Question

Assuming she receives the additional funding, how should Bornstein allocate her budget across the various digital categories? Given that the additional funding requested must be shifted from Sephora’s other marketing spending, where would you propose to cut?

Answer 1

Ans)

It would be an extremely beneficial investment if Sephora could receive an additional1 million in funding in the budget for additional various digital categories. Their targetaudience are young, hippier, trendsetting customers. This target audience fits thecategory of millennials (demographic 18-35). They already distinguished their clientsrange between 25-35 year old women, and it is important for them to engageteenage girls who look up to this age group.Given this direction, it would be wise to pursue their digital efforts in marketing,including Sephora Direct, their mobile app that allows ubiquitous shopping forconsumers, whenever wherever. There is a distinct growth in mobile shoppingacross e-commerce. So much that predictions say there will be more mobileshopping done than that of a computer. They need to allocate more of their budgetto be more competitive in their mobile experience. They have had increasing growthin visits and they need to maintain this growth, as their competitors acknowledge thisgrowing channel. Because social media is constantly accessed from the mobileSmartphone, there needs to be an increase in focus in these channels as well. Theyneed to make sure that these new alternative channels stay consistent with theirproduct image in their traditional channels as they transition.Their most predominant assignment of their publicizing spending show 45% going toretail (prints, lists, store activities, and so forth). While this source of introduction isstill prominent, particularly in regard to the Beauty Insider popularity with their loyalclients, they could decrease their endeavours and expenses on their flow of print.

Millennials are trying to not use this type of information and move to digital. I believe sephora still prints and mails their advertisement but I think that it will be better that if they improve their mobile and social media channels. Sephora needs to innovate itself and move forward.