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.
Please, buy our products - No, not you.
19 Jun 2006 14:54
Probably the most popular buzzword in the drinks industry of the last few years has been ‘premiumisation’. Hated by many for its lazy butchering of the English language, the premise of the word is really quite simple.
Getting consumers to trade-up and spend more is the aim of pretty much all of you out there, but what happens if, in trying to do this, a company finds itself attracting what it feels is the wrong crowd?
French Champagne maker Louis Roederer’s run-in last week with rapper Jay-Z is a class example of the potential minefield facing all brands.
In an interview with The Economist magazine, the company’s managing director, Frederic Rouzaud, was asked if his Cristal Champagne’s association with the hip-hop industry could harm his brand. “That’s a good question, but what can we do?” he replied. “We can’t forbid people from buying it. I’m sure Dom Perignon or Krug would be delighted to have their business.”
Jay-Z took exception to Rouzaud’s comments last week, deeming them “racist” and leading a boycott.
At the other end of the scale, this reminded me of an interview a couple of years ago with (then Interbrew but now) InBev’s John Woods about his Stella Artois brand. Here in the UK, GBP5 will get you six cans of Stella, a brand which boasts of being ‘reassuringly expensive’. “If there were evidence that price discounting was having a bad effect on the brand, then we would be concerned, but we don’t have any such evidence,” Woods told me.
Both situations highlight what’s on either side of the tightrope that brand managers need to walk.
And yet, both brands are also household names - although Cristal might be more of an aspiration than a realisation in most households - suggesting that one needs to be careful what one wishes for.
Drink if you're winning. You only drink if you're winning.
14 Jun 2006 13:22
I know, I know – not another World Cup-related blog? I apologise, but when one puts as much effort into watching as much of the tournament as I do (look, darling, it’s just for four weeks every four years), you understand how I have little else to write about.
England’s second game tomorrow (15 June) sees them come up against the underdogs of Trinidad & Tobago, a team who are just happy to be at the finals.
Angostura Rum, meanwhile, has served up an incentive that could see the ‘Soca Warriors’ put up quite a fight against, Beckham, Owen et al. Trinidad & Tobago’s 23 players and coach will each receive a barrel of Angostura’s most historic rum if they win.
The rum was laid down for maturation in Trinidadian warehouses on 31 August 2002 to commemorate the 40th anniversary of independence from the UK. Angostura had earmarked the rum for an extra special occasion, and chairman Lawrence Duprey has declared that rewarding the players for a win against their former colonial rulers would be a fitting use. He will also present a barrel and honorary keys to the distillery, allowing visitation access at any time, to Leo Beenhakker if the coach can lead the team to victory.
“We hope the barrel bonus will act as an extra incentive for the players as there are few Trinidadians that don’t like a drop of rum and these casks hold the best in the world,” said Angostura’s marketing manager Nigel Bissoon.
Diet Coke - not really what it was made for
14 Jun 2006 10:58
Some people believe that the amount spent by drinks companies on advertising is quite obscene. But word of mouth, as many advertising execs will readily agree, is the most powerful tool you can use to up sales.
A snowball of publicity is gathering pace online at the moment for Mentos mints and Diet Coke. Put the two together, and you have an explosive ‘firework display.’
The Wall Street Journal spoke to Coke this week, and asked them what they thought of the craze. “It’s an entertaining phenomenon,” a spokesperson for the soft drinks company told the paper. “We would hope people want to drink (Diet Coke) more than try experiments with it.”
Off the record, however, I shouldn’t be surprised if, like most five-year-olds, she said: “"Do it again! Do it again!”
The Brewers' World Cup
13 Jun 2006 10:23
I’m pretty sure you don’t need me to tell you what kicked off on Friday and, whether you love or hate football, with your professional head on, I’m sure you can recognise the almost bottom-less potential the World Cup has to offer to your company.
The timing couldn’t be better here in the UK and across much of Western Europe, with the sun finally coming out and suggesting that (s)he’s here to stay for a while.
The age-old tradition of using beer as foot-fall creators in supermarkets is also back. One report last week from the UK said that beer sales were up 65% on last year as England fans prepared for the team’s first game on Saturday. Beer as a loss-leader is old hat, but when the price in the UK of one can as part of a multi-pack can cost as little as 40p during the tournament, the fear must surely be that brands are being cheapened.
Still on the brewer front, the World Cup throws up some interesting clashes. As the Official Beer of the World Cup, Budweiser has pouring rights in all 12 stadiums in Germany, but late last year buckled to public pressure and will now allow German beer Bitburger to be available at three of every ten taps.
The ongoing global struggle between Budweiser and Budvar takes footballing form today (12 June), meanwhile, when the USA play the Czech Republic. I’ve a great idea - why don’t the two sides agree that the result shall decide they’re legal wranglings once and for all?
DND - It's World Cup Month
08 Jun 2006 16:10
Starting tomorrow, for about four weeks, I, like millions of other men around the world, am not leaving the house. The lady has been advised, the boss has been told. It happens once every four years and, damn it, I’m not going to miss a second.
And I know I’m not alone, am I, gents?
So, hopefully this open letter won’t upset the Women of Wine, who have invited me to their summer party later this month, on the same evening that Holland are due to play Argentina. Thank you very much, but I shall be unable to attend.
