Direct marketing and your brand


More and more companies are moving toward a direct to consumer sales model. There are a number of reasons for this and it can be a tricky process to implement without upsetting the existing distribution ecosystem but let’s not go there for now.

But this move will see an increase in Direct Marketing. Direct Marketing should be included in any Malaysian business’s brand strategy, whether business to business or business to consumer. And it is a tactic that has plenty of room for growth as it is currently under appreciated and under utilized.

Because the quality of Direct Marketing in Malaysia and the mining and management of data must improve before consumers will pay attention.

What is direct marketing?
In a nutshell, direct marketing is the way in which a supplier of goods or services contacts an end user, normally a consumer or business. Direct marketing includes any mail sent via traditional post or email, brochures, magazine inserts, leaflets and catalogs.

With the direct to consumer sales model, it is also common to include telemarketing and face to face sales as elements of direct marketing

The existing model
If you want to at best create a bad first impression of your brand and at worst ensure an instant negative impact on the reputation of your brand, prepare a badly written product or services document on your desktop, use fonts that are hard to read or have a thick bold type face and whatever you do, don’t spell check the document.

Next, print 10,000 copies and shove them in letterboxes at office and/or apartment complexes in the Klang Valley. Don’t bother to record how many are delivered to each destination and ignore whether or not your product or service has any relevance to the occupants.

Then go back to your office and wait for the phone to ring (assuming you included your number on the document – and believe me, some don’t).

With this approach, the best you can hope for is that the leaflet will be used as a place mat for lunch or simply allowed to fall on the floor by the letterboxes. Hardly an inspiring ‘moment of truth’ first time experience for your brand and potential customers.

If there isn’t a response to the exercise, does this mean the ‘Direct Marketing campaign’ is unsuccessful? Absolutely not, what it means is that a very good tool has been used wrongly.

Another way to damage your brand is to send the wrong material to the wrong people. Credit card companies are renowned for sending credit card application forms to children.

Why am I receiving this sort of mail? – Note to self, do not use this company for training.

Little wonder consumers lose faith in financial institutions when they make such glaring mistakes. Think of the money wasted on buying the list of names, designing and writing content for brochures, envelopes, postage, administration and so on.

Email is still one of the most effective forms of communication with open rates of 22%, click through rates of 8% and conversion rates of 1.5%. But it must be done properly. The common approach is to buy a list of names (normally the cheapest) and carpet bomb that list with every offering you have.

Conference and training providers do this. They don’t bother who the recipient is and what he does, they simply fire off an email offering agile this, scrum that to their mailing list each time they have a new event or training seminar. Research suggests most executives have a spam filter that directs this mail straight to the trash.

The UK has some of the toughest privacy laws in the world yet Direct Marketing is still one of the most effective forms of brand development.

In 2011, UK firms spent RM14.5 billion on direct marketing which was responsible for 23% of all sales and generated RM196 billion of business. Direct marketing is effective in the UK because it is used properly.

How to do it properly
The key for all direct marketing is get the customer information right in the first place and keep it updated accurately thereafter. Well targeted communications can improve response rates by 300%.

If you don’t have the resources to compile data, outsource. There are many firms offering data collection, cleansing and data suppression services and it is money well spent.

Next, take some time to think about what you are doing and why. Are you looking to make a sale or build a customer base? Free tip, it should be the latter. Once you know what you are doing and why, think about the channel.

Determine which is the right channel. Should you use email, magazine or newspaper inserts or other. If you have a lot to say or want to show off images, an email is probably not the right channel to use unless you have a very niche product and a very well researched database. Many firms simply programme their servers to reject any email with an attachment.

Measurement
Measurement is critical in any campaign but especially so in Direct Marketing. Understand what the exercise is going to cost so that you know what your break even point is. Also measure response rates from specific segments and determine why prospects don’t buy.

Personalise each communication
If you want to stand out from the competition and have a chance of connecting, every communication should be personalised to ensure a chance of engagement. Personalisation is dificult and time consuming because it requires attention to detail but worth the investment because it instantly makes the recipient feel recognised and important.

Content is king
Content is critical, especially if you are selling a luxury product. Yes I am aware that Malaysia is a price driven and discount defined market but I disagree that that is all it is. It has got to that stage because consumers have been let down by advertisers so often and for so long that they now focus on price and price alone.

