Chapter Seventeen

Direct and Online Marketing: Building Direct Customer Relationships

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 1

Direct and Online Marketing: Building Direct Customer Relationships

Topic Outline
The New Direct-Marketing Model Growth and Benefits of Direct Marketing Customer Databases and Direct Marketing Forms of Direct Marketing Online Marketing Setting up an Online Marketing Presence The Promise and Challenges of Online Marketing Public Policy Issues in Direct Marketing

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 2

The New Direct-Marketing Model

Direct marketing is: A marketing channel without intermediaries An element of the promotion mix Fastest-growing form of marketing

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 3

Growth and Benefits of Direct Marketing

Benefits to Buyers

Convenience Ready access to many products Access to comparative information about companies, products, and competitors Interactive and immediate
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 4

Growth and Benefits of Direct Marketing

Benefits to Sellers

Tool to build customer relationships Low-cost, efficient, fast alternative to reach markets Flexible Access to buyers not reachable through other channels
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 5

Customer Databases and Direct Marketing

Customer Database

Customer database is an organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic, and behavioral data

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 6

Forms of Direct Marketing

Personal selling direct marketing Direct-mail direct marketing Catalog direct marketing Telephone marketing Direct-response television marketing Kiosk marketing

Digital direct marketing

Online marketing
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 7

Forms of Direct Marketing

Direct-mail marketing involves an offer, announcement, reminder, or other item to a person at a particular address Personalized Easy-to-measure results Costs more than mass media Provides better results than mass media
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 8

Forms of Direct Marketing

Catalog direct marketing involves printed and Web-based catalogs
Benefits of Web-based catalogs Lower cost than printed catalogs Unlimited amount of merchandise Real-time merchandising Interactive content Promotional features
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Challenges of Webbased catalogs Require marketing Difficulties in attracting new customers

Chapter 17- slide 9

Forms of Direct Marketing

Telephone direct marketing involves using the telephone to sell directly to consumers and business customers Outbound telephone marketing sells directly to consumers and businesses Inbound telephone marketing uses tollfree numbers to receive orders from television and print ads, direct mail, and catalogs
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 10

Forms of Direct Marketing

Direct-response television

Direct-response television (DRTV) marketing involves 60- to 120-second advertisements that describe products or give customers a toll-free number or Web site to purchase and 30-minute infomercials such as home shopping channels Less expensive than other forms of promotion and easier to track results Copyright 2010 Pearson Education, Inc.
Publishing as Prentice Hall

Chapter 17- slide 11

Forms of Direct Marketing

Kiosk marketing Digital direct marketing technologies
Mobile phone marketing Podcasts Vodcasts Interactive TV

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 12

Forms of Direct Marketing

Mobile phone marketing includes: Ring-tone giveaways Mobile games Ad-supported content Contests and sweepstakes

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 13

Forms of Direct Marketing

Podcasts and vodcast involve the downloading of audio and video files via the Internet to a handheld device such as a PDA or iPod and listening to them at the consumers convenience Interactive TV (ITV) lets viewers interact with television programming and advertising using their remote controls and provides marketers with an interactive and involving means to reach targeted audiences
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 14

Online Marketing
Marketing and the Internet

Internet is a vast public web of computer networks that connects users of all types around the world to each other and to a large information repository

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 15

Online Marketing
Online Marketing Domains

Business to consumer (B2C)

Business to business (B2B)

Consumer to consumer (C2C)

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Consumer to business (C2B)

Chapter 17- slide 16

Online Marketing
Online Marketing Domains

Business to consumer (B2C) involves selling goods and services online to final consumers Business to business (B2B) involves selling goods and services, providing information online to businesses, and building customer relationships
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 17

Online Marketing
Online Marketing Domains

Consumer to consumer (C2C) occurs on the Web between interested parties over a wide range of products and subjects Blogs
Offer fresh, original, and inexpensive ways to reach fragmented audiences Difficult to control
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 18

Online Marketing
Online Marketing Domains

Consumer to business (C2B) involves consumers communicating with companies to send suggestions and questions via company Web sites

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 19

Online Marketing
Setting Up an Online Marketing Presence

Types of sites
Corporate Web site Marketing Web site

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 20

Online Marketing
Setting Up an Online Marketing Presence

Corporate Web site is designed to build customer goodwill and to supplement other channels, rather than to sell the companys products directly to: Provide information Create excitement Build relationships
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 21

Online Marketing
Setting Up an Online Marketing Presence

Marketing Web site is designed to engage consumers in interaction that will move them closer to a direct purchase or other marketing outcome

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 22

Online Marketing
Designing Effective Web Sites

To attract visitors, companies must:

Promote an offline promotion and online links Create value and excitement Constantly update the site Make the site useful
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 23

Online Marketing
Designing Effective Web Sites The Seven Cs

Context

Content

Community

Customization

Communication

Connection

Commerce
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 24

Online Marketing
Placing Ads and Promotions Online

Forms of online advertising

Display ads Search-related ads Online classifieds

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 25

Online Marketing
Placing Ads and Promotions Online

Banners are banner-shaped ads found on a Web site Interstitials are ads that appear between screen changes Pop-ups are ads that suddenly appear in a new window in front of the window being viewed Rich media ads incorporate animation, video, sound, and interactivity
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 26

Online Marketing
Placing Ads and Promotions Online

Search-related ads are ads in which textbased ads and links appear alongside search engine results on sites such as Google and Yahoo! and are effective in linking consumers to other forms of online promotion
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 27

Online Marketing
Placing Ads and Promotions Online

Other forms of online promotion include:

Content sponsorships

Alliances

Affiliate programs
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Viral advertising
Chapter 17- slide 28

Online Marketing
Placing Ads and Promotions Online
Content sponsorships provide companies with name exposure through the sponsorship of special content such as news or financial information Alliances and affiliate programs are relationships where online companies promote each other
Viral marketing is the Internet version of word-ofmouth marketing and involves the creation of a Web site, e-mail message, or other marketing event that customers pass along to friends
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 29

Online Marketing
Creating or Participating in Social Networks (Web Communities)

Social Networks (Web communities) allow members to congregate online and exchange views on issues of common interest iVillage.com Facebook
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 30

Online Marketing
Using E-mail

Marketers are developing enriched messages that include animation, interactivity, and personal messages with streaming audio and video to compete with the cluttered e-mail environment
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 31

Online Marketing
Using E-mail

Spam is unsolicited, unwanted commercial e-mail messages Permission-based marketing allows users to opt in or opt out of e-mail marketing
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 32

Online Marketing
The Promise and Challenges of Online Marketing

Online marketing will remain an important approach in the marketing mix to:
Build customer relationships Improve sales Communicate company and product information Deliver products and services more effectively and efficiently
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 33

Public Policy Issues in Direct Marketing

Customer irritation, unfairness, deception, and fraud Privacy Security

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 34

Public Policy Issues in Direct Marketing

Irritation, Unfairness, Deception, and Fraud

Irritation includes annoying and offending customers Unfairness includes taking unfair advantage of impulsive or lesssophisticated buyers Deception includes heat merchants who design mailers and write copy designed to mislead consumers Internet fraud includes identity theft and financial scams
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 35

Public Policy Issues in Direct Marketing

Invasion of Privacy

The concern is that marketers may know too much about consumers and use this information to take unfair advantage Sale of databases Microsoft
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 36

Public Policy Issues in Direct Marketing

A Need for Action

Can Spam California Online Privacy Protection Act (OPPA) Childrens Online Privacy Protection Act (COPPA) TRUSTe
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall

Chapter 17- slide 37