Wednesday, June 06, 2007

Don't just analyse the sign-ups! The case of the missing Channel lipstick.

Here's a little story about why it's never the best idea to analyse the success of a campaign by the number of "clicks", visitors or sign-ups.

My wife was browsing the Internet about 6 weeks ago and was presented with an online advert (or somehow found a link) for Chanel makeup - since you ask it was for Le Rouge lipstick. The premise was a typical one - watch the online advert or in this case film, learn about the product and we'll send you a free sample.

At this point, I'm assuming that their analytics team are quite happy with the data they collected and the value the campaign generated. I'm also assuming that their brand manager is feeling quite good about this campaign:
  1. got the viewer (in the right target market)
  2. got the details
  3. they've signed up to our database (and are likely to have selected to receive more info)

Now so far, there's no real ROI - but they have now got a person to go and sell to. The next part of the implicit deal that they have made is to send out a free sample but this is where the "deal" falters. Instead what actually happened was that my wife received an e-mail yesterday telling her that she can't have a free sample - "sorry but it's all gone" was the message. Those with a keen memory will recall that this is a 6 week process between sign-up and being told that stock has run out of the freebie. So the question for Chanel is this. Was this a successful campaign?

From a marketing measurement point-of-view, i suspect that internally it's being regarded as a promotion that worked "too" well - certainly a success! Too many people said that they wanted to trial the product and we got too many interested customers. Oh how tough can this marketing game be?

In practice, what Chanel did was raise then lower peoples expectations about the brand and it was all unnecessary for the following reasons:
  1. It's easy to work out how much stock you have then close the offer when it's run out - Chanel didn't do this (and by implication can't). That's dumb. In fact it took 6 weeks for Chanel to spot this.
  2. The marginal cost of a few extra lipsticks must run to literally a few thousand pounds which is a tiny amount in comparison to any potential damage from not fulfilling the brand promise - again dumb.
  3. Chanel could have offered something else in return if there was a shortage of product. Maybe an alternative free sample, consultation or even a voucher
You may of course question why a premium brand like Chanel is offering a free trial or even vouchers. Neither are very "premium brand" but clearly Chanel's team felt that it was a risk worth taking to bulk up their database of prospects. In practice, I'd guess that they've added a whole list of names to a database with little value and potentially negative ROI given that they left so many people disappointed. My guess is that there is a whole range of people out there who are now less inclined towards this prestigious brand than there were previously which can't be a good thing.

  • On a "sign-ups" basis - a success
  • On a "visitors" basis - a success
  • On a "brand equity" basis - fail
  • On an ROI basis - really?

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