How to sell a brand

When GSK sold Lucozade and Ribena to Suntory, the new entity’s UK & Ireland marketing director Carol Robert was at the heart of the process.

Hot property

If you have not been lucky enough to experience the real heat and excitement of the World Cup on Brazilian soil, you may at least be able to find out artificially how it feels to play football in high humidity and 32 degree temperatures and empathise with the England team, who wilted in the Amazon.

Throughout the tournament, drinks brand Lucozade Sport is running the Conditions Zone, a pop-up five-a-side sweat box in Canary Wharf, where football teams can battle it out in temperatures similar to those that the professionals have been subjected to across the Atlantic.

Lucozade pitches
Lucozade Sport’s pop-up five-a-side Conditions Zone at Canary Wharf

The brand will show grassroots teams how their performance has been affected by the heat – and obviously hopes to shift a few bottles of the drink to help hydrate them. Lucozade Sport had already sold £1.3m worth of its Latin-inspired guava flavour drink and Lucozade Energy saw sales of £1.4m for its Brazilian blend before the tournament even started.

However, the South American carnival spirit is a long way from the culture of the brand’s new owner, the innovation-focused Japanese business Suntory. Based in Osaka, it has recently bought distiller Beam to add to its alcoholic drinks portfolio and is anticipating global sales of nearly £13bn this year.

British business GlaxoSmithKline (GSK) sold Lucozade, along with Ribena, to Suntory in December 2013 for £1.35bn. It is an acquisition that the firm hopes will help to make it the world’s largest soft drinks company for premium brands, with a 2020 sales target of £11.5bn for the beverage group alone.

Carol Robert
Carol Robert, UK & Ireland Marketing Director for Suntory

Marketer Carol Robert was at the heart of the process, as part of the GSK leadership team that sold the brands to Suntory; she is now Lucozade Ribena Suntory’s UK and Ireland marketing director.

“Going through a sale process was a once-in-a-lifetime opportunity and it stretched my skills beyond anything I’ve learned in my career,” she says.

Having detailed, functional knowledge of all three brands was critical to her success as a marketer on the team that sold the business, which meant late-night learning as well as doing the day job at GSK.

The process was made trickier by a language barrier, with a translator present at all meetings. “Everything was slow-paced, it was about being respectful, patient and taking things step-by-step.”

Suntory was in effect setting up a new company solely focused on the two drinks brands, says Robert. It revamped the entire structure of the marketing team, which is now an ‘end to end’ business unit that works on insight and strategy as well as execution. People work together on marketing to retail customers, as well as to those who buy and drink the products, who may be different people.

“Our marketers are able to think about the consumer, the shopper, the [trade] customer and the financials, which has been a learning and development challenge.

“It means that under one roof someone can go from being in activation to being in insights or revenue, whereas in most businesses that would be a big cross-functional leap and it would require a lot of support to get you there,” she says.

Robert looks after the entire team, which includes insight, revenue strategy, digital marketing, external affairs, consumer care and category management.

Being part of Suntory means there is a relentless focus on innovation and being a top FMCG player. Previous owner GSK sold the Lucozade and Ribena brands because it wanted to focus on the main emphasis of its consumer division – healthcare. Its brands include Aquafresh, Nicorette and Panadol.

“Health was always rooted at GSK and [the difference is] we now have access to a global food and beverage player. The fact that we’re rooted in FMCG makes a difference to our work pace.

“The Suntory entrepreneurial spirit means we can dream big about where we take the brands. At the same time, the [rigorous approach] to research and development will ensure we only put things out there that are rooted in consumer insight,” says Robert.

Visiting Suntory’s headquarters in Japan earlier in the year, she realised that the differences in culture extend to relationships with retailers. “It is very much ‘a promise is a promise’ and that is what you see in retail stores. When customers commit to 100 per cent distribution they do everything possible to make that happen. In the UK it’s more difficult.”

Lucozade Sport and Energy have both had £10m in marketing budget put behind them and the focus is on forging an emotional connection to the brands among consumers. Previously, emphasis had been placed on Sport’s function as an isotonic carbohydrate drink that aids athletic performance, but the focus has been shifted onto consumers’ aspirations using the line ‘Fuel to rule’.

