Marketing is one of the key aspects of a business. The success or failure of a business, a product or a project is determined by the marketing that is undertaken to sell the product. However, marketers usually find themselves engulfed in a dilemma as they aim to meeting high sales targets within a short time. Historically, both big companies like Nike, Coca-Cola, and Pepsi have had a bad experience with poor marketing (Ainscough, 2012). However, these companies have been able to learn from their past mistakes and are doing great as global brands. This essay focuses on the marketing failure of Ecomom, a classical example of a digital marketing strategy failure.
Ecomom was a startup online retail store selling affordable mom and maternity products such as toys, apparel, food and other baby related products. It was founded in 2007. By 2011, after four years in business, Ecomom had a turnover of slightly above $1 million. The company made significant marketing blunders which saw its downfall (Ainscough, 2012).
The company’s marketing campaign revolved on discounts. The company was offering heavy discounts as part of marketing. Discounts were supposed to be one time, but Ecomom could not limit them by client; hence each discounted order has a 50 percent cutback regardless of whether it was from a new customer or an existing customer. The discounting was so serious that, for each additional normal $60 order made, the variable cost was established to be $89, thus the company was losing $29 for such orders. This led to massive losses by the company leading to its demise.
Several marketing lessons have been learnt from the case of Ecomom. First, the company overreliance on traditional discounting was a bad idea, since it was not even well planned. It is necessary for any company to set the appropriate KPIs to review and manage a business.
To avoid this kind of marketing tragedy, Ecomom should have focused on making their store famous through extensive marketing campaigns, hence increase the number of customer base. There are various digital marketing that Ecomom could have used including social media like Facebook, television ads which are appealing to customers. This could have led to increased popularity of the store, not only locally but regionally and abroad. In addition, the company could have had a balanced management and marketing team with succinct marketing abilities (McDonald and Wilson, 2011). As noted from Ecomom’s case, there was poor coordination of the various teams. The company’s sales manager for example, was paid on basis of the achieved sales before discounting.
Ultimately, Ecomom was destined to become a global leader in moms and baby’s products but due to poor marketing strategy, it failed within the first few years of operations. Although the problems that faced the company are financial in nature they originated from marketing failure. Discounting is a good way of marketing, but it does not always work. Chick-fil-A for example has been able to survive the extensive competition in the fast food industry without discounting. Its marketing usually entails creative advertising campaign including the Cow Appreciation Day. As marketers, there is a lot to be learnt from past failures such as Ecomom and other companies. Could things have been done differently at Ecomom, the company could be competing with giant companies like E-bay and other related online retailers (McDonald and Wilson, 2011).
- Ainscough, T. L. (2012). MAR3023: Basic Marketing Online. Course Syllabus: 2012: 08 (fall).
- McDonald, M., & Wilson, H. (2011). Marketing plans: How to prepare them, how to use them. John Wiley & Sons.