DM expectations in need of management

While many marketers believe that consumers are more than happy to receive direct marketing via texts and social media, they are out of touch with reality, according to research seen exclusively by Marketing Week.

virgin media
Virgin Media: Uses all DM forms depending on customer preferences

Marketers continue to be more optimistic than consumers towards direct marketing (DM), as new data seen exclusively by Marketing Week shows public resistance to any format other than mail and email. The news is not all bad, as coupons and personally addressed communications provide effective incentives to read messages.

No more than 6 per cent of people are happy to be contacted directly on any subject by telephone, text message or social media, according to the latest Marketing-GAP report, carried out by research agency Fast.MAP, sponsored by Market Reach and partnered by the Institute of Promotional Marketing and the IDM. It assesses the gaps between consumers’ perceptions of DM and how marketers think they feel.

The figures for phone, text and social media do show a slight improvement over last year’s results, but there have been no increases of more than four percentage points in the number of people who welcome DM on any particular subject. For example, only 6 per cent of the 1,000 people surveyed say they would be happy to receive direct communications about entertainment from brands through social media, compared with 2 per cent last year.

But this is still far below the average marketer’s expectations. Asked for their take, marketers estimate that 19 per cent of people would be happy to receive entertainment-related DM through social networks. The gap of 13 percentage points between marketers’ expectations and the reality of consumer attitudes is among the widest in the study.

Ahead of the curve

Fast.MAP managing director David Cole says: “Marketers are atypical of consumers. Despite their education, experience and the insight they get, these are not enough to get it right and really understand consumers. The difference is alarming.

john lewis
John Lewis: sensitive use of email and text messaging contact

“The key one is the pace at which consumers are embracing digital media, relative to [how quickly] marketers believe they are. Marketers are way ahead of the curve, because they work in a community that embraces digital, they like it and they want it to happen.”

Consumers show a greater willingness to receive DM via mail and email than by social media, telephone or text. The least desirable subject of marketing messages sent by mail and email is mortgages – only 9 per cent are happy to get messages in either medium. This rises to a maximum of 38 per cent who are happy to receive physical mail from supermarkets.

In the majority of circumstances, marketers still overestimate how much people will welcome direct mail and email communications of various kinds and overall, fewer consumers say they are currently happy to receive it than in 2011. One-fifth say they never open direct mail, which has risen from 13 per cent last year.

But marketers’ predictions about consumers’ attitudes to direct mail and email are closer to reality than where telephone, text or social media are concerned. And in some circumstances, marketers even underestimate consumers’ openness to receiving DM. For example, consumers are slightly more willing than marketers realise to receive mail from local businesses and supermarkets, and to receive email on several subjects including competitions, books and local restaurants.

Nature of the medium

Cole suggests that the relative acceptance of direct mail and email marketing is related to the nature of the media: “With both of those, you pick and choose when to interact. You can have filters on email and screen the junk, for example, and you feel far more in control. With mail, you can open it in a time and a place that’s convenient for you. But a text comes through and demands immediate attention.

“SMS is a very intrusive medium and there is something about the mobile phone that is highly personal. For a company to be contacting you on that personal device is overstepping the boundary in some cases.”

Cole says this doesn’t mean marketers should shy away from text messages or other “disruptive media” as a rule, but they do need to be careful of the tone and content, otherwise they risk alienating people. He adds that social media remains as yet an immature medium for DM, and that it is impossible to predict whether it will go the way of email or of text message marketing in the future.

Just as important as the chosen medium is how it is matched with the content. For direct mail, the most important factors in whether it is opened are whether it comes from a company the consumer knows and whether it is personally addressed. Both are cited as reasons for opening a mail pack by more than half of the survey respondents, and they are also the only reasons that have become more common as a long-term trend.

In 2012, 55 per cent say they open DM because it is from a company they know and 51 per cent because it is addressed to them, compared with 47 per cent and 43 per cent respectively in 2006. Marketers also underestimate how important these factors are to consumers. Only around one-fifth are prompted to open DM because it is in an interesting package, while 10 per cent of people or fewer cite any other aspect of design as being important.

Cole says: “The targeting process – sending the right message to the right person at the right time from a brand people recognise – is the overwhelming reason why people are responding, as opposed to just sending something out that is creatively exciting. That is just not going to work.”

INF Range DM
Infiniti: Its Since Now campaign used email and direct mail

Voucher popularity

Coupons and discount offers appear to be highly important for DM overall, even though there is a trend away from people saying they would be prompted to open mail because they know or suspect it contains a coupon (35 per cent now say this). While coupons may not be the key reason for paying attention to DM, the number saying they never use them has halved year on year to 7 per cent. Meanwhile, the number saying they use them regularly has increased by a third to around 30 per cent.

