Textbook Notes (369,205)
Canada (162,462)
MCS 3620 (29)
Bharat Sud (21)
Chapter 6

Chapter 6

6 Pages
101 Views

Department
Marketing and Consumer Studies
Course Code
MCS 3620
Professor
Bharat Sud

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Description
Chapter 6: Planning for Direct Response Communications Direct Marketing: Amarketing system for developing products, sending messages directly to customers, and accepting orders through a variety of media and then distributing the purchase directly to customers Direct ResponseAdvertising: Advertising placed in a meidum that generates an immediate and measurable response from the intended target  Involves the deisgn and development of appropriate messages and the placement of messages in appropriate direct response media to encourage immediate action by the intended target  Capable of making a sale Direct mail: Aprinted form of direct response advertising distributed by Canada Post or independent delivery agents Direct Resposne Television (DRTV): Advertising that appears on television and encourages viewers to respond by telephoning a toll-free number, by mail, or online; often refered to as infomercials Direct Response Print: An ad in print media that issues a direct call to action via a toll-free number, return mail address, or website Telemarketing: The use of telecommunictions to promote the products and services of a business involves outbound calls (company to customer) and inbound calls (customer to company) Catalogue: Areference publication, usually annual or seasonal, distributed by large retail chains and direct marketing companies The Direct Response Planning Process The Roots of Direct Response Communications: Database Management House List: An internal customer list  This list is well-maintained and well-managed internal list of customers Internal Data Sources  Agood database management system collects and maintains relevant information about customers  The information is stored in such a manner that managers have easy access to it when developing marketing strategies Collecting data  The database should identify what a custome rpurchases, how often the custome rpurchases, how much the customer spends on average, what brands of goods the customer prefers  Adding external information to the database rounds out the profile of the customer  Information about customers using credit cards for purchases is readily available  Demographic and psychographic information can also be obtained form comercial research companies or a company can hire an independent research company to conduct primary research to uncover such information Accessing Data  Second step in database management is devising a storage system that allows managers to access information easily when it is needed  Data Mining: The analysis of information to determine relationship among the data and enable more effective marketing strategies to be identified and implemented ◦ Rather than looking at an entire data set, data mining techniques attempt to locate informational patterns and nuggets within the database ◦ Goals of data mining: ▪ Produce lower marketing costs ▪ Increase efficiency by identifying prospects most likely to buy in large volume ◦ Offers two essential benefits: ▪ 1. Provides ameans of profiling the “best” cusotmers and the “worst” customers. Greater emphasis must be placed on cusotmers who produce sales and high profit margins for an organization. Consideration can be given to dumping customers who are costing more than they generate in profit ▪ 2. Gives an organization a means to predict future sales. Continuous compiling and analysis of data about current cusotmers sales histories should result in more accurate forecasts about what the future holds. Companies can us the internal customer profile information as a guideline and then rent names from lists that have similar profits External Sources  List Broker: Acompany specializing in finding or developing lists for direct response purposes; finds propsect lists based on target market criteria established by marketing organizations  Merge/Purge: Aprocess in which numerous mailing lists are combined and then stropped of duplicate names  Response Lists: Alist of direct mail buyers who have previously bought based on direct response offers ◦ Its a “hot” list so the price is high on a cost-per-thousand basis ◦ Such lists include book-of-the-month buyers, CD music buyers, and people who routinely place orders with cooperative direct marketing firms  Circulation List: Apublication's subscription list that targets potential customers based on specified demographic characteristics, interests, or activities  Compiled Lists: Adirect mail list prepared from government, census, telephone, warranty or other publication information  Online Database: An information database accessible online to anyone with proper communications facilities  Directory Database: Acommerical database that provides information about a company (e.g. Size, sales, location, number of employees) The Tools of Direct Response Communication Direct Mail  Use of direct mail is widespread thanks to its ability to personalize the message by using names secured from internal databases or rented from external databases  It provides an opportunity to target customers demographically and geographically  Provides an opportunity to “tell a story”  Typical direct mailing has several components, each designed to serve a specific purpose: ◦ Envelope – Critical component of mailing. The envelope has to suggest storngly why the recipient should read the contents. There should be a sense of urgency to opening the envelope ◦ Letter – Introduces the prospect to the product or service and encrouages the reciever to read more about the offer inthe other pieces included in the mailing. The letter may be unaddressed or addressed ◦
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