Chipco Case Study
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 uncalculated and lacked vital research and development that could have lead to potential sales and success. These and other factors lead to the initial failure of this product. A well-known marketing concept, “The 4 P’s of the Marketing Mix,” could have dramatically affected the outcome of the product. This essay will explore some issues concerning Chipco, their impact, and how they could have been avoided all together.
1. Product The first “P” is product. Ibrahim and Ellis detail four stages of product development (Ibrahim & Ellis, 2002, p. 132). The first is the idea generation stage. The idea for Chips product came from her experience as cosmetologist and applying makeup in cramped spaces during her dancing career. She perceived a need for a solution to the difficulty of applying ones’ own eye makeup. A 3-way mirror that allowed one to see their top and bottom lids was Chips’ potentially innovative product. This stage was complete. The second and third stages are the development and the incubation stage, respectively. During these stages, an innovator researches all aspects of their idea and, based on this, develops a feasible prototype. Although Chips conducted some research, it was insufficient to ensure success for her
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 uncalculated and lacked vital research and development that could have lead to potential sales and success. These and other factors lead to the initial failure of this product. A well-known marketing concept, “The 4 P’s of the Marketing Mix,” could have dramatically affected the outcome of the product. This essay will explore some issues concerning Chipco, their impact, and how they could have been avoided all together.
1. Product The first “P” is product. Ibrahim and Ellis detail four stages of product development (Ibrahim & Ellis, 2002, p. 132). The first is the idea generation stage. The idea for Chips product came from her experience as cosmetologist and applying makeup in cramped spaces during her dancing career. She perceived a need for a solution to the difficulty of applying ones’ own eye makeup. A 3-way mirror that allowed one to see their top and bottom lids was Chips’ potentially innovative product. This stage was complete. The second and third stages are the development and the incubation stage, respectively. During these stages, an innovator researches all aspects of their idea and, based on this, develops a feasible prototype. Although Chips conducted some research, it was insufficient to ensure success for her
Bibliography: Chipco. Entrepreneurship Case. Ibrahim, A., & Ellis, W. (2002). Entrepreneurship and Small Business Management (Fourth Edition). Bubuque: Kendall Hunt Publishing.