Tuesday 2 November 2010



a. Overview:

In the previous chapter, the data found by primary and secondary research was presented and analysed. This chapter summarises the findings of the study to test the hypotheses. Further, recommendations will be provided on the subject area and basis for further research will be given. Finally, the limitations of the study will be discussed.

b. Summary of the findings:

1. The direct marketing industry is growing at very high rate because of the increasing allocation of resources by organisations towards direct marketing and other factors such as rapid advances in technology.

2. The failure of traditional mass marketing approaches has led more and more organisations to adopt direct marketing as their strategy for marketing communications.

3. One such organisation is British Gas, which uses direct marketing as their main marketing tool. British Gas uses a number of direct marketing mediums such direct mail, door drops, inserts face-to-face selling etc. It has been a top user of direct marketing in terms of volume and spending for past three years.

4. However, despite being a high user of direct marketing, British Gas has been loosing customers and market share for past six years. But the reasons identified for this loss were the price hikes and the ‘churn’ caused by the competitors likes Npower and E.oN.

5. It was also found that direct marketing has helped British Gas to minimise its customer loss and re-acquire the previous customers.

6. Another interesting finding of the study was the consumer responses to direct marketing. For majority of customers, direct marketing was not a very big issue and had a neutral view on direct marketing.

7. It was also revealed that direct marketing does not necessarily lead to high level of customer satisfaction as majority of the consumers surveyed described their experience as somewhat unpleasant or strongly unpleasant.

8. The consumer survey also unfolded that consumer were deeply concerned about their physical and information privacy being constant infringed by direct marketing activities of organisations.

c. Hypothesis Testing

1. Hypothesis 1 predict that The direct marketing strategies has been the best approach by the British Gas in the London area and this has helped British Gas in increasing and maintaining customer base in the London area. Structured interviews were conducted to test the hypothesis. The interviews revealed that direct marketing has helped British Gas to minimise its customer loss after deregulation, price hikes and extensive competition from competitors. This justifies that it is the best approach adopted by British Gas. Thus, hypothesis 1 is supported.

2. Hypothesis 2 state that the direct marketing strategies by the company have actually benefited the consumers. Planned surveys using questionnaire were conducted to test the hypothesis. The consumer survey revealed that direct marketing has not necessarily benefited majority of consumers as majority of consumers were dissatisfied with direct marketing. Thus, hypothesis is not supported.

3. Hypothesis 3 examines the impact of direct marketing. It states that the direct marketing activities by various companies have raised many concerns regarding information protection among consumers. Again, the surveys were conducted to test the hypothesis. The surveys conducted among the consumers showed that majority of consumers were concerned about their information protection. 36 % of consumers surveyed believed that their information is misused by companies to meet their sales goals. Thus, hypothesis is fully supported.

d. Recommendations

1. In the research it was found that the success of direct marketing depends on the availability of accurate and relevant information. Information and its management are considered as the back bone of direct marketing. Therefore, it is recommended that information for the purposes of direct marketing must be acquired only from reliable sources in order to ensure reliability and validity of the information. Moreover, in order to manage information efficiently, I.T. based system such as Management Information Systems (MIS) must be employed.

2. Bad reputation is one of the biggest challenges faced by the direct marketing industry as found in the research. This is because of the unethical and dishonest practices of some of the direct marketing firms. Therefore, strict regulations must be introduced and followed by the industry regulators so as to stop such unethical and dishonest practices and improve the reputation of the industry. Also a complaints procedure must be in place where customers can put forward their grievances.

3. An important advantage of direct marketing is its ability of measuring the response of consumers to the different mediums of direct marketing. Therefore, it is recommended to the direct marketers to monitor the responses of the consumers to the different direct marketing mediums closely and record them, so that a strategy can be developed where the medium having best response rates is used more.

e. Limitations and Future Research

This dissertation contains some limitations and these limitations provides basis for future research. Following are the limitations of this dissertation which provides basis for further research.

1. In this dissertation, the various aspects of direct marketing model were analysed by studying the case of only one organisation, that is, British Gas. However, in order to have a better understanding on the various aspects of direct marketing, the research should involve more organisations. Future research should therefore involve more organisations so as to get a better picture on the topics involved in the study.

2. In this dissertation, a consumer survey was carried out to understand the consumer responses on the issues related to direct marketing of organisations. However, a consumer survey would reflect better on the responses of the consumer if a cross-cultural survey is carried out where there is some representation of various cultures. Future research should include cross-cultural studies so as to reveal the true position of the hypothesis.

3. The research was carried out in the London area and therefore the study reflects the findings of the London area only. Further research that covers the whole nation or a group of nations can be done so as to do a comparative study of the direct marketing activities and the consumer responses of different nations.