Starting with my first experience of direct marketing managing my own band (of brothers!) and explaining why direct marketing may be expensive but almost always makes you money with reference to award winning DM campaigns from round the world. Given at the inaugural Romania in Direct event - called My kingdom for a horse - that explains the predominance of horse imagery!

1. Back to basics – Direct Marketing
that drives business
John Griffiths Oct 21st

2. Direct Marketing that drives business

3. DM
(because it makes me money!!)

4. How I discovered Direct Marketing

5. Advertising strategist by day..

6. and then I had to manage a band

7. At first the fans made all the merchandise
– tapes, posters even T shirts

8. But then we started to produce our own

9. Advertising worried me
(because I never knew if it had worked
and it was so expensive!)

10. I loved PR because it was fun, it was free
and journalists love something unusual

11. I loved Direct Mail
because I always knew what it cost me –
and it always made me money
the fan mailing list
was our most valuable asset

12. Once I started measuring I noticed that
at gigs 10% of the audience bought albums

13. Doing business from the gut

14. Satisfied Mailing
Is there anything as annoying as a spare
cover with no music or case?

15. Results of the Satisfied Mailing
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16% response
Revenue paid for the all production and
duplication costs of the new album
Postage costs covered by 3rd party who
wanted access to our mailing list!
Every sale afterwards was pure profit

16. What I learned
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The power of targeting – everyone on the mailing list
was a potential buyer
The power of measuring – I knew how much to spend
and risk
I wasn’t just communicating I was selling
Leveraging existing low cost assets – the mailing list,
lots of spare tape covers – I started with a budget of
zero!
Clear branding helps – couldn’t have come from any
one else

18. Don’t do this!
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NO targeting – I don’t
buy wheels!
Clearly didn’t profile
by company type
No personalisation
No offer
No brand distinctive

19. 1 year later I was offered a job in a
direct marketing agency
Which combined direct marketing with brand building
We couldn’t get clients quick enough

20. Direct Marketing is
NOT an Ad in an
envelope!

21. Direct Marketing ≠ Advertising

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In my role as a planner I have to add value to the agency’s product
Advertising: value = the power of the creative idea
Direct Marketing: value = targeting + the ability to generate response

22. Which gives you better response?

Send great creative to the wrong target group
OR

Send terrible creative to the right target group

23. Contribution to response
Tact ical
15%
Target ing
40%
Creat ive
20%
Of f er
25%
Source: Direct Marketing Association

24. Correct Targeting before everything else
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Which is why we don’t mail just anybody
Need to know how the list was recruited and
how often it is mailed
Lists must be clean and cleaned regularly
If there is an offer, then it too must be
relevant
Creative is only worth investing in if the
targeting is right

25. The right audience and the right offer!
Condoms for horses!!

26. from the Society for the Protection of Equine Morality
SPEM

27. The client: Haunui Stud Farm
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SPEM: Mails 200 horse breeders warning them of the ‘extreme
fertility’ of Haunui’s ‘hot blooded young males’ includes 2 free
horse condoms
Followup mailing from Haunui apologises, admitting the stallions
are indeed very fertile – free service offered with a booking!
112 bookings – 1056% ROI return on investment and lots of
word of mouth about stallions, fertility and LARGE condoms!
Agency: AIM Proximity New Zealand

28. What makes Direct Marketing different?
1.
2.
3.
4.
5.
DM costs more
DM is more complicated
DM is more controllable
DM and the internet
InDirect Marketing

29. Direct Marketing costs more

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Direct Marketing consistently costs more per head than any
other communications medium
Henry Winterman needed to recruit cigar smokers before
advertising and prospecting activity was banned so it could do
loyalty activity with mailing list and local retailers
Ran a test to find the most efficient channel
for recruiting names, using money off vouchers
in DM and 3rd party mailings. Also using press ads
offering free pack of cigars if you sent your
name and address!
Trying only to give 1 pack of cigars away per name –
direct mail the only way to control multiple redemptions

30. Which channel should
Henry Wintermans use?
Third Party
mailing
£18,000
Direct mail
Total cost
Off the page
Advertising
£13,000
Acquisitions
940
2,800
3,150
£3.17
£3.02
£6.81
Net cost
per Acq
Less orig
£26,000
DM test: Grey Integrated

