Direct mail plays an important role in the Marketing channel mix. The email inbox has certainly replaced the mailbox as the most efficient channel for relationship development and maintenance, but for relationship creation, direct mail still remains king.
That reality may be challenged over the next decade without some major changes in how direct mail gets delivered – the USPS business model may well push direct mail right out of the marketing picture entirely. The effects of an entity with monopoly privledges and Congressional oversight are clear – higher prices and lower services. Consumers and business are responding – 2007 mail volume of 212 billion pieces became 177 billion in 2009 with a projected decline of another 15 billion pieces in 2010. I would say that business model isn’t working anymore.
Is direct mail dead? Far from it – even at 150 billion pieces going thru the system in 2010 (more likely than 162), that’s still a significant business waiting to be right-sized and restructured to better suit the economic realities of today. I wouldn’t bet against the governments’ ability to push that elephant into the tarpit however – would you?
TheBusiness Dictonairyprovides a pretty good summary definition of Integrated Marketing as“Strategy aimed at unifying different marketing methods such as mass marketing, one-to-one marketing, and direct marketing. Its objective is to complement and reinforce the market impact of each method, and to employ the market data generated by these efforts in product development, pricing, distribution, customer service, etc”
Although fairly comprehensive in scope, that definition lacks one key component of Integrated Marketing that really brings home the ROI. Not only should it employ the market data generated by efforts for the benefit of sales, pricing, etc – the data should funnel back into the overall campaign elements to better inform targeting efforts overall – creating a continuous cycle of campaign improvement and a very long run-on sentence.
Integrated Marketing is about better leveraging your Marketing budget investment for improved results across the communication channels and beyond. It’s a single message broadcast in many channels – online and offline – in the social, sales, marketing and PR spaces. It requires customizing that message to suit the medium – and it requires intelligent design to incorporate measurement throughout. It’s often complicated – and it’s always worth the effort.
You Get What You Give when it comes to allocating funds to the Marketing budget.
Many companies wonder what percentage of revenue should be allocated to fund Marketing efforts – and that answer is rarely straightforward or simple to answer. Research suggests an inverse relationship between company size and marketing allocation, with the variable for a proper marketing budget between 2% and 10% of sales.
As this is an important subject and clients are keen to get a concise, easily digestable answer, my pat response is this: the correct percentage (or amount) should correspond with what you’re looking to accomplish as a company. Big, hairy growth goals require adequate Marketing dollars to achieve – flat or declining sales require less.
In the final analysis, there is no magic number that will ensure adequate Marketing support and product sales success for your firm – that percentage is unique and will require some test-and-learn efforts to arrive at over time.
Gerson Lehman Group just published their Councils Report on Closing the CMO / Agency Gap: How Agencies Can Win Business and Build Stronger Client Relationships. The answer in a sentence: agencies should invest more in winning business – more time – more resources – more capital. The challenge of course for agencies is to do so in the most brutal marketing services environment in 100 years. Every CMO has the right to expect an agency to understand their business model, industry and related challenges before stepping into the ring to battle for their marketing budget. Every agency has the right to expect a fair, transparent and timely contest and opportunity to be judged on the value of their thinking, experience and execution. And then there is the real world where decisions are made based on relationships, based on political structures and based on the lowest bid. In the new business economy of 2010 – so many things are changing, they almost look the same – !
If you can’t beat em, steal from em? McDonald’s has ruled fast-food breakfast for as long as anybody can remember, but has “The King” stolen their secret?
Burger King has recently launched an ad that shows its spokesman, The King, stealing a breakfast sandwich recipe from McDonald’s headquarters. The product, a “not that original” and “super affordable” sausage, egg, and cheese sandwich isn’t actually on McDonald’s menu, but that’s besides BK’s point. Their message is simple: it’s cheap, it’s the same thing you’d get at McDonald’s, come and get it. McDonald’s has taken the high road, as “imitation is the sincerest form of flattery”, and will likely continue to do so.
The ad itself is a bold move, and BK may have connected. Their entire campaign, surrounded by the creepy “King” character and questionable sponsorships, is directed at a younger demographic that might appreciate the honesty in the ad, and find it funny. Here is some of the feedback for the ad on YouTube..
y2kbug77 I love this commercial. It’s no b******t. Yes they stole the idea, but it’s cheaper and will probably taste better since it’s from Burger King. And? talking about stealing ideas: Burger King had the steakhouse burger way before McDonalds put the 1/3 pound angus burgers on the menu.
Pangora2 I wish more companies would admit this stuff. “Yes, we’re making the? same thing, let’s see who does it best for the best price.” The free market at work.
While I have no idea who these comments are from, I believe they raise some very valid points. Younger demographics are overly skeptical of any kind of traditional advertising, and smart enough to realize when brands are copying each other. In those situations, they will likely stick with the original because nobody likes being associated with a knock-off. However, Burger King has shown that if you are honest and throw in some humor, it could be a good way to reach your target.
I believe this ad will be effective in improving brand equity for Burger King, especially among males 25 and younger, but do not believe it will drive breakfast sales. A sustained effort is likely required to have any effect on McDonald’s breakfast domination, and this ad cannot be turned into a campaign. Admitting to knocking off a competitor once is funny, doing it twice could be a much different story.
What do you think about the ad? Do you like Burger King’s approach?
After a couple months and millions of dollars, AT&T has dropped its comparative ad campaign against Verizon. The two largest wireless carriers went back and forth over maps, apps, and everything that is mobile technology today. Moving forward, AT&T is trying to reposition itself as an innovative and forward thinking company, and has begun this by launching a campaign titled Rethink possible.
The Rethink Possible campaign’s first ad (shown above) tugs at the heart strings of viewers with an Apple-like jingle and brand logo approach. While I’m not exactly crazy about this first ad, I can respect the campaign and the direction AT&T is heading. Like I said before, anything is better than another Luke Wilson ad. It seems like everybody, little kids included, has a cell phone, leaving a very small number of new customers for wireless companies to target. This means the competition has moved explicitly to new services (apps, etc.) for the wireless carriers, and AT&T’s Rethink Possible is a step in that direction.
However, AT&T must prove itself as an innovator in order for this campaign to actually re-brand the company. The initial reaction to these ads will likely be skepticism, and consumers asking AT&T to “prove it.” And if Verizon gets its hands on the iPhone, which some believe may happen, it will further put AT&T to the test. Trying to claim an “innovator” position in a market where mobile apps and new technologies are coming from everywhere is an aggressive approach by the company. While brand turnarounds often require bold moves, I hope AT&T didn’t bite off more than it can handle.
Direct mail plays an important role in the Marketing channel mix. The email inbox has certainly replaced the mailbox as the most efficient channel for relationship development and maintenance, but for relationship creation, direct mail still remains king.
