PALMERS: success of promotion undermines image
A PROMOTION launched in September by Austrian lingerie chain Palmers proved much more successful than expected and caused considerable consumer dissatisfaction as a result. To celebrate its 100th anniversary, the chain offered a free return flight to 18 European cities to all customers spending at least EUR 100 that month. Faced with a response that was double that anticipated, the chain was unable to accommodate requests for all destinations on the dates requested, even though customers had been asked to give alternative destinations and dates. Although only 5 per cent of requested dates and destinations could not be met, reports in the press and posts on Facebook by disappointed customers created a very negative image for the chain. The impact was aggravated by other customers complaining of excessive waits for connecting flights.
There are two lessons for retailers to be drawn from this. The first is that estimating accurately the response to a promotion is not possible. The second is that the nature of promotions should lead to financial cost rather than to image damage, which can cause much greater loss of revenue, if response is under-estimated to a significant degree.