DIRECT & DATABASE
MARKETING
Direct & Database Marketing
Learning Objectives:
Define “direct & database marketing” (DDM)
Understand & apply DDM concepts and methods
Understand concept of integrated marketing & the role
of DDM
“Hands-on” practice with DDM software
Implications of current events
DIRECT & DATABASE
MARKETING
“The New Direct Marketing is an information driven
marketing process, made possible by database
technology, that enables marketers to develop, test,
implement, measure, and appropriately modify
customized marketing programs and strategies.”
David Shepard Associates
DIRECT & DATABASE
MARKETING
Consists of ways of thinking, principles and tangible
elements
What are the tangible elements of direct marketing?
DIRECT & DATABASE
MARKETING
Direct Marketing’s Tangible Elements
The database itself
Communications that invite a direct response
Direct distribution of goods
DIRECT & DATABASE
MARKETING
Possible definitions:
“Any activity which creates and exploits a direct
relationship between you and your customer”
Drayton Bird, 1989
“Direct marketing is a way of acquiring and keeping
customers by providing a framework for three
activities: analysis of individual customer information,
strategy formation, and implementation such that
customers respond directly”
Alan Tapp,
2004
DIRECT & DATABASE
MARKETING
The Database - Interactive Marketing’s Essential
Difference:
who our customers are
what they buy
leads to what they want from us
how much they are worth to us
=> create relationships over time?
HANDLING CUSTOMERS ‘OVER
TIME’
Your database allows you to understand your customers
history with you and so predict their future needs
DIRECT & DATABASE
MARKETING
General marketing: product focus
build a brand and advertise it
distribution to retail
customer initiates buying
Direct & Database marketing: customer focus
get to know customer because you start recording
your transactions with them
maybe distribute direct
company initiates contact
DIRECT & DATABASE
MARKETING
Similarities: in the initial stages of strategy
formulation
General marketing & DDM marketing:
New product development
Strategic thinking (SWOT)
Research methods and testing
DIRECT & DATABASE MARKETING
GM vs DDM differences = in the content &
execution of the strategy
General Marketing:
communications uses mass media to build brands
sales promotions in retail environment
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content & execution of
the strategy
Direct & Database Marketing:
Uses mass media when addressing new prospects
Uses personal media-direct mail, telemarketing, when
developing relationships with existing customers
Focus on customers, rather than products
get to know customer because you start recording your
transactions with them
maybe distribute direct
company initiates contact
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content &
execution of the strategy
General Marketing: measurement
Market research techniques to understand &
predict customers’ likely behaviour
Direct & Database Marketing: measurement
Marketersanalyse behaviour to predict best
responding people & the best offers to make
DIRECT & DATABASE
MARKETING
GM vs DDM differences = in the content & execution of
the strategy
Direct & Database Marketing:
Is more expensive, on a per-customer basis
A way of buying a closer relationship customer
First individual information
Subsequent precision & control in customer contact
I.e., Marketers analyse behaviour to predict best responding
people and the best offers to make
DIRECT & DATABASE MARKETING
A Complete System of Marketing:
market analysis and research
segmentation and positioning
making an offer
media and communication
creating relationships
… are all done within a database marketing
framework
DIRECT & DATABASE
MARKETING
3 levels of direct marketing:
DDM drives the business
DDM drives all or part of the marketing strategy
DDM is used within the communications mix
DATABASE MARKETING: 3 BROAD
TYPES OF APPLICATION
DM 1. ‘Stand alone’
2. Integrated
DM
DM
3. ‘Peripheral
DIRECT & DATABASE
MARKETING
Reasons for growth:
Social:
Fragmentation of society
Proliferation of media
Greater consumer sophistication
Consumers want to be in control
DIRECT & DATABASE
MARKETING
Reasons for growth:
Business:
Ever more competition
Drive for cost-effectiveness
Interest in consumer retention & loyalty
Continuing drop in computer processing costs
DIRECT & DATABASE
MARKETING
DDM Advantages:
Lead grading
Customized targeting at the right time
New information & past results help formulate strategy
DIRECT & DATABASE
MARKETING
DDM Advantages:
Information can drive new programs & fuel new revenue
sources
Information can foster new services & generate repeat
orders
Ongoing communication efforts can increase customer
loyalty
