How Shutterfly Seeks Picture-Perfect Profits: A Strategic Case in Marketing Yolanda Williams, 2012

1. A Strategic Case in Marketing
Yolanda Williams, 2012
ybowdrywilliams@gmail.com

2.  Founded in December 1999, Shutterfly is an internet-based social expression
and personal publishing service.
 Shutterfly is headquartered in Redwood City, CA with manufacturing facilities in
Phoenix, AZ and Charlotte, NC.
 Shutterfly offers free online photo storage, and has never deleted a photo.
 Millions of customers have billions of pictures on Shutterfly.
 The Shutterfly flagship product is its award-winning photo book line, which
helps consumers celebrate memories and tell their stories in professionally
bound coffee table books.
 Other popular gift ideas include personalized coffee mugs, t-shirts, holiday
cards and calendars.
 The winter holidays are the peak season at Shutterfly.
 At the end of 2012, the number of Shutterfly’s transacting customers totaled in
7.1 million people with $27 million in annual revenue.

3. How to remain a top online photography
company
Solution
Manage
• Heterogeneity
• Intense Competition
• Target Markets
• Marketing Mix

4. Customers who need to stay connected with family
and friends by sharing photos and videos, online
and in print media.
People
Woman are 70% of customer base of Shutterfly and
tend to be the family historians and curators of
capturing family moments.

5. “You and your pictures.
Your stories. Share
your world.”
Shutterfly wants to deliver
award-winning prints from
your digital camera right to
your door

6. Shutterfly provides high quality products and world class services that make it
easy, convenient and fun for consumers to preserve their digital photos in a
creative and thoughtful manner.
 Product - Photo storage, digital photos printing services, photo enhancement
services, and personalized products
 Promotion - Free online photo storage, Photo sharing, Photo software, Photo
borders and Back of print messaging, Never delete picture and secure picture
storage, cartoon character licensed products
 Price - Free, Moderate and Premium: photo size, type of print, and product
 Place - Online, with options to Direct-ship or Pick up prints at Walgreens, CVS,
and Target® stores

7. I. Shutterfly has increased measures to manage customer heterogeneity by investing in
major printing equipment so that it can control the quality of its pictures instead of
outsourcing it to other photo processing companies. In doing this the company is able to
develop standards in providing quality coloring and images. The company has added
features to its website to allow customers to manage their pictures, such as reducing red
eye, adding borders and other improvements before having the pictures ordered. The
goal for the company is give customers high quality pictures through its online services.
II. Shutterfly single-minded focus on helping customers enhance, organize and store digital
photography allows them to provide the highest quality products. They are number-one
choice of professional photographers and the proud recipient of many industry awards.
III. Shutterfly continues to innovate – introducing new products and services to consumers,
driving process innovation to improve product quality and cost.

8. Watch Shutterfly in action
www.youtube.com/watch?v=naUmyHkmNiU

9. I. Shutterfly eases customer through the product adoption process by offering
free prints to customers. This allows for customers to try its services and
experience it’s the quality product offering that the company is trying to sell.
This early strategy built awareness and interest in the product.
II. In addition, the company promotes picture storage through its website for
free and promises to never delete the pictures unlike other companies, which
may entice customers to try their service.
III. The company’s website features such as, free image loading and storage on
their website, sharing with friends and family, and allowing friends and family
to order prints/products allowed better adoption of the product.
IV. Before the social media became very popular, Shutterfly implemented the
sharing strategy and extended their products to a market segment such as
Grandparents without any additional efforts.

10. Shutterfly is 100% focused on developing a premium lifestyle
brand. That's because premium brands confer high customer
loyalty, viral word-of-mouth growth, high customer retention and
repeat orders. In addition, Shutterfly continues to innovate –
introducing new products and services to consumers, driving
process innovation to improve product quality and cost.
I. Our picture storage is free and unlimited. We never delete photos
II. We securely store your images at full resolution
III. Enjoy free personalized websites
IV. 100% customer satisfaction guaranteed
V. Plus, receive 50 free 4x6 prints
VI. Pick up prints at Target, Walgreens, or CVS in as little as an hour

11. I. Shutterfly negotiated with Nickelodeon to license its characters
because it wanted to attract parent’s in buying these personalized
photos with their children’s favorite characters. Nickelodeon is a
popular children’s network on TV and this partnership allowed
Shutterfly to be more competitive and attract more customers. This
partnership also allowed the company campaign around the new
product in places such as magazines and TV networks.
II. This helped Shutterfly to expand its appeal and gave customers
more reasons to log on, Upload new photos and buy from Shutterfly
again and again also increases market segmentation. Adds brand
value to Shutterfly