Principles of Direct Marketing in Delivering Company Objectives - Term Paper Example

Role of principles of direct marketing in delivering the company’s objectives AFFILIATION: Introduction to direct marketing Since marketing strategy is a vital part of the company’s overall business strategy, the top management has to ensure that it develops a well-integrated marketing mix that encompasses all imperative aspects required for the effective performance of the organisation. In order to reach the markets with success, the mass marketing is being shifted to the direct marketing. In the today’s market, direct marketing is extensively used in every industry sector for both Business-to-customer (B2C) and Business-to-business (B2B) firms (Winer, 2009). With the advent of time, direct marketing has grown to be compatible with the requirements of today’s market. The traditional channels of direct marketing such as inserts, door drops, telemarketing and direct mail have been substituted by E-mail, Internet and Database marketing. In the last few years, the companies have focused more on relationship building with the customers so that they can develop long-lasting bonds with them and ensure that their revenue stream moves in an upward direction (Dannaher & Rossiter, 2011). Principles of direct marketing As the concept of direct marketing is considered to be the crucial element of the marketing strategy, the companies have to ensure that they employ those channels of direct marketing that will help them in maintaining their competitive edge in their respective industry (Thakur, Summey & John, 2013). It has been found that there are various differences between the objectives of B2C and B2B companies; it is mandatory for the top management to make certain that there is alignment between the type of the company and its strategy. The main and frequently used marketing mediums used by the corporations in the last few years have been Television Commercials, Advertisements in magazines and newspapers, billboards, flyers, brochures, Corporate websites, radio and many more. Now-a-days, the organisations are using a wide range of direct marketing tools such as e-mails, online catalogues, telemarketing, Interactive videos, direct-action advertising, social networking sites, online marketing, kiosk marketing, face-to-face selling, vending machines and home or office personal selling (Weber, 2012). Since the businesses of B2C and B2B organisations vary a lot, the marketing strategy has to incorporate only complementary marketing activities that will help them in achieving their objectives (Shimp, 2010). For instance, B2C customers make their final decisions quickly after analysing the important features of the products and services. Although the end consumers are concerned about the information about the related offering but their need for details about the key elements of the offering are less important when compared to the B2B customers. Similarly, B2B companies want to inform their potential clients about the descriptions of the offering via their marketing activities. However, the main aim of both types of businesses is to earn sufficient amount of revenue that will allow them to exploit the unleashed opportunities and enhance their performance by making use of appropriate tools and techniques (Chong et al., 2010). According to Vel and Sharma (2010), the direct marketing comprises of the direct connections that is developed with the targeted consumers for obtaining the immediate responses and cultivating the long-lasting relationships with the customers. The crucial elements of the direct marketing are that it involves no intermediaries; it is one of the most important constituents of the promotion mix; and it is considered as the greatest growing form of the marketing. Difference between direct marketing principles of B2B and B2C Companies The fundamental differences between the direct marketing principles of the B2C and B2B organisations are as follows: 1. Size of market – The market of B2C firm is measured in terms of the customers which are in millions, while, B2B firms have only thousands of the customers. It has been found that each B2B customer has more dollar value as compared to that of the B2C market. 2. Process of buying – In B2B market, the duration of the buying process is longer that involves various people. The direct marketing is designed in such a way that the customers are able to gather information as soon as possible. The buying process cycle is reduced by 20% as compared to the traditional methods in the B2B market and 40% in B2C market by using the direct marketing tools. 3. Process of selling – In both B2C and B2B markets, the sales people are the main personnel involved in selling the product to the final consumer. However, in B2B organisations, the selling process comprises of the sales people, business partners or self-sufficient representatives and even distributors. After purchasing the product, the customers are not looking forward for any after-sales services. But in B2B market, the company representatives have to get engaged in the after-sales service requirements of the customers. 4. Selling cost and sales value – The total cost of the B2B customer is higher as compared to the B2C consumer. The company has to take into account the sales value as well so that it can ensure that it provides complete satisfaction to the customers. 