Research

1. Direct Marketing is a channel-agnostic form of advertising that allows businesses and nonprofits to communicate straight to the customer, with advertising techniques such as mobile messaging, email, interactive consumer websites, online display ads, fliers, catalog distribution, promotional letters, and outdoor advertising. Direct marketing messages emphasize a focus on the customer, data, and accountability. Characteristics that distinguish direct marketing are: y Marketing messages are addressed directly to customers. Direct marketing relies on being able to address the members of a target market. Addressability comes in a variety of forms including email addresses, mobile phone numbers, Web browser cookies, fax numbers and United States and international postal addresses. y Direct marketing seeks to drive a specific "call to action." For example, an advertisement may ask the prospect to call a free phone number or click on a link to a website. y Direct marketing emphasizes tractable, measurable responses from customers regardless of medium.

History of Direct Marketing Mail order pioneer Aaron Montgomery Ward knew that by using the technique of selling products directly to the customer at appealing prices could, if executed effectively and efficiently, revolutionize the market industry and therefore be used as an innovative model for marketing products and creating customer loyalty. The term "direct marketing" was coined long after Montgomery Ward's time. In 1967, Lester Wunderman identified, named, and defined the term "direct marketing". Wunderman (considered to be the father of contemporary direct marketing ) is behind the creation of the toll-free 1-800 number and numerous loyalty marketing programs including the Columbia Record Club, the magazine subscription card, and the American Express Customer Rewards program.

In 1872, Aaron Montgomery Ward produced the first mail-order catalogue for his Montgomery Ward mail order business. By buying goods and then reselling them directly to customers, Ward was consequently removing the middlemen at the general store and, to the benefit of the customer, drastically lowering the prices. The Direct Mail Advertising Association, predecessor of the present-day Direct Marketing Association, was first established in 1917. Third class bulk mail postage rates were established in 1928.

Benefits Direct marketing is attractive to many marketers because its positive results can be measured directly. For example, if a marketer sends out 1,000 solicitations by mail and 100 respond to the promotion, the marketer can say with confidence that campaign led directly to 10% direct responses. This metric is known as the 'response rate,' and it is one of many clearly quantifiable success metrics employed by direct marketers. In contrast, general advertising uses indirect measurements, such as awareness or engagement, since there is no direct response from a consumer.

5 companies engage in direct selling 1.) Avon Products Inc. Sales: $10.3 billion Country: USA Avon is the founder of modern direct selling and the acknowledged world leader in cosmetics, fragrances and toiletries. Avons well-known product lines include Avon Color, Anew, Skin So Soft, Advance Techniques Hair Care and Avon Wellness. Wholesale Corporate Revenue: $10.3 billion Marketing Style: Person-to- person Compensation Plan: Single level and multi- level Products: Beauty, fashion jewelry and apparel Markets: 100+ Distributors: 6.2 million Employees: 42,000 Headquarters: New York, N.Y. Year Founded: 1886 Stock Symbol: AVPNYSE

2.) Amway Sales: $8.4 billion Country: USA Amway, under parent company Alticor, is maintaining its might in the industry. Its product banner includes Artistry cosmetics and skincare products, Nutrilite nutritional products and loyalty-inducing household products. Amway independent business owners work through the companys e-commerce network. Wholesale Corporate Revenue: $8.4 billion Marketing Style: Person-to-person Compensation Plan: Multi-level Products: Personal care, beauty and home care Markets: 80+ Distributors: 3 million+ Employees: 13,000+ Headquarters: Ada, Mich. Year Founded: 1959 3.) Mary Kay Inc. Sales: $2.5 billion Country: USA Mary Kay Inc. was founded by the now-legendary Mary Kay Ash to give women more options. She struck a chord with the motto God first, family second, career third. Today, that message adjusts across borders and cultures to make the company one of the largest direct sellers of skincare products and color cosmetics in the world. Wholesale Corporate Revenue: $2.5 billion Marketing Style: Person-to-person and party plan Compensation Plan: Single level and Multi- level Products: Skincare products and color cosmetics Markets: 35 Distributors: 2 million Employees: 5,000 Headquarters: Addison, Texas Year Founded: 1963 4.) Herbalife Ltd. Sales: $2.3 billion Country: USA

