Key skills communication Level 3 Direct Marketing. Tuesday 10 March Source Booklet

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1 Key skills communication Level 3 Direct Marketing Tuesday 10 March 2009 Source Booklet This booklet contains source material for the level 3 communication test, Direct Marketing The test questions will be based on this material You must hand in this source booklet at the end of the test, along with your question paper and answer booklet The level 3 communication test will assess your ability to: select and read material to obtain the required information identify accurately, and compare, the lines of reasoning and main points from the text and images synthesise the key information in a way that is relevant to the purpose select and use a format and style of writing that is appropriate to the purpose and subject matter organise relevant information clearly and coherently ensure text is legible and spelling, grammar and punctuation are accurate First published in Qualifications and Curriculum Authority Reproduction, storage, adaptation or translation, in any form or by any means, of this publication is prohibited without prior written permission of the publisher, unless within the terms of licences issued by the Copyright Licensing Agency. Printed in Great Britain. The Qualifications and Curriculum Authority is an exempt charity under Schedule 2 of the Charities Act Qualifications and Curriculum Authority, 83 Piccadilly, London W1J 8QA. Ref: COM-L3-Q4-P5-v7.0-URN:663

2 DOCUMENT 1 page 1 of 2 Common Misconceptions About Direct Marketing Any method that delivers a message to a selected range of potential customers can be used in direct marketing. We can distinguish direct marketing from mass media such as TV, radio and print by its ability to target a suitable audience for that message. Communicating with a potential customer via the postal service using direct mail has up to now been the most common method of direct marketing. Electronic means such as and the Internet are becoming increasingly popular. Direct mail is not junk mail. When used properly, direct mail will send its message only to a very carefully chosen list of people who are interested or are likely to be interested in your product or service. If you receive a mailing that is totally irrelevant to you, that is junk mail. On the other hand, if you are in the market for a new product and you receive a targeted mailing that includes valuable information, then that is definitely not junk mail. Finding the right target audience The first question the direct mailer has to ask is who they want to mail. The answer will probably come most frequently, and most successfully, from their own database of customers. On the other hand, even though they may have a great many names on their files, it may still be worthwhile being selective, choosing just those who will be interested in the mailing. This saves on cost, but it also protects the investment in the database by not exposing recipients to mounds of irrelevant junk mail. If you do not have a suitable list of potential recipients on your database, you may be able to use the services of a specialist mailing house which does maintain such a list. Mailing houses will usually sell a list for one-time use, providing labels or even a complete mailing service. The most important question to ask when buying such a list is how accurate it is. The source of many lists may be suspect. They are frequently derived from subscribers to magazines, for example, or respondents to free offers, who may not be the ideal prospects. However, this may be the only way in which you can reach your target audience. Lists may also be out of date; 12 per cent of the UK population changes address each year. Lists may also need cleaning, for example, to remove duplicate entries or to update contacts within organisations. Usually the only satisfactory way of finding out how useful they are is to run a test mailing, even though that represents an investment of time and money. Unfortunately, many companies think that because it is so easy and cost-effective to send out letters, they should send them to everyone! If this is what you do, your ill-targeted mailing will not be well received by the majority; indeed it may not be well received by any of them. However, if you get the audience right, and the offer and timing right, direct mail can work very effectively. 2 Key skills communication Level 3 March 2009 URN:663

3 DOCUMENT 1 page 2 of 2 Telemarketing as part of a direct marketing strategy Direct marketing in the form of telemarketing, or cold-calling, is where the initial contact with the customer is via telephone calls. One of the original attractions of telemarketing was the speed with which marketing campaigns could be undertaken. Contacting consumers by telephone can also offer other advantages over other forms of marketing. It allows you to gauge the customer s interest immediately, so that you can then ask questions to assess the customer s needs and you also have the chance to explain technical or complex messages more effectively. This means that telemarketing as a method lends itself well to the marketing and promotion of products and services that are complex to buy, such as switching to another telephone company or buying a financial service. Certain types of transactions may also be subject to government regulation and telemarketing permits a company representative to guide the customer through the purchase, while ensuring compliance with the law. In business-to-business (B2B) marketing, telemarketing has a wider role. People are more receptive to marketing calls as part of their work than they are at home. Few B2B sales are made without some telephone contact with a prospective customer. In addition, a dedicated telemarketing campaign could help you to build your database and generate business. It also enables you to follow up responses to direct mail campaigns, keep in touch with existing clients and renew relationships with lapsed customers. Furthermore, it s a useful tool for keeping up-to-date about industrial developments and the activities of competitors. Keeping the customer on your side Some people respond positively to direct mail advertising and telemarketing, and find useful goods and services on offer. Traditionally, this was truer in rural areas where people had to travel many miles to do their shopping; thus direct mail and mail-order shopping was a major convenience. However, many people dislike it, as they do cold-calls, and there are laws requiring junk mailers to withhold their offerings from residents who opt out. The Direct Marketing Association (DMA) runs a free scheme that allows people in the UK to register their wish to stop unwanted marketing material by mail, fax or via the telephone. These schemes are not foolproof though and the DMA expects only 95% of unwanted material to be removed. Computer users can also install security software that identifies junk (known as spam) and filters or blocks it out before it can be read. Here again, there are no guarantees of success and the more creative direct marketers will always try to be one-step ahead of the anti-spam software to ensure that their message gets through. Source: Based on Sales and Marketing Strategies Consultancy website, 2006 and Wikipedia, Key skills communication Level 3 March 2009 URN:663 3

