Managing the Direct Marketing Supply Chain
Jim Boring
Once upon a time, a direct marketer would come up with an offer for a
particular market segment, work with a list provider to focus on likely
recipients, have its advertising agency develop a package for the offer,
send the package off to its printer, and then mail it.
The system had the advantage of being fairly straightforward; each
element in the supply chain could be measured according to its own
criteria, and the whole project could be measured by ROI.
That was then. Nowadays, a direct marketing offer can reach its
potential customers through print mailings, e-mail blasts, Website
offerings, television advertising, Internet promotions, social media,
and the rest of the traditional and new media channels.
Indeed, the supply chain itself now extends beyond mailing to include
order taking, fulfillment, and customer service.
To further complicate matters, each element of the supply chain has
become a sophisticated area of expertise, which requires corresponding
expertise from the direct marketer to properly vet and select among
suppliers.
Unless the direct marketer has its own expertise on staff-adding a
layer of cost and management-the marketer is dependent on outside
consulting organizations to perform the necessary supplier acquisition
process.
Globalization and virtualization (in the sense that a worldwide array
of production resources is now a virtual community) have enabled direct
marketers to precisely match production capabilities to a particular
project.
They are no longer dependent on the capabilities of a single printer,
and the convenience of having a local supplier has been eclipsed by the
cost savings inherent in a world of suppliers competing with each other
for their business.
Consultation on list definition and management, postal regulatory
counsel, package design, and data analysis-all these areas of expertise
are now available from companies based anywhere in the country or the
world. Virtualization has made every supplier easily accessible and
available.
These phenomena-globalization and virtualization-have given rise to
new players in the direct marketing business.
In response to the need of direct marketers and to the difficulty of
selecting from such a broad range of choices, and taking advantage of
unique production facilities, a class of marketing support companies has
come into being.
While some of these companies simply act as a negotiating interface
with potential suppliers, others are deeply involved in the vetting
process.
These latter companies narrow selection to a more manageable number
of highly qualified potential suppliers and become directly involved in
project management.
Some go even further and take on such tasks as assuring the financial
stability of suppliers.
The most ambitious of this class of companies provide expertise
across all the various print and digital media. How well they accomplish
this tricky feat depends on their own history.
Those grown from the print side of direct marketing tend to be better
on that side of the equation, while those with digital roots favour the
electronic media.
In either case, a direct marketer can use such companies as expert
managers of the supply chain to lessen the need for in-house expertise,
facilitate the production process, reduce costs, and improve return on
investment. Salesandmarketing.com |