" Expand the product line to include housewares. The key supplier carries a full range of good quality housewares products and GGI can leverage its existing relationship to obtain discounted pricing on these additional product lines." Repackage and brand: currently, the products arrive with a "plain brown wrapper" sort of packaging so little attention has been paid to whether GGI even has a reputation in the market. GGI has the option to repackage the items to promote a stronger brand image, but the cost will shrink their profit margin." Open additional stores, possibly under a new brand, much like other manufacturers' and importers' "factory" stores." Engage in a major marketing effort to increase sales and brand awareness.
This can easily be achieved if GGI simply revamps its distribution channel and marketing strategy. Revamping marketing strategy will ensure building up of a strong brand. Within this, we need to revamp the distribution channel because making the product readily available will ensure a rise in sales. Both the issues can be easily addressed by adopting the direct marketing strategy.
Slide 3:
As the name suggests, contacting your customers directly is Direct Marketing. This can be achieved by way of telephone marketing, sending advertising emails, mailing product catalogues, seeking mail orders, door-to-door selling etc. As more and more businesses are recognizing the importance of direct marketing in enhancing sales and establishing a brand name in less time, the spending on direct marketing is also increasingly. Research indicates that spending on direct marketing will increase by 5.8% in 2011 (accounting to $47.8 billion) compared to 2010 figures (Corn, 2011).
Slide 4:
Direct marketing can be done by way of several methods such as: Internet selling, door-to-door sales, home parties, mail order, telemarketing, TV selling, manufacturer-owned stores, Catalogues etc. Depending on the type of product one has, these strategies can be adopted. For example, while car manufacturers will benefit from manufacturer owned stores, soap-manufacturing companies will do better by adopting a door-to-door selling strategy. No same strategy, hence, is applicable for different products. Keeping this in mind, since our product is gift items, home décor and other house-wares, for us, the best way of direct marketing will be manufacturer-owned retail stores, online catalogues (mail order) selling and tele-marketing. The reason for selecting these three amongst the rest of the direct marketing strategies is that our range of product usually sells when the customers specifically are looking for gifts. Thus, placing the products online and in retails stores will help maximise the reach of the customers in need of our product. Then again, tele-marketing can be used as an after sales way of enticing the existing customers into buying the product and spreading awareness amongst the new ones about the new products and stores being launched.
Slide 5:
In this marketing method, the marketing material and product catalogues are sent directly to the customer. While orders may not happen instantaneously, this helps mould the customer’s mindset in favor of certain products, trends etc. This helps in future purchases and ensures that the brand stays in top of mind (TOM) of the customer. Hence, whenever the customer is looking for a gift next, he would know where to go and what to buy. From the manufacturer’s perspective, some of the pros of this way of marketing are: Low costs, reaching to the wider target audience/customer base, advance payments for orders placed online, and since advance payments are received, there is no need to maintain stock, thus reducing inventory costs. Some of the cons of this are: breach of customer privacy (we will read more about it in future slides), hard to get customer loyalty, building customer database is difficult and time consuming.
Slide 6:
Since responsible marketing strategy is the one where conveniences and inconveniences of customers are also catered to and understood, we will be discussing the pros and cons of the said three direct marketing strategies from customers’ perspective as well. From the customer’s perspective, the pros of online catalogues are: convenient sit at home shopping opportunity, choice of products, free home delivery, online sales, and price cuts help save costs. Cons of this strategy from the customer’s point of view are: the quality of the product cannot be trusted, payment details might not remain a secret and may be misused by the company, incurrence of spam mails, cancellation charges, or refunds not possible.
Slide 7:
Tele-marketing involves making phone calls to the customers and enlightening them about the product range and taking orders for the product from interested customers. Some of the pros of following this type of marketing strategy are: The company executives can directly interact with the customers. Making calls is comparatively a cheaper option for the company to spread awareness amongst the customers and informing them about the new retail stores, product range etc. A large base of customers can be covered by way of tele-marketing. The cons of this marketing strategy from the marketer’s perspective are: Tele-marketing has so extensively been employed by companies these days that customers have rather started taking it as a nuance and hence have stopped responding to this type of marketing strategy. Government has also placed several regulations in place that are detrimental to tele-marketing. If tele-marketing is outsourced, the tele-marketing executives cannot be regulated by the company.
Slide 8:
From the customer’s perspective, some of the pros of tele-marketing are: Since the executives are directly speaking to you, all your queries can be successfully answered, apart from getting personal time and attention from the company executive. Tele-marketing also ensures that after sales service and even before sales service will be good by the company. However, tele-marketing has long sought ire by the customers and hence more cons can be counted for this one than pros. Some of the cons from customers’ perspective are: the disturbing calls become extremely irritating when in the middle of doing something important (meetings, hospitals etc). Some tele-marketing executives absolutely cling on to you even when you make it clear that you are not interested in talking to them. this makes the entire experience extremely trying for the customer. There is no guarantee that the purchase of the product will remain private with the company and will not be misused in future or details sold to other companies collecting consumer database.
