If Bornstein receives more funding, she needs to determine how to distribute it across various digital platforms/categories. To do so, she should consider reducing traditional marketing as requested in the additional funding proposal. It is important to assess the analytical metrics of traditional marketing categories before deciding where to cut funds, as this will help evaluate their effectiveness. However, we currently lack data on these metrics and only possess information on social media marketing instead.
Based on 2010 data, Sephora allocates 45% of its expenditure to retail marketing, which includes prints, catalogs, and store animations. Online strategies account for 35% of their spending, while the remaining 20% is invested in Beauty Insider. It seems that Sephora heavily relies on traditional marketing methods as its primary approach. However, I believe it is crucial for this approach to evolve. To adapt to today’s digital era where the majority of people reside in the virtual world rather than the physical one, my recommendation is to decrease funding for printing and catalog campaigns since print marketing has become less effective.
The rise in popularity of tablets, smartphones, and computers has led to a shift from printed materials to digital formats for newspapers, advertisements, and books. David Suliteanu poses the question of when we should decrease our distribution and catalog size. Should we cease printing and mailing catalogs altogether? Although many individuals appreciate our catalogs as a way to showcase Sephora’s position as a trendsetter with expertise, their visual attractiveness is crucial for upholding our company’s reputation. However, it is not mandatory to send them out to every single person.
To reduce printing, it may not be logical to completely stop, but rather to decrease the number of prints and target selected customers, such as VIPs. These VIP customers can be selected based on factors like their longevity as Sephora customers and their annual spending.
Regarding Sephora, I perceive it as a platform rather than just a store or a product. This is because Sephora offers a wide range of brands and thousands of different products, making their variety extensive.
The beauty talk policy on their website has become a platform that brings people together, similar to a large forum. Additionally, their effectiveness on social media and websites is another reason. Creating Beauty Talk as a separate platform from Facebook raises the question of whether it was a wise decision. However, it does have value for customers since Facebook has its own disadvantages despite being an essential tool for reaching people easily.
In Sephora’s website, all customers remain anonymous, even if they choose to share their picture through privacy settings. However, on Facebook pages, everyone can see the pictures and identities of those who ask questions, post comments or updates. This lack of anonymity on Facebook may deter users from asking sensitive or embarrassing questions. Furthermore, due to the continuous posting on Facebook pages, older posts quickly become buried and difficult to find after a few hours.
However, on Sephora’s website, users can constantly reference that post. Ultimately, it is advisable to utilize one’s own website for this purpose as it offers increased security. Even Facebook cannot be fully trusted as they have the capacity to alter their rules or the structure of Facebook pages, which could hinder Sephora’s Beauty Talk strategy. Additionally, managing user activities (such as inappropriate comments or spam links) will be more convenient on their own website as opposed to Facebook. Which competitors should Sephora prioritize as they shift towards digital and social marketing and why?
To enter the digital marketing realm, Sephora will need to make a substantial investment in establishing an efficient supply chain system that encompasses warehouses, logistics, and other components. It is important to acknowledge the presence of established competitors like Amazon in this market. As the biggest online retailer, Amazon possesses a robust supply chain management system supported by multiple warehouses throughout the USA. This advantage empowers them to effectively handle their inventory and provide an extensive array of products.
On the other hand, their logistics also works well, ensuring that shipments usually reach customers on time as promised. Additionally, they have a helpful review and rating section for each product. ULTA serves as a major competitor to Sephora, so it is important for Sephora to consider what strategies ULTA is implementing. What should Sephora’s overarching strategic goal be for their digital and social marketing programs? How can they meet the CEO’s desire to achieve success in the digital realm?
It can be challenging to establish strategic objectives for future digital and social marketing media because of the uncertain nature of social media. The ever-evolving actions of anonymous users make it difficult to anticipate outcomes. Nonetheless, a key objective for present-day social media could be directing Facebook users to Sephora’s Beauty Talk webpage. It should be noted that Sephora maintains its dedication to Facebook, as demonstrated by the presence of the “Call” feature on their mobile page (Exhibit 1).
The functionality of the “Call” button allows users to easily contact Sephora’s customer service. Furthermore, Twitter has seen a substantial increase in its user base. This social media platform is highly effective at quickly gathering individuals, particularly those with a large number of followers (Exhibit 2). Additionally, it can be used for advertising purposes not just through Sephora’s official account but also by utilizing other users’ accounts on Twitter.
There are two types of Twitter accounts that can invest: celebrity accounts and phenomenon users. Celebrity accounts are usually held by music, Hollywood, or TV celebrities with thousands or even millions of followers. However, their impact on people may not be as significant because when they promote a brand on Twitter, it is seen as an advertisement and not their personal opinion. On the other hand, phenomenon users are not celebrities but are popular among Twitter users, with thousands of followers. The main difference between them and celebrities is that phenomenon users often have an emotional connection with their followers. People follow them because they like what they write, so when they mention a brand like Sephora, for example, people do not necessarily see it as advertising. Instead of directly typing out advertisements, phenomenon users indirectly reference the brand, making it less obvious that they are promoting it. One way to impress CEOs and secure their investment is through metrics. By showcasing data analysis that supports the consistent trend of social marketing and demonstrates the underperformance of traditional marketing methods like printing catalogs, CEOs can be convinced to invest.