Editorial: Rethinking Market Strategy.

By Len Monheit
[email protected]

Chief Marketing Officers in five national categories, indicated in a recent poll that in 2003, they would increase spending on direct mail, direct-response media and Internet marketing. Overall, the combination of direct and interactive is expected to grow from 33.7 percent to 35.7 percent of advertising dollars with general media advertising and public relations taking the hit.

Although we may dispute the numbers it’s important to note the definition and logic behind the statement. The study http://www.london.edu/marketing/Mktg_Expenditure_Trends/index.html defines direct marketing as ‘advertising whose main purpose is to generate a specific and fairly immediate customer response such as a direct order, a qualified sales lead, an information request, or a visit to a store or website.’

The logic behind the study is that as dollars become scarce, companies become leaner, competition remains fierce and everyone gets busier. Capturing and qualifying mindshare becomes paramount. Whether you’re strengthening existing relationships or developing new ones, not only do you have to get the attention of your audience, you have to prove it. Companies must increase the number and value of all touches they have with their customer base, and both direct and interactive programs can do this effectively- if planned and managed properly.

The objective becomes, ‘how can you have the most meaningful interactions with existing and potential clients for the lowest cost, and as a program evolves, keep in contact with an ever more targeted list of prospects?’ Of those that haven’t given up trying to keep up with changing behavior and technology, more and more companies are using mixed and integrated strategies, questioning past program value and working from the ground up to develop launch strategies and customer relationship management approaches that suit company culture and generate a high rate of return. This rate is measured as customer satisfaction, number of interactions, number of leads and sales, level of buzz, and other performance evaluators, built into the program from the outset.

Some companies have the best of intentions, may have deeper pockets, and so can afford to dabble with some new ideas and technologies, but don’t execute at a fundamental level. Here one often sees poor list and client management (damaging to credibility), inconsistent behavior and treatment (lack of communication in the organization may be involved) and often a lack of concrete forward progress. (‘We’ll have this discussion next show or next year’.) As an example of the first, yesterday, we received seven direct mail announcements for an upcoming industry event. One person was sent three pieces, another four. In the overall scheme of things, this may be a small issue, but magnified many times over, there are both cost and credibility implications.

Other companies haven’t gotten it at all and keep doing what they’ve done in the past. They publish brochures, sell sheets and catalogs, arm their sales force and let fly with the 2003 rendition of the 1985 program. They moan about fickle customers, companies with bigger marketing and communications budgets and never realize that by not rethinking their approach they are squandering the dollars they’re presently spending and wasting time and uncountable resources in the process. They’re often the ones left to sell on price because they haven’t invested in high value client interactions (whether at trade or consumer level), they have no unique selling proposition, no loyalty and have built no ‘community’ of clients. By far the biggest impact is their lack of ability to mold and manage a client community, and interacting with this group on a regular and meaningful basis.

And that’s why direct and interactive makes more and more sense.

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