Chapter 21 Managing Direct and Online Marketing Marketing Management Tenth Edition Philip Kotler

Objectives Growth & Benefits of Direct Marketing Customer Databases & Direct Marketing Major Channels for Direct Marketing Marketing in the 21st Century: Electronic Commerce Public & Ethical Issues in Direct Marketing

Why Growth in Direct Marketing Market “Demassification” Effort of “Traditional Shopping” Continuous Access Next-day Delivery Specialty Items Increase in Computer Power

Benefits of Direct Marketing Fun, Convenient & Hassle-Free Mailing Lists for Almost Any Market To Customers To Companies Saves Time Customized Offers Larger Merchandise Selection Ongoing Relationships with Customers Comparison Shopping Timed to Achieve Higher Readership & Response Order Products for Themselves or Others Alternative Media/Message Testing Privacy Measurable Response

Uses for Databases 1. Identify Prospects 2. Match Customers & Offers 3. Deepen Customer Loyalty 4. Reactivate Customers

Direct Marketing Channels Face-to-Face Selling Online Marketing Direct-Mail Marketing Kiosk Marketing Catalog Marketing Direct-Response TV Marketing Telemarketing

Lifetime Value Cost of Campaign: $10,000 100 new members @ $70 $7,000 1st year “cost” $3,000 2d Year 80 renewals @ $70 $5,600 Two year “gain” $2,600 3d Year… 4th Year...

“Information Rich” Buyers Objective Information Initiation of Information Requests Design Desired Offerings Employ “Agents” or Solicit Bids Find Specialized Third-party Sellers

Benefits of Online Marketing Consumers Companies Convenience Information Fewer Hassles Quick Adjustments to Market Conditions Lower Costs Relationship Building Audience Sizing

Online Marketing Channels Electronic Presence Corporate Website Marketing Website Advertising Online Place Ads in Special Sections of Online Services Place Ads in Certain Internet Newsgroups Buy Online Ads That Pop Up While Consumers are Surfing Online Marketing Channels Participating in Forums, Newsgroups & Web Communities Forums: Discussion Groups on Commercial Online Services Newsgroups: Internet Version of Forums Web Communities: Sites Where Members Exchange Views Online Using E-Mail and Webcasting Customers Send Questions, Suggestions & Complaints Via E-Mail Webcasting: Automatic Downloading of Information to PC’s

Challenges of Online Marketers Limited Consumer Exposure & Buying Skewed User Demographics & Psychographics Chaos & Clutter Security

Public & Ethical Issues in Direct Marketing Irritation Unfairness Deception & Fraud Invasion of Privacy

Review Growth & Benefits of Direct Marketing Customer Databases & Direct Marketing Major Channels for Direct Marketing Marketing in the 21st Century: Electronic Commerce Public & Ethical Issues in Direct Marketing