1. Sephora Direct: Investing in Social Media, Video, and Mobile
Case Study by: Hannah McArthy
Published by: Harvard Business School

2. Assumptions
Sephora will at least have a minimum $ 1 million budget for social media, video, and mobile
Sephora will continue to update social media platforms
Ulta will continue to be Sephora’s main competitor
Online search advertising will be minimal, since a heavy amount of 2010’s budget went directly to online search advertising
Beauty Talk will still be available and maintained
Facebook and Twitter will still be current (still be heavily used by the public)
Sephora is focusing on the other social media sites, such as Pinterest and Instagram
Sephora’s target market will not change, it will remain women between the ages of 25-35

3. Sephora’s Problem
Bornstein, senior vice president of Sephora, wants to double her budget in social media, video, and mobile for 2011.
Justify Sephora’s need to increase the budget for social media, video, and mobile
It is currently less than 5% of the marketing budget
Allocating the budget to make the biggest impact
Metrics need to be put in place
Return on investment needs to be found and calculated

4. Recommendations
Come up with a specific marketing objective for social media, video and mobile
Increase focus on non-traditional marketing while integrating it with the traditional platforms
60% of online sales are more than $25/month, compared to 40% who do not shop online
Survey customers in-store and online after checkout
Compare Sephora’s social media, video and mobile to its main competitor to ensure Sephora will not get left behind
Come up with common metrics that can be taken across multiple platforms
ROI
Conversion Rates

5. Implementation
Implement the social media, video, and mobile objective to focus on extending customer service and driving sales and leads to Sephora.com
Help narrow down to see if these platforms are performing
Survey at in-store and online checkout and ask what marketing mechanism encouraged them to purchase from Sephora
Facebook, Twitter, Catalog’s, etc.
Both in-store and online to get rid of bias
Integrate social media, video, and mobile with Sephora.com and traditional media
All social media should be linked to Sephora.com
Magazines have social media information or QR codes that lead to social media, video and mobile information
Benchmark Sephora’s social media, video, and mobile to Ulta
Number of tweets, posts, uploaded photos on various media platforms, video’s on YouTube ( Burke)

6. Implementation
Calculate ROI and conversion rates to calculate where to allocate the budget and to justify non-traditional marketing budget
ROI – Social Media Value Chain (Exhibit 14)
Derived Value – Investments/ Investments
Measure Engagement (Followers )
Measure the Social Media Impact (Benefits)
Compare Investments from Derived Benefits
Conversion rates – see how Sephora’s digital marketing platforms bring visitors to Sephora.com
Google Analytics
Goals and Advanced Traffic Segments
Goal: Destination (Sephora.com)
Create a funnel for the goal (path you expect people to take)