Is direct marketing still working?

As both of you said above, it's about about targeting. The recession has caused many companies to turn away from traditional direct mail and move towards more digital means (social media, etc), but as the recession is winding down, I think direct mail is coming back - only this time, much smarter. The trick now is to ensure that each direct mail peice has a true VALUE to the consumer (according to a recent Neilson report, direct mail is the second fastest growing redemption method for coupons, jumping 69%!). Of course, the hard part is determining what your customer base perceives as valuable... but this should drive your strategy. So, keep it targeted and add value and I think you'd be surprised at the results.

But, the most successful marketers know that it's wise to have many channels involved in the marketing mix - social media and the web included.

Cheers-
Sherri
http://www.gostrata.com

My answer to your question comes in late because I just joined the Focus.com. We ran a printing and mailing business in SF Bay Area. We found that the direct mail response for our client are actually have improved for the last six months. Contrary to most people think every business should concentrate to the web marketing. I do agree that you should have that channel too. The challenge on the web marketing is have to make sure you are on the top of Google search or spend enough money on PPC. Otherwise you will be lost in the cyber space. Direct mail is active and getting the reaction for your existing customers or new customers without competitors' presence. Our clients response improve is deal to less crowed in the marketing place because lots of people thinking direct mail don't work anymore. It means less competition out there. My suggestion is to do both and see which one pull better ROI for you.

Yes, and no. Proper direct mail works. I notice my mailbox is still full. Weren't we going away from direct mail. No way. People are actually becoming more numb to email, it goes into spam folder etc.

In the B 2 B world it can work extremely effective, if you target, target, target, don't mail to the free world, and do it right.

As Jeff has so rightly said above, the success of any marketing campaign is down to whether or not you campaign is correct for the demographic you are trying to communicate to.

While I believe that Social Media and Online Marketing activities have a huge role to play in the future of many small businesses, for some those forms of marketing would be a waste of resources as 'online' is not where their demographic is. For these companies direct marketing is still crucial, and should not be overlooked in favour of online marketing if the target audience are no 'on line'.

All the best,

Stefan Topfer

Depends on your target audience. We dont do any direct mail and have adopted a 100% online direct marketing model (email).

I have found that almost no one provides a accruate mailing address anymore. Our target personas consume information almost entirely online. That being said I dont rule out offline direct marketing but our focus is online at the moment.

Direct marketing still works...it simply requires that you do it on line. You will enhance the response by creating web info on any mailer you do. Give them a call to action on all pieces.

I agree with Tricia, It just has to be online.

So Jim.....what are 3 things I need to know about email marketing campaigns to insure a successful launch?

There's a reason why we call it Marketing "MIX". Different vehicles work for different customers and industries. It's true that DM is less effective today than it was 10 years ago. There are a lot more marketing stimuli to compete with now, and people's attention span (and patience) is drastically shorter. Having said that, a DM piece to the right audience, with thoughtful creative that breaks the clutter can still work. It won't make the sales for you (nothing will), but it can still create the positive mind-state to open the door for you. I'd reserve it for times when the audience is very clear, and you can deliver something of value to them that they can get their hands on (assuming the piece stands out amongst the 5lbs of junk that hits the mailbox every day)

There is a certain age group who still prefer direct marketing. Probably you can segment the list based on Age and roll out direct mailing or email marketing.

Over the years I have learned that you need to put as much research into your direct marketing campaign as you do the product you are trying to sell. As stated above by various respondants, you need to know who you want to reach - and how they are most likely to be reached. A 20-something young professional isn't a good target for a USPS delivered campaign, but a 60-something retiree likely is.

If your product/service is broad in scope you need to look into multi-avenue marketing paths. If it is more narrow, you need to know where you're going to reach the most eyes. Snail-mail direct marketing, believe it or not, is still EXTREMELY effective...if your mail reaches the right audience.

Kami

I get DM at my office a few times a week including folks sending me books.