Herbalife sells nutritional supplements and weight-management and personal-care products. Its extensive product line has gained a following and credits success to scientific backing. All of its products have been developed by scientists, physicians and nutrition experts, including Nobel laureate in medicine Louis Ignarro, Ph.D. Wholesale Corporate Revenue: $2.3 billion Marketing Style: Person-to-person Compensation Plan: Multi-level Products: Nutritional supplements, and health/fitness, wellness, personal-care, skincare and weight-management products Markets: 72 Distributors: 2 million Employees: 4,000 Headquarters: Los Angeles, Calif. Year Founded: 1980 Stock Symbol: HLFNYSEa 5.) Pola Inc.* Sales: $1.03 billion Country: Japan Pola sets the standard in Japan. It is the nations fourth-largest cosmetics company and the biggest direct seller. Pola products include cosmetics, skincare, personal-care and nutritional products sold in department stores, retail stores, through mail order and door to door. Wholesale Corporate Revenue: $1.03 billion Marketing Style: Person-to-person Compensation Plan: Single-level Products: Cosmetics, skincare, personal-care and nutritional products, fashion and jewelry Markets: 16 Distributors: 100,000 Employees: 1,049 Headquarters: Tokyo, Japan Year Founded: 1929 2. Direct Selling is the sale of a consumer product or service, person-to-person, away from a fixed retail location, marketed through independent sales representatives who are sometimes also referred to as consultants, distributors or other titles.

Benefits of Direct Selling Research shows some of the most popular reasons people choose direct selling are:
y y y y y

Direct selling is a good way to meet and socialize with people. Direct selling offers flexible work schedules. Direct selling is a good way to earn extra income. Direct selling is a good way to own a business. Earnings are in proportion to efforts.

There are no required levels of education, experience, financial resources or physical condition. People of all ages and from all backgrounds have succeeded in direct selling. Direct sellers are independent contractors. You're your own boss. This means you can:
y y y

Work part-time or full-time - you choose when and how much you want to work. Set your own goals and determine yourself how to reach them. Earn in proportion to your own efforts. The level of success you can achieve is limited only by your willingness to work hard. Own a business of your own with very little or no capital investment.

3. Personal selling is oral communication with potential buyers of a product with the intention of making a sale. The personal selling may focus initially on developing a relationship with the potential buyer, but will always ultimately end with an attempt to "close the sale" Personal selling is one of the oldest forms of promotion. It involves the use of a sales force to support a push strategy (encouraging intermediaries to buy the product) or a pull strategy (where the role of the sales force may be limited to supporting retailers and providing after-sales service).

What are the advantages of using personal selling as a means of promotion? Personal selling is a face-to-face activity; customers therefore obtain a relatively high degree of personal attention

The sales message can be customized to meet the needs of the customer The two-way nature of the sales process allows the sales team to respond directly and promptly to customer questions and concerns Personal selling is a good way of getting across large amounts of technical or other complex product information The face-to-face sales meeting gives the sales force chance to demonstrate the product Frequent meetings between sales force and customer provide an opportunity to build good long-term relationships

Given that there are many advantages to personal selling, why do more businesses not maintain a direct sales force? Main disadvantages of using personal selling The main disadvantage of personal selling is the cost of employing a sales force. Sales people are expensive. In addition to the basic pay package, a business needs to provide incentives to achieve sales (typically this is based on commission and/or bonus arrangements) and the equipment to make sales calls (car, travel and subsistence costs, mobile phone etc). In addition, a sales person can only call on one customer at a time. This is not a costeffective way of reaching a large audience.