# Direct Marketing: What It Is and How It Works

> **Definition**
>
> Direct marketing is a form of advertising without using a third party.

## What Is Direct Marketing?

Direct marketing is a form of advertising that consists of any promotion that relies on direct communication or distribution to individual consumers rather than through a [third party](https://www.investopedia.com/terms/t/third-party.asp), such as mass media. Mail, email, social media, and texting campaigns are among the delivery systems used. It is called direct marketing because it generally eliminates the middleman, such as advertising media.

### Key Takeaways

*   Direct marketing relies on direct communication or distribution to consumers rather than through a third party.
*   Mail, email, social media, and texting campaigns are commonly used in direct marketing.
*   The call to action is a common factor in much of direct marketing.
*   The most effective direct marketing campaigns use lists of targeted prospects.
*   The effectiveness of direct marketing is easier to measure than media advertising.

![Direct Marketing: Distributing a sales pitch to individual consumers.](https://www.investopedia.com/thmb/eM95KMXkXchvdSqf3jjUlhLZ2mY=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/terms_d_direct-marketing_FINAL-f379da27ee5841a78cfb7b6b2658760f.jpg)

*— Investopedia / Daniel Fishel*

## How Direct Marketing Works

Unlike traditional public relations campaigns pushed out through a third party like media publications or mass media, direct marketing campaigns directly communicate with target audiences.

In direct marketing, companies deliver their messaging and sales pitches by [social media](https://www.investopedia.com/terms/s/social-media.asp), email, mail, phone/SMS, and door-to-door visits. Although the number of communications sent can be massive, direct marketing often attempts to personalize the message by inserting the recipient's name or city in a prominent place to increase engagement.

The [call to action](https://www.investopedia.com/terms/c/call-action-cta.asp) is an essential part of direct marketing. The recipient of the message is urged to immediately respond by calling a toll-free phone number, sending in a reply card, or clicking on a link in a social media or email [promotion](https://www.investopedia.com/terms/p/promotion.asp). Any response is a positive indicator of a prospective purchaser. This variety of direct marketing is often called direct response marketing.

> **Fast Fact**
>
> Opt-out options makes it harder for companies to track whether their direct marketing works.

## Targeting in Direct Marketing

A direct marketing pitch that is delivered to the widest possible audience is probably the least effective. With that strategy, the company may gain a few customers while annoying all of the other recipients. Junk mail, spam email, and texting all are forms of direct marketing that many people can't get rid of fast enough.

The most effective direct marketing campaigns use lists of targeted prospects to send their messages only to the likeliest prospects. For example, the lists might target families who have recently had a baby, new [homeowners](https://www.investopedia.com/articles/mortgages-real-estate/09/new-homeowner-tips.asp), or recent retirees with products or services that they are most likely to need.

Catalogs are the oldest form of direct marketing, with a history that dates back to the latter half of the 19th century. In modern times, catalogs are usually sent only to consumers who have indicated an interest in a previous purchase of a similar product.

> **Important**
>
> A lot of direct marketing takes place on the internet. Platforms of choice include social media and email.

Social media has emerged as the most modern form of direct marketing. Targeting strategies can also be used on social media when putting out ads; platforms like Facebook allow brands to choose the age, gender, demographics, and even interests of potential new audiences that an ad could reach.

Many companies engage in [opt-in or permission marketing](https://www.investopedia.com/terms/p/permission-marketing.asp), which limits their mailing or emailing to people who have indicated a willingness to receive it. Lists of opt-in subscribers are particularly valuable as they indicate a real interest in the products or services being advertised.

## Advantages and Disadvantages of Direct Marketing

### Advantages

*   Direct marketing is one of the most popular and effective marketing tools to establish a direct connection with a target audience. As the world becomes increasingly connected through digital platforms, social media becomes an effective way to market to customers.
*   Direct marketing has its appeal, particularly to companies on a shoestring budget who can't afford to pay for television or internet advertising campaigns.
*   The effectiveness of a [direct marketing campaign](https://www.investopedia.com/articles/personal-finance/053015/how-calculate-roi-marketing-campaign.asp) is easier to measure than other types of advertising since brands can analyze their analytics, track unique source codes, and tweak strategies effectively without going through a middleman. The company can measure its success by how many consumers make the call, return the card, use the coupon, or click on the link.

### Disadvantages

*   It may seem intrusive and can result in low response rates, especially when marketing tools like emails and mailouts end up in junk mail. This is an indication that the company and its brand aren't reaching their target audience.
*   The main drawback with direct marketing is the profile-raising and image-building that comes with a third party accrediting your brand. A sponsored article, say, in _The New York Times_ can cost a lot of money.  
    
*   It's often hard to stand out among the competition. Companies may find it difficult to get ahead of the pack in an environment where everyone is trying to get the attention of consumers for their products and services using direct marketing tools. Consumers can be overloaded with a high volume of marketing materials.  
    

Pros

*   Popular and effective
    
*   Low-cost if done properly
    
*   Allows companies to track and measure their success  
    

Cons

*   May seem intrusive and lead to low response rates  
    
*   Third-party relationships may cost a lot
    
*   Too much competition
    

## Which Is an Example of Direct Marketing?

An example of direct marketing is a company sending promotional emails about its products or services directly to potential customers. Most companies periodically reach out to consumers who agreed to receive communications in a bid to sell them something. The email may flag a special offer, new product range, or the fact the company sells something that is currently popular or in season.

## What Is Direct and Indirect Marketing?

Direct marketing involves explicitly trying to sell goods or services to customers. Indirect marketing, on the other hand, is marketing without trying to sell a specific product or service. An example of indirect marketing is writing and sharing a blog post or newsletter.

## What Is the Aim of Direct Marketing?

The aim of direct marketing is to boost awareness and sales. If successful, the communication will familiarize the consumer with the company and tempt them to make a purchase and tell others about it.

## The Bottom Line

Marketing strategies are often broken down into types. One of these types is direct marketing, which, as the name implies, involves advertising straight to the consumer rather than through a third party such as the media. Methods of communication include email, social media, mail, phone calls, text messages, and knocking on doors, and the most effective campaigns are based on targeting people who have previously expressed an interest or who match the targeted demographic.

> **Article Sources**
>
> 1.  Smithsonian, National Postal Museum. "[Catalogs and the Mail Order Industry](https://postalmuseum.si.edu/exhibition/america%E2%80%99s-mailing-industry-industry-segments/catalogs-and-the-mail-order-industry)."
>     
> 2.  Smithsonian, National Postal Museum. "[Direct Marketing, Advertising Agencies, and Designers](https://postalmuseum.si.edu/exhibition/america%E2%80%99s-mailing-industry-industry-segments/direct-marketing-advertising-agencies-and)."
>     
> 3.  Meta. "[Audience Ad Targeting](https://www.facebook.com/business/ads/ad-targeting)."