Being direct... AdVantage Jan 2006
Direct marketing is not what you think … the future has arrived!
In the age of time-depravation and information-overload, relevance is what opens eyes, ears, and wallets ... !
Well, let's start 2006 by wishing y'all a very happy new year! So, you noticed my southern drawl? I have recently returned home safe and sound from my week-long first visit to Georgia, and the DMA*05 Conference, held in Atlanta. Following on from my column last month, I was impressed both with the City of Atlanta itself, and with the wide variety of input from DMA*05. Its official in the USA now, folks….the convergence of 'Brand' and 'Direct' is happening at breakneck speed. This was the view of many, including David Bell, Co-Chairman of the Interpublic Group - who spoke at the Senior Officers Summit held as part of the DMA*05 event. The 5 days of the conference attracted some 10 000 delegates from all over the world, and the distinct 'buzz' around the conference was that very soon all marketing will be referred to as direct marketing. Why?
According to Jim Nail, principal analyst at Forrester Research Inc, there is now strong evidence that many consumers are 'switching off' traditional media advertising because of one simple word: RELEVANCE. People increasingly have greater access through newer technologies: 'Consumers are moving from using digital technologies to mastering them!' But (perhaps even more importantly) they are doing so because much of traditional 'targeted' communication simply lacks individual relevance in today's world. David Bell also observed that many customers with rapidly changing lifestyles are now demanding that information and offers be RELEVANT to their personal needs and desires, or they simply won't pay them attention!
…'the 'contract' between customer and marketer is broken…' said Mark Knobel of consultancy 'thinkingcraft' when he quoted numerous stats from a recent study by Yankelovich: 'today there is a 60% greater negative comment about marketing & advertising than a short few years ago; 69% of Americans respondents claim to be interested in products and services that block or skip promotions (eg Tivo); 65% want more limits and regulations on marketing and advertising; 65% feel constantly bombarded with too much marketing & advertising; 61% say marketers and advertisers don't treat consumers with respect; and then 61% say that the amount of marketing and advertising is out of control'.
By contrast, the updated DMA manifesto launched at the conference this year defines direct marketing as: a data-driven, typically multi-channel process for finding, creating and cultivating mutually beneficial relationships between marketers and their customers and prospects, in responsible and measurable ways. In 2005, the DMA estimates that promotional direct marketing in the US will total $161.3 billion - nearly half of all US advertising expenditure, and will generate an estimated $1.85 trillion in sales. They believe that direct marketing's growing success can be attributed amongst others to three primary things: it provides relevance to consumers; is increasingly responsible in the eyes of policymakers; and produces measurable results for the marketers.
The DMA's annual report tabled at DMA*05 describes the future as follows: '…direct marketing represents the future of marketing because - when used respectfully and intelligently - it provides marketers and consumers alike with what they want and need. For consumers, in the home and in the workplace, direct marketing fosters unprecedented convenience, freedom of choice, and empowerment. It provides them with more relevant marketing messages. It enables more informed purchase and charitable-giving decision making. And, ultimately, it forges more mutually beneficial relationships…'
The conference presented some 150 sessions across 8 different tracks over the 3 core days - Basics; Creative Execution; CRM; Planning & Research; List/Database Management; Executive Issues; Production and Other and included some very interesting presentations and discussions. One of these, featured under the heading 'Interactive' was titled Marketing to the Consumer Who is in Control, was very powerful indeed and the expert speakers acknowledged that the paradigm shift has arrived.
Aided by the proliferation of broadband and wireless access and the rise of the search engine, it is now the prospect that seeks the business, rather than the other way around. 42.3m or 36.2% of all US households now have broadband access. This has grown markedly from 34.3m or 29.9% in 2004. It is estimated that in 2007 over half of all US households will have broadband. 64% of broadband users vs only 40% of dial-up users buy products or services from home.
Finally, as promised last month - some more feedback from David Hoffman, the Emmy-Award winning documentary film maker, who has had phenomenal success using Google Ad-Words to sell his film products. In his keynote address, David urged marketers to focus more on the needs of web searchers rather than on their own products. The question that customers want answered right away is 'Can You Help Me?' rather than have to wade their way through a whole bunch of product-focused 'stuff' said Hoffman.
As a real example: he sells a documentary film on horses - and his best 'ad' for it is in response to searches for the terms 'Ford Truck'. 'I realised that these search systems are about the needs of the searcher, and not about the product,' he said. 'That's a real epiphany.'
Since making my very first visit to a United States DMA conference some fourteen years ago, I have been recommending to clients and their communications professionals that they stop and think hard about the future, and the inevitable swing from the broadcast mode of marketing communication to the interactive mode; from targeting response to providing access. This trip has left me in absolutely no doubt whatsoever, that the future has arrived.