The beverage business blog from Olly Wehring
If you would like to offer your comments, opinions, suggest topics or just have a good rant, please feel free to email: Olly Wehring.
Coke or Pepsi - which drink makes you 'happiest'?
16 Nov 2006 13:26
Pepsi consumers are happier when they take a drink of their favourite beverage than Coke consumers. At least those are the findings of The University of Michigan’s annual consumer satisfaction index, which claimed that people liked Pepsi better than they did last year, but customers’ taste for Coke went a little flat.
According to the survey, satisfaction fell two points among Coke drinkers over the last year to 82 points on a 100-point scale, while Pepsi and Cadbury Schweppes shared the highest index rating with 86.
Now, typically, I suspect, for a journalist, I have a huge distrust and dislike for marketing-speak, and sit smugly and cynically through any presentation that veers close to explaining to me the deep emotional bond between a drink and the person drinking it.
So you’ll have to forgive me for wondering what on earth this survey is all about? Are Pepsi consumers really happier people than Coke drinkers? And if so, how the hell did some market researcher with a clipboard ascertain this? All this is made even more baffling by the fact that these drinks don’t actually change in flavour year to year.
The explanation given for the apparent victory for Pepsi by Professor Claes Fornell, the researcher in charge of the study, did make sense - a little annoyingly. He said that anecdotal evidence gathered by his researchers suggested an increase in spending on marketing and product innovation, and a lesser reliance on price promotions, might have helped Pepsi bump up its satisfaction rating. He said that, when consumers have more choice, they are more likely to be happy. This tallies with what we have seen from the two giants over the last couple of years.
But you can’t help but sympathise with the Coke spokesman yesterday when he told just-drinks: “People in the US vote for their favourite soft drinks when they buy them every day, and we lead in the top three categories with Coke, Diet Coke and Fanta.”
Coke Amatil - makes ties with one, cuts loose of another?
15 Nov 2006 13:29
The highlight of last week on just-drinks was the announcement that Coca-Cola Amatil has secured a tie-up with Maxxium in Australia.
The deal will see CCA’s joint venture with SABMiller, Pacific Beverages, sell and distribute Maxxium’s spirits portfolio across the country, as well as producing Beam Global Spirits & Wine’s RTD portfolio. In just one sentence, then, we see a company that specialises in soft drinks set to sell beer and spirits.
The move is a canny one, with CCA spreading itself but not overstretching itself. The crossover is not tenuous and, with Maxxium Australia helping out on the side, CCA is set for a whole new adventure.
What it might do, however, is take CCA out of the reckoning when it comes to buying New Zealand spirits group Independent Liquor. It looks like CCA will have its hands full for the time being. Meanwhile, our spies tell us that an announcement on who has won the race for Independent will be made in a matter of days.
Keep with just-drinks and, as usual, you’ll be the first to know.
Moët comes good on my plea
14 Nov 2006 11:41
Many of you will hopefully remember my rather pathetic attempt at a blag last month, when I hinted, maybe a little too strongly, that a ride in Moët & Chandon’s ridiculously exclusive London cab would suit me rather well.
With sincere thanks, then, to Siri Eklund, Moët’s senior brand manager, for fixing it for me to surprise my girlfriend on the night of her birthday. The looks we got from the great unwashed were priceless...
Who's on Constellation's shopping list?
13 Nov 2006 11:40
After a few days out of the office, comments last week from the chief executive of Constellation Brands have caught my eye. Richard Sands has said that the company wants to expand in Europe. Sands also said that the beverage industry on the continent was “a pretty target-rich environment”.
That phrase was notable in itself with many in the industry believing that significant acquisition targets were now scarce following Pernod Ricard’s takeover of Allied Domecq last year.
However, an obvious target for Constellation would be Sweden’s V&S Group, the owner of Absolut vodka. The recently-elected Swedish government looks set to sell off a slew of state-owned assets, and that could include V&S.
