Re-thinking direct as an analogue concept in a digital world – DIRECT magazine

In a rapidly changing digital world, the internet creates opportunities and provides threats to the concept of direct. Roger James examines where direct marketing stands.

Last time out I examined how the notions of above the line and below-the-line marketing have changed as marketing has developed, to the extent that the relevance of these terms might be questioned.  Such shifts also impact on the very concept of direct marketing itself. These developments, and other changes to marketing over the past decade or so justify examination of where direct marketing stands, both in itself and in relation to other marketing disciplines.

After all, who of us would not prefer to talk directly to our customers or potential customers?  Who would not rather keep the supply chain as simple as possible, reducing the chance of error and lowering overheads?

In its overall definition, direct marketing has meant methods of promoting goods and selling them through channels such as mail or telephone, where there is no intermediary between seller and buyer.  That essential characteristic still applies, though direct response advertising using mass media channels fulfils this criterion. In the ‘essential’ definition of direct, there is a fair spectrum in relation to specificity of targeting, from a mass mail drop where little or no market segmentation is used, to personalised mailing where recipients might even be clearly identified prospects for the product, drawn from a mailing list.

In thinking about specificity, consider a somewhat nostalgic example, the soft serve and ice cream vans that used to trundle suburban streets, alerting potential customers by a blaring, irritating electronic melody, frequently played slightly above the distortion level of the amplifier in the van.  Perhaps the operators employed some specificity by working out the suburbs where more children were to be found, but it’s likely that this was direct marketing that was almost totally ‘un-directed’.

Digital direct marketing has added to the possible communications channels, employing web browser cookies, e-mail addresses and/or mobile phone numbers.  Note again the range of specificity, where cookies may be directed at every visitor to a particular website, or in the case of sophisticated tracking and decision-tree analysis, may be tailored by the essential available information from the internet user, such as internet platform, ISP and time of logging on.  In the case of e-mail and mobile phone, these are almost always related to an individual, contrasting with a landline number, a call to which could be answered by any occupant of the premises where it is located.

The impact of social media

Another burgeoning aspect of digital marketing is the social media environment, where again both relatively non-specific and highly specific communications may be employed.  Some, delivering otherwise mass media communications, such as viral marketing of TV commercials, have a degree of self-selection (though, how many of those who eagerly send the communications to their friends and colleagues, are, or ever will be prospects?).  And it should be noted that such viral marketing has also been effectively delivered through email rather than Facebook or MySpace, etc.  At the same time, communications targeted to individuals using social media channels can be fairly specific.

But as we know, some of the big opportunities in direct marketing lie in the capacity to understand our customers, their needs and preferences by improving the feedback channels from them and by collecting information that will assist our marketing, almost at the level of the individual.  There are two aspects to this.

Firstly, the internet provides the opportunity, through website feedback pages and through social media such as blogs, for a real and much more intimate dialogue to be established between the marketer and the customer.  ‘Let us know what you think’ has been around for a long time in product registration and warranty forms, etc., and through formal market research.  But the ease and immediacy of these electronic connections, change and are changing the game.  Marketing can reap real benefits from these developments.

Loyalty talks

The second feedback system, and one with even more potential, is the information collected about customers through vehicles such as loyalty programs.  Understanding customers by their buying behaviour can be at once powerful and effective.  As data analytics has developed to allow us to address smaller and smaller groups of customers with similar interests and buying behaviour in a cost-effective way, so both marketing success and improved customer satisfaction can be simultaneously achieved.

Mass media such as daily newspapers and broadcast television face growing threats to their future, from fragmentation and from trends such as changes in media usage.  Direct marketing also has its challenges; privacy concerns, opt-in rules, the lack of specificity of some of the traditional channels and methods.  But the compelling conclusion seems to be that in this sphere, the opportunities readily outweigh the threats.

Roger James is director of Roger James Associates and is the former chair of the Marketing Institute. < rjahil@bigpond.net.au>