Marketing for the drinks sector: no shots in the dark
When it comes to drinks marketing, Jason Wills has done it all. The Southern Co-Op, Charles Wells and Heineken all appear on his CV; and he's been behind major marketing drives for Jack Daniels, Southern Comfort, Desperados, Tiger Beer and a recent innovation project for Kingfisher.
Today he’s talking us through the biggest challenges to marketing in beers, wines, spirits and sundry goods, and the areas where most brands show room for improvement.
State of the industry - what challenges face drinks marketers?
“From both a brand and a retailer perspective, disruption is the word that comes to mind,” says Jason. “Across FMCG as a whole, we’re seeing opportunities for brands to sell direct to consumer without going through retailers, and consumers are becoming more confident in buying direct. Big brands are trying to match how the likes of Beer Hawk sell, through direct to consumer channels, but they’re fulfilling through the likes of Amazon - the customer experience isn’t actually direct.”
Beyond logistical challenges, says Jason, there’s a more fundamental question of brand purpose. “Think about that much overused term ‘millennials’,” he advises. “They’re demanding an understanding of what a brand stands for. If they don’t agree with that, the likelihood of them buying from that brand decreases. Brands can’t pay lip service to areas like sustainability and community involvement: they need to demonstrate real credibility.” Once again, there’s an example at his fingertips: “Pernod Ricard have this thing called Spirit of Entrepreneur - an ethos that percolates through their entire business, through their social channels and particularly Instagram, that’s all about how they add value back to the broader population.”
Channels are another area Jason identifies as a priority. “Increasingly, we’re faced with a plethora of different channels, and as a smaller business you have to clearly understand which ones to participate in and how. Rather than publishing that content across all channels, you need to understand the channels you’re publishing in, and make sure your content is fit and appropriate for that channel as well as valuable to your audience.”
So, with all this in mind, where are drinks brands currently going wrong?
1. Understanding customer needs
“Businesses are not taking enough time or applying enough rigour to really understand customer needs and pain points”, says Jason. “They need to understand where they could solve an issue for a customer, and how they do it better than their competitors, and have clear priority activities to market both of those qualities. Often, I hear business owners talking about what they think their customer needs are, not actually talking to their customers.
“Behind the scenes, they need to unite their internal teams and align them to those specific needs. They need to talk to the customers and improve their products and services on an ongoing basis. And if the brand appeals to more than one customer segment, they need to go into more detail and understand how the same product meets different needs on different occasions.”
Jason cites Brew Dog as a clear standout in this area. “They have absolutely led the disruption of the beer market in the UK in the last five years, and they’re known for their marketing strategy. They’ve delivered an ongoing range of core products that have become more mainstream, but they’re also constantly bringing in limited editions or brand extensions that appeal to more demanding craft beer consumers - people who are always looking for something new.”
2. Innovating and effective communication
Smaller businesses are often challenged for resources - headcount, budget and time are all tight, and the focus is often on short-term needs. Jason says, “the challenge is to invest time into innovation, and to be really clear about how that innovation will meet customer needs and extend your existing brand proposition.”
When Heineken tried to innovate around craft beer, and found their big name status made it difficult for them in the sector, they bought minority stakes in Beavertown and Brixton. Not controlling stakes - not total buyouts - but enough to give them a presence and association with the sector, extending their brand proposition so that future offerings are less unwelcome.
- You may like: Barriers to growth, and how marketing can help: Product
Heineken have also performed well in the low-alcohol beer category, with Heineken 0.0 and Light now accounting for a third of the brand’s sales. The marketing campaigns have aligned with Heineken’s Formula One partnership, emphasising that you can drive while drinking Heineken 0.0 - and it’s worked.
At this point in time, the demand, the product quality and the branding are all in the right place, but breweries have been trying for this growth for ten years. According to Jason, this proves a key point about innovation.
“If your initial innovation in a category doesn’t work, don’t be afraid to try again. Nine out of ten product launches fail. Test and learn, use test markets, understand where your target audience is and what channels can reach them.”
There’s more to communications than just choosing a channel, too. “Having made the choice of channel based on where your audience is”, says Jason, “you need to think hard about the content you’re going to deliver. You can’t just copy and paste content from here to there without thinking about how the audiences consume content, and what you’re trying to say on the platform. Berry White - an organic soft drinks business that recently went bust - may have done so because they didn’t have anything to say: identifying an emerging consumer trend and launching a brand isn’t going to guarantee success.”
Content, in the end, demands a consistent long-term strategy. Too many brands are inconsistent in how and what they publish, and how they source it. “A lot of social ends up going to one of the most junior people in the team, who happens to have an Instagram account themselves, who ends up coming in on Monday and thinking, ‘oh gosh, what do we post this week?’”
3. Using marketing automation
“A lot of business leaders read about marketing automation and AI and they think, ‘we’ve got to get in on that’ - but until you’re really clear on what you’re communicating and how, leave it alone.”
The technology is relatively easy to install and set up, but it needs to be used in light of a real, clear, and viable plan. Only once the business is clear on its customer needs, value proposition and optimal channels can it start to think about automating communications. Does the business only need email, or does it require social, or more developed content, and what internal resource needs to be committed to providing materials for the automated programme?
“There’s a change in process”, Jason explains. “You need to be clear about the customer journey and where the content will come from, because once you’ve started to engage people with a weekly email, they’ll expect it every week. If you don’t deliver you’re going to lose them. Don’t dive into marketing automation without establishing the plan.”
At the bottom line, marketing drinks is like marketing anything else. It’s driven by customer needs and product or service offerings that meet those needs. It needs careful segmentation and insight into the target demographics - why do they buy, what channels do they use and trust, how do they like to be spoken to? It demands a consistent, long-term strategy, with enough agility to respond to customer feedback, and a clear sense of how you’ll introduce your innovations to the marketplace.
To get a grip on your marketing, whatever sector you’re in, take our free Marketing 360 Healthcheck today.