4 DOCUMENT 2 This was published by a consumer magazine in response to an article on direct marketing. Dear Sir Getting your own back Day and night I m constantly badgered at home by unwelcome direct marketers, who I m always polite to, although I ve no idea why. If I was to start ringing random numbers and asking strangers questions about whether insurance cover might make them feel better about the threat of having cancer, I d have a visit from the police in a matter of hours. A friend of mine told me about a website started up by a clever Dutchman called Martin Engelbregt. From it, you can download what he calls a counterscript, which turns the tables on cold callers. In fact, the counterscript does exactly what my dad used to do. Instead of answering the questions, you do the interrogation. Engelbregt s counterscript starts, To whom am I speaking? Could you spell your name for me? Could you tell me how you found this number?, right down to Is this your full-time job? Oh, you study, too? What exactly? That s funny, my neighbour does the same thing. Do you have to have good teeth for your job? If the cold caller gets annoyed, he recommends saying, Don t you like talking to me? Do you have problems answering questions from a stranger on the phone? Loving it. I remember my dad once kept a cold caller on the phone for 45 minutes with his own version of this, before the guy finally realised my dad was leading him on and hung up. Of course, I could try Engelbregt s approach, which is all about tying up the direct marketing companies phone lines, increasing their phone bills and slashing their profits, as well as making your day, but I really don t have the time. I ve also thought about adopting my granddad s tack, which was to simply say, Battersea Dogs Home to all callers. He also used to phone friends and family and when they answered, say Yes? Who s this? Why did you call? He was ahead of his time. In the end, I ve opted for a far simpler approach. I logged onto the Telephone Preference Service (TPS) and registered my phone number for free so I no longer get any more unwelcome calls from direct marketers. In a way I ll miss them... and I just know I ll forget to get cover for osteoporosis... Yours Frank Harris Source: Adapted from 4Homes Magazine, Key skills communication Level 3 March 2009 URN:663

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6 DOCUMENT 3 page 1 of 2 How direct marketing improved my business Armorica is a specialist cookware retailer based in Petersfield, Hampshire. Owners Bill and Valerie Brown have recently started direct marketing to publicise both their high street outlet and complementary online shop. Bill describes the methods used and how the campaigns have increased sales. Try new methods We had been advertising in some of the bigger home magazines for a while, but it was expensive and we weren t getting the response rates we d hoped for. With advice from Business Link, we investigated several direct marketing methods and decided to start with a leaflet drop. Our trade organisation, the British Hardware Federation (BHF), produces a twice-yearly product catalogue for members. The catalogue is printed by the BHF with several pages of general content but is tailored for individual retailers with logos and outlet-specific information. We worked with the BHF and used this catalogue as the basis for our leaflet. You end up with a professional-looking sales tool at a fraction of the price of doing it all yourself. We did an initial drop of 15,000 leaflets to local addresses. In the month following the drop, we experienced a 35 per cent increase in sales compared to the previous year. Use a database We have a database of over 600 customers, managed by our web design company, DataSouth, in accordance with Data Protection laws. We re especially careful to abide by the opt-out rules that prohibit contacting customers who have asked not to be sent information. We send out a six-weekly Armorica Newsletter to all eligible contacts, updating them on new products and special offers in-store and on the website. To add value and encourage retention, we also include a practical article in each issue, for example, tips on how to choose good kitchen knives. Review and refresh We regularly review our direct marketing activities to assess the return on investment. While you have to put your money where your mouth is and try new 6 Key skills communication Level 3 March 2009 URN:663

7 DOCUMENT 3 page 2 of 2 things, you also need to know you re not wasting resources. We ask for customer feedback and track sales volumes following each activity. Following one review we tried telemarketing as a new approach but found that most people were not receptive to this form of direct marketing and we actually annoyed some of our customers by ringing them up! We haven t tried it again and feel happier with direct mail. Direct marketing is only as good as the quality of the material you send out. If a particular leaflet drop or newsletter isn t as successful as we d hoped, we ll look at ways to develop it, for example by including a voucher redeemable by quoting a reference number or bringing the leaflet into the shop. Segment the database We re fortunate that our products are of universal appeal to most households, so blanket mailing our database has been quite successful. However, certain product categories appeal more to certain types of customer, so we re looking at ways to segment our database and target specific groups. Cross-promote When we started the website last year, we initially thought that it would have to be marketed separately to the shop. With experience, we found that the two sales channels complement rather than compete with each other, so we now use direct marketing to promote both the website and the shop. Source: Adapted from Direct Marketing: the basics, Business Link website, Key skills communication Level 3 March 2009 URN:663 7

8 DOCUMENT 4 Image 1 IT S A TELEMARKETER...HE SAYS IF YOU RE NOT BUSY HE CAN CALL YOU BACK WHEN YOU ARE. Image 2 TELEMARKETING AND DELIVERING YOUR BRAND Source: CSL CartoonStock, 2006 and Direct Connect Group website, Key skills communication Level 3 March 2009 URN:663

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