While some brands are contemplating what budget to allocate to television advertising, others are worried this medium might not even be an option for them in the future. Alcohol brands were warned at a Health Select Committee meeting last week that they face a possible ban on television advertising.
Government concern over binge drinking is leading to proposals that could restrict the way alcohol brands use promotional activity. The first Health Committee report has led some marketers to argue that alcohol is being treated as the “new tobacco”. There are concerns that an industry which spends £800m a year on advertising and already works under tight regulations, will be damaged if rules are tightened further.
Simon Litherland, managing director of Diageo, which sells brands including Smirnoff vodka and Guinness, argues that the “draconian proposals on alcohol advertising and sponsorship…amount to an effective ban”.
But while some marketers like Litherland believe further restrictions on alcohol advertising could be damaging for business, other industry experts believe this could in fact drive marketing innovation within the booze category.
“Displacement marketing” is one route being touted as an alternative approach to alcohol promotion. It is already practised in India to get around the blanket ban on alcohol advertising.
“Displacement marketing”, which is sometimes also called “surrogate marketing”, involves brands marketing one particular product in order to bring attention to another banned item. For example, Kingfisher beer has successfully launched non-alcoholic products that effectively remind consumers about the items they cannot see in marketing.
Kingfisher Airlines and Kingfisher Water carry the same logo as the beer brand, promoting the lager label while generating an alternative revenue stream for the business. Other alcohol brands have even created holiday operators and CDs (see Displacement Marketing In Action, below, for other examples) to generate awareness of their brand name.
While this is a grey area of marketing in India in legal terms, and indeed other countries, there are clearly some brands successfully moving their alcohol brand into non-alcohol sectors. Could this trend for “displacement” pop up in a UK market with heavier regulation for food and drink?
Stretching an alcohol brand into different territories is something that Anna Eggleton, director at The Value Engineers, believes could work well in the UK for brands with strong personalities. Some companies are practising displacement marketing in various forms already, she argues.
Guinness, for example, has already moved beyond its traditional stout, offering a selection of branded goods including clothing. This follows in the footsteps of tobacco brands, which have long been heavily restricted in their marketing and have grown good at displacement tactics.
For example, Philip Morris licenses the Marlboro Classics name to Valentino, which produces a clothing range. However, the tobacco company is at pains to point out that this business is “not a platform for Philip Morris International to promote tobacco products”. But it certainly doesn’t hurt. Camel also has a licensed clothing range. While legal restrictions are now in place in the UK to prevent tobacco firms using displacement marketing, such ranges work in their favour regardless.
“If you have a good brand like Camel or Marlboro, it should have a life of its own,” says Eggleton. She says the practice of displacement marketing is about “thinking about branding in a different way.” Many alcohol brands are already thinking beyond large-scale television campaigns to get messages across to their target audience.
While Bacardi global marketing manager Lisa Jazwinski says rum is what the brand is about, it has taken an unconventional route to promote the drink. Jazwinski claims Bacardi’s association with music is “in its DNA” and complements the brand’s “distinctive Latin attitude to life”.
A “record deal” in 2008 with band Groove Armada saw the partnership release four tracks and put on a series of concerts promoted with a large-scale PR campaign, the results of which the brand was “extremely satisfied with” says Jazwinski. This particular deal broke conventions in both the musical and alcohol industries, and while Jazwinski will only confirm the deal had “promotional benefits”, it did help market the brand in more areas than would normally be possible.
Although this particular partnership has now come to an end, Bacardi is looking at other ways to market itself through music. The brand is planning to release the Mr Bongo track created exclusively for The Spirit of Bacardi commercial in February and has further plans for its online music strategy throughout 2010. Embedding music within the marketing strategy has allowed Bacardi to promote the brand creatively via unconventional means.
Although Jazwinski says the brand will not be straying into new product sectors, the brand is already thinking about other non-conventional promotions, which make the brand distinctive as a music brand and not just an alcohol one.
Other brands aren’t convinced either that creating a new product under the same brand name is really the answer. While Kingfisher beer has effectively created an advertising vehicle through its other Kingfisher products, beer brand Budvar’s marketing manager Ian Moss can’t see his brand moving into other business areas.
He believes this avenue is only an “excellent” option for his competitors, who he terms “bland global-fizz”. He says it is a viable strategy for brands which have nothing to differentiate themselves with, such as provenance or quality. While advertising restrictions could damage larger brands, he believes niche brands like Budvar benefit much more from word of mouth. He jokes: “We would be the last brand to suffer from tightening restrictions on advertising.”
