Saturday, February 11, 2012
   
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Operating a Direct Marketing Firm for Limitless Returns

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Sales is everything. No comapny can declare profit if sales are not made. The money to pay staff and the CEO, expand the business and all that comes from the sales of the product the company produces. To this end, several large companies have their sales and marketing departments. This department is constantly at work to ensure that the company’s products do well in the market. Some establishments engage the services of logistics companies to ensure nationwide coverage of their products. Not every establishment requires sales across  the nation to make profit. However, whether nationwide or within a state or city, sales must be made. Regardless also of the size of the company, it must sell its products.

A company, instead of having to establish a sales and marketing department, may choose to outsource this aspect of its business to direct marketers. This is a viable choice for small and medium scale enterprises without the capacity for a dedicated marketing department. It also makes sense for an enterprise to utilise this option if it has a new product that it wants to get to the market quickly, or its goods have a city or statewide coverage only.

What any producer, who has a product in mind wants to reach a customers, and beat the competition successfully, does is to carry out a market assessment. Market assessment involves creating a profile of your product against similar products in the market, and profiling the market.

In creating the profile of the product, the producer needs to ask the question, ‘What is the differentiation?’ The answer tells what it is about this product that makes it different from others. Its price must be compared with other similar products to ensure competitiveness. How does the product fare in its performance compared to similar products? Does it work better or faster? What is the quality of the product? If the product is premium priced, that is, the product has a price above the average cost of the product of its class currently in the market, then the features of the product that make for premium pricing must be elicited.

To profile the market is to find out about the competitors. You need to know who are the makers of similar products that are already in the market. Find out who are the leaders, who are the followers and decide where, as a producer, you want to be found in this market.

Information from the product profile and the market profile is what the direct marketer needs from the producer to successfully carry out a sales campaign for the client. The client, in this case, is the producer who has chosen to outsource this aspect of business.

What direct marketing does for the producer is that it cuts out middlemen. At every point, there is a middleman in the sales process, there is increase in price as each one will take his cut or commission, which ensures the product gets to the consumer at a higher costs. Direct marketing makes for competitive product pricing.

It essentially gets products to the market faster, as products are transferred directly from producer to buyer. Market-specific selling is done and this increases market penetration. A producer who engages the services of direct marketers will be allowed to focus efforts on production. These advantages and the previous information supplied on the direct marketing concept was shared by a business development expert, Ugochukwu Umeokeke of Salt City Consulting, who stated that remuneration comes to the direct marketer through commission on sales which should be measured by volume and not in units.

Also, for the period which the producer engages the direct marketing service provider, a basic wage may be agreed on. Reporting times must be scheduled with the possibility of obtaining facilities such as transportation / mobility from the producer.

Therefore, if you have a flair for selling something and you have the ability to impact such skills to others, this expanding the scale of your operations and expertise, setting up a direct marketing firm is good optioin for you to consider.

Mike Onen Ubi is one of such who engaged and recruited a group of direct marketers in Lagos. He said the thought came to his mind when he entered a bookshop and saw a myriad of books on shelves that would not be sold, except a buyer who comes with a compelling decision to make purchase.  All the books present have little or nothing to advertise themselves apart from their covers. This was his motivation. So he threw out an advert to the public, to which about 50 persons responded.

Mr. Ubi conducted training and orientation for 14 people who scaled through the hurdles in the selection process. The job of his direct marketing recruits, in this case was to market books-song books and books on marriage and relationships. At this point, it must be noted that direct marketing is a prime choice for authors who want their books to reach the market and get sold, instead of having them sit endlessly on the shelves of a bookshop somewhere. Therefore, as a direct marketing service provider, look out for authors as your clients.

Mr. Ubi said that he paid one of his workers N20,000 for his efforts on the job. This was far back as 1995. However, as with every venture, there will always be challenges. Running a direct marketing firm is a business that can be done from a home office. Mr Ubi stated that running his business from home introduced a lack of organisation in the operations of the business which affected performance adversely. Therefore, do not allow the atmosphere of your home be the cause of ineffectiveness. Be disciplined in handling your workers and get organised in all aspects of your operations.

Another challenge he mentioned was unfaithfulness from many of his marketers. Some of them absconded with books they were meant to sell. He also mentioned that some want to reproduce their version of the books he gave them to market and broke away.

Mr. Umeokeke stated that the challenge of workers absconding with products can be dealt with by requesting for guarantors and strong collaterals such as the accademic certificates from the recruits before they start work. “Each direct marketer should be made to sign a confidentiality form and produce a strong guarantor so that they do not abscond with your product,” he said.

Umeokeke added that you should make sure your marketers are well paid. “When going out for jobs, negotiate with them in mind,” he advised. He went also stated that you must develop a system to monitor your workers on daily outcome of sales and weekly reports. If you are dealing with a new product, schedule a time for your staff to be trained on it.

Membership of a professional body that opens you up to more networks is an important tip to bear in mind. There are professional bodies relating to marketing in general and direct marketing specifically in the country today.

Your returns as a direct marketer have no caps. The only limit to how much you get is the production capacity of your client producer, and your own capacity to sell. So, do your plans and set your target, there is no restriction of how far you can go as a direct marketer.

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