Chipco Case Study Essay

2316 Words Aug 3rd, 2010 10 Pages
Introduction
Bill Gates, founder of Microsoft, said, “It's fine to celebrate success, but it's more important to heed the lessons of failure. How a company deals with mistakes suggests how well it will bring out the best ideas and talents of its people, and how effectively it will respond to change.” This quote definitely applies to Colleen Klein’s company Chipco. “Chips,” as Ms. Klein is common known, invented a 3-way mirror for the application of eye make-up: The Eye Maker. It was Chips’ personal belief that this product was a useful essential for all women that wear eye makeup. Although she was aware of the fact that 95% of new products end in failure (Chipco, p. 1), Chips took a risk and launched her creation. This risk, however, was
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For example, when Fred Becker was conducting the little market research that was done, a salon owner who was shown the product commented that it was “too cheap and tinny.” (Chipco, p. 8) Chips herself stated, “Women hoped and prayed that by using this or that makeup they would somehow change their appearance to that to their favorite movie star.” (Chipco, p. 3) “Cheap and tinny” are not terms usually associated with movie stars. Another major issue with the product was the packaging. As previously stated, women saw makeup as one step closer to achieving the looks of their favorite stars. This demonstrates the need for the packaging to be glamorous and enticing for women. Chips chose beige and brown colored boxes with an acetate film covered paneled. These neutral colors may not have been the best choice to attract attention and interest while on display. Furthermore, while being transported some of the acetate films tore, rendering them unsellable. Once Chips’ research was complete and analyzed, Chips should have produced about five of the newly adjusted and improved Eye Makers, using the actual materials and packaging. This assumes that the results of her research indicated that the product was useful, feasible and sellable. These five Eye Makers would be used for quality tests for the durability, sturdiness, and safety of its materials and packaging. This could have avoided the

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