Blog.
An introduction to direct marketing

By Tash Ward
 

Digital retail media has created a host of new ad formats, enabling brands to engage with customers in innovative ways like sponsored search and personalised offers. As exciting as those opportunities can be, though, tried-and-tested techniques like direct mail and printed vouchers can still deliver immense value – particularly when used as part of a connected, multi-channel campaign.

In our final article in a series investigating the many opportunities of retail media, Tash Ward turns to the subject of direct marketing in the world of grocery – including a comprehensive overview of its role within the Tesco Media & Insight Platform.

There’s something very special about direct marketing. At a time when our experiences are becoming increasingly digitised – particularly our interactions with brands – physical incentives are becoming increasingly unique. Be it a mailing through the door, or a voucher handed over at the till, direct marketing delivers at a distinctly personal level. Importantly, it works, too; 96% of consumers are engaged by direct mail, according to one recent study[1].

Effective as direct marketing can be, though, it can also be a tactic that’s difficult for consumer brands to employ. An effective direct marketing campaign demands an extensive distribution network, and an equally sizeable customer database – neither of which are things that brands typically have. That’s where direct marketing as a form of retail media comes into its own.

Direct marketing is a key component within the Tesco Media & Insight Platform, where it goes by the name of CRM. Underpinning CRM is data from more than 20m Tesco Clubcard holders, the UK’s largest behavioural dataset. That data enables brand advertisers to be incredibly strategic in their approach to audience targeting, and also supports comprehensive measurement and campaign evaluation capabilities.

Two products sit at the heart of CRM: Direct Mailings and Coupon at Till. Presenting an opportunity to engage shoppers both at home and in-store, these complimentary products enable brands to achieve a wide range of marketing objectives – from encouraging customers to test out new products through to rewarding loyalty. Here’s what each offers.

Direct Mailings

Delivered straight to their doorstep, Direct Mailings are a great way to engage with customers in the comfort of their own homes. Eye-catching visuals can be combined with a wide range of creative mechanics, from coupons and incentives through to free trials and invitations to in-store events. Available formats include postcards, four- and six-page brochures, and product sampling packs.

With the aid of Tesco Clubcard data, Direct Mailings can also be targeted around specific audiences, ensuring that the customers who receive your message are those who are most likely to take action as a result. That data also makes it easy to measure campaign performance, providing clear insight into how many people redeemed a coupon or bought your products having received a mailer.

Direct Mailings provides three different campaign options:

  • Solo Mailing – bespoke mailers designed to support specific objectives like customer acquisition.
  • Category Mailing – mailings that address broader, category-wide objectives like seasonal events.
  • Themed Mailing – multi-category mailings that speak to specific shopping missions like Back to School.
Coupon at Till

Whether they’re used to encourage repeat purchasing behaviours, win back lost customers, or do something else entirely, discounts can be an excellent motivator. Coupon at Till helps you inspire shoppers to take action, delivering personalised incentives that are given to customers at the till or added straight to their coupon wallet in the Tesco Grocery & Clubcard app.

Allowing you to engage with anywhere between 10,000 and 350,000 Tesco shoppers at a time, Coupon at Till has an average redemption rate of 5 – 10%, making it a highly effective way to create the response you’re looking for. Customers are pre-selected to receive coupons based on prior purchases, maximising relevance and creating the greatest chance of success.

At its core, CRM provides an opportunity to inspire shoppers to take action. 67% of Tesco customers say that they are motivated by promotional offers, for instance, and 72% that they are encouraged to try out a product when given a free sample. From rewarding loyal customers to winning back lost ones, CRM gives you everything you need to achieve cut-through and spark a response.

This is the final post in our series exploring the fundamentals of retail media in the grocery sector. To learn about some of the other ways in which you can reach Tesco customers, check out our accompanying posts:

[1] What is The Response Rate From Direct Mail Campaigns? – Data & Marketing Association, 21st May 2021