Direct Response Marketing Definition, Objectives, Key Characteristics, and Resources
There are two major types of marketing strategies: branding (or mass marketing) and direct response marketing. Only one of these strategies gives cut through for small businesses.
WHAT IS BRANDING?
Branding is a type of advertising that aims to remind customers and prospects of your brand as well as the products and services you offer. The idea is that the more times you run ads from your brand, the more likely people are to have your brand at the top of their consciousness when they go to make a purchasing decision.
If you’ve seen the ads from major brands such as Coca-Cola, Nike and Apple you’ll have experienced “image” marketing. The vast majority of advertising falls into this category.
WHO BENEFITS FROM BRANDING?
There’s no doubt that branding or mass marketing is effective, but here’s why it’s not for everyone.
1. It is very expensive to successfully pull off.
2. It takes a lot of time.
It requires you to saturate various types of advertising media e.g. TV, print, radio, Internet, etc. on a regular basis and over an extended period of time. The expense and time involved are not a problem for the major brands as they have massive advertising budgets and product lines which are planned years in advance.
However, a problem arises when small businesses try to imitate the big brands at this type of marketing.
A study by Outbound Engine found that 55% of small to medium business owners spend less than 5% of their annual revenue on marketing. So, the few times they run their ads is like a drop in the ocean. It’s nowhere near enough to reach the consciousness of their target market who are bombarded with thousands of marketing messages each day.
They get drowned out and see little or no return for their investment.
It’s not that small businesses aren’t able to create good “branding” or mass media ads. It’s that they simply don’t have the budget to run their ads in sufficient volume to make them effective. Unless you have millions of dollars in your marketing budget, you have a very high probability of failure with this type of marketing.
WHAT IS DIRECT RESPONSE MARKETING?
Direct response marketing is designed to evoke an immediate response and compel prospects to take some specific action, such as opting in to your email list, picking up the phone and calling for more information, placing an order or being directed to a web page.
WHO BENEFITS FROM DIRECT RESPONSE MARKETING?
All businesses, small, medium, and large, will benefit from direct response marketing. But here’s why it should be the only option for owners of small-to-medium-sized companies.
Research by Leadpages found that the top two digital marketing priorities for small business are driving sales (51.3%) and building brand awareness (48.4%).
Hubspot’s 2019 State of Inbound Marketing report revealed that the top marketing challenges for small-to-medium-sized businesses are:
- Generating traffic and leads – 63%
- Proving return on investment – 40%
- Securing enough budget – 28%
Direct response marketing ticks all of these boxes. It focuses on lead generation. It doesn’t cost a lot, and it’s trackable. A good marketing team will monitor the number of leads they get and how many convert to paying customers. This means that your direct response campaign is measurable. It quickly delivers a return on investment, making it ideal for small to medium-sized companies.
DIRECT RESPONSE MARKETING VS BRANDING
Direct Response Marketing differs from branding in that it targets a hyper niche audience and uses compelling messaging to get an immediate response. So, it will most likely offer a solution to a problem that their audience is grappling with.
Here’s a great example. Melyssa Griffin wrote a blog post on 6 Strategic Ways to Actually Make More Money with your Email List. Now this is something that small business owners or entrepreneurs who are struggling to get new leads and convert them to customers might google.
So, she creates her blog post and a nice looking image, and uploads it to the likes of Pinterest, Instagram, Facebook, and Google.
If she’s done her SEO homework, anyone searching for How to make more money with your email list will be served her content. One click and you can read her blog post where she explains the six steps that have worked to scale her email list.
Her article shares insightful advice and actionable tips based on her experiences. But she also offers a FREE Sales Funnel Cheatsheet that you can download and use to strategize how you will grow your list.
This is direct response marketing in action. At no point has she sold a service. Instead she’s:
- Delivered value
- Established credibility
- Positioned herself as an authority
- Offered an ethical bribe (which I’ll go into more detail below)
- Begun to build trust.
Now branding or mass marketing targets everyone and focuses on building brand awareness. It doesn’t require immediate buy-in or that the consumer take action. For example, let’s look at this Coca-Cola ad.
Now everyone knows Coca-Cola. They’ve been marketing since the 1950s so they don’t have to offer value to get buy-in. They can spend tons of money on pretty and feel-good adverts because their target audience is massive. They already know and like their product.
They don’t need to convince someone to buy it. This ad doesn’t even show the entire product. Half of the ad is dedicated to the logo and the other half a simple line, open a Coke, open happiness.
