Limitations of Direct Marketing
Acquisition of data of individual customers may be difficult – Direct marketing is effective only when all information about the individual customer is available. It may be difficult to acquire this data, as people would be reluctant to part with personal information.
The customers could be exposed to information overload – In today’s rich business and personal environment everyone is bombarded with all types of data. Daily people receive letters, voice mails, catalogues etc. Welcome and unwelcome information accosts the senses through the radio, television, telephone, books etc. Direct marketers are perceived to be contributing to this overload.
Requires highly skilled staff to analyze each customer profile – In Direct marketing communications, individual customers should be addressed by name & title. Also information from database is used to produce specific appeal based on consumers personal characters &/or past purchase behavior.
It is therefore important that the profile of each individual customer is accurately maintained. This would be possible only if the staff employed is highly competent to carry out this accurately.
Customer Service rather than customer loyalty is more important in direct marketing
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For successful implementation of direct marketing program, a company needs to take a number of decisions. It is important to determine:
What the program’s objective will be
Which markets to target through the use of a list or a marketing database
What direct marketing strategies will be employed
How must the effectiveness of the program be evaluated
To determine the effectiveness of database, the database must be frequently updated.
RFM Scoring method must be employed to databases.
RFM- Recency, Frequency, Monetary transactions between the company and the customer.
It is important to enter the data each time a transaction is made. The company can keep a track of :
How recently purchases have been made
How often are they made
What amounts of money are spent
Tracking which products/services are used increases the ability to track the customer population & develop effective marketing strategies.
Acquisition of data of individual customers may be difficult – Direct marketing is effective only when all information about the individual customer is available. It may be difficult to acquire this data, as people would be reluctant to part with personal information.
The customers could be exposed to information overload – In today’s rich business and personal environment everyone is bombarded with all types of data. Daily people receive letters, voice mails, catalogues etc. Welcome and unwelcome information accosts the senses through the radio, television, telephone, books etc. Direct marketers are perceived to be contributing to this overload.
Requires highly skilled staff to analyze each customer profile – In Direct marketing communications, individual customers should be addressed by name & title. Also information from database is used to produce specific appeal based on consumers personal characters &/or past purchase behavior.
It is therefore important that the profile of each individual customer is accurately maintained. This would be possible only if the staff employed is highly competent to carry out this accurately.
Customer Service rather than customer loyalty is more important in direct marketing
*
For successful implementation of direct marketing program, a company needs to take a number of decisions. It is important to determine:
What the program’s objective will be
Which markets to target through the use of a list or a marketing database
What direct marketing strategies will be employed
How must the effectiveness of the program be evaluated
To determine the effectiveness of database, the database must be frequently updated.
RFM Scoring method must be employed to databases.
RFM- Recency, Frequency, Monetary transactions between the company and the customer.
It is important to enter the data each time a transaction is made. The company can keep a track of :
How recently purchases have been made
How often are they made
What amounts of money are spent
Tracking which products/services are used increases the ability to track the customer population & develop effective marketing strategies.