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ASP 2009 Batch

CLASS 3

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Direct Marketing

Organizations communicate directly with

target customers togenerate a response

and/ora transaction It involves a variety ofactivities,including

databasemanagement, direct selling,

telemarketing, and direct response ads

through direct mail, theInternet, and

various broadcast and print media.

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Eg :Tupperware,Discovery Toys, and

Amway

Dell Computerand Gateway haveexperienced tremendousgrowth in the

computerindustry by selling a full lineof

personal computers through direct

marketing.

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Oneof themajor toolsofdirect marketing

isdirect response advertising, whereby

a product ispromoted through an ad thatencourages the consumertopurchase

directly from themanufacturer.

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DM hasmeant more discretionary income butless timeforin-storeshopping.

The availability ofcredit cards and toll-freephonenumbers has alsofacilitated thepurchaseofproductsfrom direct-response ads.

Morerecently, therapid growth oftheInternet isfueling thegrowth ofdirect marketing.

The convenienceofshopping through catalogs

oron a companys website and placingordersby mail, by phone,oronline has led thetremendousgrowth ofdirect marketing.

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Direct-marketing tools and techniques arealso beingused by companies thatdistribute theirproducts through traditional

distribution channelsorhave theirownsalesforce.

Direct marketingplays a bigrolein the

integrated marketing communicationsprogramsofconsumer-product companiesand business-to-businessmarketers.

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These companiesspend large amountsofmoney eachyeardeveloping and maintaining databases containingthe addresses and/orphonenumbersofpresent andprospective customers.

They use telemarketing to call customers directly andattempt tosell themproducts and servicesorqualifythem assales leads.

Marketers alsosend out direct mail piecesrangingfromsimple letters to detailed brochures, catalogs, andvideotapes togivepotential customersinformation abouttheirproductsorservices.

Direct-marketing techniques are alsoused to distributeproduct samplesor target usersofa competing brand.

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Interactive/Internet Marketing

Interactive media allow fora back-and-

forth flow ofinformation whereby users

canparticipatein and modify theform and

content of theinformation they receivein

real time.

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Unlike traditional formsofmarketing

communicationssuch as advertising,

which areone-way innature, thenew

media allow users toperform a variety of

functionssuch asreceive and alter

information and images,makeinquiries,

respond toquestions, and,ofcourse,makepurchases.

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Themost prevalent perspectiveon theInternet is that itis an advertisingmedium, asmany marketers advertisetheirproducts and serviceson the websitesofothercompanies and/ororganizations.

Actually, theInternet is a medium that can beused toexecute all theelementsof thepromotional mix.

In addition to advertisingon the Web ,marketersoffersalespromotionincentivessuch as coupons, contests,and sweepstakesonline, and they use theInternet toconduct direct marketing,personal selling, and publicrelations activitiesmoreeffectively and efficiently.

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While theInternet is a promotional medium,itcan also beviewed as a marketingcommunications tool initsownright. Becauseof

itsinteractivenature,it is a very effective way ofcommunicating with customers.

Many companiesrecognize the advantagesofcommunicatingvia theInternet and are

developing Web strategies and hiringinteractiveagenciesspecifically to develop theirwebsitesand make thempart of theirintegratedmarketing communicationsprogram.

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Sales Promotion

Sales Promotionisgenerally defined asthosemarketing activities that provideextra valueorincentives to thesalesforce,

the distributors,ortheultimate consumerand canstimulateimmediatesales.

Salespromotionisgenerally brokeninto

twomajorcategories: consumer-oriented and trade-orientedactivities.

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Consumer-oriented sales promotion is

targeted to theultimateuserofa product or

service and includes couponing,sampling,

premiums,rebates, contests,sweepstakes, andvariouspoint-of-purchasematerials

Thesepromotional toolsencourage consumers

tomake animmediatepurchase and thus can

stimulateshort termsales.

