Pernod Ricard has moved to take media buying, programmatic and data collection in-house, as it believes having direct consumer relationships is “the way forward”.
The company’s CEO Alexandre Ricard said during its half-year results meeting this morning (14 February) that it has been making lots of changes to the way it works with agencies.
The spirits company, which sells brands such as Absolut Vodka, Ballantine’s and Chivas Regal, is taking its media buying in-house, particularly when it comes to its digital and programmatic advertising. It is also taking its content production in-house, which Ricard says is more “cost-efficient”.
“In terms of who we want to target and the space we’re buying, as well as consumer insight, there’s a lot going on in getting to know consumers directly rather than via agencies,” he said.
He added that he had read P&G Marc Pritchard’s speech surrounding the “murky” media supply system, which he said raised many “interesting questions”.
When it comes to digital, you cannot rely on third parties to know your consumers.
When questioned on how important it is for the business to go direct to consumers, Ricard said having direct feedback from customers is “the way forward” and that the business has invested a lot in gathering more data directly.
“Gathering data is the easy part, but how you digest and use that data to improve the relationship with consumers in terms of brand messaging and its proposition is critical. When it comes to digital, you cannot rely on third parties to know your consumers,” he explained.
In terms of delivering the alcohol brands directly to consumers, which is something Heineken explored after partnering with Deliveroo last year, Ricard remained vague and said it is “too early to say” whether traditional retailers will eventually become the company’s direct competitors.
The Internet of Things ‘not a fad’
Ricard insisted that this focus is a valid one, as he claims consumers are willing to pay a premium for brands that stand for a set of values and offer experiences. He sees “hometainment”, where consumers entertain guests in their homes, as a particular strong area of growth.
“All the consumer insight we get is based on experiential. We are starting to see ‘hometainment’ grow across the world. It started in Latin American countries like Colombia. People started entertaining at home because there was a high risk of getting shot in a bar. In other markets, it’s growing just because it’s cheaper to entertain at home,” he told Marketing Week.
Despite this, there is still a way to go before this type of technology will be adopted among a mass market, added Alain Dufossé, managing director of the Pernod Ricard’s Breakthrough Innovation Group.
“Today, [the IoT] is not necessarily completely flawless and everybody is struggling with the maturity of the technology,” he said.
Pernod Ricard is also looking to roll out QR codes on all of its bottles this year on a market-by-market basis, which will provide detailed information about a brand’s provenance as well as nutritional information.
Ricard concluded: “We believe in today’s world that it’s better to inform consumers via connected devices. It’s as simple as that. I think it’s a more modern, forward-looking way of doing things.”