Direct marketing / response ads

1
Direct marketing / response ads

• Direct response ads developed with computer
  databases
• Led to focus on relationship with customer ?CRM
• Pareto principle ? approx 80 of business
  generated by 20 of customers
• Suggestion that it costs 5 to 10 times as much to
  get a new customer as to keep one ? Retention
• Objective get profitable customers ? true value
  concept

2
One-to-one marketing

• Includes direct response ads, direct mail,
  Internet, interactive digital TV...
• Develop maintain dialogue with customer based
  on knowledge gathered in data warehouse
• Mostly relevant to service businesses
• Difficult to apply to FMCG (cf. Heinz)
• ... Permission Marketing

3
Principles

• Drayton Bird ? 3 Graces
• Ability to isolate the individual customer
• Continuity, or potential continuity, of contact
• Ability to test
• Testing thru measuring results by what you get
  back (orders, enquiries and their conversion into
  cash)

4

• Direct mail ?ad letter with long copy, detailed
  info
• Press ? large size with response coupon
• Broadcast ad ? spots longer spots (60, 90 secs,
  infomercials) often with demonstration phone
  number
• Telemarketing ? inbound phone (toll free) for
  placing order or outbound (to close a sale or
  make an offer)
• Interactive media (digital TV, Internet)

5

• Recency
• Frequency
• Value