Of the 625,000 people around Australia who are employed in direct marketing, it is easy to get the impression that many don't understand what it really is.
Numerous people think of it as a channel of communication, such as direct mail. Others think of it solely as direct response advertising. Very few people recognise the full potential of dm.
Essentially, dm is a way of thinking about business. It is a method of marketing that starts from where the customer is. Professional dm practitioners begin by trying to understand the prospect or customer as deeply as possible.
It is fairly obvious that that's not where most businesses start. Most businesses start from the product or service they have to offer.
In practice, dm includes any interactive activity whereby you reach prospects or customers directly, or they respond to you directly.
With all dm that I can think of, the all-embracing objective is to build a direct relationship between yourself and your customers as individuals. And why do we do this? To encourage customers:
- to stay longer,
- to continue buying (or donating in the case of fundraisers), and
- to help build the business by providing that all-important word-of-mouth advertising.
Ultimately, where this happens, the players on both sides of the equation are happy. Suppliers make healthy profits and customers get real and continuing value.
To actually implement effective direct marketing is very much a detail business. There are dozens of small details that have to be completed correctly. But there are two elementary steps that are essential to understand.
Isolating your prospects and customers as individuals
Without an effective database, direct marketing cannot get off the ground. By storing names on a database, with useful information that's accurate, you have a chance to make offers and approaches that are relevant. And wouldn't you say that 'relevancy' is the NUMBER ONE DROP DEAD MOST IMPORTANT ELEMENT in all promotions?
Building a continuing relationship
There's only one effective way to develop a relationship that is going to be ongoing: the way that best suits the customer or prospect! By communicating interactively in a tone and manner that fits the individual, at suitable times, with appropriate messages, you then have a chance to create something of value for both parties.
In the early 1970s, the renowned Peter Drucker suggested that the aim of marketing was:
"To make selling superfluous ... to know and understand the customer so well, that the product or service fits him/her and sells itself."
How many companies that you know, have been so effective with their marketing that their selling is no longer needed? My guess is, not many.
To know a customer properly, obviously, the ideal is that you know that customer as an individual. Just like the old-time corner grocer. Before the days of supermarkets, he knew most of his customers by name. But that's history. Today, 'knowing and understanding' customers involves isolating segments on the database. The more refined the segmentation, the more it can enable us to develop offers that are relevant.
When you keep useable information in your database about your prospects and customers you are enabled to vary the way you speak to them, the frequency with which you speak to them, and what you speak to them about.
Yes, dm is an information driven process. Obviously, it is the database that gives us the ability to store and use information with powerful effect. But what's even more fundamental? The whole question of what information goes into the database in the first place.
This is a big issue. And the answer is different for every business. Marketing judgement is required. What shall we ask and what shall we store? Where knowing the 'favourite cuisine' of prospects may be important for some businesses with some products, preferences for 'government schooling versus private schooling' could be far more important in other cases.
No matter what the 'correct' answer may be in your case, the best time to start collecting is right now.