Selling Source Competition
Now Viewing Selling Source's competition in: Direct Marketing Services (primary)
Call Preparation Questions
Customers, Marketing, Pricing, Competition
How successfully has the company retained its top customers? - Direct marketers work hard to develop strong customer relationships to get repeat business.
What alternative channels has the company introduced? - Online marketing is increasing in importance, and marketing using mobile telecommunication is emerging as the newest direct marketing channel.
Does the company specialize in particular customer segments? - Many direct marketers specialize in an industry or geography.
How important are the company’s largest clients? - Small firms may have just a few clients.
What trade shows does the company attend? - Marketing trade shows and client industry-specific conferences are a major source of new business.
How much of the company’s business is long-term contracts versus one-time projects? - Direct marketers generally have long-term contracts with clients.
Who is the company’s primary competition? - The industry is relatively fragmented, but several large companies have a national presence.
Competitive Landscape
Demand is driven by economic activity and corporate profits. The profitability of individual companies depends on their targeting services, creative skills, and marketing ability. Large companies have advantages in economies of scale in database analytics, marketing, and automated operations, which allow them to compete more aggressively on price. Small companies can compete effectively by specializing in a particular industry, geographic market, or service type. The direct marketing services industry is labor-intensive: average annual revenue per employee is less than $150,000.
Business Challenges
CRITICAL ISSUES
Dependence on US Economy - Spending on direct marketing is highly sensitive to the financial health of the US economy. Marketing spending is often viewed as a discretionary expense that can be cut when corporate profits fall. Increased demand for direct marketing services often lags an economic recovery as firms remain cautious in setting marketing budgets.
Shift to Electronic Correspondence - The shift from letter correspondence to email may force the US Postal Service (USPS) to increase rates on standard mail to cover costs. While standard mail volume has grown over the past five years, first class mail volume has declined. Higher postal rates increase the cost of direct mail advertising.
Industries Where Selling Source Competes
- Business Services
- Advertising & Marketing
- Direct Marketing Services(primary)
- Information & Records Management Services
- Advertising & Marketing
- Computer Services
- Financial Services
