Back to Basics. Public Relations (PR) vs Advertising.

When my husband made a Christmas gift request a few years ago, I was surprised and relieved. He’s difficult to shop for, so this would save me the time and frustration of trying to find something he wouldn’t hate. What did he ask for? A pair of slippers - I know! —but these were no ordinary pair of furry slip-ons - these were “re-invented indoor footwear” complete with bright, rubberised, detachable soles that transformed them from indoor slippers to outdoor shoes. They were called Mahabis.

The professional in me was intrigued by how Mahabis—a brand I hadn't heard of until this point - had managed to capture Dan's (the husband’s) attention since he's a tricky customer to target. He doesn't read magazines and only looks at book reviews and the cryptic crossword in weekend newspapers. He doesn't commute, so he isn't exposed to the countless ads on trains/buses/taxis and doesn't engage with social media socially. However, Mahabis had found their man, and they found him, it turned out via online adverts on The Times website. I bought the slippers, and even though the £69 price tag made me cry real tears, it saved me the hassle of searching through shops and websites for inspiration.

A few months later, I attended a marketing conference in London, where industry leaders shared their wisdom and godly greatness with marketing minions like me. Among them was Ankur Shah, the founder of the most expensive slippers in the world, Mahabis. Shah bounded around the stage looking delighted with himself as he gleefully informed the audience of PRs, marketers and brand builders about his 'lightbulb moment', a Google search that saw him pivot from launching luxury flip-flops to DTC (direct to consumer) luxury slippers when he saw demand was 10x higher (or something along those lines). The data told him slippers, so slippers it was. 'The data' also told Shah where his target customer was hanging out online, so he poured all his resources into a single marketing strategy - online and social media advertising. Mahabis chased (some say stalked) customers around every corner of the internet, targeting then retargeting them relentlessly with ads for their luxury hipster slippers. 

Shah dismissed PR and brand-building as seemingly 'old hat', redundant, and slow—why invest in long-term brand-building when data-driven online ads could yield immediate growth and sales? When you could spend £1 on online advertising and get a 10x return almost immediately. His strategy was a success, initially. Mahabis sold 1 million pairs of slippers in 100 countries within three years and achieved a valuation of £75 million; at the end of year four, the company went into administration just after Christmas after trading at a loss of £1.2m and owing creditors £2.5m. 

So what went wrong?