Steven Gerrard Lucozade
England captain Steven Gerrard fronted a £10m campaign for Lucozade Sport

“It is much more personal and we considered how it is relevant to people, how can they ‘rule’ their chosen sport, whether they are a grassroots participant or a serious athlete,” says Robert.

She adds that the Conditions Zone pop-up is probably the first execution of the parent company’s philosophy ‘Yatte Minahare’, which means ‘Go for it’. She claims it is an entrepreneurial project because it will be able to measure players’ performance and educate them in how the sports drink can hydrate them.

Meanwhile, the focus for Energy is on ”highly social energetic occasions”, through its ‘Yes’ campaign. “The Yes project is about inspiring people to have ‘yes’ moments and to celebrate them,” says Robert.

For ready-to-drink Ribena, the focus is on new variants such as orange and guava. In the squash category, growth has been driven by the no added sugar range, with the brand launching a campaign with the strapline ‘Delicious goodness, no kidding’.

Yet both Ribena and Lucozade have been rapped by the Advertising Standards Authority this year for exaggerated health claims: Lucozade for saying that it hydrates better than water, and Ribena for going too far in its attempts to make its own health claims understandable for consumers, at the expense of compliance with the European Food Standards Authority’s requirements.

“The challenge is getting the balance between taking the approved claims and then making them into consumer-friendly language. As marketers it is critical for us to have messages that are relevant.

“There is no point having a great claim that no-one understands, so we have to take it and try to ensure our consumers understand it,” says Robert. However, the parent company lets Robert and her team be responsible for their actions, she says, adding that it is rare to have to ask permission for any individual marketing activity.

“We are empowered to develop our own strategies and accountable for our own business results, so [the relationship with the parent company] is more about learning and networks, tapping into bigger opportunities. Moving across into this business, the first priority has been building trust and credibility, doing what we are saying that we are going to do.”

Background: Suntory Time  

“For relaxing times, make it Suntory time,” is how Bill Murray immortalised Suntory whisky in the film Lost in Translation and last month the company showed its real-life commitment to the spirit by buying US distiller Beam for $16bn (£9.4bn).

It now owns Jim Beam, Teacher’s, Maker’s Mark and Courvoisier. The Beam Suntory company has a $4.6bn turnover, making it the world’s third largest spirits business after Diageo and Pernod Ricard.

Founded in 1899, Japanese group Suntory’s founding principle is ‘Yatte Minahare’, or ‘Go for it’, and its food and beverage company – of which Lucozade and Ribena are now part – was listed on the Tokyo Stock Exchange in July 2013.

The parent company also owns the Orangina and Schweppes brands in Europe, runs a brewery, has wineries in Bordeaux, a food supplements business, and gyms and restaurants in Japan.

Suntory anticipates sales of ¥2.22trn (£12.9bn), up 8.8 per cent in the year to December 2014, and operating profit of ¥146bn, up 15.4 per cent in the same period.

Top tips: Carol Robert’s three tips for selling a FMCG brand to a new owner 

The first impression is crucial

“As a leadership team, you are leading your way through a sale process and are responsible for making sure the right information changes hands.

“At the same time, you have to leave the buyers with a lasting, strong impression. We knew we had good content and were in a good place because we had done the work to get ourselves there. We wanted to give it our best shot and there was obviously adrenalin as we had not met them before. The first impression is so critical.”

Put yourself in the shoes of the buyer

“Think about what is going to be important to a buyer. At the beginning of the process we were focused on ‘what do we want to tell them?’ and what we thought was relevant.

“As things progressed it became apparent that it was important to really understand what Suntory needed to know and make that as clear as possible, even if it was not the most exciting bit of the brand that we wanted to talk about. There is no point focusing on the exciting stuff if it is the financials that they want to know about.”

Think about the customer, shopper and end consumer

“When you are thinking about selling a business, brand equity is critical, but that has to flow through to profitable sales. Having great customer relationships and being able to show how [marketing to the retailer, shopper and consumer] are working together is important to any buyer. It is not just about having great equity if that is not translating to a good balance sheet.”

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