31. Direct Mail the most expensive
and the most efficient
Third Party
stuffer
£81,000
Direct mail
Total cost
Off the page
Advertising
£81,000
Acquisitions
26,000
27,000
12,000
£3.17
£3.02
£6.81
25.5 million
26.7 million
119,000
Net cost
per Acq
Less orig
Total
Audience
Required
£81,000

32. Direct Marketing is
more complicated

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Takes more time
More people needed to manage
Because you aren’t renting someone else’s medium
or communication channel. You are creating a
channel, using it, disassembling it and measuring
how it performed – that’s why it costs so much more
per person reached
great Direct Marketing manages the complexity
and makes it look simple

33. How to get drinkers to take
taxis home instead of driving?

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7 Leisures Group largest chain of nightclubs
and pubs in Bahrein wants to reduce drunk
driving
Bluejack drinkers’ mobiles as they are leaving
to get them to think twice
Result: measurable increase in callout of
Radio Taxis within 2 weeks
Agency: JWT Bahrein

35. Direct Response posters to make
the Government take action

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NGO Women against violence creating public
awareness by getting public to do something – sign a
petition to the Malaysian government
Low budget high impact posters put up in shopping
malls- take back the abusive words by removing
them and signing them as a petition to promote better
government support
58% completion of the yellow notes – massive
publicity
Agency: ARC Malaysia

36. Take back your words – petition on sticky Postit notes

37. Direct Marketing is
more controllable
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The additional cost gives you control
The ability to test small quantities – YOU CAN’T DO THIS WITH
ADVERTISING
Tone of voice can change between communications
You can test variant offers, you can test different lists you can
test different copy
You can send different offers to loyal customers and lapsed
customers, or people who live further away from the store
You can send a sequence of communications to lift response –
can save you money!
Use direct marketing in conjunction with advertising to get
additional response
Direct marketing gives you CONTROL

38. Case study IBM mailing -different
sizes of business self-select
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IBM simultaneously trying to recruit large
medium and small businesses to a Solutions
Day
Wanted to challenge perception that IBM only
interested in big business
Target was 600 registrations – they got 900
and 60% of those who came were from small
and medium sized businesses
Agency: Ogilvy One Malaysia

40. Direct marketing and the internet?
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The Internet brings out the best and worst in Direct
Marketing
Generate response 
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Controllable
Shorter development process than direct mail
Lower cost medium than sending direct mail
BUT Internet has lower response levels cf to those
door to door flyers 0.1%-0.3% so the effiency does
not necessarily mean a) more sales and b)
comparable noting/opening
It is so easy to spam that overuse of email threatens
long term viability

41. Build an ECRM database online cheaply
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Calloway Golf wanted to build a pan European list of
golfers – the use of mailing lists would have cost €10
per response to contact!
All the client had was a shoebox with 5000 names of
amateurs who had entered competitions in the last 5
years.
Email campaign with a viral mechanism
Gave them the chance win golfing accessories if they
became the Captain of a fourball – bring 3 friends.
Collected a database of 39,000 active golfers: 780%
response at a cost of €50,000 less than €2 each!
Agency: Stephen Francis Whitson

43. Indirect Marketing
(Direct Marketing’s hidden asset)

44. Direct marketing pays for itself
by direct response BUT..
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we need to consider the effect of a personal
communication placed in the hand on the other 9597% of those who do not respond
Studies shows a much stronger branded effect than
you get from advertising
So direct mail does indeed build brands ( but is a very
expensive way to do it if you don’t generate response
as well)
A very expensive way of talking to a lot of people!
But unless you do follow up research you will never
measure the branded effect

45. C & W Mercury ask questions to educate
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The questionnaire is easy to do
Mercury will learn a lot about the TV and telephone
services cable customers want from responders
BUT more important – those who read the
questionnaire are being educated about the services
the company offers.
It isn’t actually research – its an education and brand
building campaign when cable companies had a big
image problem
US political parties use surveys to tip respondents
into voting in marginal areas

47. In summary – direct marketing
is a key tool for driving sales
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If you use it only to communicate (ad in an
envelope) it will be very expensive for you
If you don’t work at improving targeting
then it will be very expensive for you
One of the strengths of direct marketing is the
relatively high cost!
Makes you use it carefully – with a proper
strategy and test matrix

48. Thank you for your attention!

49. Any
questions
?