Slide 9:
Obtaining customer database is an extremely tricky thing. It involves huge costs and time. While surveys require a lot of time (training of personnel for survey taking, compiling results and developing a database), buying mail lists from database companies becomes extremely expensive. Then again, if the company decides to develop its own database, it will have to invest a lot of time (years). The best option here, thus, becomes outsourcing the job of contacting the customers or mailing the catalogues to the companies which already have an existing customer database. This will prove to save a lot of time and costs for the company. However, effectiveness of this method is questioned by many since there is no way to regulate the process. However, one must not forget that ours is an existing firm dealing with customers since past 10 years. This means that the company already has a set of existing customer database. This will prove to be of immense advantage for GGI in its foray into direct marketing. Not only will this prove to be cost saving, it will also save a lot of time. Hence, the company can implement the change in marketing strategy almost immediately.
Slide 10:
Personalized marketing helps customize the gifts or housewares according to the customer preferences and needs, making the product unique to each customer. This process not only helps forge a better relationship with the customers, it also boosts sales as individuals want customized products that they can flaunt as unique. More and more marketers are adopting personalized marketing strategy these days. J&J has an online portal where customers can design their own containers for crèmes etc. This is just one example. Several other examples include where photo frames, mugs, shirts etc have personalized messages, photographs etc imprinted on them. Personalized marketing is founding preference among customers these days. Maybe with the advent of more individualized and intellectual younger generation is seeking avenues to express their individuality. Personalization of gift items and other wares is just one way of achieving it. Marketers have identified this fact and hence, personalized marketing is becoming a rage amongst most marketers.
Slide 11:
When discussing Direct Marketing, it is extremely important to discuss the issue of customer privacy. In general, conventional ways of direct marketing are considered to be in breach of the basic customer’s personal privacy policies. Amongst the ones most highly abused happen to be the financial details of the customers. Most often, the personal data is being used and reused by companies, while several others also make money by selling this database to other companies. In order to combat the issue of privacy, several regulations have come into place. According to The Lustigman Firm, “California Civil Code § 1798.83 which went into effect on January 1, 2005, requires businesses to disclose the types of personal information they share with third parties. Upon a customer’s request, a business must provide details about the type of personal information it shares with other businesses, along with the names and addresses of companies with whom the information is being shared. Alternatively, a business may provide a privacy statement that offers a cost-free means to opt out of a businesses’ information sharing activities.”
Slide 12:
Personalized marketing helps customize the gifts or housewares according to the customer preferences and needs, making the product unique to each customer. This process not only helps forge a better relationship with the customers, it also boosts sales as individuals want customized products that they can flaunt as unique. More and more marketers are adopting personalized marketing strategy these days. J&J has an online portal where customers can design their own containers for crèmes etc. This is just one example. Several other examples include where photo frames, mugs, shirts etc have personalized messages, photographs etc imprinted on them. Personalized marketing is founding preference among customers these days. Maybe with the advent of more individualized and intellectual younger generation is seeking avenues to express their individuality. Personalization of gift items and other wares is just one way of achieving it. Marketers have identified this fact and hence, personalized marketing is becoming a rage amongst most marketers.
Slide 13:
When discussing Direct Marketing, it is extremely important to discuss the issue of customer privacy. In general, conventional ways of direct marketing are considered to be in breach of the basic customer’s personal privacy policies. Amongst the ones most highly abused happen to be the financial details of the customers. Most often, the personal data is being used and reused by companies, while several others also make money by selling this database to other companies. In order to combat the issue of privacy, several regulations have come into place. According to The Lustigman Firm, “California Civil Code § 1798.83 which went into effect on January 1, 2005, requires businesses to disclose the types of personal information they share with third parties. Upon a customer’s request, a business must provide details about the type of personal information it shares with other businesses, along with the names and addresses of companies with whom the information is being shared. Alternatively, a business may provide a privacy statement that offers a cost-free means to opt out of a businesses’ information sharing activities.”
Slide 14:
The reason we select online catalogue and manufacturer-based stores is that the online catalogues are an absolutely low-cost medium of marketing and contacting customers. Secondly, manufacturer-owned retail stores will help build a respectable brand image, even as the mall culture boosts the sales. Thirdly, since customer database is a prime need in direct marketing, both these forms will help enhance the already existing database collection of the company. Since the customers are providing information knowingly, (online permission can be asked of the customer if he can be contacted again and a register can be kept in retail stores asking the customers to provide contact information) the issue of breach of privacy is also covered. Thus, we handle the three key issues of our discussion together – enhance sales, develop a respectable brand image and deal with privacy breach issue effectively.
