1. Direct and Online Marketing: The New Marketing Model
Chapter 17
Direct and Online Marketing: The New Marketing Model

2. Mass Marketing and Direct Marketing
Most Mass Marketing Involves One-Way Communications Aimed At Consumers.
Direct Marketing Involves Two-Way Interactions With Customers.

3. What is Direct Marketing?
Direct Marketing Consists of Direct Connections With Carefully Targeted Individual Consumers to Both Obtain an Immediate Response and Cultivate Lasting Customer Relationships.

4. The New Direct Marketing Model
Some firms use direct marketing as a supplemental medium.
For many companies, direct marketing - especially Internet and e-commerce companies - constitutes a new and complete model for doing business.
Some firms use the new direct model as their only approach.
Experts envision a day when all buying and selling will involve direct connections between companies and their customers.

5. Benefits and Growth of Direct Marketing
Convenient
Consumer Relationship Building
Buyers Benefits
Sellers Benefits
Easy & Private
Reduces Costs
Product Access &
Selection
Increases Speed & Efficiency
Abundance of Information
Provides Flexibility
Interactive & Immediate
Global Medium

6. The Growth of Direct Marketing
Demassification – Focus is
Toward Minimarkets
The Growth of Direct Marketing
Higher Costs of Driving, Traffic
and Parking Congestion
Consumers Lack of Time
Convenience of Ordering
From Direct Marketers
Growth of Customer Databases

7. Mass Marketing Vs. One-to-One Marketing (Tab. 17.1)
Average Consumer
Individual Customer
Customer Anonymity
Customer Profile
Standard Product
Customized Market Offering
Mass Production
Customized Production
Mass Distribution
Individualized Distribution
Mass Advertising
Individualized Message
Mass Promotion
Individualized Incentives
One-Way Message
Two-Way Messages
Economies of Scale
Economies of Scope
Share of Mind
Share of Customer
All Customers
Profitable Customers
Customer Attraction
Customer Retention

8. Customer Databases
Customer Databases are an Organized Collection of Comprehensive Data About Individual Customers or Prospects Including:
Geographic,
Demographic,
Psychographic, and
Behavioral Data.

9. Database Marketing
Identifying Prospects
Database Marketing is the Process of Building, Maintaining, and Using Customer Databases and Other Databases for the Purposes of Contacting and Transacting With Customers. How Companies Use Their Databases:
Deciding Which Customers Should
Receive a Particular Offer
Deepening Customer Loyalty
Reactivating Customer Purchases

10. Forms of Direct Marketing
Face-to-Face
Selling
Online
Marketing
Telemarketing
Kiosk
Marketing
Direct
Mail
Direct-Response
TV Marketing
Catalog

11. Discussion Connections
When was the last time you bought something via direct marketing?
How did you buy it?
What did you buy and why did you buy it direct?
When was the last time that you rejected a direct marketing offer? Why did you reject it?
Based on these experiences, what advice would you give to direct marketers?

12. Online Marketing
Online Marketing is conducted through interactive online computer systems, which link consumers with sellers electronically.
Two types of online marketing channels:
Commercial Online Services offer information and marketing services to subscribers who pay a monthly fee. (i.e. American Online)
The Internet (the Net) is the vast global and public web of computer networks.

13. Who is the Online Customer?
They tend to be younger, more affluent, better educated, and more male than the general population; female usage almost equals males.
Other characteristic of net users:
Half are 40 years or older,
Differ psychographically, in approaches to buying and responses to marketing.

14. Creating Online Marketing
Create an Electronic Online Presence
Buy Space on a Commercial Online Service
Company Can Open It’s Own Corporate or Marketing Web Page
Place Advertisements Online
Place Ads in to Build Internet Brands or Attract Visitors to Web Site
Buy Online Ads That Pop Up While Consumers are Surfing, “Banners”
Content Sponsorships

15. Creating Online Marketing
Participate in Forums, Newsgroups & Web Communities
Forums: Discussion Groups on Commercial Online Services
Newsgroups: Internet Version of Forums
Web Communities: Sites Where Members Exchange Views Online
Use and Webcasting
Customers Send Questions, Suggestions & Complaints Via
Webcasting: Automatic Downloading of Information to PC’s

16. Promise and Challenge of Online Marketing
Limited Consumer Exposure and Buying
Skewed User Demographics and Psychographics
Promise and Challenge of Online Marketing
Chaos and Clutter
Security
Ethical Concerns

17. Integrated Direct Marketing
Direct marketing campaigns that use multiple vehicles and multiple stages to improve response rates and profits.
Marketers seek to improve response rates and profits by adding media and stages that contribute more to additional sales than to additional costs.

18. An Integrated Direct-Marketing Campaign (Fig. 17.2)
Paid ad with a
response channel
Direct Mail
Outbound
Telemarketing
Face-to-face
sales call
Continuing
Communication

19. Public Policy and Ethical Issues in Direct Marketing
Irritation to
Consumers
Unfairness,
Deception, or
Fraud
Invasion of
Privacy

20. Review of Concept Connections
Discuss the benefits of direct marketing to customers and companies and the trends fueling its rapid growth.
Define a customer database and list the four ways companies use databases in direct marketing.
Identify the major forms of direct marketing.
Compare the two types of online marketing channels and explain the effect of the Internet on electronic commerce.
Identify the benefits of online marketing to consumers and marketers and the four ways marketers can conduct online marketing.
Discuss the public policy and ethical issues facing direct marketers.