Anything more than a page, I don't have the time for -- even if they send me a gift -- even if they pad the envelope, etc. I'm not sure why folks send me that stuff so soon. in their marketing funnel.... when a postcard that tells me about the results I'd get and give me a freebie that I'd really want would have been better (and less costly).

Yes it is working but not in its basic form. We preach target marketing from a target hit list if you have a direct sales force.

Every sales rep comes up with a hit list of 30-50 names to target over 30-60 days and then we create a creative dimensional direct mail themed mailer and mail priority mail and follow up afterwards on a regular basis.

A bulky mail piece breaks through the 3lbs of mail that everyone gets and gets read 80% of the time.

How would you not open a box, a tube or a lumpy letter

Yes, direct marketing is still working. The major difference now is businesses need to be smarter about targeting and reaching those customers- cannot simply role out a mass mailing and expect good results.

In addition I have to disagree that it has to be done only online. As an email marketing manager I see first hand how effective online marketing is, however I also see how much direct mail, catalogs, fliers, etc drive people to websites and stores and without the direct mail piece the online piece would simply not be as effective. Understanding a customer's behavior and how they respond to your marketing mix is very important. Each company is different, however blending your offline and online direct marketing initiatives always seems to be the most effective. Companies that abandon direct mail altogether will simply be leaving opportunities for their competitors to step in and pick up on their business.

DM is often the catchall name for direct mail, so that may skew the responses here. While direct mail has been on a downward slide for a few years, direct marketing is, I think, working better than ever because of email, landing pages, PURLs, and of course social and mobile media.

I spent many years on the "branding" side of marketing, and I am now seeing more money being plowed into direct marketing because it is measureable, trackable, and we can quantify our clients' ROI. The current state of the economy demands that marketing expenditures are allocated to strategies that are more likely to produce results, and direct marketing can do that better than other approaches.

Social media is all about "conversations" and "1-to-1 relationships", and that is part of the DNA of direct marketing. That's one reason why direct marketing is doing very well these days, and it is more effective than ever before. Email is another direct marketing channel that is experiencing a new life because it translates so well to mobile devices. Direct mail is re-inventing itself a bit by integrating QR codes.

On the whole, I'd say DIRECT MARKETING is working very well.

Nope now every one using the internet for all there marketing and you should too.

THE EMERGENCE OF THE WEB

Ten years ago, there was no such thing as e-commerce as we know it today. Although the Internet has been around in some form or fashion for many years, for most of its history it was used only by the military and research scientists. As the technology became friendlier, others began to use it. The key event to the popularization of the Internet was the creation of the World Wide Web—especially the capability to show pictures and play sound from the Web, which became available around 1994. Adding that multimedia capability to the Web made it inevitable that the Internet would eventually pervade business and commerce. It did not take long.

The graphical Web was shortly followed by the capability to transmit credit card information securely online, which was shortly followed by the ability to process the card payments in real time online. A new venue to sell products and services had arisen seemingly overnight.

A NEW DISTRIBUTION CHANNEL

The Internet provides a new and quite different distribution channel for vendors to sell their products and services to consumers. Consumers can learn about, view pictures of, and order products from anywhere at anytime from the comfort of their home or office.

To sell anything, though, a vendor needs to get traffic to his or her Website through advertising. This was first approached from the old model of TV, radio, and print ads. That is, vendors went to popular Websites and offered to pay for placement of their ad for a period of time. Since the Internet is different from the old broadcast media, however, new more efficient methods of advertising were sought. It is relatively easy to determine the size of a TV or radio station's audience. The same is true with the circulation of print media such as newspapers and magazines. It's not as easy with a Website, however. Sure, there are counters, but they can not always be trusted.

Plus, a Web page being retrieved from a server (and thus adding to the counter) does not necessarily mean it will be seen by a human being. Bots and automated processes can retrieve pages that are never seen by any human being. It became important to know whether the page views were coming from the same source or whether they were "unique views"—i.e. new people rather than the same few over and over or some automated process. Another problem was that unless the ad is placed prominently and in context on the host site, it will not draw traffic, even from a large audience of unique viewers to the host site. So, paying a flat fee for displaying an ad on a Website for a set period of time turned out to be undesirable.

