Is It Just About a Man and His Whiskey?

by Denis Serikov on January 5, 2012

Welcome to the rude awakening from the post-holiday coma. Hope you have eaten, drunken and been merry enough to last until Memorial Day. Now, off sticking to those resolutions!

Speaking of drinking and being merry, I caught myself eyeballing a plethora of options at a neighborhood liquor store Downtown Manhattan while heading to a holiday party. Between bottles of Clicquot and gift sets of Absolut, Johnnie Walker and Jack Daniel’s, surrounded by newer, less familiar brands, I wondered if the spirits market share game was a fair one after all.

In a recent issue of Fortune magazine, Jim Stengel, former P&G head of marketing and author of Grow: How Ideals Power Growth and Profit at the World’s Greatest Companies, listed Jack Daniel’s as one of his top 10 brands, praising its ability to stay authentic yet implement innovation and grow.

As Jim commended the vision of Jack Daniel and his followers, I thought of spirits marketing in a more global perspective. In the last decade, dozens of liquor brands tried the Veni Vidi Vici approach in the US market. Take vodka, for instance.
Have you heard of the Ukrainian Nemiroff, French Balinoff, or the Jewel of Russia? I have – most likely because they all came to us for media planning guidance early in their market entry – yet, even I wonder what stopped them from becoming ‘global megabrands’?

Vodka and whiskey may not share the same audience, but they do share similar price points and advertising budgets. Vodka sales in the U.S. overtook combined sales of bourbon back in 1975, but bourbon has retained its loyalists. So what’s the secret behind the longevity of Jack Daniel’s? Apparently, it’s Jack himself – the identifiable character that makes the brand. Jack Daniel, Jim Beam, John Jameson – derived from the tradition, the name become synonymous with quality.

For most of 2011, New York subways displayed Jameson ads that quoted something along “I named my son after my whiskey,” emphasizing the loyal following behind the brand. The same approach is seen outside of the spirit world as well. Fashion brands often carry the name of its chief designer – Oscar De La Renta, Ralph Lauren, Miuccia Prada, Donna Karan – all implying their own style and quality.

Vodka brands, however, rarely use a dedicated ‘character’ to sell their products. Except Trump (a topic we will soon re-visit) and, perhaps, Svedka, no premium vodka brand boasts a recognizable ambassador. Maybe that is the reason behind the recent vodka backlash and its attempts to get out of being perceived as just an ingredient that provides alcohol. Or maybe the liquor marketing cycle has given way to other bar players — for now. In any case, the topic of spirits and consumer behavior behind choosing one is intriguing enough to be revisited. Until then, bottoms up!

{ 4 comments… read them below or add one }

Jesse Williamson 01.09.12 at 4:43 pm

Very interesting!

A couple of factors which might play a part in the phenomenon you cite -

1. vodka is relatively late on the scene as a drink associated with wealth and privilege. until fairly recently, to many consumers vodka was what you drank in a screwdriver – it was ‘that (almost) tasteless alcohol’, the ingredient you ‘didn’t really know was there’. it’s only recently that there has been an absolut (pardon the pun) explosion in the number of high-end brands available in the marketplace – the charge of course, led by the aforementioned swedish brand. as a result of this circumstance, there are very few vodka brands with historical significance, and a high degree of ‘clutter’ in the marketplace. with new launches occuring on a weekly basis, brands must not only grab the attention of the marketplace as a new offering, but establish a strong brand identify which will have staying power in a segment where each afterparty brings with it another trendy brand launch. not necessarily an easy task in a segment which is changing faster than facebook’s look and feel – it requires both a willingness to step outside the box, as well as the patience to follow through on key brand building principles.

2. as I hinted at above, many marketers have made the choice to NOT market their vodka on the basis of taste. and certainly, many vodka drinkers are looking for, shall we say, a ‘smooth, mild experience’. at the same time, this leveraging of vodka’s legacy as a ‘tasteless’ beverage means there is an inability to market the liquor, as with many of the whiskeys and bourbons on the market, as the choice of an individual looking for a particular, unique ‘taste’. why does mr. jameson command our attention today? in part, because he is a unique man, who long, long ago, made a unique whiskey – one which still has unique and appreciable qualities all these years down the road. at least, this is the messaging. some vodka brands have embraced this approach based on the unique characteristics of their product – but only a very few.

now, having mentioned absolut, i’m curious if you see other brands that, in place of a clear ‘brand ambassador’, have been able to succesfully develop a strong brand positioning. ketel one might be one – perhaps jewel of russia is another. what is it about their approach that has succeeded, while so many others have fallen by the wayside?

Artemy Saguirian 01.10.12 at 2:27 am

Identity, identity, identity,
Patience, Patience and patience, once again
While developing a successful premium vodka brand you need to create a strong identity by a combination of the following factors : best quality in the segment and distinctive taste characteristics, fascinating legend (including, but not limited to – production originality), adequate price positioning and retail price consistency, packaging distinctiveness, emphasis on tasting promotions to target drinking audience and trend-setters (that would lead to “forced” on- and off-premise placements which in turn results in increased visibility and brand recognition), creative advertising efforts in strategically important regional markets…

And while doing all this you need to have patience and adequate resources to survive. There have been quite a few potentially successful vodka brands that were short-lived because their creators couldn’t survive a launch phase. It sometimes take up to 20 years for a brand to mature and receive wide market recognition.

And of course, as always, you need a little bit of “luck”, like Absolut, for exempl. While being a secondary vodka brand for years, it sharply and unexpectedly increased its market share during the Soviet invasion in Afganistan in 1979 and the resulting Anti-Stoli campaign in the United States…

Art Saguirian
Brand Creator,
“The Jewel of Russia”

Denis Serikov 01.10.12 at 6:41 pm

Art,

Best quality in the premium vodka segment, probably, depends on who you ask, right? Each month/quarter there seems to be a new unofficial leader, “best in class” guy – at times a very biased judgment call based upon various tasting contests, or even upon few jet-setters’ opinion. One can do his/her your own little research and draw conclusions by seeing what’s hot. For instance, what’s sitting on VIP tables at New York’s (and most recently Miami’s and Vegas’) exclusive nightclubs – the ones where bottle service starts at 5k… While the validity of such studies can surely be questioned (even those infamous blind tests at the Beverage Testing Institute are not perfect!), they do provide some insight into what is likely to set a mood in the near future. So who has or claims to have the absolutely best quality in this segment? Would it be Grey Goose or Ketel One – the latter seems to be edging the competition a bit? Or it is “handmade” and highly-praised Tito’s corn vodka with its somewhat plain-looking bottle and label? Or other trendy, organic kinds that seem to be popping up every week now? Is it Russian Beluga, a relatively new heavyweight in the U.S. market? Or maybe it is a grape vodka Ciroc backed by P.Diddy who is pushing it via the newly facelifted, “all-out” Vegas playground? Or is it The Jewel of Russia? I don’t think there is a single answer.

There is a lot more to answer and discuss after your post. Thank you. We will revisit the subject shortly with an article on recent market trends, after we gather several other opinions and provide them here for the audience.

Denis Serikov

Lucky 01.20.12 at 6:00 am

At last! Someone with the iinshgt to solve the problem!

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