Hits & Misses
(Business 2.0) – [HIT] A pattern for profits. Here's a classic yarn about an old-line business learning to move at Internet speed: After Martha Stewart was photographed leaving prison in a hand-crocheted poncho and revealed in an online chat that a fellow inmate used Lion Brand yarn to make it, e-mail inboxes at the 127-year-old textiles concern overflowed with requests for the pattern. Marketers at Lion Brand paid a freelance crocheter $500 to re-create the poncho and then posted instructions on its website days before any of its competitors followed suit. More than 600,000 users downloaded the pattern, which requires about $20 worth of Lion Brand yarn to make. As a result, Lion Brand saw sales jump 39 percent in the two weeks after the design was posted.
[HIT] For the sequel, how about $12.5 Million Baby? Anyone who's anyone in Hollywood knows the rule: Always sign your next deal before the buzz from your last hit dies down. Now you can count boxing equipment maker Everlast Worldwide among the anyones, as the company followed its starring role in Million Dollar Baby with a five-year women's apparel licensing deal with Jacques Moret International that guarantees it $2.5 million in annual royalties. Everlast's fancy footwork has been a knockout on Wall Street too: In the four months after the movie's debut, its stock tripled to more than $13 a share.
[MISS] Pink slip for the Queer guy. Pier 1 may be having trouble moving merchandise these days, but it could run one heck of a seminar on the perils of celebrity endorsement. After a lackluster three-year campaign featuring style-challenged Kirstie Alley, Pier 1 went in the opposite direction, signing up personality-challenged Queer Eye for the Straight Guy designer Thom Filicia. That campaign went so poorly that in the third and final ad, rather than trying to get Filicia to emote, the spot had him just wordlessly pushing around furniture. Pier 1 parted ways with its agency, Campbell-Ewald, and declined to renew Filicia's contract. "It wasn't worth the $1.5 million or whatever we paid him," says Pier 1 CEO Marvin Girouard. Left pitchless for the holidays, Pier 1's same-store sales fell 9 percent from the previous year.
[HIT] I like big bucks and I cannot lie. When it comes to picking music, wireless carriers are a lot like radio stations: The ringtones they promote come straight from the top of the charts. Great for flavors of the month; not so great for anyone else trying to cash in on the ringtone craze. So what's an old-school hip-hop artist like Sir Mix-a-Lot--pushing a ringtone remix of "Baby Got Back" called "Pick Up the Phone"--to do? Mix-a-Lot turned to "mobile brand management" firm Versaly Entertainment, which picked up the phone and worked its relationships with direct-to-consumer marketers. The top source of sales: those obnoxious late-night Jamster commercials on MTV and BET. The ringtone went gold in seven weeks, selling 500,000 units at $2 a pop.
[HIT] To boldly promote what no marketer has promoted before. Ad agencies often promise clients the moon--but rarely do they mean it literally. Nonetheless, Euro RSCG helped Volvo achieve liftoff with a clever promotion for the automaker's XC90 SUV: a contest that awarded the winner a seat on the first commercial launch of Richard Branson's Virgin Galactic. Not surprisingly, 135,000 would-be astronauts entered the giveaway after it was launched with an ad aired during the Super Bowl. More surprisingly, 60,000 of them also requested information on Volvo cars, and more than 1,000 placed preorders. Volvo says the sales leads and publicity it received as a result of the contest were worth $5 million--more than twice what it spent on the 30-second Super Bowl spot.
[MISS] Introducing our new line, Kopikatt. Swedish home-furnishings giant Ikea likes to promote the provenance of its cheap yet comely goods, often devoting catalog space to the designers behind them. But no glory will go to the creators of Ikea's mini flashlight, which raised ire in the offices of Mag Instrument, maker of the iconic Maglite. Mag filed a trademark infringement suit in Sweden, and in March won a ruling against Ikea. The home-court penalty had to sting: Ikea said it's considering an appeal of the $629,000 judgment.