Defining direct

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It is a potent symbol of the evolution of the direct-marketing landscape when a search marketer identifies himself as a direct marketer. 

Two weeks ago during a New York meeting of search marketing industry professionals, Steve Jacoby, exec VP-sales and marketing for search marketing agency SendTraffic, commented, "We're direct marketers." He was referring to the healthy conversion rates his clients are experiencing due to paid search marketing campaigns.

Some say direct marketing has grown to encompass paid search marketing, e-mail marketing and direct-response Web display ads, along with the traditional mail, phone and print media. There is a continual blurring of lines between brand advertising and direct response marketing.

"Everyone is a direct marketer these days," said Chuck Swanson, director of business development at W.A. Wilde Co., a direct marketing agency.

Not everyone looks at it that way, however, and the definition of direct marketing is open to interpretation.

"I don't think of us as being direct marketers," said David Hughes, CEO of the Search Agency. "We are marketers who work toward an ROI."

His clients don't view themselves that way, either. "Many of my clients would not think of themselves as traditional direct marketers," Hughes said. "They think of it as, `Hey, I've got products to sell, and search is one of the channels in which I do that.' "

Nonetheless, he said that he's seen a major shift from marketers historically being limited to tracking a few channels to now being able to more precisely track several marketing channels.

"We live and die by data," Hughes said. "One of the concepts of direct marketing is the ability to target to the individual. In some ways you could argue that direct marketing is increasing because it is touching more channels.

"I don't think of us as being a direct marketing firm, and yet we do think of ourselves as applying heavy analytics and being very targeted; and there are many direct marketing firms that would argue the same thing," he continued.

Data-driven online advertising continues to exhibit enormous potential. Online advertising revenues for the first half of 2006 totaled $7.9 billion, up 37% year over year, according to Merrill Lynch in its U.S. online forecasts. That exceeded its anticipated forecast of 34% growth. It maintains its 27% growth forecast for the second half.

E-mail, another big online direct-marketing channel, remains extremely effective for marketers, despite spam issues and ongoing deliverability challenges.

In fact, b-to-b marketers in general are seeing the most increase in spending on search advertising, up 43% from 2005, and e-mail, which is up 40% over last year, according to Forrester Research in "B2B Marketing Needs a Makeover?Now" published in August.

With access to more data from multiple channels, sorting out and integrating those data?and then using them to drive customers?presents big challenges to marketers. It's not just about generating leads anymore.

"Working with and integrating all that is getting much more complex," said Tom Klug, brand executive at CFM Direct, a direct marketing agency. "We need to make sure our message on behalf of clients is cohesive.

"It's getting harder and harder," he added.

Others agreed. Gary Skidmore, senior VP-corporate office at Harte-Hanks, said lead management is both a big challenge and a priority for marketers. "The reason it's back in the conversation, and [that] resources are being allocated to it, is the tens of thousands of companies that are getting leads off the Web," he said. "With so many [leads], how do you understand who's a real prospect? We talk to customers about that [challenge] a lot. You need to be able to take action and route leads to the right place in your distribution channel."

That could be one factor behind the activity in direct marketing deal-making as traditional direct marketing and database companies acquire smaller companies to round out their capability sets.

Michael Iaccarino, president-CEO of Epsilon, said "Everything we're doing at Epsilon is about building capabilities to put together multichannel delivery systems."

Swanson agreed. "It's no longer about doing a direct-marketing campaign," he said. "If you can do something to facilitate [direct] response, then it has to become part of the overall [marketing] mix." For example, "if you have content sponsorship in a white paper about an [IT] security challenge, it will reinforce a direct-mail piece you've sent out."

"Direct marketing is proving to be the most valuable, measurable discipline today," Skidmore said. "It's being reinforced by the boardrooms wanting measurable results, and the fragmentation of media is driving people to a data-driven approach."

That suggests direct marketing will continue to play a starring role in the future of marketing.

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