Blog: Innovation - never a bad thing, even in failure
Olly Wehring | 14 June 2007
Innovation, the Holy Grail of the modern drinks company. Get it right and you'll have the next Bailey's on your hands. Get it wrong and you'll be pulling an expensive failure off the shelves quicker than you can say Tia Lusso.
Rather like English football's fixation with 1966, the way we in the drinks industry hark back to the launch of Bailey's says more about subsequent failure than past glories.
Launching a successful innovation into an industry as complex as ours is no easy matter, driven as it is by fickle, fashion-led consumers on the one hand and staunch conservatism on the other. And, Diageo GB's announcement today that it is to withdraw three of its products from the UK market is further evidence of this.
The company has said it will cease production of Quinn’s fruit ferment and the RTD brands Slate 20 and Archers Vea. The unit said the brands “have not met Diageo’s stringent performance criteria”, with demand being lower than anticipated.
Quinn's was launched amid much fanfare. Indeed, when the brand was unveiled in March last year it was Diageo GB’s biggest product launch for five years and backed by an GBP8.5m marketing campaign - an expensive failure then.
A company with the marketing clout of Diageo can afford to take these sorts of risks. They are risks worth taking, though, according to the UK-based giant. Innovation remains a hugely profitable area for the business and has contributed over GBP1bn (US$1.97bn) of sales value over the last three years in the beer, wine and spirits category.
The question of how smaller players in the industry keep pushing forward the innovation agenda is of course less clear, but given the rewards it's a quest that continues to be worth running.
Whisk(e)y companies spend a lot of money and effort ageing their products for that premium taste....
PepsiCo created a stir last week with the news it is testing a product called Caleb's Kola, with some in the media claiming it was the beginning of a new “craft soda” category....
SABMiller's bid to widen the appeal of beer is very much in evidence at its latest 'House of Peroni' - with beer cocktails and a bigger bottle for the Italian lager brand on offer. ...
Here's a round-up of the big stories on just-drinks last week, featuring PepsiCo, SABMiller, the Scotch whisky category and the US wine market....
- Diageo's future brighter than present suggests
- Diageo's Q1 Results by Region
- Analysis - Remy's Cognac "dead-cat bounce"
- SABMiller's troubles fuel M&A rumours
- Focus - Remy Cointreau's H1 Performance by Brand
- Moët Hennessy unveils first Travel Retail outlet
- Diageo puts Beckham centre stage in Haig Club ad
- United Spirits sees Q1 net loss
- Diageo Q1 sales dip "in line with expectations"
- TWE unveils Penfolds range after CEO's "bold move"