But as many luxury retailers, developers and service providers will tell you, provide a high quality service and product and consumers suddenly seem less focused on price and more focused on the experience and the prestige.

So make your content interesting. The example below is from a property developer trying to get wealthy buyers to part with millions of dollars. I doubt they will be successful with this copy.

Make content interesting, it’s not rocket science!

There is an edict within Direct Marketing industry that says, “Right offer, right person, right time.” It isn’t complicated, it just means that to be successful, start up, SMEs and GLCs need to up their game.

Put an end to poorly thought out, badly designed, written and untargeted material and use quality direct marketing to build quality brands.

Direct Mail, Email and your brand


Direct Mail and Email marketing are critical components of any branding strategy for either a business to business or business to consumer brand. And it is a growing business. But the quality of Direct Mail and Email marketing in Malaysia and the mining and management of the databases used is horrendous.

If you own a company and you want to destroy any equity there may be in your brand, prepare a badly written product sheet on your desktop and when you are finished, don’t bother to spell check the document.

Print 50,000 copies and shove them in all the letterboxes of as many office or apartment complexes in the Klang Valley as you can. While you are sitting at home waiting for the phone to ring (assuming you included it on the flyer – and believe me, some don’t), your ‘DM campaign’ is being thrown in the rubbish bin by the lift, used as a place mat for lunch or simply thrown on the floor by the mail boxes. Hardly an inspiring ‘moment of truth’ first time experience for your brand and potential customer.

Another way to damage your brand is to send the wrong material to the wrong people. I have three kids, two under the age of 13. Yet this year they have both received two offers from credit card companies. These offers state that applicants must be at least 18 years of age.

A lot of firms are moving away from DM to save money on the printing of their flyers or brochures and looking at Email marketing. Although figures are unavailable for Malaysia, the Direct Marketing Association in the UK informs us that 90% of companies are now using email marketing.

There is no doubt that a well thought out and planned email campaign can be effective and profitable. But too many firms don’t do this and instead are simply adding to the seven trillion spam messages expected to be delivered to inboxes around the world in 2011.

I signed up with a local event organiser for information on forthcoming branding and marketing seminars that they organise in the region. Within a week my inbox was inundated with emails related to human resources, accounting, insurance, motivation and other topics I have nothing to do with and no interest in. These emails are trashed with the same irritation as the ones for Viagra, lottery wins and Nigerian banks.

Despite my repeated requests to be unsubscribed from their list, I continue to receive multiple emails. I cannot simply mark the email as ‘junk’ because they are using a Gmail account and this will send all mail from Gmail addresses to my trash. The name of the company is ingrained in my subconscious, but for all the wrong reasons and it is now a matter of principle that we will not sign up for any event organized by this firm.

I have received about 10 emails in the past month from an insurance company that recently spent RM13 million (US$4 million) on a rebranding exercise. The emails are not personalized, the attachment is of a flyer that is dull and states in two places that the offer is exclusively for Mastercard holders yet I don’t have a Mastercard.

I really lose faith in financial institutions and other companies when they make such mistakes. Think of the money wasted on the cost of the name, flyers, administration and so on.

The rewards for good campaigns are significant. The Direct Marketing Association reports that more than RM550 billion was spent on direct marketing advertising (including email marketing) in 2008 and sales generated from that were an astonishing RM6,450 billion! There is no question then that DM can be effective because it allows consumers to read about the products and services before deciding to explore further, or even buy.

But it has to be done properly. It is not enough simply to create a campaign and send it out. It is also important that the content resonates with the target market. And you still need to ‘sell’ the product. Just because you have got into the prospect’s inbox, doesn’t mean the prospect will buy.

The key for all direct marketing or email marketing is get the customer information right in the first place and keep it updated accurately thereafter. If you are collecting a lot of leads but don’t have the resources to input and clean the data, then outsource. There are many firms offering such services and it will be money well spent.

There is an edict within Direct Marketing industry that says, “Right offer, right person, right time.”

So it’s time for Malaysian firms, from SME up to main board, to end all this untargetted, uninspiring, untrackable, unproofed direct mail and start building brands with quality marketing collateral.