Malibu and Kahlua are using digital innovation to “outsmart” rivals with larger marketing budgets by fostering a startup culture that prioritises speed over fear of failure.
Johan Radojewski, director of communication and channel marketing at Malibu and Kahlua, tells Marketing Week: ”It’s not about being the biggest fish but the fastest. We are up against some huge competitors with bigger budgets so we have to to outsmart them.”
The company created The Living Lab, Malibu and Kahlua’s creative digital innovation hub, five years ago in order to foster fast prototyping but the lab has also driven cultural change within the marketing team.
Colin Kavanagh, vice-president of global marketing for Malibu and Kahlua, explains: “It’s hard to innovate in big companies because of the fear of failure but with this setup we get people energised around taking risks. It takes fear off the table to a certain extent.”
Radojewski adds: ”With us, speed is of the essence so we want to trial with consumers as soon as possible rather than having the perfect product.”
The hub is located at the brands’ headquarters in Stockholm and is charged with coming up with digital solutions to common industry problems. All innovations are rooted in either a business challenge, a consumer insight or an opportunity.
To date, its most successful innovation was Malibu’s connected bottles, which used ‘smart packaging’ that printed codes on bottles that when scanned gave users access to games on their phone.
Kavanagh says The Living Lab has enabled the two brands to carve out a niche for themselves around innovation.
He says: ”Traditionally, the drinks industry hasn’t been known for innovation so there is a big opportunity there that we sought out and capitalised on.
“We’ve built a reputation around being innovative and being a centre of excellence around The Internet of Things and influencer marketing and now we are seeing more Pernod Ricard affiliates coming to us and asking for advice and sharing the learnings we’ve gathered.”
Putting prototypes into consumers’ hands
The Living Lab’s most recent innovation includes an augmented reality game intended to drive purchase that is being trialled next month in Copenhagen. Consumers use a Malibu bottle to unlock the game on a screen that uses image recognition software and motion sensors. If they win, consumers are rewarded with a discount code to buy the bottle.
The idea is based around the insight that if consumers simply pick up a bottle they are more likely to purchase it.
The brand is also working with the off-trade as well, which Kavanagh says helps it build closer partnerships.
Some of these innovations include an interactive bar top that uses facial recognition to remember the consumer and their previous drink order, and beacon technology that notifies consumers when they are near places that offer drinks deals.
Radojewski says: “Being brand owners we have two types of customers: the consumer and the off-trade. If we can provide value to both that’s ideal.
“[The beacon prototype] was about driving footfall into the bars. It was all about giving consumers added value via a discount on a drink and giving the bars a special experience.”
He concludes: ”In the future, The Living Lab shouldn’t exist because we will have built that mindset of taking risks and rapid prototyping throughout the brand from communications to innovation.”