Jonathan Salem Baskin, brand strategist and author of Bright Lights and Dim Bulbs believes more restrictions on advertising could be the “best thing that’s ever happened to the afflicted brands.” The reliance on creative content to sell a pint of beer or a vodka cocktail is fundamentally flawed, he argues. Being free from these marketing conventions would drive businesses forward, not backwards as alcohol brands like Diageo have argued.
Salem Baskin says that “displaced brands” should be focusing on creating more exclusive deals. Brothers Cider has just signed a pouring deal with The O2 arena, which means that its brand will be exclusively available to the hoards of concertgoers. Brothers Cider marketing manager Matthew Langley agrees that the deal with The O2 “gives us the opportunity to bring our brand to a large audience with great exposure.”
He says that for Brothers Cider, there are “no plans to stretch our brand into other unrelated product categories” and wonders if other alcohol brands would also be cautious of committing to displacement marketing practices that would involve the launch of products outside of their known sectors.
Salem Baskin adds that many tobacco brands use deals like exclusive distribution, rather than choose the displacement route.
He explains: “Cigarette brands were forced to give up their addiction to image ads and branding nonsense…some of those funds weren’t put into alternative marketing tools per se, but rather distribution deals, so as to gain exclusive access to potential customers.”
He believes that those brands seeking alternatives to “displacement” should look at shifting brand marketing to activities not traditionally associated with marketing: better facilities and customer service, for example.
The sector could even benefit if alcohol brands are further restricted believes Salem Baskin because it would allow marketers to concentrate on aspects that make a real difference to consumers. He says: “Sinful brands tend to focus on customer retention and ‘friendly stakeholders’ as a primary driver of sales and category growth.”
He is working with Futurelab with some unnamed brands looking at unconventional strategies that “creatively address the limitations in traditional marketing”. Salem Baskin argues that it is not only those companies facing tighter regulation that can benefit by taking the same routes as displaced brands, but other brands – even those that are most socially palatable.
Still, with tighter controls on marketing looking increasingly likely for alcohol brands, this trend for “displacement” activities does not look set to fade. Although alcohol brands appear reluctant to openly see the creation of a new product category under their own name as a viable option in a depressed economy, deals like “Bacardi Groove” show that alcohol brands can work comfortably outside their own sector with credibility.
While some of the more drastic approaches that Indian alcohol brands have taken to marketing – such as starting an airline – might seem a step too far in the current climate, more unconventional strategies will come further up the agenda if the threat of tighter restrictions are put into practice. The Value Engineers’ Eggleton claims that the smart brands “need to start thinking about putting strategies in place now” in order to stay ahead of any future restrictions.
Non-conventional routes of alcohol marketing:
Drinks company Pernod Ricard may not call its recent campaigns true “displacement marketing” but its strategy has seen the brand deliberately head down a route that takes the products into new areas.
Mark Hamilton, head of marketing for vodkas at Pernod Ricard, says the Absolut brand is all about “doing things in an unconventional and different way”. Meanwhile, Patrick Venning, head of marketing for whiskies at Pernod Ricard, says the company’s marketing has to be about “stripping the layers between the brand and the consumer.”
While this might not yet be classed as full “displacement marketing”, there are glimpses that some of the brands in Hamilton and Venning’s portfolio are very happy to sit in other areas outside of alcohol.
Absolut has moved away from television advertising. Last year, says Hamilton, “TV didn’t have that success for us”. Instead, he has taken Absolut into a new area with the launch of a marketing drive based around a social “manifesto”.
“‘Absolut World’ allows the brand to step comfortably into a different genre,” says Hamilton. The “manifesto”, he says, allows consumers to glimpse into the brand and connect with the world.
Part of the Absolut World campaign is the launch of a label-free bottle that the company claims is: “A vision of the world that is more diverse, vibrant and embracing of those from every walk of life.”
Such bold social statements are difficult to pull off convincingly, but Hamilton believes that by committing to social causes “without being heavy handed”, consumers are more likely to connect with the Absolut brand and understand the issues it is campaigning for.
Last year, Absolut was involved in a creative campaign around the political G20 Summit. Hamilton says the key to executing the association between vodka and social campaigning convincingly is to “capture the mood of the nation”.
Viral elements of marketing have also been creeping into Hamilton’s strategy for Absolut. Its “Give Kindness Not Cash” initiative, which calls for a currency for kindness, relies on consumers getting into the spirit and giving “high fives” to bartenders in exchange for a vodka and mixer.
While Absolut isn’t planning any new product launches outside of alcohol, Hamilton says the marketing direction shows that “Absolut can sit in another genre”.
Venning also takes this approach with whisky brand Jameson in its association with film. The drink is attempting to reach out to its core market of males aged between 25 and 35 years old through the creation of the Jameson Cult Film Club.
