DIRECT SALES: Never Mind the Big Etailers?
Pay close attention to ROI. Some of Shambhala's direct selling initiatives have succeeded in reaching new audiences but did not produce the hoped-for payoff. The company tried breaking out "sub-niches" and sending targeted catalogs to them, as well as putting scaled-down versions of its catalogues in a magazine as a tip-in, but neither of these efforts justified the extra cost. "It saved us the postage and the cost of the list," Jacobs said of the magazine tip-in, "but we did have to pay for the ad space, and it did not seem to generate enough sales for us to continue to do that."
Social media is great, but not proven as a direct sales tool. Social media such as Twitter and Facebook "requires a great amount of resources, but it's really questionable how to measure the effectiveness of it," he says. "Shambhala has over 25,000 likes but we're not sure how that translates to sales. Are they potential customers or just looking to win a contest [on Facebook]?
Vice President of Marketing
National Geographic knows a thing or two about direct sales, having gotten into the book business through direct sales of books to its members. The organization has diversified its sales channels since the 1990s but still sees a significant amount of book revenue from direct sales. Having a strong distribution backbone is key, Vincent says. "But there are so many new and exciting ways to reach the consumer now."
Direct sales require a direct approach. Like Shambhala, National Geographic's direct sales success is rooted in direct marketing efforts, especially direct mail campaigns to association members receiving National Geographic magazine. In the last few years, catalog and website sales have become increasingly important, as has direct-to-consumer contact through social media, Vincent says.