Constellation could be one to watch in what would be a fiercely competitive auction. In August, it announced that a share offering had raised US$700m, suggesting it has the financial firepower to bid for V&S, while it is keen to bolster its stable of premium spirits - and Absolut would prove a top drawer addition to that portfolio.
Speculation has also surrounded the future of French spirits and Champagne group Rémy Cointreau in recent months. Brown-Forman has been linked with a bid and Constellation is likely to be interested should Rémy’s controlling shareholders decide to sell.
A company like the UK-based Blavod Extreme Spirits could also interest Constellation. Blavod, producer of the eponymous black vodka, has seen sales of its spirits portfolio soar in the US.
Blavod has also entered the fast-growing Tequila category in the US and its El Diamante del Cielo would bolster a Constellation portfolio that so far already includes Montezuma Tequila. Blavod also distributes a raft of wines from Italy in the US, where consumer demand for Italian labels is growing.
Constellation’s shopping list in Europe, then, could be quite long. Who’s at the top of the list, however, could keep us guessing for a short while longer.
Searching for research? Check this just-drinks deal
01 Nov 2006 11:34
Whilst not known for my street-market selling techniques, I’ve just been informed by the just-drinks sales team of what looks like a pretty good deal, for those of you on the hunt for drinks research.
Some of you may already know that we offer profiles of the 30 largest companies in our sector. Each profile is available for GBP55.
However, for the rest of this year, these profiles are available free - on a sliding scale - when you purchase research. Spend up to GBP500 on research, and choose any one profile. Between GBP500 and GBP1,000 can get you up to five profiles, while between GBP1,000 and GBP2,500 gets you any ten. You can get all 30 if you spend over GBP2,500.
Looks like Christmas has come early round here.
The Skyy's the limit - London isn't
31 Oct 2006 16:51
Skyy has become the latest brand to launch a line of flavoured vodkas here in the UK. The premium vodka market is notoriously competitive, with a new brand aiming to meet demand for top-end vodkas seemingly launched every month.
Just-drinks attended the launch of the flavoured Skyy range in London last night, sceptical that the brand can succeed in a segment where Finlandia and especially Absolut is dominant.
However, during the course of the evening, our doubts were allayed first of all by the striking taste of Skyy’s flavours but also because of the plans for the brand throughout the UK.
Let’s face it, London’s backbars are overflowing with a whole range of self-proclaimed “super-premium” spirits, let alone vodka.
Brand owners should cast their eyes around the UK and witness the rise of exclusive bars in cities like Birmingham, Manchester, Leeds and Glasgow and Edinburgh further afield.
On a per capita basis, Scotland has the highest level of vodka consumption in the UK. Skyy, which is distributed by the Stirling-based Fior Brands, seems to be in the best position to capitalise on that trend - and the burgeoning bar scene in Scottish cities.
Too many owners of premium vodkas seem blinded by the lights and think they must conquer the London bar scene to be a hit in the UK. They couldn’t be more wrong.
Moët & Chandon - pleasepleasepleaseplease
31 Oct 2006 16:13
As some of you may no doubt already know, I have a dreadful propensity to place-drop - as opposed to name-drop. I’ve asked my parents, and it’s not inherited, so I can blame no-one but myself for this habit.
This place-dropping might work forwards, I reckon. Surely, if I say where I want to go - or how I want to be taken there – often enough…?
Let’s see, shall we?
This evening (31 October), I am being taken, as a guest of the malt whisky folk at Diageo, to the International Wine & Spirit Competition awards banquet in London.
My wish, dear readers, is that I get whisked home afterwards by this - a one-off London black cab that has been tarted up with 200,000 Swarovski crystals to form an image of a Moët & Chandon bottle and champagne bubbles.
I’m told that the only way I’ll get a lift in this beauty is if I buy a limited edition Moët & Chandon crystallised Methuselah from either Harrods or Selfridges in London. But, surely by mentioning it often enough, my wish could come true?
