Date post: | 08-Feb-2017 |
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Marketing |
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THE HOOVER FREE FLIGHTS FIASCOONE OF THE GREATEST MARKETING DISASTERS OF ALL TIME
THE PROMOTION• Launched in 1992 with the aim of
selling excess stock from Hoover’s warehouses.
• Enticed customers to spend £100 on any Hoover product such as vacuum cleaners or washing machines in order to get two free return flights.
• Promoted via television adverts and in-store marketing materials.
TWO RETURN SEATS: UNBELIEVABLE • Original promotion promised
customers who spent just £100 two free return flights to Europe.
• Before the emergence of budget air travel like easyJet so the promotion amazed customers due to how much the free flights were worth.
• Hoover’s sales shot up and managers deemed the promotion a success.
TOO GOOD TO BE TRUE• Hoover bosses decided to extend
the promotion to offer free return flights to the US.
• Sales increased even higher with Hoover claiming 50% market share at the height of the promotion.
• The offer seemed too good to be true as the plane tickets were worth hundreds of pounds.
• Many customers discovered it was.
OVERWHELMING RESPONSE• The flights to America cost around £500,
but Hoover thought only a minor percentage of customers would actually redeem their free tickets.
• The new TV advert inadvertently reminded customers to submit their claims for their free flight tickets.
• Consumers were buying Hoover products just to get the free flights as the plane tickets were worth so much more.
• Hoover’s travel agents struggled with the amount of application forms coming in.
NEGATIVE PUBLICITY• Hoover’s travel agents used small
print to make claiming the free flights difficult for consumers.
• The press began picking up on how Hoover’s customers were not receiving the flight tickets they were promised.
• The negative publicity boosted the promotion even further.
• Consumers created an action group to put pressure on the Hoover company.
THE HOOVER VAN KIDNAP
• An outraged Hoover customer blocked in one of the company’s vans when an engineer visited his house.
• The kidnapping of the van lasted 13 days and embarrassed the company even further in national media.
THE RESULT• Multiple court cases against Hoover
went on until 1998. • Hoover were forced to pay tens of
thousands to charter entire planes to fly people to America.
• The marketing campaign ended up costing the company £50million.
• A number of Hoover executives were sacked including the Managing Director of Hoover Europe.
• The British division of the company was sold to Italian manufacturer Candy.
WHY DID IT HAPPEN? • Hoover underestimated the demand
that giving away expensive flights would have.
• Bosses were slow to realise that the promotion was going downhill.
• Even when they did realise the situation, they attempted to stop customers from claiming the free flights and made things worse for themselves.
WHAT SHOULD THEY HAVE DONE DIFFERENTLY? • Hoover should have researched key
questions such as how many people would buy into the promotion and is the offer just too good.
• The company should not have based their research and planning on assumptions – they assumed only a small percentage of customers would get round to redeeming the flight tickets.
• The company should have researched how much people wanted to fly.
• Consumers were more intelligent than Hoover assumed.