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Trade-oriented sales promotion is targeted

toward marketingintermediariessuch as

wholesalers, distributors, and retailers.

Promotional and merchandising allowances,price deals,sales contests, and tradeshows are

someofthepromotional toolsused to

encourage the trade tostock and promote a

companysproducts.

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Amongmany consumerpackaged-goods companies,salespromotionisoften 60 to 70 percent ofthepromotional budget.

Inrecent yearsmany companies haveshifted the

emphasisof theirpromotional strategy from advertisingtosalespromotion.

Reasonsfor theincreased emphasisonsalespromotioninclude declining brand loyalty and increased consumersensitivity topromotional deals.

Anothermajorreasonis that retailers have becomelargerand morepowerful and are demandingmore tradepromotionsupport from companies

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Publicity/Public Relations

Publicity refers tononpersonalcommunicationsregarding anorganization,product,service,oridea not

directly paid fororrununderidentifiedsponsorship.

It usually comesin theformofa news

story,editorial,orannouncement about anorganization and/oritsproducts andservices.

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The company ororganization attempts toget themedia to coverorrun a favorablestory on a product,service, cause,or

event to affect awareness,knowledge,opinions, and/orbehavior.

Techniquesused togainpublicity include

newsreleases,press conferences,featurearticles,photographs,films, andvideotapes.

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An advantageofpublicity overotherformsofpromotionisits credibility.

Consumersgenerally tend to be lessskeptical

toward favorableinformation about a product orservice whenit comesfrom a source theyperceive asunbiased.

Forexample, thesuccess (orfailure)ofa new

movieisoften determined by thereviewsitreceivesfromfilm critics, who areviewed bymany moviegoers asobjectiveevaluators.

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Anotheradvantageofpublicity isits low

cost,since the company isnot payingfor

timeorspacein a massmediumsuch as

TV,radio,ornewspapers. While an

organizationmay incursome costsin

developingpublicity itemsormaintaining a

staffto doso, theseexpenses will befarless than thosefor theotherpromotional

programs.

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Publicity isnot alwaysunderthe control of

anorganization and issometimes

unfavorable.

Negativestories about a company and/or

itsproducts can bevery damaging.

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Public Relations

When anorganizationsystematically plans anddistributesinformationin an attempt to controland manageitsimage and thenatureofthe

publicity it receives,it isreally engagingin afunctionknown aspublic relations.

Public relations is defined as themanagementfunction which evaluatespublic attitudes,identifies thepolicies and proceduresofanindividual ororganization with thepublic interest,and executes a programofaction toearnpublicunderstanding and acceptance.

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Public relationsgenerally has a broader

objective thanpublicity, asitspurposeis to

establish and maintain a positiveimageofthe

company amongitsvariouspublics. Public relationsusespublicity and a variety of

othertoolsincludingspecial publications,

participationin community activities,fund-

raising,sponsorshipofspecial events, andvariouspublic affairs activitiestoenhance an

organizationsimage.

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Personal Selling

Personal selling, is a formofperson-to-person

communicationin which a sellerattempts to

assist and/orpersuadeprospective buyers to

purchase the companysproduct orserviceortoact on anidea.

Unlike advertising,personal sellinginvolves

direct contact between buyerand seller,either

face-to-faceor through someformoftelecommunicationssuch as telephonesales

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Thisinteractiongives themarketer

communicationflexibility; thesellercan

seeorhearthepotential buyersreactions

and modify themessage accordingly.

Thepersonal,individualized

communicationinpersonal selling allows

thesellerto tailor themessage to thecustomersspecific needsorsituation.

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Personal selling alsoinvolvesmoreimmediateand precisefeedback because theimpact ofthesalespresentation cangenerally be assessed

from the customersreactions. Ifthefeedbackisunfavorable, thesalesperson

canmodify themessage.

Personal sellingefforts can also be targeted to

specific markets and customertypes that are thebest prospectsforthe companysproduct orservice.