Shall I repeat all this?
When is a vodka not a vodka?
30 Oct 2006 16:46
The EU made its presence felt on several fronts last week, proving its usual source of controversy. While many in the drinks industry bemoan the part played by the authorities at times, on the issue of the definition of vodka , it is clear that the EU is simply holding up a mirror to the producers.
Last week, agriculture ministers from member states across the EU could not agree on what should and should not constitute vodka. While countries such as Poland, Finland and Sweden want vodka protected as a traditional spirit made only from grain or potatoes, there are others out there who feel that anything can be used to make vodka, so long as it tastes like, you’ve guessed it, vodka.
The argument is about heritage - traditional vodka-producing countries have a strong affinity for the product and believe they are the home of the spirit. As the planet becomes a smaller place, they argue, where you come from is an anchor in an ever-changing world.
The problem is, however, that the taste of vodka is pretty easy to recreate; the vast majority of consumers would not be able to tell the difference between vodkas made from a variety of raw ingredients. Indeed, at the meeting, the EU Agriculture Commissioner, Mariann Fischer Boel, offered to set up a blind tasting for Council members.
Where this will end is tough to guess - probably with a compromise. But trading on what something is made of, or even where it came from, is proving harder and harder in the 21st century.
The just-drinks soft drink campaign starts here - join us
24 Oct 2006 15:16
Here at just-drinks, we are not ones for campaign-style journalism. Give us a lead on a good story, and we’ll deliver the facts for you. But generally, we believe it’s up to the industry to take the lead on the issues it faces - not that I am backward at coming forward with my own opinion as those that have read this column will know.
However, a piece by our soft drinks reporter, Annette Farr, this month got me thinking that, perhaps, there are issues we ought to support more vocally. Of course, I suggest you read the whole piece for yourselves but, to summarise, Annette is calling for the European soft drinks industry to show a united front and launch a single exhibition that would cover all aspects of the industry under one roof.
Three years into this job now, and it still amazes me there isn’t a show that represents the interests of everything soft drinks, from packaging and vending to marketing and innovation.
As Annette points out, the soft drinks industry has spawned the world’s No. 1 brand. Soft drinks outsell all other FMCG categories across Europe. And, soft drink manufacturers are pioneers when it comes to innovation and new product development. Surely, the industry deserves its very own showcase?
So, we would like to hear what you have to say about this. Is this idea worth pursuing? Do you in the industry feel you are already well serviced by the existing, fragmented network of shows? In short, can someone - and should someone - host a show of this nature?
Is Ashes fever getting to the Aussies?
20 Oct 2006 18:10
Interesting to see the Australians squabbling among themselves ahead of next month’s Ashes series.
Alas, it’s not Shane Warne and Glenn McGrath bickering over who should bowl from which end, but the country’s two biggest brewers arguing over so-called “ambush marketing” surrounding the Ashes, world cricket’s longest and deepest rivalry.
Last week, Foster’s Group, which is a major sponsor of the national association Cricket Australia, accused arch-rival Lion Nathan of “ambush marketing” with its own sponsorship of a nationwide beach cricket tournament.
A Foster’s executive even went as far as labelling Lion’s behaviour as “un-Australian”.
Both Foster’s and Lion have tried to downplay the row. A Foster’s spokesman told just-drinks the spat was “a storm in a teacup” while his counterpart at Lion said he didn’t want to “fuel the issue further” by commenting.
Leaving aside the unlikelihood of Australian beer drinkers confusing beach cricket with the Ashes and Foster’s apparent over-sensitivity on the issue, as unashamed Englishmen we at just-drinks have allowed ourselves a wry smile at the bickering between our Australian cousins. Not because we see it as a sign of Australian nerves ahead of the English holders of the Ashes defending the little urn Down Under, but because, deep down, we’re a tad worried the Aussies are going to win it back.