Benefits of Direct Response Marketing
Posted on: July 11, 2011
The term, "Direct Response Marketing" often conjures images of the creative inventions and late night TV. However, business owners should pay close attention to the many "gold mine" opportunities direct response marketing presents. Beyond the specific field of direct response radio advertising that we're focused on here at Strategic Media, there are numerous benefits of direct response marketing that often times are over looked. Here is an outline of important benefits of direct response marketing to consider, when planning any marketing campaign.
Unrivaled "Track-ability" - Direct Response Marketing gives you virtually instant access to the results of your campaign. It accomplishes this by using dedicated toll free numbers, and/or unique URLs to provide quantitative data as soon as your ads began to air. This gives businesses instant meaningful feedback on creative messaging and media placement. In contrast, a typical "branding" advertising campaign can take months to deliver measurable results - if raw, quantitative data is ever available at all. One of the biggest benefits of direct response marketing is that you can view hard numbers on campaign performance, and therefore make decisions based on fact rather than assumption. For instance, you'll know exactly how many phone calls came in from each station, on each given ad. Of those calls, you'll know exactly how many were answered, and how many calls actually converted into sales. This information will show you exactly which media choices were profitable for you and which creative messaging was profitable as well. Conversely, you'll also learn which media was the least cost effective and which creative was the least profitable. All in hard, indisputable numbers. No guesswork, no waiting, and no truly lost money (even if an ad performs poorly, you've learned something valuable about media or messaging).
In addition to providing business owners with reliable information from which to make important marketing decisions, a benefit of direct response marketing is that it also keeps a company's advertising agency fully accountable. Because results are so transparent, it is obvious whether a spot is performing well or underperforming. Whether a direct response campaign has delivered desirable results is proven in black and white facts. This means, ad agencies, stations, call centers, or direct response agencies are completely on-the-hook to deliver the results they promised. A great benefit of direct response marketing is knowing that the agencies you're working with are fully accountable. That is - they know results are being measured and that hard numbers don't lie. You're less likely to mistakenly conclude a campaign is working if you're looking at a terrible cost per call or an outrageous cost per order. You and the agencies you work with will know how you're measuring success and the metrics you need to achieve in order for your campaign to be deemed successful. This level of accountability would be difficult to achieve with a branding campaign, as there are often no hard numbers to consult, therefore leaving the success of your campaign open to many different interpretations. Remember, the ability to closely track your results is one of the most important benefits of direct response marketing.
Superior Affordability - Another benefit of Direct Response Marketing is that it's very affordable in comparison to the typical brand marketing approach. This is because direct response marketing is measurably self-funding - it funds its own activities in a knowable way by asking the customer to take an action that can be quantified in terms of revenue and profit. In contrast, branding campaigns aim to make a lasting impression on consumers about a given brand. The presumption is that the increased awareness that results will increase purchase decisions for the brand. However since they aren't coming out and directly asking for a sale they can't make decisions to optimize their advertising dollars. So, money is being spent on creating a brand image, but not necessarily in a way that delivers optimal profitability. Direct response marketing is executed in a way that creates a more direct link between advertising dollars spent and revenues and profits driven.
Another benefit of direct response marketing that relates to its affordability is the fact that even though you're asking for a sale - you're still getting your brand name and identity out there. Yes, this means that direct response marketing is also brand building - so you get the best of both approaches. You're able to gain brand building benefits while making sales at the same time. Direct Response Marketing allows you to actually increase your revenue as you build your brand awareness in a self-fulfilling cycle of increased sales, profits and brand-building.
Another part of the affordability aspect of direct response, is that buying media for a direct response marketing campaign is often significantly less expensive than purchasing media for a conventional/branding spot. This is a clear savings, right from the beginning of the campaign.
Greater Profitability - The ability to track data, and make informed decisions, with direct response marketing, gives businesses the chance to test and optimize creative and media as often as needed to achieve desired results. A wonderful benefit of direct response marketing - and this is particularly true in direct response radio - is that you'll never throw money away by continuing to run, say, a radio spot or run on a radio station that doesn't work. You're armed with data that will help you make informed decisions about how to tweak creative or media variables in order to maximize results - netting you maximum ROI. An important benefit of direct response marketing is that you're able to make wise advertising investments guided by verifiable data. This is an especially important benefit for businesses that absolutely need their marketing efforts to be profitable quickly, and don't have the time or resources to wait for traditional brand-building efforts to increase their bottom line.
Also, as stated above, a benefit of direct response marketing is that it allows you to increase revenue while building an image for your brand. Once you've rolled out a successful, proven DR ad; you'll be gaining all of the benefits of your brand being placed in front of your target audience numerous times per day, while also reaping the benefits of direct response messaging that compels your target audience to act now and purchase your product. Rather than building an image for your brand that you hope will lead to sales; with direct response marketing, you're building a targeted message that's highly focused on gaining sales - and building a positive image in customers' minds is a wonderful by-product of your effective messaging.
Whether you're considering direct response television, direct response radio, or one of the other forms of direct response marketing - before you embark on creating an advertising and/or marketing campaign for your business, keep in mind the important benefits of direct response marketing. You'll be glad you did.
Campaigns, Leadership, Media Buying