

       One-third of the people in the
          United States promote, while the
          other two-thirds provide.
       • Will Rogers
           (humorist)

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