Fab Marketing Case Study

Ever heard of Fab?

No I don’t mean as in fab dress, film etc. Nor Faaabulous as in Strictly Come Dancing quotes.  It is a fab marketing case study that shows the basics of meeting customer needs and doing a great job really works.

 I am referring here to the design business.  http://eu.fab.com/ 

The statistics from the CEO below show why this is a Fab business.  It has been in existence for hardly anytime at all and just look at the numbers- now that is Fabulous —

Goldberg the CEO gives us some key addresses highlights:

  • Fab has sold 4.3 million products, or 5.4 products a minute. This holiday season, it sold 17 products a minute.
  • A third of Fab’s sales come from mobile with 56 percent on Christmas Day sales coming from mobile devices.
  • Total sales grew by 600 percent from 2011 to 2012. On a daily basis, two-thirds of sales are from repeat customers. Fab had several days in 2012 with sales of more than $1 million.
  • Q4 sales grew by 400 percent in 2012 with 30 percent of sales outside the U.S. Fab now sells in 26 countries.
  • 50 percent of Fab’s sales are home products while 20 percent are fashion and accessories. Jewelry and art make up more than 10 percent each. Fab now has 15,000 products for sale, up from 2,000 at the end of 2011.
  • Fab ships 75 percent of U.S. orders within two hours, compared to 16 hours last year. Customer response time is down to 15 minutes, from 48 hours last year.
  • Employee headcount is now 600, up from 85 at the end of 2011.
  • 15 percent of products sold in 2013 will be exclusive to Fab. Fab has worked with 7,500 designers

Many thanks to Dan Sodergren for the insight- check him out on mobile marketing.

A lesson to us all – and many thanks to – http://gigaom.com

Customer Service- Why Bother?

Many companies spend a huge amount of their budget on attracting new customers. Just look around at the number of promotions you see everyday. There is pressure on business to reduce costs and marketing is one of the departments guaranteed to be hit. It is a matter now of looking at the breakdown of the business and examining how the marketing budget can be most effectively spent.

It is well known in marketing that it is much more expensive to attract a new customer than to keep your existing customer.  Examine everything that your business does and ensure that it focuses on the customers and their needs. Really understand what they want and follow this up. Make sure that the product is delivered on time, it is what they wanted, it lives up to expectation. Focus on building the relationship, customers will tell others and that is so much more powerful that your promotions.

The marketing lesson is to really get under the skin of your customers and build that relationship. So how to do it?

Understand their needs, make the most of any customer interaction, use customer service teams to find out as much as possible about the need and how well your business is meeting that need.

Ask your customer to compare you and your competitors.

Build a benchmark of good performance.  Such as delivery in 5 days or call back in 24 hours. Opportunity to up grade, learn more, build your own are all examples of how businesses have adapted and changed.

If we look at examples of really good customer service and then examine the performance of the business. You would not be surprised to learn that companies that score well on customer service are keeping customers, up selling to them and performing better.

Recent winners of awards are First Direct that scored highest in the banking sector in a survey conducted bySatmetrix. First Direct scored 42% satisfaction compared with an industry norm of -4%.

Virgin and Sky scored well in the ISP business. Still in mobiles O2 did the business. Apple iPhone was miles ahead of the industry with a score of 67% compared to the industry average of  18%. This is a really good example of marketing practice

Customer service is so much more than dealing with complaints. It offers business the chance to really understand their customers, analyse their needs, build new products or services. It will also reduce costs and focus on making the business more effective.

So deliver and build the level of customer service. Do what you promise and make sure you know what to promise

Free Marketing Course

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I am offering a free short marketing course. The course will cover the basics of marketing and help you to understand the key marketing ideas in a really simple way.

If you are studying for a marketing exam it will help you to revise and check your understanding of the marketing environment and how the economic factors can affect a business. It will show you how to plan for the future and understand the key parts of a marketing plan. It is in easy to follow and will help you to understand the marketing template more easily.

If you are working in marketing and trying to find that little extra insight to help your organisation to compete and deal with the challenges facing business today. It will show you the key models and the way in which your business can develop and focus on building value for the customer. The better the customer needs are met the greater the chance that the business will be successful.

The course will be delivered to you by email over a a few weeks.

Social Media Marketing meets Politics

The results are in Nick Smith was elected as MP in Blaenau Gwent for Labour. As you will have seen in the media this was against the tide of Labour loses. The previous election saw a loss by 2,500 votes and this time a majority of 10,516 votes.  The swing to Labour was 29.2%, a success by any standards.

So how was it done?

The key point in any communication and political campaigns is who get the message over in the simplest way possible. The art of cutting through the noise from other parties, masses of media coverage and voters who maybe switched off, is a huge challenge.

The starting point is the message, simple and give the voter a reason to vote, sounds easy but in reality very difficult to do. There are lots of ways of achieving this and as many commentators have said the role of social media is important.

Nationally, there were acres of newsprint, hours of TV, masses of radio and yet millions of people who had not made up their mind until the day of the election.  In Blaenau Gwent the campaign used lots of traditional tactics, leaflets and connecting with small groups in meetings, in public events, by walking the streets and door knocking.  Visibility of campaign material such as traditional posters and garden stakes as a reminder was important. It also created momentum but the number of posters was much lower than the final vote.

