Just the Answer – Ian Jamieson, Stolichnaya Vodka
There has rarely been dull moment in recent years for anyone concerned with Stolichnaya, with a long-running rights dispute over the brand name, a switch to bottling the brand outside Russia and the transfer of an exclusive international sales and marketing agreement from Allied Domecq to Pernod Ricard. In the second part of this month's Just the Answer vodka double, Olly Wehring spoke with Ian Jamieson, president of The Stolichnaya Brand Organisation, about the brand's future within the Pernod portfolio.
J-D: Stolichnaya has been very active on the marketing front of late. How successful have recent initiatives been, and what else is in the pipeline?
Jamieson: Until Allied Domecq took on the Stolichnaya brand in the US in 2001, Stoli hadn't really had a single marketing focus at all. Then it wasn't until 2005 that a global agreement was concluded with SPI. Shortly after that agreement was concluded, Pernod Ricard acquired Allied, leading to a reorganisation of the distribution channels. So, in essence, it's really only been since the beginning of 2006 that - under Pernod's ownership of the distribution agreement and the subsequent creation of the Stolichnaya Brand Organisation - the brand has had a single marketing communication distribution and sales platform in all markets. The brand has been around for around 70 or 80 years, and it's only now that it's getting any coherent and consistent support in markets around the world.
We've just reached the point where we've concluded a lot of our research into the heritage and the product story. This is the moment where we're starting to unveil all of that. This is why our new advertising campaign has just been launched at the end of the spring/beginning of the summer.
What you will see over the next few months is that many more of the initiatives we're taking will concentrate much more on our 'Choose Authenticity' positioning.
Jamieson: We believe that authenticity is very important to premium spirits drinkers of all kinds. Given that vodka has frequently been about packaging, authenticity is very, very important. So we're quite happy that more people are pushing authenticity. But we would argue that the iconic brand of Russia, which comes from the motherland of vodka, is the real authentic deal.
I would argue that Smirnoff's campaign is coming from a completely different place. Their heritage story is how they actually left Russia to make their fame and fortune in other countries throughout the world - and they've been very successful and good luck to them. But I think that when it comes to the real authentic brand that stands for what is great about Russian vodka, there's only one brand that can do that, and it's Stolichnaya.
J-D: Russian Standard, however, has accused Stolichnaya of "false advertising" when advertising its Russian heritage. How do you counter this argument?
Jamieson: Let's be absolutely clear - Stolichnaya is a 100% Russian vodka. It is distilled in Russia, it is made into vodka in Russia. Everything about the product is Russian. However, like many other spirits, it is then transported to be bottled in another location. We have no issue with that. Under every possible definition of authentic, genuine Russian product, it is 100% Russian.
So, we have no concerns whatsoever about our authenticity. Why would Russian Standard be taking this path? I have no idea to be honest. Mr Tariko is a very successful businessman, he's a big financier, he's a banker, and now he has a vodka brand. If you are wanting to build your new Russian vodka brand, then perhaps you'd want to associate yourself with the best-known, world's favourite vodka brand that sells over 3m cases outside of Russia. I can think of no other reason why he would wish to do that.
J-D: And where is Stolichnaya bottled?
Jamieson: That's in Riga in Latvia, which is where SPI has a state-of-the-art bottling plant.
Ian Jamieson, president of The Stolichnaya Brand Organisation
J-D: What is the state of play between SPI and Pernod?
Jamieson: SPI owns the trademark rights for Stolichnaya outside the Russian Federation. The Russian courts awarded the rights for Stolichnaya within the Russian Federation back to the Russian government; SPI disputes that decision, but that is the decision that currently exists.
SPI has concluded an exclusive distribution, sales and marketing deal first with Allied, now with Pernod for all those markets. The Stolichnaya Brand Organisation is the company that is managing the marketing, commercialisation, sales and distribution of Stolichnaya within Pernod.
The agreement between Pernod and SPI is fundamentally the same as the original one agreed with Allied. The one difference is that immediately Pernod made explicit its desire and intention to gain ownership of the brand from SPI. Clearly, the Russian government has an interest in the brand and it is in our interests to conclude an agreement that involves all parties. A three-party agreement is therefore much more complicated to sort out, and thus it's taking a lot longer than we would wish.
It is the group's stated desire, however, to be a very key and prominent player in the imported vodka category in order to achieve its ultimate objective of industry leadership. So purchasing the Stolichnaya brand is still one of the group's key corporate objectives.
J-D: How would Stolichnaya fare in the priority list for Pernod should it buy Vin & Sprit? Might it be a case of: "At least we've got one now"?
Jamieson: From a corporate perspective, I think as far as Pernod is concerned, we are looking to be a leader in premium imported vodka. Clearly when a brand like Absolut comes along, one has to look very closely at the possibilities it affords. The group, I'm sure, will be taking a very active interest in looking at the opportunities Absolut presents. The timetable has at least been started by the Swedish parliament's decision, and everyone is circling their wagons. We'll have to see how it develops. I'm afraid, however, that I can't speculate on how the two would be managed in a portfolio.
J-D: What is the Stolichnaya view on the recent EU vote on vodka definitions?
Jamieson: For Stolichnaya, this gives us no issue whatsoever. Our vodka has always been made using 100% grain, and it says so on the label. That some less expensive brands are made from other products doesn't really concern us one way or the other.
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