As a small business owner, if you tried this with a brand that very few people know, it wouldn’t drive an action. People wouldn’t think, I’m going to go out and buy that now. Remember, they don’t know you or trust you, so how can you create an advert that grabs their attention?
WHAT IS A DIRECT RESPONSE AD?
While most ads focus on name recognition, direct response ads, in comparison, focus on acquiring leads.
Let me be clear, that while direct response ads include a call-to-action, the point is not to sell.
It’s about getting people who are interested in what you do to raise their hand and say I want to know more. These leads are then channeled into a follow-up database (or sales funnel) so that you can deliver value, position yourself as an authority, and create a relationship built on trust.
8 CHARACTERISTICS OF A DIRECT RESPONSE AD
So what makes a direct response ad? Here are some of the main characteristics:
1. It’s trackable.
That is, when someone responds, you know which ad and which media was responsible for generating the response. This is in direct contrast to mass media or “brand” marketing – no one will ever know what ad compelled you to buy that can of Coke, heck you may not even know yourself.
What’s more pressing is that you actually track your ads. A survey by Blue Corona Media revealed that less than 30% of small businesses use website analytics or call tracking, and 18% admit to not tracking anything. What gets measured, gets managed. You can’t improve your numbers if you don’t track and measure the results.
2. It’s measurable.
Since you know which ads are being responded to and how many sales you’ve received from each one, you can measure exactly how effective each ad is. You then drop or change ads that are not giving you a return on investment. The point is that measuring, managing and improving your key marketing numbers, even by an incremental amount, can have a massive impact on the end result.
3. It uses compelling headlines and sales copy.
Direct response marketing has a compelling message of strong interest to your chosen prospects. It uses attention-grabbing headlines with strong sales copy that is “salesmanship in print”. Often the ad looks more like editorial than an ad (hence making it at least three times more likely to get read).
4. It targets a specific audience or niche.
Prospects within specific verticals, geographic zones or niche markets are targeted. The ad aims to appeal to a narrow target market. Your goal should be to become a big fish in a small pond.
5. It makes a specific offer.
Usually the ad makes a specific value-packed offer. Often the aim is not necessarily to sell anything from the ad but to simply get the prospect to take the next action, such as requesting a free report.
The offer focuses on the prospect rather than on the advertiser and talks about the prospect’s interests, desires, fears and frustrations. By contrast, mass media or “brand” marketing has a broad, one size fits all marketing message and is focused on the advertiser.
6. It demands a response.
Direct response advertising has a “call to action”, compelling the prospect to do something specific. It also includes a means of response and “capture” of these responses.
Interested, high probability prospects have easy ways to respond such as a regular phone number, a free recorded message line, a website, a fax back form, a reply card or coupons. When the prospect responds, as much of the person’s contact information as possible is captured so that they can be contacted beyond the initial response.
7. Multi-step, short-term follow-up.
In exchange for capturing the prospect’s details, valuable education and information on the prospect’s problem is offered. The information should carry with it a second “irresistible offer” – tied to whatever next step you want to prospect to take, such as calling to schedule an appointment or coming into the showroom or store. Then a series of follow-up “touches” via different media such as mail, e-mail, fax, phone are made. Often there is a time or quantity limit on the offer.
8. Maintenance follow-up of unconverted leads.
People who do not respond within the short-term follow-up period may have many reasons for not “maturing” into buyers immediately. There is value in this bank of slow-to-mature prospects. They should continue hearing from you once to several times a month.
For example, let’s look at this LinkedIn Marketing Solutions (LMS) ad.
- As a promoted post on LinkedIn, LMS can track how many times the ad was served to prospects and who clicked on it.
- It uses an enticing headline and compelling copy: The stories of six lead generation campaigns that drove real business results.
- It makes a specific offer: It will show you how to build a sophisticated lead generation strategy on LinkedIn.
- It includes a call-to-action: Learn more
- On clicking the link you are taken to a page to read the article, and a pop-up asks if you’d like to subscribe to the blog. You have to input your email address to subscribe to the blog. It includes a multi-step, follow-up form:
WHAT IS DIRECT RESPONSE COPYWRITING?
Direct response copywriting is copy that is designed to push the emotional hot buttons of your target audience. Many businesses, especially those that sell products and services to professional or business customers, feel like this type of copy is not appropriate for their market. You couldn’t be more wrong.
Whether you are marketing to the director of a multi-million dollar business or a stay-at-home mom, you are selling to humans. We are all emotional beings. While we might like to think we make decisions based on logic, our choices are driven by our emotions and justified with logic.
