Direct Sales is selling goods directly to consumers rather than through retailers, usually by mail order, direct-mail shot, newspaper advertising, door-to-door selling, telephone selling, the internet, or television home-shopping channels.
The technique that is generally used for sales, marketing, advertising, evangelism or campaigning, in which the person or persons walk from the door of one house to the door of another, trying to sell or advertise a product or service to the general public or gather information. People who use this sales approach are often known as traveling salesmen.
In the 19th century, the American retailer, Aaron Montgomery Ward, believed that 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 a model for marketing products and creating customer loyalty. The term "direct marketing" was coined long after Montgomery Ward's time.
In 1872, Ward produced the first mail-order catalog 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 price.
Direct marketing is attractive to many marketers because its results, positive or otherwise, 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 the campaign led directly to a 10% conversion. 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.
Channels available include a variety of media: cell phone text messaging, email, websites, online adverts, database marketing, fliers, catalog distribution, promotional letters. Use of Television advertisements, newspapers, magazine advertisements, and outdoor advertising are not direct, although they may have a direct response aspect, such as an 800-number
Sending marketing messages through email or email marketing is one of the most widely used direct-marketing methods. One reason for email marketing's popularity is that it is relatively inexpensive to design, test, and send an email message. It also allows marketers to deliver messages around the clock, and to accurately measure responses
Relationship marketing refers to an arrangement where both the buyer and seller have an interest in a more satisfying exchange. This approach aims to transcend the post-purchase-exchange process with a customer in order to make richer contact by providing a more personalised purchase, using the experience to create stronger ties. A main focus on a long-term relationship with customers differentiates relationship marketing from other marketing techniques.
Thus relationship marketing revolves around gaining loyal customers. According to Liam Alvey, relationship marketing can be applied where there are competitive product alternatives for customers to choose from and an ongoing desire for that product. Research studying relationship marketing suggests that companies can do this through one of the three value strategies: best price, best product or best service. Hence companies can relay their relationship marketing message through value statements
According to process reengineering theory, organizations should be structured according to complete tasks and processes rather than functions. Thus cross-function teams should be responsible for a whole process from beginning to end rather than having the work go from one functional department to another, whereas traditional marketing uses the functional department approach where stages of production are handled by different departments. The legacy of traditional marketing can still be seen in the traditional four Ps of the marketing mix: pricing, product management, promotion, and placement. In contrast, relationship marketing is cross-functional, organised around processes that involve all aspects of an organization. In fact, some commentators prefer to call relationship marketing 'relationship management' because it involves much more than that which is included in normal marketing.
A principle of relationship marketing is the retention of customers in order to ensure repeated trade from preexisting customers by satisfying requirements above those of competing companies through a mutually beneficial relationship.This technique balances new customers and opportunities with current and existing customers to maximise profit and counteracts the leaky bucket theory of business, where new customers in older direct marketing-oriented businesses are gained at the expense of the loss of older customers. This process of 'churning' is less economically viable than retaining all or the majority of customers using both direct and relationship management because securing new customers requires more investment.
Many companies in competing markets redirect or allocate large amounts of resources towards customer retention. In markets with increasing competition, attracting new customers may cost up to five times more than retaining current customers because direct or 'offensive' marketing requires much more to cause defection from competitors. However, it is suggested that because extensive classic marketing theories center on means of attracting customers and creating transactions rather than maintaining them, the predominant usage of direct marketing used in the past is now gradually being used more with relationship marketing as the latter's importance becomes more recognizable.
Direct-to-consumer became immensely popular during the dot-com bubble of the late 1990s when it was mainly used to refer to online retailers who sold products and services to consumers through the Internet.[
This model dates back to before modern transportation and electricity. People consumed mostly locally due to large geographical distances, which they could overcome either on foot or by horse, but both usually took them days. Therefore, they established relationships with closest goods and service providers and this is what Direct-to-consumer models first looked like.
With farmers as a business, it could be argued they had a small but loyal pool of customers and operated on a small scale. The relationships were tight and healthy, because the switching costs for customers were pretty high, as said, due to geographical barriers and small number of competitors. Furthermore, there was much more space for personalization of business processes as farmers (among others, such as shoe repair master) knew exactly who their customers were and what they wanted.
Personal selling occurs when a sales representative meets with a potential client for the purpose of transacting a sale. Many sales representatives rely on a sequential sales process that typically includes nine steps. Some sales representatives develop scripts for all or part of the sales process. The basic process is perfecting the pipeline of Prospecting for customers, then presenting the customer the product offer. You then close the customer by convincing customer the benefits of product or services then Follow up through the sales pipeline process.
Modern direct selling includes sales made through the party plan, one-on-one demonstrations, and other personal contact arrangements as well as internet sales. Some sources have defined direct selling as: "The direct personal presentation, demonstration, and sale of products and services to consumers
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