13-1 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Chapter 13 Direct marketing and communication

13-2 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Learning objectives 1.To examine the development and reasons for growth of direct marketing communication. 2.To define the role and relationships of direct marketing, the internet and interactive media in an IMC program. 3.To identify the advantages and disadvantages of direct marketing communication. 4.To evaluate the effectiveness of communication through direct marketing communication.

13-3 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Limitations Advertising Direct marketing Measuring effectiveness Part of IMC Advantages Mail and print Catalogues Broadcast Telephony PR Objectives Media Growth Personal Selling Support

13-4 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Guide Dogs Australia

13-5 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing defined Interpersonal Direct selling Internet & Mail Telephone TV, Radio & Print Direct marketing is a system by which organisations communicate directly with target customers to generate a response or transaction. DM media Techniques Catalogues SMS Electronic home shopping Direct mail Telemarketing Direct response Electronic interactive marketing

13-6 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Anthony Hordens’ mail-order catalogue

13-7 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Growth of direct marketing Miscellaneous factors Technological advances Changing structure of society Direct marketing syndicates Consumer credit cards

13-8 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing: roles and relationships

13-9 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing combines with... Advertising Sales promotion Public relations Personal selling Internet Support media Direct marketing

13-10 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Dirt Action direct marketing

13-11 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Limitations Advertising Direct marketing Measuring effectiveness Part of IMC Advantages Mail and print Catalogues Broadcast Telephony PR Objectives Media Growth Personal Selling Support

13-12 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Developing a database Improve selection of market segments Stimulate repeat purchases Cross-selling other products Customer relationship management Objectives

13-13 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Sources of information for developing a database Credit bureaux List services Direct marketing associations Direct marketing associations Online search behaviours Postal services Syndicated research Bureaux of statistics Info sources Info sources Retail transaction histories

13-14 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell A comprehensive consumer database Name Address/ postcode Telephone number Length of residence Age Gender Marital status Family data Education Income Occupation Transaction history Promotion history Inquiring history Unique identifier

13-15 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing and customer loyalty

13-16 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Limitations Advertising Direct marketing Measuring effectiveness Part of IMC Advantages Mail and print Catalogues Broadcast Telephony PR Objectives Media Growth Personal Selling Support

13-17 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing media strategies One-step approach One-step approach The medium is used to obtain an order Goal is to generate an immediate sale Examples: Reply paid coupons numbers The medium is used to obtain an order Goal is to generate an immediate sale Examples: Reply paid coupons numbers Two-step approach Two-step approach The medium is used for inquiry and to qualify prospects Follow up with a second medium to complete the sale Also known as permission marketing The medium is used for inquiry and to qualify prospects Follow up with a second medium to complete the sale Also known as permission marketing

13-18 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell DM Media: mail

13-19 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell DM Media: catalogues

13-20 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell DM Media: unwrapped catalogue

13-21 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell DM Media: catalogue websites

13-22 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct selling Direct selling Direct selling Party plans Party plans Repetitive person- to-person selling Non-repetitive person- to-person selling

13-23 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Evaluating DM effectiveness DM specific measures Cost per order (CPO) DM specific measures Cost per order (CPO) Behavioural objective Traditional measures Brand awareness Brand attitude Other measures of brand health Traditional measures Brand awareness Brand attitude Other measures of brand health Non-behavioural objective Measures

13-24 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Direct marketing advantages and disadvantages Accuracy Image factors Content support Selective reach Segmentation capability Frequency potential Flexibility Timing Personalisation Economy Advantages Disadvantages Measurement of effectiveness Rising costs

13-25 Copyright  2012 McGraw-Hill Australia Pty Ltd PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell Summary and conclusions  As advertisers search for more cost efficient means of reaching markets, direct marketing and direct response media continue to grow.  Advantages of direct marketing include the ability to tightly segment, high level of message personalisation as well as excellent cost efficiency.  Advantages of the internet include its versatility, interactivity and its use in building customer relationships.  This chapter also considers means of evaluating the performance of DM and the internet.