Blog: New Year's Resolution - Buy Blavod?
Olly Wehring | 3 January 2007
It seems that now is the perfect time for a buyer to come forward and breathe life into parts of the Blavod Extreme Spirits business.
The UK-based spirits group yesterday (2 January) posted a set of mixed half-year figures with a leap in sales leading to a cut in the company’s losses.
However, Blavod chief executive Jeff Hopmayer admitted that some of the revenue growth had come at the expense of lower margins in the UK and the US due to the “heavy promotion” of Blavod black vodka. Hopmayer pointed to growing competition in the vodka categories on both sides of the Atlantic for the company’s move to support its flagship product on price.
Citing competition from rival brands is a fair point but Blavod has yet to succeed in setting its black vodka apart from the rest of the category and needs to convince consumers that they should pay a premium for a niche product.
A brand-owner has to work hard at creating awareness of its product in the on-premise. That strategy will help build a loyal following that will stay with the brand when its moves into the off-trade. However, Blavod appears to have been too keen to secure listings with large retailers in the UK and the US without first developing a durable presence in top-end bars in both markets.
The concept behind the brand could prove a successful formula; every bar in the world could have a bottle of black vodka in theory. Takeover talk has surrounded Blavod in recent months, and maybe now is the right time for a suitor to come in and put fresher ideas and greater resources into the company’s black vodka, something the brand certainly deserves.
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