5. Quality of Data – The quality of data is of utmost importance in the direct marketing as it needs to be relevant and up-to-date so that it has the latest information. It has been found that the data quality is below the standards in B2B market as compared to the B2C business market. All of the above factors reveal that the business environment of B2B and B2C organisations show that the objectives of the direct marketing strategy for each type of firm will vary. The main aim of the B2B firm is to provide detailed information about the characteristics of its offerings and persuade the clients to get engaged in a business relationship with it. Similarly, the purpose of the B2C company in direct marketing is to prompt the customer to purchase the product and give it a try so that the person can take advantage of complementary offerings of the company. Principles of direct marketing for B2B and B2C Companies Almost all the leading corporations are making effective use of the direct marketing tools and techniques so that they can upgrade their positions successfully in their sectors. Some of the well-known B2C companies that have exploited the benefits of the direct marketing are Unilever, Johnson & Johnson, Colgate-Palmolive, Nike, Marks & Spencer, McDonald’s, Nando’s, Procter & Gamble and many more. Likewise, the highly reputed firms that have created distinctive position in the market with their direct marketing activities are General Electric, Intel, Microsoft, GlaxoSmithKline (GSK), IBM, British Petroleum (BP) and many more (Weber, 2012). Unilever has made effective use of the direct marketing mediums by developing cordial relations with the customers. It has introduced various new features in its marketing campaigns such as trade shows, children day events, sponsorships, online marketing and digital direct marketing. In order to measure the success of its marketing activities, it has implemented programs such as customer traffic on website, number of online sales, customer feedback and conversion rate (first-time visitor becoming a customer). Similarly, Johnson & Johnson has started its online marketing campaigns in which the health experts talk with the mothers about their children problems. In order to develop long lasting relationships with the customers, the company has initiated various programs such as telephone marketing in which they call up their customers and talk to them about the performance of the products that they bought. Even they inform the potential customers about the new product offerings through their blogs and social networking sites. Generally, it is the policy of the company to send direct mails to the loyal customers so that they can deepen the bond with them (Thakur, Summey & John, 2013). Since the B2B companies have to provide extensive information to the customers, they make sure that they make use of the important tool to provide accurate details to them. For instance, BP has developed an Intranet system with it suppliers and distributors so that it can keep in touch with them with ease and convenience. Since the client of the company is a firm, it has to provide detailed information about its new products and service which is possible only through face-to-face selling and e-mails (Miltesky, 2010). Simultaneously, the company is exploiting the Internet marketing tools by providing a platform to the potential clients to retrieve vital information from their website and contact the company’s representative online on their corporate websites (Shimp, 2010). In order to strengthen the business relationship with the customers, the company offers various complementary services that will allow them to reap additional benefits for availing the services of the company. Another leading name in B2B market is IBM that is presenting the best solutions to the customers through its direct marketing strategy. IBM provides instant solutions to different organisations in accordance to their needs so that they can have a well-integrated system suitable for the enhanced performance of the client’s business. Almost entire services of the company have become online and they are offering their services right at the doorsteps of the customers so that they can gain various benefits (Ris et al., 2009). IBM has designed an online catalogue for its customers so that they can review the offerings that are available; in some cases, the company even allows the customers to get their systems designed in accordance to their requirements. The best aspect of IBM is that it gives the top quality maintenance services which fall in the category of face-to-face selling (Lombert, 2010). Hence, all organisations have to ensure that they incorporate the direct marketing techniques in accordance to the principles that have been highlighted by the experts of the industry. Importance of direct various levels of organisation Since the recession hit the countries on the international level, the companies have to encounter various problems such as ever increasing cost of expenses, high prices of marketing activities, ever changing consumer’s demands and reviving industry standards (Thakur, Summey & John, 2013). It has been found that the recession has not severely impacted the direct marketing industry as compared to the other sectors of marketing. The direct marketing channels such as e-mail marketing, Internet marketing, direct database marketing and direct mail marketing are cheaper and focus alternatives to the other channels of advertising. On every level of organisation such as