The beverage business blog from Andy Morton
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TFWA - Diageo prepares for a travel retail journey
25 Oct 2012 07:28
Diageo's global travel retail head, Roland Abella, was in a bullish mood last night (24 October).
“I like to take risks,” he said at the unveiling in Cannes of the Johnnie Walker Explorers Club Collection, his company's biggest travel retail launch. “If we fail, then we will learn from it. But, I hope we won't.”
He's unlikely to fail with the Explorers Club, a premium blended Scotch range exclusive to the travel retail sector that claims to tap into the “romance of travel”. The question is: why has it taken Diageo so long to come up with a collection like this?
As Abella said, the strategy in travel retail today is differentiation; trying to give the target Asian and Russian airline passengers something they can't get at home.
Aside from the question of whether non-Western cultures can identify with the Victorian-tinged view of travel Diageo is peddling with its Silk Road, Royal Route and Gold Route lines in the Explorers Club, the collection ticks all the modern boxes. The packaging is colourful, it comes with an off-the-peg story behind it and it's expensive, from US$43 to $159.
After the launch, Abella told just-drinks that “geographies don't mean anything anymore”, highlighting Diageo's one-size-fits-all approach to travel retail and why this new collection is being released in all global markets.
That's not a view shared across the Scotch industry. Morrison Bowmore Distillers said yesterday that regional market trends do seep into travel retail, but it'll no doubt work for the Explorers Club, especially with the marketing clout of Diageo behind it.
"This is our big play for the foreseeable future," said Diageo's Global travel and Middle East marketing director, Steve White. It appears then, that Diageo is setting sail on its own journey.
Fetch me my binoculars.
TFWA - a different world
24 Oct 2012 07:24
just-drinks is in Cannes for TFWA, the annual travel retail get-together, and it's not just the warm weather that marks this event out as a different world.
At the Pernod Ricard media meet-and-eat at the Majestic Hotel on La Croisette last night, the CEO of Pernod's Chivas Brothers Scotch and gin unit, Christian Porta, reminded everyone that one out of five bottles of Chivas is sold in travel retail.
It is a huge market for the big companies, which is why over the past few years, they have set up bespoke travel retail divisions that operate like any other regional arm.
But this is a vast and complex market, with many more variables than the average country. In what other sector would you hear people talking about Russians buying Jameson in Thailand, or Chinese buying Cognac in Italy, as they were at the Pernod event.
It is also a relatively rich place, so premiumisation is usually the buzzword here and visitors can expect to see some eye-watering ostentation on display.
just-drinks is here until the end of the show on Friday, so if you see us about make sure to stop for a chat.
The freefall gamble that earned Red Bull its wings
16 Oct 2012 08:32
Red Bull reached new heights on Sunday
It may not equal Felix Baumgartner's leap into the unknown on Sunday, but when Red Bull agreed to fund the extreme parachutist's attempt to freefall from near space, executives at the Austrian firm were taking their own big risk.
Space travel, even near-space travel, is expensive, and if Baumgartner had died in his attempt Red Bull could have been indelibly linked to the result. But the gamble paid off, perhaps better than anyone could have expected.
The jump, which can be seen below, was yesterday called “perhaps the greatest marketing stunt of all time” in Forbes magazine and estimated to be worth “tens of millions of dollars of global exposure”. Eight million people online watched the moment Baumgartner stepped from his balloon 24 miles above the New Mexico desert and many more have seen the blanket media coverage.
Of course, this is all in keeping with Red Bull's unique focus on extreme sports, as outlined in this Guardian article, from its high-profile sponsorship of a Formula One team to funding ex-ice hockey pros to race down mountains. None, though, have had the penetration of yesterday's planetary plunge.
So, well done, Red Bull. And well done, Felix Baumgartner. While Heineken and the Coca-Cola Co continue to spend millions on football and the Olympics, his one small step for man resulted in one giant leap for Austrian energy drinks.
Latest projections for Pilsner Urquell looking good
08 Oct 2012 15:11
Putting on a show
Czech beer maker Pilsner Urquell celebrated its 170th birthday last week, with festivities culminating in this jaw-dropping light show projected on to the beautiful Cathedral of St Bartholomew in Pilsen. Highlights include golden lager flowing out of the windows and World War II bombers blowing the stone façade seemingly to bits.
Europe's breweries seem to have developed a taste for these sound-and-vision spectaculars. Ahead of this year's Champion's League Final in Munich, Heineken thrilled guests at a pre-match event with a similar light show that saw giant footballers kicking lumps out of a German castle.
Beer drinkers come out ahead of the curve
03 Sep 2012 16:19
Glass shape determines a drinker's speed, a study has shown
People drink beer twice as fast from curved glasses than straight ones, new research has shown.
The Bristol University study, which brought 160 subjects in for a drinking session, said the reason was probably down to difficulties in judging the halfway point of a curved glass. There was no difference in drinking speeds for non-alcoholic beverages.
