The popularity of direct selling and direct marketing has increased with the advent of social media. This is because it has become a lot easier to get connected with people on a large scale. Often, the two terms are considered to be the same; however, there are actually quite a few differences between the two terms and these will be explained further in this article.
Definitions and explanations
Direct selling is the process through which products are sold directly to consumers, without any intermediary in between. The sales take place in a personal and face-to-face manner in a non-retail setting, at home, workplace, over the internet, or in other non-store settings.
Through direct selling, most of the intermediaries involved in the distribution of products are eliminated, for example, distribution center or wholesaler. Rather, products are transferred from the manufacturer to a representative or sales agent, who then makes the sale directly to the consumer. Such products are generally not available in the retail stores which suggests that the product can only be brought through a distributor or representative.
The representatives who sell the product to the consumer usually make use of their personal relationships to sell a product a service to the consumer directly, while receiving compensation for the amount of sales they generate. The basis of direct selling is on establishing and maintaining personal connections with the customers and encouraging them to make repeated purchases. It becomes much easier to sell products through face to face communication as it allows the representative to provide live demonstrations to the consumers and explain to them how the product works and provides effective results.
Direct marketing is considered as a system or an approach to marketing, i.e. it is a way of carrying out the main marketing activities of identifying markets, generating demand in those markets and then supplying the product to the customers.
Direct marketing refers to a promotional tool like advertisement, sales promotion, personnel selling and public relation. It is basically a form of direct communication with a selected category of customers, and its intention is to generate an immediate response as well as to formulate long-term relationships. Some of the direct marketing tools used by companies are telephone marketing, direct mails and online shopping.
It is basically a selective promotional tool, the purpose of which is not to achieve mass communication, but to target possible customer segments. In addition, it is possible to determine the effectiveness of direct marketing, either through customer inquiries, or through actual purchases made by the customer.
Differences between direct selling and direct marketing
Some important differences between direct selling and direct marketing are given below:
Direct selling and direct marketing are both targeted communication techniques that remove intermediaries in the supply chain. Both of them involve a sales function in that their objective is to generate sales. However, there are differences between the two approaches, which will be discussed in detail below.
Direct selling is the distribution process carried out through independent representatives who sell products to customers directly in a non-retail environment. Direct marketing refers to a promotional tool that is targeted towards a particular segment of the market, with the aim of bringing about a purchase or an intention to purchase.
2. Means of communication
There is face-to-face interaction between the sales representative and the consumer in direct marketing. It is essentially a door-to-door campaign and is of a personal nature. However, this is not the case in direct marketing, which is carried out through different tools, such as the internet, television, post, etc. This means that direct selling is limited to personal interaction, while direct marketing involves the use of broader communication channels to reach customers.
Direct selling is a very old method and has been prevalent for a long time, going back to peddlers and other people moving from one place to another to sell their goods. On the other hand, it was following the advent of the postal service that direct marketing became popular. Furthermore, its use became more widespread following the development of the Internet, especially the social media.
In direct selling, only those customers are targeted that belong to the personal network of the seller. Though the social media has made it quite easy to get in touch with people you have not met before, direct selling is still restricted to those with whom you have a personal contact. Through this personal contact, customers feel more comfortable when they know that they are directly in touch with the person from whom they are making the purchase. In contrast, direct marketing does not require personal contact and direct communication with the seller.
5. Point of interaction
There is a single point of interaction in direct selling, where the seller presents the product to the customer, provides a demonstration and makes the sale. This is not the case in direct marketing, where the seller and customer interact at different locations and times.
There is limited coverage of direct selling as individuals are not able to reach a large number of customers, while the coverage of direct marketing is large as several customers can be reached.
Direct selling versus direct marketing – tabular comparison
A tabular comparison of direct selling and direct marketing is given below:
|A method of selling products directly to customers, without intermediaries, and in a non-retail setting||Selective promotional tool that aims to bring about a purchase immediately or sometime in the future|
|Means of communication|
|Face to face interaction between the seller and the customer||More extensive communication channels to reach out to the customers, such as the internet, television, radio or postal service|
|A very old method that dates back to the time of peddler selling||A method that became popular after the introduction of the Internet|
|Point of interaction|
|Single point of interaction||Multiple points of interaction|
|Limited coverage||Extensive coverage|
Conclusion – direct selling vs direct marketing
Direct selling is different from direct marketing in various ways, as has been shown in this article. In conclusion, it can be asserted that direct selling focuses on selling products directly to customers through agents or representatives, while direct marketing concentrates on using promotional tools to identify possible customer markets and make a sale in those markets.