Uniqlo is a Japanese retail brand that now sells in 15 countries thanks to digital marketing campaigns. Founded with the aim of bringing affordable, fashionable, casual clothing to all people, it began in 1984 under the philosophy "UNIQLO clothes are MADE FOR ALL." The company focuses on its signature innovative clothing lines that have names such as HeatTech, UV Cut, LifeWear, and AIRism. In 2007, its pioneering "Uniqlock" viral marketing campaign won dozens of advertising awards, including the coveted Grand Prix award at Cannes. The company continues to run digital marketing campaigns, and while awards are nice, results are better. Marketers measure all sorts of metrics related to digital campaigns, from impressions and clickthroughs to purchases. Consider one of the most recent digital campaigns that Uniqlo ran in Australia to increase brand awareness and sales of its clothing. A fast-moving image contained a series of stills on digital billboards at a rate of 20 to 30 frames per second. A unique product code was embedded in the images. The code could be seen only if a consumer took a photo of the display. If consumers uploaded the code to the campaign website, they received a sample from the Uniqlo clothing line. Consumers also created content about the campaign, including videos that were viewed more than 1.3 million times. Suppose the campaign measures were as follows:

Calculate the net marketing contribution (NMC), marketing return on sales (marketing ROS), and marketing return on investment (marketing ROI). Was the campaign successful? Refer to Marketing Profitability Metrics in Appendix 2: Marketing by the Numbers to learn how to do this analysis.

Data from appendix 2

Given the above financial results, you may be thinking that Wise Domotics should drop this  new product. But what arguments can marketers make for keeping or dropping this product?  An argument for dropping the product is that first-year sales were well below expected levels.

So, what would happen if Wise Domotics did drop this product? If the company drops  the product, the profits for the total organization will decrease by $10 million! How can that be? Marketing managers need to look closely at the numbers in the profit-and-loss statement to determine the net marketing contribution for this product. In Wise Domotics’s case, the net marketing contribution for the product is $10 million, and if the company drops this product, that contribution will disappear as well. Let’s look more closely at this concept to illustrate how marketing managers can better assess and defend their marketing strategies and programs.

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Return on investment = net profit before taxes investment $6,000,000 $41,000,000 = 0.146 = 14.6%