1. Direct and Online Marketing
Chapter 14

2. Previewing the Concepts
Direct marketing and its benefits
Database in direct marketing
Major forms of direct marketing
Internet and other new technologies with online marketing strategies
Online marketing to profitably deliver more value to customers

3. Direct Marketing
Connecting directly with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships
LO 1: Define direct marketing and discuss its benefits to customers and companies

4. New Direct Marketing Model
OLD supplemental
NEW complete model for doing business
Some only approach
Fastest-growing form of marketing
Direct marketing expenditures generate $2.1 trillion in sales, about 10% of U.S. economy
Direct marketing sales are expected to grow at 5.3% annually through 2013
Continues to become more Web-oriented
Internet marketing is the fastest-growing form of direct sales

5. Benefits of Direct Marketing
Benefits to buyers:
Convenient, easy to use and private
Provides greater control
Ready access to products
Ready access to wealth of comparative information
Can reach consumers in remote locations
Immediate and interactive
LO 1: Define direct marketing and discuss its benefits to customers and companies

6. Benefits of Direct Marketing
Benefits to sellers:
Builds customer relationships
Provides a low-cost, speedy way to reach markets, including business markets
Offers lower costs, improved efficiencies, and speedier handling of channel/logistics functions
Offers greater flexibility
Gives access to buyers that could not be reached through other channels
LO 1: Define direct marketing and discuss its benefits to customers and companies

7. Customer Databases and Direct Marketing
Customer database: An organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic, and behavioral data
Many uses for customer database:
Locate potential customers and generate sales leads
Learn more about customers and fine-tune offerings and communications

8. Forms of Direct Marketing

9. Direct-mail Marketing
Sending an offer, announcement, reminder to a person at a physical or virtual address
Largest direct marketing medium (34%)
One-to-one communication
Use of traditional forms may decline
Combination with other media
Often perceived as “junk mail”

10. Catalogue Marketing Catalog marketing:
Direct marketing through print, video, or digital catalogs distributed by mail, in stores or online
Catalog marketing trends:
More catalogs are going digital, minimizing costs and allowing real-time merchandising
Print catalogs are the primary medium, driving web traffic and creating consumer connections
Expected U.S. catalog sales in 2013 = $182 billion

11. Catalogue Marketing Catalog marketing trends:
More catalogs are going digital, minimizing costs and allowing real-time merchandising
Print catalogs are the primary medium, driving web traffic and creating consumer connections
Expected U.S. catalog sales in 2013 = $182 billion

12. Telephone Marketing 17% of all direct marketing sales
Used in both consumer and B2B markets
Outbound VS Inbound
Do-not-call legislation (DNCL)
Outbound: Sell directly to consumer
Inbound: Toll-free ordering or order faxing

13. Direct-response Marketing
DRTV – 60 or 120 sec long
Infomercials – 30 min (or longer)
Home shopping channels – dedicated to selling multiple brands, items & services

14. Kiosk Marketing
Information and ordering machines generally found in stores, airports, and other locations
E.g., in-store Kodak kiosks allow customers to transfer pictures from digital storage devices, edit them, and make high-quality color prints

16. New digital Marketing
MOBILE content, display or sponsorship advert & mobile messaging (SMS), expected to grow
POD & VOD - Ad-supported podcasts, downloadable ads, informational features, and other promotions
iTV - Viewer engagement is higher than regular TV ads

17. Online Marketing Online marketing: Marketing and the Internet:
Efforts to market products,
and services and build
customer relationships
Marketing and the Internet:
80% household penetration rate
Online marketing efforts are expanding
Click-and-mortar companies are having more online success than click-only companies

18. Online Marketing
B2C -Online buying continues to grow; the Internet influences 35% of total retail sales
customers initiate and control the Internet exchange process (diiff from off-line purchase) gratefulpalate.com
B2B - Businesses using B2B websites, , online catalogs/trading networks, and other online resources to reach and serve customers, obtain buying efficiencies and attain better prices, offer online product information, purchasing, and support, used to build stronger customer relationships cisco systems
C2C - Online exchanges of goods and information between final consumers, Auction sites such as eBay offer marketplaces to buy or exchange goods, Blogs and forums facilitate information interchanges
Firms should monitor blogs for what is being said
C2B - Online exchanges in which consumers search out sellers, learn about their offers, and initiate purchases, sometimes even driving transaction terms
E.g., GetSatisfaction.com allows users to post questions, voice complaints, or deliver compliments to companies

19. Online Marketing Creating a website Placing ads and promotions online
Creating or participating in online social networks
Using

20. Online Marketing Corporate websites: Marketing websites:
Corp -Build customer goodwill, collect customer feedback, and supplement other sales channels, rather than to sell the company’s products directly
Mtkg - Engage consumers in interactions that move them closer to a direct purchase or other marketing outcome

21. Online Marketing The seven Cs of effective website design:
Context
Content
Community
Customization
Communication
Connection
Commerce
Constant change encourages repeat visits
LO 5: Discuss how companies go about conducting online marketing to profitably deliver more value to customers

22. Online Marketing Placing ads and promotions online:
Online advertising is a major medium to build brands and attract visitors to sites
Forms of online advertising: Banner ads, Interstitials, Pop-up or pop-under ads, Rich media ads, Search-related ads (contextual advertising)
Other forms of online promotion:
Content sponsorships (sponsoring special content)
Affiliate programs (work with other companies to promote each other)
Viral marketing (Internet version of word-of-mouth)

23. Online Marketing OfficeMax’s ElfYourself.com viral website:
Viral marketing: OfficeMax’s ElfYourself.com viral website has propelled itself into the digital record books. With no promotion at all, the site logged more than 193 million visits between late November and early January. One-third of those visiting the site were influenced to shop at OfficeMax.

24. Social Network Marketing
Online communities where individuals and companies can exchange information
E.g., MySpace, Facebook, Twitter, YouTube
Marketers can participate in existing online communities or set-up their own
Focused niche networks are emerging which can be used to target special interest groups

25. Email Marketing Cost-efficient, lowest cost
Used to welcome new customers, qualify leads, announce events, cross-sell and upsell, promote new products and build customer relationships
Permission-based marketing is key
According to the Direct Marketing Association, marketing produces a ROI 40 to 50% higher than other forms of direct-marketing media

26. Challenges of Direct and Online Marketing
Internet fraud and phishing
Online security
Difficult to restrict access by vulnerable or unauthorized groups
Invasion of privacy
LO 5: Discuss how companies go about conducting online marketing to profitably deliver more value to customers

27. Previewing the Concepts
Direct marketing and its benefits
Database in direct marketing
Major forms of direct marketing
Internet and other new technologies with online marketing strategies
Online marketing to profitably deliver more value to customers

28. Chapter 14 Case
1. Conduct a brief analysis of the marketing environment and the forces shaping the development of StubHub?
2. Discuss StubHub’s business model. What general benefits doe sit afford buyers and sellers? Which benefits are most important in terms of creating value for buyers and sellers?

29. Chapter 14 Case
3. Discuss StubHub as new intermediary. What effects has this type of intermediary had on the ticket industry?
4. Apply the text’s e-marketing domains framework to StubHub’s business model. How has each domain played a role in the company’s success?

30. Chapter 14 Case
5. What recommendations can you make for improving StubHub’s future growth and success?
6. What are the legal or ethical issues, if any, for ticket-reselling websites?