Can a new marketing strategy from Absolut Vodka focusing on a philosophical “manifesto” help the brand reposition itself? Purchased a year ago by Pernod Ricard, the spirit is now looking to increase its popularity among consumers and the on-trade by moving away from marketing that focuses on the distinctive bottle shape, which has run since the Eighties.
While Pernod Ricard has seen sales rise by 9% in the last financial year to €7.2bn (£6.3bn) as a result of the acquisition, the debts of the drinks group mean it needs the premium vodka brand to appeal to a wider audience. In April, Pernod Ricard launched a €1.04bn (£928m) rights issue as part of a capital raising strategy aimed at cutting its net debt, which stands at more than €12bn (£10.7bn). It sold its Tia Maria liqueur brand to Illva Saronno for €125m (£107m) in July, while bourbon Wild Turkey was offloaded to Italy’s Campari for $575 (£496m) in April.
Mark Hamilton, head of marketing for vodkas at Pernod Ricard UK, says: “Historically, Absolut had a strong brand positioning, so it’s important we don’t forget that.
“Our ultimate challenge is to amplify the brand, and make it one to remember globally; it needs to match the personalities and lifestyles of our audience.
“We want Absolut to lead the way in terms of both the purity of the vodka and the amount of flavours it is available in as well.”
The new strategy aims to spell out what the brand stands for and sees Absolut suggest that “doing things differently leads to something exceptional”. It has already put the feelers out over the past few months to see if a new style of advertising would have an impact. It ran a “protest” campaign designed to coincide with the G20 summit – an online video depicting a world where all conflict would be resolved in peaceful and light-hearted exchanges.
It also used a “Hugs” marketing push at the time of the Budget, comprising a TV ad and experiential activity called “Give Kindness Not Cash”, where consumers bought services in independent retailers for hugs instead of money.
“The aim of the campaigns and the manifesto is to emphasise that we are not just another vodka brand. The ads reflect the positive nature of the brand,” explains Hamilton, who adds that rather than ditching some of the brand’s equality-focused marketing – such as reaching out to the gay community with its “no label” ads – the new strategy will help the brand by “extending” this activity.
“The manifesto will enable consumers to share our vision of a world as creative, visionary and inspired. We want to encapsulate the experience and can hopefully influence the segment,” he explains.
This will be supported by a major on-trade push, assisted by Rebecca Almqvist, bar manager at upmarket restaurant The Lonsdale, who has been hired as a brand ambassador to help bars increase their use of Absolut as a mixer.
Hamilton, who used to market Tia Maria, says Absolut will use cinema as its main advertising medium for the new activity, before embarking on online and experiential activity. He claims that the drinks company is throwing its biggest ever marketing budget for an Absolut campaign behind the new initiative to ensure the marketing reaches “as many eyes as possible”, although this is unlikely to include TV.
“We’re not aware of the brand advertising in this way before, but for us it’s the best way of connecting with a consumer and being seen as accessible and obtainable,” says Hamilton. “It helps to create great buzz and word-of-mouth, assisted by favourable PR. Using cinema means we can connect with the right audiences first time, and experiential means we can build relationships with the customers in person. TV didn’t have that success for us when we tried it.”
Rival vodka brand Smirnoff, however, recently announced that it will be appearing on TV screens and online with its “Be there” campaign. Will ditching an advertising strategy synonymous with the brand for more than 20 years really help Absolut compete more effectively?
How Absolut has helped Pernod Ricard sales The integration of Absolut into the Pernod Ricard distribution portfolio saw the company report a decline in volumes in the US but growth in most other markets, according to Pernod Ricard’s results for the last financial year, reported earlier this month. Off-trade sales fell 4% in the US, but elsewhere around the world the Absolut brand continued to increase its market share. According to Nielsen off-trade statistics for the first year since acquisition, orders for volumes of Absolut increased by 48% in Brazil, 25% in Germany, 15% in Australia, 14% in the UK, 9% in Greece andFrance, 6% in Spain, 4% in Poland and 2% in Italy.
Critics say that while the new ad approach could work for Pernod Ricard, it lacks the eye-catching nature of the brand’s previous efforts and may not help the drinks company repay its debt quickly.
Jump Branding and Design strategic director Jason Hemsworth warns: “Pernod Ricard seems to be jumping onto the manifesto bandwagon thinking that will make consumers sit up and listen, but typically it has been found that this is not true.
“The Absolut brand has had some fantastic campaigns in the past and if I was marketing it, I would look to carry on that trail and not go off in a completely new direction.”
Sam Hart, an analyst at Charles Stanley, adds that switching to a new strategy may give rivals’ more established marketing initiatives a boost. He suggests: “It is worth keeping an eye on how brands like Smirnoff, which trade under the premium vodka tag, are acting. Absolut’s manifesto theme is much more discreet and so consumers relate to it more. I think Pernod Ricard needs to really give this some thought if it wants to see an uplift overall.”
Hamilton is unwilling to rule out a return to the more traditional Absolut marketing campaigns if necessary and admits: “The ads the brand has run in the past have been incredibly effective and had great resonance with its audiences.”
He is convinced, however, that his own ethos of doing something differently should lead to “exceptional” results for the Absolut brand. But after moving away from such a high profile set of ads spanning three decades, it remains to be seen if consumer and trade reception of Absolut’s marketing remains as pure as the vodka itself.