Furthermore, for over half the survey respondents, just 20p is enough of an incentive to redeem a coupon and this rises above 90 per cent of respondents when the value is £1. Fast.MAP’s data shows that marketers greatly underestimate consumers’ willingness to redeem these low-value coupons, suggesting that there is greater scope than they believe to use coupons to increase consumers’ use and consideration of their brands.

“They have been around forever, they are not particularly sexy, but consumers like them,” Cole says. “Marketers just don’t believe that a very high proportion of consumers are using them.”

Cole goes even further to argue that marketers are “completely out of touch” when it comes to DM. But the solutions to understanding consumer preferences around DM and shifting perceptions away from the junk mail stereotype are relatively simple, he argues. The crucial aspect of this is to ensure that DM responds to and meets a real consumer need.

“Consumers will often dismiss mail as junk if they don’t like it. But direct mail that they want, they will not think of as direct mail. They just think it is from their bank or their supermarket and put it into a separate category. It is communication that comes through that is helpful and a part of the relationship.”

do you open or read

do you redeem coupons

whenfillingoutforms

The Frontline

We ask marketers whether our ‘trends’ research matches their experience on the ground

chris bates

Chris Bates
Head of marketing – CRM and customer insight
John Lewis

We are best known for our emotive TV ads. But DM also plays a really important part in our overall marketing mix, giving us a channel for targeted, sales-focused communications. For instance, we can talk to customers about product categories that we know they’ve bought from in the past.

Good old-fashioned mail packs are proving to be a great vehicle for our loyalty communications. We recently sent a mail pack, created by our agency Kitcatt Nohr Digitas, to 75,000 of our most regular customers, inviting them to become part of ‘my John Lewis’, our targeted rewards programme. It included the chance to win a London 2012 experience and a monthly voucher for free tea and cake in-store.

Emails are a very cost-effective sales driver for us and they actually drive more store sales than online. But outbound calling is not part of our marketing mix. For me it can be both expensive and intrusive.

Text messaging has worked well as a follow-up reminder or for time-sensitive messages, such as letting customers know a clearance sale is finishing or that we’re matching a competitor’s promotion as part of our Never Knowingly Undersold promise.

Social media is a growing part of our mix, but we’re not yet at a point where I’d call it DM, it’s more a way to broadcast information and interact with customers, but that is evolving rapidly.You’re never going to please all of the people, all of the time. What for some is a really useful, relevant and timely communication can feel like spam or junk mail for someone else.

michael payne

Michael Payne
Director of customer insights and one-to-one marketing
Virgin Media

Often when people talk to me about direct mail, they ask which media we use. We use all of them – direct mail, SMS texts, email. They also ask which the best medium is, but that’s not the right question, because while some people view it as an either-or, we view it as a spectrum that can be added to. The key thing is you need to respect customers’ preferences.

Consumers are open to DM in certain circumstances. It depends on the consumer. Some of our consumers want us to talk via email and that’s what we do. But a good 50 per cent of them say they don’t want to use email – they want to use more traditional channels.

Most people who physically buy a product in our stores will have searched online. The smart provider recognises that the time you want to engage with consumers is when they are doing their search, but you may want to introduce them to physical mail or a physical store when they are close to deciding they want to engage with you in a much more serious manner.

Consumers have a preferred style of interaction that you need to reflect, not impose. Is there a trend towards moving online? Yes. But does that mean it is moving at the expense of more traditional media? No, I don’t think so: consumers want a mixture.

The subtlety that often perhaps gets ignored is that when you talk about the online world, it is much more of a two-way dialogue. You should be able to build your organisation around it to enable a two-way dialogue. If you don’t, you’ve missed why consumers go online.

martin jobin

Martin Jobin
Interactive marketing manager
Infiniti Europe

It is paramount to think of consumer preferences when planning DM campaigns. Everyone is different and while we can find commonalities and identify personas, the idea of a linear sales funnel and treating everybody the same is outdated.

DM remains an important and effective part of the marketing mix, particularly when used with other channels to amplify and add clarity to brand messages, expand on the story with supporting information and aid conversion. No channel is more useful than others – what matters most is creating a seamless customer journey. The Holy Grail is to conjoin and integrate our channels.

Our European social media channels amplify the wider story, and where appropriate we drive people to the relevant sections of the Infiniti website and our mobile site to provide consumers with a more immersive product experience. When consumers request the next step, we can follow up via phone and consumers are receptive to this.

For our ‘Since Now’ campaign we used direct mail and targeted email through our agency, TMW. Our prospects react well to Formula 1 incentives which we use in our social channels and in direct mail to uplift interaction and response rates. Our Formula 1 partnership with the Red Bull racing team has helped to add clarity about our performance credentials while also increasing test drive response rate.

Recommended