Rather than paying for a set period of time, advertisers began to prefer to pay according to the number of clicks on their banners. Standard sizes evolved for banners used to advertise Websites on other Websites. The banners can have words, pictures, and animation and serve as a link to the advertised Website. When you click on the banner, you are taken immediately to the advertised site. Thus, with "pay per click" if you did not get any traffic, you did not have to pay. This motivated the host site Webmaster to place the banner effectively on the site so it would draw traffic. Even "pay per click" had its problems, though. Clicks could also be automated and unscrupulous hosts could cheat. Clicks also needed to be from "unique viewers" to be effective.

Thus, vendors ultimately came to prefer paying only when a sell was actually made or someone at least interacted with the site by joining an opt-in program. The vehicle for paying only for sells or opt-ins on your site from persons sent from the host site became known as "affiliate programs."

AFFILIATE SERVICES

As the popularity of affiliate programs has grown, services, such as LinkExchange, Commission Junction, BeFree, and many others, have arisen to provide centralized locations where Webmasters can pick and join affiliate programs. These services also monitor the vendors and keep them honest. They provide standardized software and interfaces to run the affiliate programs so that each new vendor does not have to re-invent the wheel when they start up an affiliate program.

As a Webmaster, you can go to one of these sites and pick out the programs you want to join. You fill out a form providing information about yourself and your Website and then you download the "banner code" to place on your site. When someone clicks on the banner from your site and buys something from the vendor, the sale is tracked and they pay you a small commission. Most provide online reporting so that you can see your how your sales are going at any time.

While these affiliate services help to promote affiliate programs for the vendors, and provide some efficiency for the Webmasters, vendors are still looking for better ways to promote their affiliates' programs and Webmasters are looking for more profitable arrangements.

BUYING FROM YOUR OWN STORE

Only a small percentage of the millions of Websites on the Internet actually draw any significant traffic. ISPs and other services provide free personal home pages and many people have designed sites more for their own amusement than any serious purpose. Nevertheless, it is advantageous to vendors to have their affiliate banners on as many pages as possible. Even the sites that do not draw significant traffic have the benefit of the loyalty of their own Webmaster. If you have put the Amazon.com affiliate banner on your site, you will go there to buy your books rather than Barnes and Nobles because you get a little commission back when you buy from your own "store." Because of this, most vendors make it as easy as possible to join their affiliate programs and want affiliates even with low traffic sites.

After the new wears off, however, most Webmasters realize it is too much work for too little value to keep affiliate programs on their low traffic Web pages. Because vendor sites are constantly being redesigned, your banner stops working and you have to download new "banner code" and replace it on your site. As promotions change, the vendors make you change your code or the pictures stop showing up. A few of the major vendors with affiliate programs have gone bankrupt and the links just quit working. It turns out to take a lot of time and effort to keep affiliate banners working on your site. Yet, it would benefit both the vendors and the Webmasters of the low traffic sites if this could be more conveniently and more profitably done.

A BRAIN TEASER SOLVED

There are thousands upon thousands of affiliate programs available on the Internet. A Webmaster cannot put more than just a very few affiliate programs on any one Website without losing effectiveness. (Nothing is worse than a Web page crammed full of banners.) Thus, Webmasters have become selective in choosing affiliate programs. As competition heats up among the vendors, the vendors find themselves focusing on finding creative ways to promote their affiliate programs. Affiliate programs are excellent for marketing products and services on the Internet, but how do you effectively market an affiliate program to the Webmasters?

A few bright entrepreneurs, including SFI marketing Group's founder, Gery Carson, have come up with the answer. The answer is to have a multitier affiliate program. This solves two problems. One, it makes it worthwhile for the ordinary person to become involved in e-commerce. You can make good money even without a high-traffic Website because you share in the sales of an entire organization. Plus, you don't have to hassle with keeping banner code for multiple programs up to date. SFI's Catalog allows all SFI affiliates to "buy from their own store" without the hassle of trying to maintain hundreds of affiliate programs yourself. Two, the attractiveness of the multitier commissions effectively promotes the affiliate program without distracting from product promotions.