So you need to write your sales copy as though you were talking directly to a single person. You need to get into their heads and spend a day in their shoes. What are their struggles, and how can you help?
Forget about B2B and B2C.
Focus on H2H, human-to-human marketing.
Here are my five top tips:
- Remember, one ad, one focus. Don’t jam-pack your copy with loads of unnecessary information. This will only confuse your prospect. Choose the focus of your ad and only include relevant information.
- Use an eye-catching headline. Headlines are one of the most important elements in your sales copy. Their job is to grab the attention of your target market and get them to start reading your body copy. The headline is basically the ad for the ad and should encompass the self-serving result your reader will get.
- Keep it short and succinct. Don’t waffle in your body copy. Use bullet points, headers, italics and numbers to break up copy. People often skim read, so you want to make sure that you give them all the information they need.
- Include a must-have offer. It’s your job to create an exciting and radically different offer from that of your competitors. One of the main reasons marketing campaigns fail is because the offer is lazy and poorly thought out. It’s something crappy and unexciting like 10% or 20% off. The offer is one of the most important parts of your marketing campaign, and you need to spend much of your time and energy on structuring this correctly.
- Create a sense of urgency. This could be something like limited time only, offer expires in 24 hours, or while stock lasts. Creating a sense of urgency puts pressure on your prospect to make a much quicker decision than they would normally.
It’s a major mistake to discount emotional direct response copywriting.
Here’s an example I found, that utilizes most of the characteristics of direct response copywriting.
- Ad focus: How to grow your business with live event and webinars. Something that many businesses with high-ticket clients are trying to do these days.
- Eye-catching headline: Wealth from workshops
- Establishes credibility up front: Mentioning where the company has been featured and that it was named in BRW Fast100 Company establishes credibility upfront.
- Perceived value: Words like “step-by-step formula” and “smartest way to build a business” play on your emotions. It suggests that they’ll give you a formula for success. Wouldn’t you rather use a tried a tested method that winging it on your own?
- To the point copy: The ad gives the prospect all the information they’d need to make a decision.
- Must-have offer: Free 1-day course. Who doesn’t like things that are FREE. This will always be compelling to a prospect.
- Sense of urgency: Although the ad doesn’t explicitly state limited offer or time running out, we know that we might not see it again. We also know that the webinar should take place soon, so most people will click through immediately.
While it’s not the best design, it knows it’s target market, and delivers the information that would make them act. They get to attend a free event which will likely deliver actionable advice, and the business gets to build its database.
WHY DIRECT RESPONSE MARKETING IS MONEY AT A DISCOUNT
Direct response marketing is a highly ethical way of selling. It’s focused on the specific problems of the prospect and aims to solve these problems with education and specific solutions. It is also the only real way for a small business to affordably reach the consciousness of a prospect.
Your marketing system must deliver profitable results. You have to know what a customer is worth to you, and then decide what you are reasonably willing to invest to acquire one, and then build systems that work within that limit.
Direct response is an accountable way to run marketing for a small business, as it is highly focused on return on investment.
If $10 bills were being sold for $2 each, how many would you buy?
The name of the game with direct response marketing is ‘money at a discount’ e.g. $2 into advertising to get $10 out in the way of profits from sales. When you turn your ads into direct response ads, they become lead generating tools rather than just name recognition tools.
I wrote the 1-Page Marketing Plan: Get New Customers, Make More Money And Stand Out From The Crowd because I’d been that business owner struggling to figure out how to win at the marketing game. I’d spent thousands of dollars on bad advertising that didn’t bring in leads or make a sale. It took me ten years to crack marketing my business, and that was ten years too long.
I wanted to give business owners a blueprint that they could use to build a strategic marketing plan that was designed to propel their business growth. The book is an implementation breakthrough. It will show you how to create and implement a sophisticated direct response marketing plan for your business.
Download the 1PMP Canvas to create your strategic marketing plan now.
DIRECT RESPONSE MARKETING INFOGRAPHIC
Whether you’re new to marketing your small business or you just want a reminder of the key characteristics of a direct response ad, get our free infographic now.
DIRECT RESPONSE MARKETING INFOGRAPHIC
- What is branding?
- Who benefits from branding?
- What is direct response marketing?
- Who benefits from direct response marketing?
- Direct response marketing vs branding
- What is a direct response ad?
- 8 characteristics of a direct response ad
- What is direct response copywriting?
- Why direct response marketing is money at a discount?