operational, tactic and strategic is well-coordinated that allows the employees to ensure that the direct marketing is effective. On the operational level, the sales representatives are able to understand the needs of the customers and offer them the services in accordance to their requirements so that they are able to meet the sales targets and earn suitable amount of profit. The promotional activities are designed in such a way that the customers can get value for their money (Vel & Sharma, 2010). Even on the tactical level, the company has to ensure that it incorporates the vital aspects of the direct marketing that are the tactics so that they can be included in the strategy. All the tactics that have been developed in relation to the business type and customers have proven to be beneficial for the company. At the strategic level, the company is able to achieve its objectives especially of increasing the profit level and enhancing the performance by undertaking various favourable growth projects (Palmer & Koeing-Lewis, 2009). In order to make sure that the direct marketing strategy contributes to the proper attainment of the company’s objectives, following are the steps developed by Weber (2012) that have to be implemented appropriately: 1. The objective of the strategy has to be established and it should be simple which can be easily comprehended by everyone. 2. Ensure that the right target market is selected so that the desired results can be successfully achieved. 3. Develop the imitation of the product to evaluate its purpose and also the prospect of its acceptance in the market. The question should elicit the response to “what is in it for me?” 4. The responding process should be easier for the target market. 5. Next step is to think about the campaign and every communication should make contribution to the distinctive image of the brand. 6. Align the promotional mix with the audience, unique selling proposition, brand and product. 7. Extensive research should be done so that testing, learning and adaptability can be effectively carried out. The entire direct marketing process is an ongoing activity. Impact of database marketing and Internet marketing on direct marketing strategy The latest trend in the direct marketing strategy is that it should be coherent with the Database marketing and Internet marketing so that there is synchronisation in all the marketing activities. For every company, Database marketing and Internet marketing are vital parts of the direct marketing strategy that are developed with the aim of gaining and reinforcing the transactions of sales which are also driven by the customers (Creusen, Veryzer & Schoormans, 2010). In database marketing, the list of the potential and existing customer is identified and their profile is developed regarding their choices, preferences, lifestyles, standards and usage frequency. With the help of database marketing, the experts have to develop the products and its packages for meeting the needs of the customers and extending the media and creative strategies for matching their tastes, lifestyles and values (Danaher & Rossiter, 2011). It is even viewed as superseding the conventional strategies of marketing. The basic foundation of all these forms of marketing is that the customers are changing at a fast pace and the segments of the companies need to be identified so that the companies target the right audience. By ensuring that the right segments are discovered, a company can ensure that the right offerings are devised that will reduce the cost of reaching the non-customers and successfully build customer loyalty. It has helped the organisations to retain a high number of loyal customers (Creusen, Veryzer & Schoormans, 2010). Internet marketing has become the crucial part of the direct marketing strategy as it allows the companies to attract the customers from various online sources. The most commonly used online mediums are social networking sites, corporate websites, online catalogues, blogs and Search Engine Optimisation (SEO) activities (Thomson & Housden, 2011). It has proven to be the most effective means of direct marketing that allows the companies to keep in touch with their customers all the time and convert the non-customers to company’s customers. In order to ensure that the direct marketing strategy effectively incorporates the Internet marketing and Database marketing, an organisation will have to ensure that it develops the objective of this strategy. Once there is clarity about the end result, the designing of the entire strategy will become a beneficial decision for the company. Hence, both of these marketing need to be coherent with the direct marketing strategy so that the effect of the complete marketing efforts is exceptional. Conclusion Hence, in order to compete effectively and achieve organisation’s goals successfully, it is vital for the organisations to develop a well-thought and consciously developed direct marketing strategy. When all the marketing efforts will be diverted towards one single objective, an organisation will be successful in accomplishing its desired results and make successive progression within the industry. References Chong, W.K., Shafaghi, M., Wollastan, C. and Lui, V., 2010. B2B e-marketplace: an e-marketing framework for B2B commerce. Marketing intelligence & Planning, 28(3), pp. 310-329. Creusen, M.E.H., Veryzer, R.W. and Schoormans, J.P.L., 2010. 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