Apparently, the Women of Wine have made a special exception this year and invited men along to their annual soiree.
Inviting them’s one thing, ladies, but actually getting them through the door during World Cup month? Well, I’d love to see THAT happen.
Only one bad apple at parliament cider meeting
08 Jun 2006 11:48
A security alert at the Houses of Parliament turned a successful cider meeting slightly sour yesterday as departing guests, growers and MPs were locked in for nearly an hour.
But for me, with tasting notes available for a wide range of ciders and perry, a warm welcome from my hosts, and a distinguished location in the Common’s Terrace Marquee, my glass was most certainly half-full rather than half-empty.
The meeting, hosted by the Parliamentary Cider Group and National Association of Cider Makers, highlighted a boost to the industry from a standstill in cider excise duty and a remarkable growth and commercialisation of the apple-based beverage.
Growers such as Gaymers and Bulmers, who makes Strongbow Sirrus, can now gain from the sudden appeal of Irish cider Magners by targeting drinkers in their early 20s. On the back of this, vintage ciders could see a resurgence and ‘wine ciders’ are being coined as another alternative, with some designed to accompany Indian and Chinese dishes.
After a few hours of enthusiastic tasting and deliberating, an alert arose at 6pm, however, when a protestor flung white powder onto the marble floor of the central lobby area, before being detained by the many armed police on the scene. While the powder was tested, possibly for anthrax, there was no through passage out of the building for aggrieved MPs, Peers, Lords and me.
Eventually the incident was resolved to no negative avail and the feared substance thought to be wheat powder.
Such scares will not hinder this biannual occasion, I'm sure, but tasters may be watching the clock a little more closely next time around.
Taittinger best in French hands
06 Jun 2006 11:50
Champagne corks were popping last week after it was announced that one of the most famous names in the region was to remain in family hands.
Last week, French bank Crédit Agricole finally bought Taittinger after a long-running and closely fought auction in a deal worth around EUR660m (US$846m). The bank was understood to have teamed up with Taittinger family members including Pierre-Emmanuel Taittinger, the firm’s deputy managing director and grandson of the company’s founder.
Crédit Agricole’s bid for Taittinger trumped seven other offers, including one from India’s UB Group. The Indian press bemoaned France’s “economic patriotism” for scuppering the UB bid, while a company spokesperson labelled the winning bid as “crazy”.
True, France has, let’s say, closely protected its companies from foreign predators. Think back to last year when the French government called for drinks and dairy group Danone to remain in French hands after rumours that PepsiCo was to table a hostile bid.
However, in the case of Taittinger, union officials were right to voice their concern over a successful UB bid. It had little to do with nationality but more to do with the Indian group’s complete lack of experience overseas, let alone in Champagne. True, the company has built a robust brewing and spirits empire in India but aside from a distillery in Nepal, UB does not have a presence abroad and it would have been a gamble to say the least for it to own the world’s sixth-largest Champagne house as its first significant overseas asset.
World Cup 2006 - how far is too far?
01 Jun 2006 15:23
With the World Cup drawing ever closer, I don't know how it is where you are, but here in England we're getting pretty carried away... again.
Two years ago, during Euro 2004, the streets here were hit by a flag epidemic, with nigh-on every car sporting its own St. George's flag. The impromptu-feel of the flags then has been taken away this time, however, with everyone and anyone trying to sell England 'fan-packs.'
A story from on-trade publication the Publican today confirms that some may be taking things too far.
A licensee in Manchester has painted his entire pub with a St. George's flag. His wife commented: "It's been worth it because the customer reaction has been great. People just want the tournament to start now."
I'd imagine their neighbours want it to end pretty quickly as well.
World Cup Tickets - We have a Winner!
01 Jun 2006 13:48
Our competition, in association with Budweiser, for two FIFA World Cup tickets has been running all week, but closed last night. We were deluged with entries (I exaggerate not), including entries from as far afield as New Zealand and Brazil.
But there can be only one winner, and that lucky football fan is...
James Sanderson, finance analyst at Constellation Brands Europe.
James and a friend will be in Nuremberg for England’s second group game against Trinidad & Tobago on 15 June.
Have a great time, James.
The correct answer, by the way, to the question ‘What is England’s FIFA World ranking’ is ten.
Our thanks go to Anheuser-Busch for their generous offer of the tickets. Keep your eyes peeled, meanwhile, for another competition we’ll be running to coincide with the start of the tournament next week.
Eau de Stella? XXXX? Kronenbourg?
31 May 2006 17:41
I went to a concert in London-town last night. In a room full of over-exuberant punters, most (if not all) of which were south of me in age, no matter how hard I tried to stay out of the melee, I couldn’t help coming home smelling rather pungently of beer.
Upon my return home, the lady was, obviously, none too impressed. But help, for me at least, may be at hand.
A scientist in Scotland has created a whisky-scented perfume. George Dodds, a biochemist from the Highlands, has named the scent ‘Spirit of Scotland,’ and expects to launch it later this year at a price of around GBP75 (US$140) per bottle.
The perfume, which has taken three years to develop, uses special ingredients to recreate the smoky, peaty scent of a wee dram.
I’m about to email Mr Dodds with a blueprint for my ‘beer-scented’ Cologne. If I can first convince the lady that my stench is a sign of sophistication, that is.