Plus, this solution involves multitier training as well. Webmasters become involved in affiliate programs not only for their own savings but also to generate income from selling to others as well. This is not easy and requires training. It would be extremely costly for each vendor to establish an effective training program, providing the one-on-one communication necessary for true results. A multitier system with Team Leaders providing one-on-one training as needed eliminates the vendors' substantial affiliate training costs.

Thus, the next logical step in the evolution of affiliate programs in e-commerce is exactly what the SFI marketing Group has already done: a multitier commission and training structure.

NETWORK MARKETING AND THE INTERNET

When you step back and look at the history of e-commerce, you see that affiliate programs have independently evolved into something very similar to network marketing, which has been around for a long time. Ironically, though, network marketing itself has not taken well to the Internet. Most network marketing companies mistakenly believe that face-to-face interactions are necessary and that recruiting can not be effectively done online. (The research is in, however, and it shows the contrary to be true.) Another factor is that many network marketing companies do not encourage analytical examination of their opportunity, which is inevitable on the Information Superhighway. Thus, most network marketing companies only use the Internet to provide forms downloads and similar services to their existing representatives. They do not effectively use the Internet as a recruiting tool or to sell products to the general public.

Some enterprising independent representatives, however, have evolved the "downline clubs." Downline clubs sign people up on the Internet, promising to place them in multiple network marketing opportunities based on the order in which they signed up. Downline clubs theoretically offer the possibility of a large organization below you in multiple opportunities without any recruiting effort on your part. In actuality, though, most downline clubs have been disappointing. The greed of the club founders, the hope of instant riches, and the lack of focus due to joining multiple network marketing companies have usually yielded poor results. Training and commitment are lacking, so large downlines (if they get built in the first place) often crumble even faster than they were collected.

Thus, network marketing as we traditionally have known it has not grasped the potential of the Internet and does not appear likely to do so. Plus, and perhaps because of the Internet, the old model of network marketing is less effective in any venue of late.

THE NEW PARADIGM

SFI's founder, an experienced and successful network marketer, was one of the first to recognize that the old network marketing model quit working for many previously successful marketers around the same time that e-commerce was evolving toward a similar but different paradigm. He realized that an entirely new model was needed. He drew upon those principles of network marketing that remained viable and applied them to solve the current e-commerce challenge of promoting affiliate programs on the Internet. The results are phenomenal. SFI now has well over 7 million affiliates and the numbers of new affiliates each month is growing progressively.

SFI works because it is an e-commerce affiliate program. Unlike the old network marketing model, SFI does not require you to make unnecessary purchases or meet stringent qualifications to earn commissions. In contrast to almost all of the old network marketing companies, SFI fully embraces the powerful recruiting potential of the Internet. The SFI opportunity stands up well to the analytical scrutiny characteristic of the Information Superhighway. It is a forerunner in the next stage of evolution of e-commerce. Adding the multitier structure to an Internet affiliate program makes the new e-commerce channel of distribution fully workable. Because of this, SFI has been able to negotiate fantastic savings and commissions for its affiliates from world-class vendors and will continue to attract more and even better deals as SFI continues to grow.

CONCLUSION

The natural evolution of e-commerce has pointed to a multitier commission structure to give life to the new channel of distribution of goods and services created by the Internet. SFI is in the forefront of this new adventure in commerce. SFI embodies the most advanced stage of evolution of e-commerce. As Moore's Law (discussed in an earlier lesson) ensures the continued growth of e-commerce, history and logic dictate that affiliate programs will continue as the distribution channel for e-commerce. It follows that SFI, representing the most advanced evolution of affiliate programs, will continue to have lasting phenomenal growth and prove profitable for all involved.

For complete details, go to: http://www.tripleclicks.com/8051555/ECA