The changing face of direct marketing

Customer engagement is a better term for this evolving discipline - it's no longer about using data to sell but about improving lives.

Jul 31, 2015 09:07:00 AM | Article | Martin Nieri Share - Share to Facebook

About three years ago, the industry we knew as "direct marketing" slowly started to be redefined under the term "customer engagement". 
It was time for a change. The industry was evolving rapidly and the agencies within it were changing just as quickly too.
Indeed, in little more than a couple of years, the traditional group of "classic" direct marketing agencies had all headed off in such differing directions that you would be hard-pushed to find many of them on the same pitchlists.
Some ditched their creative departments and focused on solely their data offerings. Others saw an opportunity to evolve into new communication areas, with a licence to do a broader scope of creative work. Some agencies folded after struggling to redefine exactly what they were. 
Direct marketing as we used to know it was a much simpler game. You would take a database and use direct principles to farm it. The home was typically at the bottom of the purchase funnel – the job was to tip people over the edge once the ad campaign had caught their attention. 
Now the funnel has become a cycle, turning those direct marketing agencies into customer experience agencies and expanding their remit and client relationships. 
That’s also down to the changing nature of loyalty. Brands are no longer looking to create loyalty by winning the battle of attrition. And it’s not even about customers being loyal because they’re "in love with a brand". 
Today, it’s about creating customer loyalty through valuable and relevant content that improves people’s lives and makes them more intelligent about any given subject. It’s about taking the strain out of the brand/customer relationship and thereby improving it. Few organisations are better-placed to provide that than customer engagement agencies. 
New investment
But only a few have taken advantage. These are the agencies that have become more real-time, more dynamic, more proactive. They have become less linear, less constrained. 
Why? It’s partly down to investment. Doing this required significant upscaling. This became a problem for a lot of direct marketing agencies, which did not have the budget or clout to do so. They also needed the inclination. Leaders who put their opinions and security on the line to change their agency, bring it out of its comfort zone and tackle new issues. To go out there and hire the very best user experience talent, the very best innovators and the very best data scientists. 
It is why the "direct marketing agencies" that are thriving now tend to be part of confident groups – those with the budgets and armoury required for the battle. To hire the very best talent, you’re battling against not just your best competitors but agencies from other sectors. Not to mention other technology and progressive companies from other industries.   
Historically, direct marketing worked because it gave clients with pressures and smaller budgets a chance of succeeding. Now, while the principles of direct are the same, those principles need to be backed by significant investment in technology, in products that can revolutionise the way a brand works, in the engaging content that your agency creates and in user experience expertise that can drive brand loyalty from customers who are more fickle than ever. 
Big plans
The result is that the best work that customer engagement agencies are now doing is not focused on an instant in time. It’s not a piece of work answering a straightforward brief. It’s about creating long-term, consistently wonderful and effortless experiences. Customer journeys. Tools that enable customers to make their lives easier. That’s harder to judge at awards, but it’s making a bigger difference to our bottom line.
It also means that creativity remains at the centre of everything we do. Although now it’s not just about creativity in your standard ad campaigns but creativity in innovation, the services you offer and the products you create. That may be the most heartening thought of all. 
So what next? This should be the part in the piece where I call for yet another definition of our discipline and warn you all to be very scared of agencies in the sector. 
I won’t do that. I think customer engagement is a suitable term. But I reckon we need to be thinking bigger than the definition suggests. The agencies working in this space have already expanded in greater and more interesting ways than we could have ever thought possible. We’re no longer on the outside looking in, trying but failing to be much more than a sales nuisance. We’re now an invisible hand that guides customers around their world. Working with them to improve each and every facet of their lives. 
And, by doing so, our industry is beginning to provide brands with the tools, the content and the experiences to engage people in more exciting and more effective ways than ever before. 
Martin Nieri is the chief executive of Partners Andrews Aldridge
(This article first appeared on