324 CHAPTER17 MANAGINGDIRECT ANDON-LINEMARKETING
build its brand over the Internet, Seattle-based casual apparel maker Eddie Bauer
(www.eddiebauer.com) is letting customers enter a “virtual dressing room.” Although
visitors to Eddie bauer.com will find the same apparel that is shown in the catalog and
in the stores, the site is more than just an electronic sales flyer: Customers can just
click and drag different items to see how they look together. Because half of the con-
sumers who visit the Web site have never shopped at Eddie Bauer before, their experi-
ence on-line is an important first contact with the company.^11Telemarketing
Telemarketingdescribes the use of telephone operators to attract new customers, to con-
tact existing customers to ascertain satisfaction levels, or to take orders. In the case of
routinely taking orders, it is called telesales.Many customers routinely order goods
and services by telephone. The telephone has also spawned home banking.First Direct,
set up by Britain’s Midland Bank, operates entirely by telephone (as well as fax and
Internet at http://www.firstdirect.com), with no branches to serve customers.^12
Telemarketing has become a major direct-marketing tool, and is responsible for
annual sales of $482 billion worth of products and services to consumers and busi-
nesses. The average household receives 19 telemarketing calls each year and makes 16
calls to place orders, although businesses are placing and receiving more telemarketing
calls, as well. For example, Raleigh Bicycles uses telemarketing to reduce the amount of
personal selling needed for contacting its dealers. In the first year, sales force travel
costs were reduced by 50 percent and sales in a single quarter went up 34 percent.
Effective telemarketing depends on choosing the right telemarketers, training
them well, and providing performance incentives. Telemarketers should have pleasant
voices and project enthusiasm; after initial training with a script, they should move
toward more improvisation. The call should be made at the right time, which is late
morning and afternoon to reach business prospects, and evening hours between 7 and
9 P.M. to reach households. Given privacy issues and the higher cost per contact, pre-
cise list selection is critical.Direct-Response Television Marketing
Although magazines, newspapers, and radio are all used to make direct offers to
potential buyers, two forms of direct-response television marketing have become
prominent in recent years:- Direct-response TV advertising:Some companies have been successful with 30- and 60-
minute infomercials, which resemble documentaries and include testimonials and a
toll-free number for ordering or getting further information. One example is the
“Chrysler Showcase,” a 30-minute infomercial touting Chrysler’s brand heritage and
the exterior design, performance, handling, and premium features of selected new
models. This infomercial aired on national cable networks as well as United Airlines
SkyTV. Infomercials generate an estimated $1.5 billion in annual sales.^13 - Home shopping channels:Several television channels are dedicated to selling goods and
services. For example, on the 24-hour Home Shopping Network (HSN), hosts offer
bargain prices on such products as jewelry, lamps, collectible dolls, and power tools.
Viewers call in their orders on a toll-free number and receive delivery within 48 hours.
Kiosk Marketing
Some companies have designed “customer-order-placing machines” called kiosks(in
contrast to vending machines, which dispense actual products) and placed them in