Social media connected via Facebook with 744 friends. That is creates a ripple effect as their friends will see the updates and comments. That increases the coverage and multiplies the effect. These friends then share the links, the stories, the photos and videos. 

Given that there are a defined number of voters. Every friend that votes takes their vote from the opposition. This doubles the impact of that vote.  So of the friends, 700 voted, that is a 1,400 swing and that in political marketing is huge.

The key here is to engage with the friends. That is critical as it increases the turnout of the vote. In political marketing the threat is from the other candidates but also from the sofa, just not bothering to turn out to vote

The connections into Twitter and Utube really worked well. It integrated the campaign and gave it life. This enabled short, quick updates and showed current activities. It involves people so they can feel part of what is going on even if they are not there. It is the social interest that increases engagement.

Changing Car Industry- Strategic Alliance

In marketing practice, one of the key srategic decisions revolves around building relationships. Today Daimler, Renault and Nissan have announced a very interesting alliance.  They aim to share production but also to keep exisiting relationships with Volkswagen. This means that costs of development and generate common parts and technology given the green agenda.

The challenge for all car companies is to meet the challenge of the environmental pressures. This is costly and incurs a high level of risk. Good marketing practice suggests that reduction of risk is key.  Therefore this alliance has a number of really positive potential benefits.

This will build scale and offer huge opportunities for the future. Marketing practice suggests that this in difficult to implement in terms of brand. It will help the partners to increase competitiveness given the costs of innovation. This will push volume and generate lower costs.

“If you have scale but you don’t make scale work for you through sharing platforms and sharing engines and making smart decisions locally, geographically, scale is just complexity and confusion,” Ghosn the CEO of Nissan told a news conference in Brussels.

The brand of Mercedes needs to maintain quality and the use of Renault engines could confuse the market. So the alliance will need careful managment to avoid the problems Daimler encountered when it merged with Chrysler, which ended in 2007

Marketing Practice-Competitive Strategy and Brand Position

Good marketing practice tells us that the foundation for a marketing strategy  is to position clearly in the market. This is something that determines the whole of the marketing tools. If your business is positioned at the top end of the market, consumers expect more. The market size maybe smaller,  more value must be added. This will determine the price and that requires careful calculation to ensure that the costs of adding the value are not higher than price the consumer is prepared to pay.

The market dynamics are  also  ever changing. Using  Starbucks, as an example. They orginally occupied the top end of the market. Then moved into the mass market with lattes on every street corner. That market looked attractive and along come the likes of MacDonald who repositioned to compete by offering lattes and healthier options.

So how does Starbucks respond? They are now testing the top end of the market and offering more value adds. Interesting to see how that is received and how the competitors respond. Best marketing practice suggests that clarity and being able to differentiate is key to success.

Consider how your marketing practice in your business can use this idea. Think about the way in which the current assets are used. You might want to offer a streamlined version e.g express, or essentials.  Marks and Spencer, Waitrose are examples of businesses that have offered a simpler version of their main business as an example of good marketing practice.

Another example is Only Men Aloud, the popular Welsh Choir who won a television competition and have gone onto enjoy successful concerts and record sales. They are now offering a slimmed down version for special parties and events. Not everyone has the space for a full choir so Only 4 Aloud. Clever use of the brand and being able to tailor the assets of the business, in this case the choir to the needs of the customer. A really good example of marketing practice at its best

If you are sitting a marketing exam this is a really good example of competitive strategy, positioning and branding. It shows how marketing practice builds the profitability of the business 


Revitalising an iconic brand

Building a brand is no easy task, many have tried and failed. So iconic brands stand out. There are new pretenders who attempt to knock the old guard off their spot. Namely the likes of Google, Amazon etc. These companies are seen as examples of best marketing practice at the moment.

The challenge for the icons is to stay at the top. Brands will die if they fail to move with the times. If a brand had clear values it can also be seen as a double edged sword. For classic read dull, for established read boring.

Levi’s and the jean we all recal is the 501 is working to revitalise its brand


Google Cool Tools

The structure of a blog is something that we take for granted. However if you think about reading a newspaper or magazine there are specific places on the page that are more expensive to advertise on. The right hand column is usually prime space. This has been determined by watching eye patterns on a page.

In a similar way best marketing practice suggests that some places in the front page of a blog attract the eye more naturally than others. For blog/website designers designing the front page is usually reliant on a theme. Lots of themes have the traditional two or three column format. Yet research shows that the centre of a page is the hot spot on a blog or website.

Check out this link and think carefully about your front page.  Let me know what you think


If you see the wordcloud below it looks cool. You can now build your own and it can be used to show the values of your brand or company. Good fun and so effective.


Will consumers pay?

For many years the Times on line service has been offered  free content. From June there will be a charge. This is a new approach and the risk is that consumers will switch to other free services such as the Telegraph. Or less direct such as television news. 

The Times is acknowledged to offer a wide ranging source of up to the minute news, articles and commentary. The BBC could compete as a free service and also dominate that space. This would mean that the Times will need to do more to persuade the consumer to pay. If this costs more than the revenue generated it will be a problem for the business.

If the Times need to generate cash it seems that there are other ways of achieving that objective.  E.g if someone registers and then accesses tailored content. It follows that advertising very carefully tailored to this consumer with links to selected products,  will generate revenue for the Times.

Time will tell if charging is a viable business model of if a customised service using tailored content and  advertised product is a stronger model