28 Feb 2011
6 out of 10 spanish companies use direct marketing techniques to connect with their customers
Direct marketing, in which companies communicate directly with potential customers without intermediaries, is the medium now used by 60% of companies in Spain to reach customers, having grown 90% in the last four years. This is what Veronica Baena, marketing professor at Universidad Europea de Madrid's IEDE Business School, demonstrates in her book, Direct Marketing: a practical approach. “Direct marketing, which was first used about 40 years ago, is currently showing strong rates of growth. In Spain, it is one of the advertising media that companies are most investing in, and it is regarded as a powerful alternative fir achieving high returns on advertising investment" said Professor Baena.
For Professor Baena, it is a marketing tool that it is currently “on the rise, thanks to the internet and new technologies” and must be taken into consideration by companies as a strategy which complements traditional marketing techniques. “It offers unquestionable advantages, the most important of which is that responses are obtained directly. It also provides quantitative results and allows for assessment of the profitability of marketing operations.” She also noted that is customizable, that is, “it helps one to obtain valuable information about the market and facilitates the development of messages tailored to one’s needs.”
Errors and privacy issues
However, this expert warns that not all companies are implementing direct marketing in an efficient manner. “Indiscriminate telephone calls to sell a product or make offers are inadequate for the final sales goals or for the image of the company” according to Baena. “Before making contact, the company should have previously studied the characteristics of the person you will call in order to carry out personalized offers.” To take full advantage of their initiatives, she advises companies to hire professionals properly trained in direct marketing techniques.
A common mistake is not planning sales processes that continue over time, says Professor Baena. Traditionally, many companies focused on selling and considered this process to be finished once the customer had paid. However, the globalization of markets and the corresponding increase in competition, in addition to growing consumer demands, require companies to focus on customer satisfaction. “Companies have to be geared towards long-term strategic marketing and make customer loyalty one of their prime objectives.”
Another key aspect of direct marketing is the use of customers' personal information. “It must be handled with the utmost care. In fact, its use as a marketing and communication tool is strongly conditioned by the prevailing legislation in each country on the use of personal data,” warns Baena. Therefore, she stressed the importance for all professionals working in the industry to know about the Data Protection Act (LOPD) and its implications on the collection and processing of information, creating databases, transferring data to third parties, etc.
Not everything is direct marketing
Finally, Baena said that direct marketing is “a communication tool that we've all heard of at one time or another, yet some people still confuse it with other types of marketing strategies.” The concept of direct marketing includes the entire set of techniques that provide immediate and direct contact with potential buyers. Its purpose is to promote a product, service or idea using media or direct communication systems such as mailings, telemarketing, mailshots, websites, etc.
“The main difference between direct marketing and the rest of the strategies that any marketing agency may use is the absence of intermediaries and the interaction between the company and the customer (real or potential),” she said. “And with respect to advertising, direct marketing differs from the usual advertising methods because it does not use an intermediate communication medium to reach target audiences such as the point of sale. It is sent directly to the consumer,” concluded the IEDE Business School professor.