Direct marketing
A Reader's Digest case study

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Page 5: Marketing

Marketing is a process of planning which involves identifying, anticipating and satisfying consumer needs. The process starts with an understanding of what people want, upon which an ‘idea’ can be developed. Many people have ideas but few make them ‘happen.’ From the idea comes a plan and then a process of production and market research, from which will come the product which consumers want, at a price they are willing to pay. This is not the end of the process. When an organisation develops products, it has to reach its customers not just to inform them about the product and persuade them to buy one, but also to create a way of distributing the product to them. For an organisation to succeed it must be able to do this better than any other competing organisations. But this is not the end of the process.

Consumers have choice and who is to guarantee that they will continue to buy your products? There must be an understanding of changing consumer needs and feedback into this process so that a business can become better and better at satisfying these needs. The beauty of Reader’s Digest, is that it covers a high quality mass market with a broadly-based general appeal, providing something for everybody. To do this involves talking to customers to find out what they want more or less of. A variety of market research techniques are often used.

Feedback

Questionnaires have been developed to elicit information from customers. One-to-one interviews help to discover consumer motives and focus groups and group discussions provide a wealth of qualitative information which often uncover subconscious consumer motives. This type of research enables Reader’s Digest to cater for changes in consumer tastes, while at the same time reflecting a broad spectrum of interests and the ability to develop products with enduring values which inform, enrich, entertain and inspire.

Direct mail involves selling goods or providing services outside the confines of a retail outlet and with no face-to-face contact. Reader’s Digest is a subscription based business. Developing personal relationships with readers through the mail is a hugely important part of Reader’s Digest’s business strategy. The effective use of databases helps Reader’s Digest to develop a good understanding of consumers from whom their mail shots elicit a remarkably high response rate. When customers receive mail from Reader’s Digest they tend to read it and because the products are what customers want and have massive appeal, many respond.

Reader’s Digest’s response rate is an important factor, not just for Reader’s Digest but also for its advertisers. For a recent competition in the magazine, 100,000 envelopes were returned in less than a month. Subscribers react promptly to the Digest’s arrival - 36% will read it the day the post delivers it, 62% within 3 days and 82% by day 8. Reader’s Digest offers advertisers a variety of response options – a range they can not get from television - from cover gatefolds and loose inserts to a bound-in business reply card.

For Reader’s Digest to appeal to the mass market, it has to be priced carefully in a way which provides value for customers and satisfies their expectations so that they continue to subscribe and yet at the same time provides financial returns for the business. Post magazine research carried out on each issue of the magazine, helps Reader’s Digest to build upon its strengths in a way which enables it to touch the lives of its readers, not just through the magazine, but also through families of products such as books, CDs and videos, which help to underpin its success. The essential feature of Reader’s Digest is that, given its many competitors in a fast-growing magazine industry, it has a unique position, with no direct competition in a mass market and with the capability to deliver a high-quality product which no other business can match.

Reader's Digest | Direct marketing
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