Venning admits that other brands operate in this space successfully – Stella Artois runs its own film festival, for instance – but he believes cinema has been given its own Jameson edge with some “wow films in some wow locations” which attract the audience that fits in with the crowd. He explains: “We recognise that we’re not the only ones doing this, so we wanted to make this uniquely Jameson.”
This process involves making the events intimate, such as the run of cult films like This Is Spinal Tap in cinemas across London last year, with Jameson available for the filmgoers.
Venning says this style of small-scale event is an attempt to cut through layers of advertising and doesn’t rely on conventional marketing such as television, while still being “subtle enough” not to feel overly branded.
To help create buzz and interest in their campaigns, Hamilton and Venning admit they find social media platforms such as Twitter, Facebook and blogs useful. Venning believes a level of “co-creating and involving customers” in its marketing make the initiatives more convincing.
Venning says that although Pernod Ricard is not yet executing “displacement marketing” as it has been seen elsewhere, he thinks the trend of extending into new categories could work for his business. He says that a brand like Malibu is “ripe for that kind of opportunity”.
He adds that through partnership deals between his product Chivas Regal and fashion brand Christian Lacroix, the company is already innovating in new areas.
While there’s no couture range planned yet, Pernod Ricard’s willingness to take an unconventional approach to marketing leaves it open to the possibility of finding‘ new ways to get closer to its audience without consulting the mainstream marketing manual.
Displacement marketing in action: A global view:
White Mischief Vodka is a brand within the United Breweries Group global portfolio. It has created “Mischief Holidays” to get its brand messaging out to its target market. The holiday logo is the same as the vodka logo but instead of offering alcohol, it sells packages to destinations such as “Sunny Goa” and “Amazing Thailand”. While the vodka brand is banned from the screens in India, the holiday brand under the same name can get its message out there semi-legitimately.
Kingfisher beer is the classic example of an alcohol brand diversifying into other business areas. Entrepreneur and chairman of the United Breweries Group,Vijay Mallya, launched an airline in 2005 with the same branding as the beer. He has also since launched a water brand.
Branding agency The Value Engineers argues that Guinness is already practising displacement because it is already well-known outside of its sector. Merchandise such as T-shirts, key rings and hats are available, and the brand has also strayed into food with limited edition Marmite flavoured with Guinness.
Many drinks brands also have well-known associations with the music scene. Smirnoff vodka has linked itself with the clubbing scene in the past and if you look hard enough, you can find Smirnoff dance CDs for sale on eBay. Bacardi has a history of music associations and has recently started to play up its Cuban heritage (even though it’s not available to buy in that country) with several concerts being held and four tracks being produced.
Tobacco brands are prevented from doing much in the way of marketing in the UK other than through packaging. However, there are examples of several brands getting their names out via other means. Davidoff is well known for its cigars but it also has the aftershave range Cool Water, and Dunhill and Marlboro Classics have their names on clothing. While all are keen to stress they do not practise displacement marketing, their brand names do appear on other non-tobacco goods.
Why displacement won’t work in 2010
Kate Waddell, managing director of consumer brand at agency Dragon Rouge
While the divergence and displacement marketing model is a tried-and-tested one in other categories, I think there are several reasons why alcohol brands are less likely to adopt this model of getting their brand in front of consumers in the UK.
The creation of drinks-branded products could well be devalued by the prevalence of “freebie” merchandise that is commonly associated with drinks launches. Consumers either see these as promotional items or do not expect to pay for the branded merchandise.
Jack Daniels clothing and lifestyle accessories would hardly be new or have cachet. Conversely, the hard-to-get-hold-of Veuve Clicquot branded umbrella says so much about you (e.g. you are part of an elite club), that would be eroded by any consumer being able to just buy it.
Drinks brands also lead multiple lives in imagery terms. A spirit brand can be cool in a style bar; a standard part of a traditional older users’ drinks cabinet; or a retro ironic cool product with a cult following among niche groups. As such, to start to build the brand world that might tie the brands down to one area could be high risk and alienate loyal customers.
The channel model for drinks brands is so established and specialised that moving into retail offers and manufacturing could just be a step too far. There is permission for drinks brands to grab attention from consumers through new packaging, product formulations, drinking rituals and so on that there surely must be many ways to keep both excitement and off-shelf communication going.
The influence of “shelf shout” in the on- and off-trade should not be underestimated and the power of grassroots consumer peer-to-peer recommendation is huge. It would be nigh-on impossible for any regulator to quash cults, rituals, buzz brands and ways of drinking.
The appeal and lure of drinking great-tasting, good-looking alcohol brands, being seen with the right “badge” brand and ritually drinking the current “in drink” is a well-established pattern. I don’t think the drinks or indeed the confectionery industries will need to look at displacement branding and divergence in the near future. If they do, I would approach with care – both to protect their brands and their bottom lines.