D irect Marketing (DM)

“Direct Marketing is an interactive system of marketing, which uses one or more advertising media to effect a measurable response and /or transaction at any location.” - Direct Marketing Association (DMA)

Unique Features of DM Action Orientation “Create share-of-market, rather than, share-of- mind” -Lester Wunderman Prospect Selectivity (Targetability) Customization ability Measurability Relationship building

DM Initiatives of some FMCG Majors HUL – Project Sangam Direct, HLL Network Marico –Harghar Procter & Gamble LG Electronics

IDSA – Indian Direct Selling Association WFDSA – World Federation of Direct Selling Association

Forms of DM  Catalogue Marketing  Tele Marketing: 1)Inbound 2) Outbound  TV Direct–Response Marketing (Tele-Shopping)  Mail order  Kiosk Shopping (Touch Screen)  Multi-level Marketing

Ethical issues in Direct Mktg. Irritation Deception and Fraud Invasion of privacy

Permission Mktg. Clutter in Advertising and spurt in DM Invades privacy of customers  “Permission Marketing”----Seth Godin e.g. Mitsubishi Lancer (Hindustan Motors) e.g. Bose audio systems  Difference between Permission Mktg.and DM

Network Marketing(NM) / Multi- Level Marketing(MLM) Network Marketing is a form of DM, which uses a network of people (consultants) to demonstrate and sell products to people they know.  Nuts & Bolts of Network Marketing  Products suitable for the system  Use of IT-Data mgmt., Inventory mgmt.,e-business.  Strengths of MLM  Drawbacks of MLM  Future of MLM in India

Some DM Co.s and their Products Amway – Household,Personal Care,Cosmetics, Nutritional Avon - Cosmetics, Jewellery,Home furnishing,Baby Care Tupperware – Food Storage Containers,Kitchenware,Toys Discovery Tops - Toys, Books, Games Brite Music Enterprises – Children Songbooks,Cassettes Encyclopedia Britannica- Educational Publications Mary Kay Cosmetics – Cosmetics, Skin care Products Oriflame - Cosmetics, Skin care Products Modi Care – Home care,Kitchen care,Car care,Personal care

Strengths of MLM Continuous growth of network. Quicker & easier entry into new markets. Low overheads. Easy to add new products. Better demonstration of innovative products Loyal & captive base of consumers. Word of mouth magic.

Weaknesses of MLM Sales forecasting is difficult – high inventories. Distributors often become the largest consumers Brand building is difficult. The chain could break down. Prices are normally high. Pyramid structure of income distribution. High turnover of distributors.