With the barrage of information and advertisements hitting consumers through social media, television and radio, it can be difficult for a company to get consumers’ attention. This causes many companies to think outside the box for their advertising and promotion ideas, and adopt creative viral marketing tactics. While this can work, most recently with Procter & Gamble’s (NYSE: PG) popular Old Spice commercials (which helped to increase sales of Old Spice body wash by 107 percent in July), it isn’t always a success.
As an example, look at Gap’s (NYSE: GPS) attempt to use crowdsourcing to get a second new logo after the original new logo they commissioned (and paid for) was panned in October. GPS’ stock price fell almost 3 percent from $18.67 on October 6th to $18.12 after the crowdsourcing controversy hit.
This week, insurer Allstate (NYSE: ALL) was the victim of its own paradigm-breaking marketing attempt. The idea was simple: issue a press release with made-up accident rates according to Zodiac signs. And while some enjoyed the joke, many were upset that their astrological signs were being used to underwrite and rate their car insurance policies. Today, ALL issued a new press release apologizing for the satirical information and stating
Astrological signs have absolutely no role in how we base coverage and set rates. Rating by astrology would not be actuarially sound. We realize that our hard working customers view their insurance expense very seriously. So do we.
But the press release debacle didn’t hurt the stock too badly, ALL fell just 1.49 percent from $31.60 to $31.13.
Covestor models with exposure to these sectors include: High Yielding Buybacks, Abandon Stock, Rule #1, Value with Catalyst and Bottom-Up Analysis.
*Prices and charts courtesy of Yahoo Finance.