DM: from poor cousin to rich uncle

  • Marketing
  • March 25, 2010
  • Ben Fahy
DM: from poor cousin to rich uncle

Optimism was in the air at the New Zealand Marketing Association's Northern Regional Event today, with the general consensus among some of the country's bravest and 'upto' direct marketers being that with the fancy tools now in the box there's never been a better time to be in the game.

Change was definitely the theme of the day at the Evolution of DM event. And the changes in the way media is being consumed and data gathered, particularly in the digital space, have opened the door for greater opportunities to connect with the public and a greater demand for modern day direct marketing skills.

Despite the constant flux, Hamish Travers, director at Twenty and the chair of the Digital Marketing Network, which was set up 15 months ago by the NZMA to "inform, challenge the status quo, celebrate, champion and protect" and also inform members on how to keep up with the play, says the basics are still important: be true to the brand, gain permission, be relevant and sweat the returns.

But innovation and new technologies have changed the game and "pretty much everything in the digital space is making us think".

"The key thing is we still have to focus on the key elements in the direct marketing mix, but you can add experimental and experiential elements to increase customer engagement."

Matt Scott, the general manager of DraftFCB, took us down memory lane to show how far the realm has evolved. When he started in the early 90s, he says direct marketing was seen as the poor cousin of advertising. Back in the day of DM legend Drayton Bird, it was a very formulaic affair. It was process and offer driven and, in terms of a hierarchy, it typically ran in this order: audience, offer, format and creativity at the rear.

This approach to DM worked and it was very successful. Ah, life was so predictable back then, and the path to purchase was linear. But that's all changed with the arrival of new channels like websites, search, social networks and mobile. Now, he says "consumers are playing hide and seek with us and they're harder to find than ever before" because their time is split across so many different channels (in the US, the average person spends nine hours a day in front of their array of screens).

The way consumers buy things has also changed. He points to the car industry, where more online research before purchasing has led to a decrease in visits to car yards by four to two. As a result, car salespeople have become more like order takers. But, on the other side of the coin,the digital realm means the ability to analyse the effectiveness of campaigns, whether for cost per sale, allowable marketing cost or ROI, has never been better.

Basically, he says digital channels and direct marketing are the perfect bedfellows. It's still about acquiring, growing and retaining, all while building the brand. But with the likes of unique landing pages, it's easier to tailor communications.

Scott went on to talk about a new campaign for the Ministry of Health's National Depression Initiative, which again features John Kirwan in the starring role (the success of the last campaign means Kirwan still gets people coming up to him on the street saying he saved their life and the campaign has even affected the vernacular: 'I've got the JKs' is now a euphemism for depression). This new campaign (it's still in testing but the world-first "e-therapy" initiative is set to be released in June) aims to inspire some positive action by driving people to a destination, the flash-based www.depression.org.nz. It's using modern direct marketing techniques to raise awareness and allow users to communicate in whatever way they fell comfortable with, whether it be privately or with the staff at Lifeline, via email or text.

In this case, he says the DM rules still apply: to acquire, relevancy is very important; the offer is for the user to be made better; the format is mainly interactive and digital; and the creative aspects are about tailoring a certain style and tone to depressed users who will be using it.

Data might not be quite as sexy as brand and digital, but Matt Cowie of Datamine showed how "even a traditional media channel like unaddressed mail can be revolutionised by integrating data insight".

100 million unaddressed mailers are delivered every month in New Zealand, but by turning a mass media shotgun approach into a highly targeted channel by using the right data platform, he showed how sales can be increased hugely and unaddressed mail can become more like direct marketing.

In the case of Appliance Connexion and 100%, he says a group of customers worth $12 million per year was being overlooked because of the lack of targeting and customer insights. The previous approach to catalogue drops was based on geo-demographic profiling (census data, distance to store etc). But by finding out who buys (from them or competitors) and finding out where they live, it could be translated into catalogue strategy, both at a nationally and local level. And it resulted in 256 new delivery areas being delivered catalogues that hd previously been missing out.

Wayne Pick, executive creative director at RAPP New Zealand, discussed some of the companies using new channels and media vehicles to strengthen their positioning and relevance.

He, like the others, marvelled at how much things have changed recently ("the only time you shouldn't expect change is from a vending machine," he says). The job he started in 20 years ago doesn't exist anymore, and while says he's not sure what it will look like in 60 years, he does know that, like now, it will still be based around human relationships.

"The toolbox has never been so full," he says. "There's never been a better time to be a direct marketer."

In words that strike fear into the hearts of marketers and advertisers, however, he says honesty is extremely important now. There's nowhere to hide anymore.

"You have to be honest and frank about your brand. You can't just say you're the biggest, the fastest, the best anymore. You have to find interesting things about your brand to talk about (he points to the gardeners who put 'we will take our shoes off before we come in' on their business card)".

The different VW Golf GTI campaigns were used as an example of the way consumers (in this case, consumers in the younger, tech savvy and male sector) can now be targeted. In 2006, the company spent US$60 million on a campaign in the US. In 2010, it spend $500,000, purchased an already popular iPhone game called Real Racing and allowed users to download it for free (oh, it also offered six pimped out cars as prizes for anyone who signed up and raced).

He says there are around 50 million iPhones and iTouches in the world. So it's a hugely influential channel. In the end, the game was downloaded 3.4 million times.

VW in New Zealand took a different, more real-life approach. It knew a test drive around the block wasn't enough, so instead it decided on the GTI Trackdays. Personalised invites were sent out to customers offering them the chance to race the new car and the campaign had an unprecedented 88 percent response rate, four times the goal. And Pick says it shows that you need to be generous to get engagement.

Youtube VideoHe then went on to talk about Axion, a bank that used digital channels and a simple idea called Banner Concerts to connect with the yoof. Of course, the yoof are notoriously suspicious of banks and typically unexcited about the free sports bags or cap they get if they sign up. So, to entice them and beat out the other banks that were offering $20 when you joined up, it focused on what really mattered to the kiddies: music.

It's hard to explain, but some of Belgium's best bands performed in banner-sized spaces in real-life and those concerts were played in the advertising banners on the country's biggest websites. Other bands auditioned and the end result was that the bank managed to engage with its difficult target market.

The Great Schlep, an online campaign that implored Jewish youngsters to get in touch with their older relatives in Florida and convince them to vote for Obama, also references the power of digital activation. And, after the mainstream media caught on, it resulted in over two million media impressions.

To finish off Pick told the crowd the first rule of building a mousetrap is to leave room for the mouse. He wasn't saying this, or any other digital direct marketing initiative, was a trap. He says it's just important to see direct marketing in the present day as a relationship; a dialogue.

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