Direct Marketing Worldwide

Questions: 1. What are the main factors which determine whether an individual uses extended problem-solving or limited problem-solving? 2. What is the difference between direct marketing and junk mail and what have been the key drivers of the worldwide growth of direct marketing? Answers: 1. Main factors that determine behaviour of a consumer at the time of purchasing The decision making process is very important to every seller. The decision making process of a consumer can be defined by the process that the consumer undergoes while making any purchase of a product or service. This decision making process depends on various factors especially upon their past, current and future life situations. These factors influence what product or service the consumer will buy and in what amount. Therefore, it is very important for a seller to understand this decision making process of the consumers while making the product or service. Otherwise, it is impossible to satisfy the consumers requirement accurately. The decision making process of a consumer comprises of five steps viz. i) recognition of a product or service ,ii) information search about the product or service, iii)looking for and the evaluation of the perfectly substitute product, iv) purchase of the product, v) post-purchase analysis of the product(feedback about the product or service) (2012books .lardbucket.org, 2015). The decision making process or the buying behaviour of the consumer can be classified into different parts. These are 1) extended problem solving behaviour, 2) limited problem solving behaviour and 3) habitual problem solving behaviour. Among these three types behaviours, the first two behaviours are very important. In the following paragraph, the influencing factors behind these two behaviours will be discussed (Basic Reasons for the Growth of Direct Marketing, 2015). Extended problem solving behaviour: The situation of the problem solving behaviour arises when the consumer does not know anything about a product or service. The class, brand, main features of the product or service are not known to the potential customers and due to this unawareness, the consumer cannot be able to evaluate the product or the service. To know about this information, the consumers have to depend on the seller of the product. Limited problem solving behaviour: The situation of the limited problem solving behaviour occurs when the consumer knows the class of the product or service he /she wants to buy and also the major brands of the product or service and their attributes and features. But the consumer is not aware of some brand of the same product. This unawareness creates a lot of confusion in the consumers mind at the time of purchasing. In this situation, the purchase decision of the consumer solely depends on the information provided by the seller of the unfamiliar brand. This information in turn helps the consumer to make a comparison and evaluation between the known and unknown brands of the product or service (Belch and Belch, 2009). In case of extended problem solving behaviour (EPS), the consumer tries to gather as much as possible information about the product or service they want to purchase. In this situation, the decision of the consumer involves a high degree of risk. However, in limited problem solving (LPS) consumers have some idea before and, therefore, have to compare between little alternatives. Hence, this decision making process involves low risk. The factors that are affecting the buying decision making process are advertisement published, the physical situation of the consumer, the social situation, time situation, the reason behind the purchasing and the current mood of the consumer (Belch and Belch, 2009). The advertisement helps the consumer to know about different brands of a particular product and their respective features. The interior design, the location, the atmosphere of a store, the presence of customer care executives in store some time influences the consumers buying process. Also cro wding in a store is another significant situational factor that may define the buying process. The current social status and perceived future status of the consumer influences the consumer in making their purchase decision. The time of the shopping may affect the consumer either positively or negatively. The reasons behind the purchase i.e. whether the consumer has urgent need of the products or not also determines the decision making process and lastly the mood of the consumer while purchasing affects the consumers decision. Reference 1: 2012books.lardbucket.org, (2015).Consumer Behavior: How People Make Buying Decisions. [online] Available at: https://2012books.lardbucket.org/books/marketing-principles-v1.0/s06-consumer-behavior-how-people-m.html [Accessed 23 Aug. 2015]. HubPages, (2015).Principles of Marketing - Buyer Behavior. [online] Available at: https://hubpages.com/hub/Principles-of-Marketing-Part-2-Buyer-Behavior [Accessed 23 Aug. 2015]. Study.com, (2015).Understanding the Consumer Decision-Making Process: A Marketing Must - Video Lesson Transcript | Study.com. [online] Available at: https://study.com/academy/lesson/understanding-the-consumer-decision-making-process-a-marketing-must.html [Accessed 23 Aug. 2015]. YourArticleLibrary.com: The Next Generation Library, (2013).5 Factors Influencing Consumer Behaviour | Explained. [online] Available at: https://www.yourarticlelibrary.com/products/5-factors-influencing-consumer-behaviour-explained/22163/ [Accessed 23 Aug. 2015]. 2. Digital marketing is now viewed as a more effective marketing strategy to make the potential customer aware of a product of a company irrespective of the current location of the consumer and also at low cost. The digital marketing can be done either using the direct mail or using the junk mail. There is a clear difference between direct mail and junk mail. The latter mail is sent to the entire potential customer irrespective of their interest in the product mentioned in the email. However, the direct mail is those mail which is sent to only those consumers who are actually interested in the product and its all the relevant information like price, features, etc. This difference between these two types emails should be understood by the producer so that they can reach their targeted customer accurately (Hackley, 2010). Direct marketing through direct mailing enables both the customer and the producers to do one-to one communication and the producer can get an accurate response about its product that is not possible through junk mail. The consumer also on the other side can be able to place the entire query regarding the product or service. The main difference between the direct mail and the spam mail is the last one is sent to the automatically selected potential customers from some database. The sending of junk mail to the potential customer does not require any permission from them. However, the direct mail is sent to only customized consumers who are actually interested in the purchase of the product. In the promotion of a new product or in marketing campaigning, both mails are useful but the effectiveness of direct mail is much higher than the junk mails (HubPages, 2015). The key drivers of the worldwide growth of direct marketing Direct marketing can be defined as an interactive marketing system that uses different advertising medium to influence and also get responses from both the potential and actual customers. This direct marketing enables both the economic agents i.e. customers and producers to make an effective communication. This direct marketing helps the producers to deliver the information and the offer of the product. On the other hand, the consumers are also able to make a query regarding the product to the consumers directly through the direct marketing. The direct marketing can be done in various ways such as direct mail, campaigning programme in some departmental store, marketing programme in different television and radio channel, telephone calls. Among these various ways, the most effective means is direct mail. This direct mail helps the producers to reach the customers irrespective of their location. The cost of this type of market expanding strategy is very low and easy to access and contr ol. The direct marketing is growing tremendously than the traditional marketing over time. The key drivers of this tremendous growth in the worldwide direct marketing are increasing the growth of electronic media. Now media can significantly influence the customer to purchase any products. The other causes are increasing use of computer and electronic database. This electronic database enables the producers to store a large amount of customer information and use them within a second. The third driver is continuous improvement in the communication technology. This improvement helps the both party to make conversation if they require any time. The fourth factor is a continuous change in a type of the marketplace (Schultz and Kitchen, 2000). Lifestyle change and demographic change are other important factors of the growth in direct marketing. Economic development and the increasing international competition due to the globalization are also responsible for the worldwide growth of the d irect marketing. References 2: Basic Reasons for the Growth of Direct Marketing. (2015). [online] Available at: https://www.managementparadise.com/forums/principal-practice-direct-marketing/207429-basic-reasons-growth-direct-marketing.html [Accessed 23 Aug. 2015]. Belch, G. and Belch, M. (2009).Advertising and promotion. Boston: McGraw-Hill Irwin. Hackley, C. (2010).Advertising and promotion. Los Angeles: SAGE. Schultz, D. and Kitchen, P. (2000).Communicating globally. Lincolnwood, Chicago, Ill.: NTC Business Books.