August 8, 2019 By SmartBiz Team

There are so many different marketing channels today, it can be tough to choose the right one to promote your business. However, there is a time-tested marketing strategy out there – direct marketing. Direct marketing is a form of advertising where businesses communicate directly with customers through a variety of media.

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Advertising guru Lester Wunderman is credited with identifying, naming, and defining the term "direct marketing" in a 1967 speech at MIT. Wunderman’s innovations included the magazine subscription card, the toll-free 1-800 number, loyalty rewards programs, and many more.

Here’s what you need to know about this marketing strategy and how it can help you reach customers.

Types of Direct Marketing

1. Direct Mail

Direct mail is sending information about your business via a physical address (mail or flyers) or an email address. Forms of direct mail include sending a special offer or free sample, announcing a sale, giving a service reminder, or providing information about your products or services. A big benefit of a direct mail campaign is that they can be personalized, tested, and measured. The mailing list is undeniably the most important part of any direct mail campaign. If you send your pieces to the wrong audience, you risk wasting valuable time and money.

Gabriel Ganger, Head of Direct Marketing for SmartBiz Loans, has expert tips to help you compile an effective mailing list.

“A targeted list for attracting new customers really comes down to understanding your existing customers. Survey your customers formally through a survey service like Survey Monkey or informally by just chatting with your customers. Find out what they read, where they shop, where they eat, what they drive. Lists can target by more than demographics (marital status, income level, gender, etc.), they can also target by interest, behavior, and stage of life. You can purchase lists that will give you potential customers in your area that are pet owners with young children who like the outdoors or beer lovers that own their own homes and drive new cars. The trick is to find an audience that looks like your current customer base. If you have a large enough customer database, there are some companies that will do this for you by modeling your database and matching it to their own.

Don't be discouraged if you do not get a huge response the first time you mail. Most people will need to be mailed 3 or more times before they are ready to respond, especially if they are not familiar with your product.”

2. Telemarketing

Telemarketing has gotten a bad rap over the years. There’s even a national “Do Not Call Registry” in the U.S. However, if you have the right target audience and message, telemarketing can be an effective and low-cost way to increase awareness and sales. Other benefits include the ability to get immediate feedback on your products and services and the ability to analyze and measure results.

3. Direct Response Advertising

The goal of direct response advertising is to get the consumer to order the product directly from your ad. Examples include a direct mail piece with a postage-paid reply card to order a product, a television advertisement with a toll-free phone number to order, and an email with a link to order the product from your website.

4. Direct Selling

The Balance Small Business Blog describes this strategy:

“Direct selling is selling products directly to the consumer in a non-retail environment. Instead, sales occur at home, work, or another non-store location. This system often eliminates several of the middlemen involved in product distribution, such as the regional distribution center and wholesaler.”

Types of direct selling include one-on-one presentations, door-to-door efforts or hosting a party to introduce your goods or services to a target audience.

5. Email

Email marketing lets you create messages that are targeted and personalized to help build meaningful relationships with your customers. It can also improve response rates to your direct marketing campaigns.

The Marapost blog has a list of 9 types of email campaigns to consider including newsletters, post-purchase follow up, addressing an abandoned cart, holiday promotions, and more. Learn about each type of email marketing series and how to optimize here:
9 Types of Email Marketing Campaigns You Should Already be Using.

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6. Social Media

Few businesses can afford to ignore social media. It’s not all about sales. There are solid reasons to have a presence on the platform where your target consumers interact. Benefits include brand awareness and the ability to provide fast and responsive customer service. Social media can also help you increase your website traffic, spark sales and improve search ranking. Of course, social media won’t reach every customer. You have to know your audience to craft a targeted social media campaign.

An example of a business doing it right is SmartBiz customer earthdog, producers of hand-made hemp pet products. Instagram has a robust pet community and the business has attracted almost 10,000 followers using targeted hashtags and on-point photography.

For a wealth of information about social media and how it can work for your business, visit the social media category on the SmartBiz Blog here.

7. Catalogues

Catalog marketing is a form of direct marketing where consumers order products from a printed or online catalog, rather than visiting a retail outlet. Almost half of U.S. consumers shop by catalog or online, according to the Chief Marketer website. Single company catalogs offer products from one company that processes the orders, ships the items, and handles customer service. Multiple Company catalogs feature products from a variety of businesses, giving companies with fewer products the opportunity to use this type of direct marketing.

8. Internet/Online Marketing

In 2018, the United States had close to 275 million internet users. This figure is projected to grow to 310.1 million internet users in 2022 with the United States being one of the biggest online markets worldwide. If you own a small business and are not putting resources towards digital marketing, you’re missing out. This blog post from the SmartBiz Small Business Blog has comprehensive information you need to know about this important topic including how to design an effect website, SEO techniques, social media strategies, and more: 12 Internet Marketing Strategies That Skyrocket Your Business.

Benefits of Direct Marketing

Direct marketing has lots of benefits for small business owners in all industries including:

  • Reaching current customers to increase brand loyalty or stimulate repeat purchases
  • Optimizing your marketing budget
  • Building relationships with new customers
  • Testing responses to current or potential products and services
  • Providing customers with content they can share to increase positive word-of-mouth
  • Increasing sales

Steps to Start a Direct Marketing Campaign

The 40/40/20 rule of marketing says that 40 percent of your campaign success will depend on your list selection, 40 percent on your offer, and only 20 percent of your success will be attributed to your creative execution. Keep in mind that direct marketing campaigns require careful planning and a clear call to action for your audience.

Here are steps to help you get a direct marketing campaign started:

  • Compile a database of contacts who can benefit from your product or service.
  • Decide how to measure the direct marketing campaign using metrics like response rate, number of orders, and revenue.
  • Draft text, choose creative elements.
  • A/B test your campaign.
  • Evaluate the Results.

Things to Consider

It’s important to note that not all marketing is good marketing and your direct marketing techniques contain negative elements that impact your target audience. For example, telemarketing might be seen as an invasion of privacy when calls come during inconvenient times. Email can be considered “spam” and perceived as inbox clutter.

Whatever you do, don’t exaggerate information about your business or mislead buyers by making promises you can’t deliver. This can create a negative image and might even have legal ramifications.

Need more marketing information and inspiration? Visit the SmartBiz Small Business Blog and search “business marketing”. You’ll get a ton of information to help you shape effective marketing programs that work.

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