The full results of the study can be found found here.
Want to sneak beer past festival security? Just concentrate
24 Aug 2012 17:11
The team here at just-drinks think beer is great. Really, really great.
Except for one thing – bottles and cans are just too darn heavy. Luckily, one US company has the solution with its very own beer concentrate. As 95% of beer is just plain old water, Pat's Backcountry Beverages figured why not just condense the essentials (malt, barley, hops etc) into a little bag. You can add the water whenever you want to start drinking.
Check it out here. It's really designed for hiking trips when space is at a premium, though we reckon it'll go down very well with the summer festival crowd who enjoy sticking it to the man and sneaking their own drinks into the party. No more giveaway clinks emanating from bags and loose-fitting clothes as you walk past security.
The only downside, in our view, is you need to pack the company's patented carbonator that adds fizz to the beer. And judging by its similarity to items used in other favourite festival activities, it could possibly land you in a lot more trouble with suspicious guards than a couple of smuggled vodka bottles.
Whisky with the fun taken out
06 Aug 2012 12:45
ArKay is said to be the world's first alcohol-free whiskey
A press release for a hangover-free whisky crossed the desk today, prompting cries of “At last”, “About time” and “Who's for an early lunch?” Turns out the zero-headache ArKay from ArKay Beverages is also zero-alcohol, a notion which, ironically, brought some on the just-drinks team out in a cold sweat.
Alcohol-free beer is well established, but whisky? Arkay said this is the world's first, with “the appearance, taste, and aroma of traditional whisky”.
We'll see if it catches on.
Coca-Cola by any other name as PepsiCo hams it up
25 Jul 2012 17:41
Euphemisms abound on a PepsiCo conference call today. In a display worthy of the most superstitious of actors, CFO Hugh Johnston delicately dodged all direct references to arch-rival Coca-Cola Co.
Johnston instead referred to the company as “our primary competitor” before throwing out an assortment of "them", "they"s and other non-specific pronouns.
I half expected him to talk about “the Scottish Play” before wishing one and all a broken leg.
How not to interview the Bacardi family
16 Jul 2012 15:48
Bats in the belfry
As a journalist, we're charged with asking the difficult questions. Unfortunately, it's very easy to ask the wrong ones.
Late last week, I was at the Savoy in London for the unveiling of Bacardi's 150th anniversary blend. It costs just shy of US$2,000 a bottle and, because the Bacardi family took a personal hand in its blending, some of them were there for the occasion. Which is how I managed to fall into conversation with family patriach Toten Comas Bacardi about the company's long-running court battle with Pernod Ricard over the Havana Club name. (For a crib sheet on the long, but often fascinating, affair, click here.)
Toten was immensely happy that Bacardi can lay claim to sole rights of the trademark in the US and can go ahead with expansion plans that could see Bacardi's version roll out beyond Florida.
For some reason, I decided to follow this line of questioning up by asking him if he thought there was a marked difference between Bacardi's Havana Club and Pernod's. "Ha!" exclaimed Toten. "Night and day, night and day." And with a polite laugh he left me to it, impromtu interview over.
Journalists are taught that they have to ask the stupid questions. But sometimes stupid questions are just that. Stupid questions.
Getting lobsters on the shelf in China is not just the snack industry's problem
11 Jul 2012 14:14
Cheesy does it
A guest blog from PepsiCo CEO Indra Nooyi the Financial Times today caught my eye. The company has just opened a new manufacturing plant in China that, it hopes, will help extend the reach of its Lays potato chips, which Nooyi says have now been tried by 40% of the country's population.
Lays has done well because the company has marketed flavours that fit in with the vast choice of snack options people in China look for. So, instead of boring old beef & tomato, there's hot-and-spicy fish, wasabi, and Sichuan-style hot pot flavours. My favourite when I lived in south-west China was lobster and cheese (see picture), mostly because of the packet's decidedly decadent cover model who seems to be enjoying what can only be described as a cheese waterfall.
Let's hope PepsiCo can be as imaginative with its beverages, even though the need is less - beverages don't have to deal with the traditional range of choice in snacks.
Where the two industries do share a problem is the lack of uniform grocery stores across China. I bought those lobster potatoes chips in WoWo, a chain of convenience stores you'll only find in Sichuan. If I'd been in Shanghai I would likely have bought them in Lawson. Other provinces have their own grocery chains, while there are also the ubiquitous mom-and-pop shops that sell the same things but in one-eighth of the space (and never cold beer). This means manufactures must strike separate deals with all of these regional variations to cover the whole country, severely limiting a company's reach.
Like most things in China, though, it'll change soon enough. The Japanese-owned 7-11, which has been in China since 2004, is expanding rapidly through China's second-tier cities and, from what I could see, is winning the fight against local convenience stores by having clean, brightly-lit units and a good range of items (plus cold beer!).
That's got to be good news for PepsiCo, and fans of lobster and cheese potato chips.