Knowledge Center

Articles

Article -> Four Keys to Direct Response Marketing1

Date Added: November 2005

Advertising, like most things in life, offers two equal, but opposite, approaches. These are known as branding and direct response. The goal of branding is to become the name people think of immediately when they need what you sell. The goal of direct response is to create a measurable, cause-and-effect relationship between your ad budget and its identifiable result. This article focuses on direct response.

The key to getting a direct response to an ad is to dramatically increase the ad's relevance to the customer. There are four key ways this can be done:

1. Reach only those people who are actively in the market for what you're selling. Your offer will be more relevant to customers who are in the market for your products than to customers who are not. Flash back to a radio campaign for Campbell's Soup that was broadcasted back when America was full of stay-at-home Moms. Just one ad each day, three days a week, always in the final commercial break before noon, you'd hear: "Wouldn't a hot bowl of Campbell's Soup taste really good right now?"

The idea was that most housewives already had a cupboard full of Campbell's Soup and they weren't going to buy any more until they ate what they already had. Those ads were written and strategically timed to convince these Moms to walk to the cupboard, open a can of Campbell's Soup and serve it to the kids. Genius. Successful targeting is more often about the timing of your message than about reaching the correct age and gender demographic.

2. Increase the urgency of your offer. If a limited quantity is available, name the exact number. Specifics are more persuasive than generalities. If your offer has a time limit, say so. "Offer ends soon" will be perceived only as shallow hype. Be specific. Be accurate. Tell the truth. "Offer ends Saturday the 15th at 6 p.m."

The downside of urgency is that customers who aren't immediately in the market for your product won't remember your ads since there will be nothing relevant for them to remember. If they desire the product on Wednesday the 19th, the ad whose message expired at 6 p.m. Saturday will have no relevance to them. You paid to reach these people, but the message didn't stick. That's the price of urgency.

3. Elevate the relevance of your core message. Put yourself in your customer's shoes. What, exactly, would an offer that would stand head and shoulders above all your competitors' offers sound like? Since this is a matter of strategy that goes to the core message of your offer, it often requires a modification of the business model. A weak core message can't be glossed over with superior graphics or wordsmanship. Let's explain:

There was a liquid fertilizer company that offered homeowners a five-step treatment program. They wanted to reduce the number of misunderstandings with customers regarding the price of the fifth treatment. Customers often thought it was supposed to be "free" when the actual offer had been, "Buy each of the first 4 treatments and receive the 5th treatment for half price."

A Voice of the Customer process led to the discovery of several additional problems; however, the fertilizer company believed these weren't issues because they were "standard for the industry." Some of these problems were:

  1. The company's income was seasonal with very little cash coming in during the autumn and winter.
  2. One-third of the customer base failed to renew their agreements each spring. The company had to sell hundreds of new customers each year just to break even with last year.
  3. Very few customers were buying optional treatments.
  4. They were receiving minimal benefit from word-of-mouth.

The "5th treatment not free" problem, as well as the other "industry standard" problems were solved through a single, revolutionary new strategy: "We'll work year-round to make your grass green for a monthly fee that's less than you're paying now."

So, instead of hoping to collect 4.5 times the treatment price from a customer each year, the "Unlimited Service" plan charged them full price for all five treatments, and added the two "optional" treatments that customers hadn't previously been buying. The seven treatments total was divided into 12 equal payments to be paid by automatic draft each month. The customer who used to pay $40 per treatment now paid only $23 per month.

Because of the new plan, revenues per customer increased by an immediate 56 percent, customer satisfaction skyrocketed, cash flow became constant, and word-of-mouth advertising went through the roof. In a nutshell, advertising works better when you have something to say.

4. Amplify the voltage of your clarity. "We guarantee the quality of the diamonds we sell" is a statement of very low voltage. To increase its voltage and clarity, you must close the loophole that exists in the customers' mind. "If the Gemological Institute of America doesn't confirm our diamond's color, clarity and carat weight to be at least as good as we promised you, we'll buy back that diamond for the price you paid, reimburse you for the cost of grading, and pay you an additional five thousand dollars. If other jewelers aren't willing to match this offer, you've got to wonder why."

Now, go sell something.

1 Williams, Roy, "Four Keys to Direct Response Marketing," http://www.entrepreneur.com/article/0,4621,322960,00.html: August 15, 2005.

HTMLgraphic Designs