LONDON--(BUSINESS WIRE)--According to the latest procurement intelligence report from Technavio, the global market for direct marketing services is expected to grow at a CAGR of 4.5% over the next five years due to return to direct marketing strategies owing to the content overload from multiple digital channels.
The research report titled ‘Global Direct Marketing Services: Procurement Intelligence Report 2017-2021’ provides an in-depth analysis of category spend, best procurement practices and cost saving opportunities, aimed at helping organizations achieve superior business performance. The report also provides insights on pricing, supplier positioning and top companies, enabling sourcing professionals to improve their competitive advantage through procurement excellence.
“During the forecast period, brands are expected to return to direct marketing strategies to target specific segments with customized content. Direct marketing channels, such as direct mail, generate the highest response rate in the industry,” says lead Technavio procurement expert Angad Singh for category spend intelligence. “Also, marketers are leveraging the power of digital channels to create a multi-channel strategy by integrating direct mail with digital channels via QR codes and PURL,” adds Angad.
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Cost Saving Opportunities in the Direct Marketing Services Market
The adoption of various cost-optimization levers helps buyers of direct marketing services realize direct cost savings and enhance category management and value benefits (including reduced procurement complexities).
Technavio procurement experts have segmented the cost saving opportunities in the direct marketing services market into the following value-enhancement opportunities:
- Adoption of technology
- Supplier Competition
- Adoption of negotiation strategies
- Optimization of procurement practices
- Bundling of services
Adoption of technology saving aspects
Incorporation of technologies such as QR codes and scanners; augmented reality, location-based marketing; and social media integration will enable the supplier to offer unique and customized solutions for the target market to generate interest about the product/service.
Due to the limited attention spans of consumers, it is essential that campaigns are designed creatively and are backed by relevant customer insights. The success of a direct marketing campaign depends on the response rate it generates. This is measured through specific call-to-action buttons such as a toll-free number, which help convert prospective sales leads into customers.
Adoption of negotiation strategies saving aspects
Adoption of negotiation strategies is a critical cost saving opportunity in the direct marketing services market. It is imperative to implement value additions such as consultative support and project management.
Buyers engage with suppliers that possess target-oriented and permissioned customer lists in direct marketing campaigns. These lists should be backed by sufficient research and must be dynamically updated to avoid violating industry regulations such as DNC. It is essential to identify the target segment to ensure a high response rate leading to desired penetration and ROI.
Bundling of services saving aspects
One of the most opportunistic strategic cost saving levers in the global marketing services market is the Bundling of services such as analytics and customer call data analysis to help buyers understand the customer's mindset better.
Marketing agencies are required to design call-to-action buttons that are refreshing, unique, and can encourage customers to respond. Buyers look for agencies that offer out-of-the-box, creative solutions that leverage customer insights to design campaigns that are unique and resonate with the customer.
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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