Absolut Truth

This is the time of year when we used to meet with distributor management to discuss the previous year and how we looked over the holidays. It reminded me of a story about a candid assessment of a new vodka product from V&S (Absolut owners at the time) called Sundsvall.

Let me set the stage for you.

In the late 90’s it was clear that high end, connoisseur and, for some, “badge” vodka products were on the ascendency. From a day-to-day marketing and sales standpoint, it was also clear that Absolut was becoming a middle brand, flanked by the top shelf entries above and the value priced vodkas below.

We requested, pleaded and ultimately begged our Swedish partner to supply a brand that would compete with Ketel and Grey Goose. Unfortunately, the gentleman who ran the brand at V&S was totally disinterested. His intractable position was that Absolut was the best and to have a more expensive and presumably higher quality entry would belie their proposition.

No amount of cajoling could change his mind. We tried to explain that the analogy was in the scotch market — single malts are not better than blended scotches, they’re different. He ignored his own people, those of us in the trenches and even the owner.

Finally, out of the blue, we were informed that a top shelf vodka brand would soon be available. I suspect that the owner went to the top of the V&S feeding chain or, for all I know, the King of Sweden to get it done. We didn’t care so long as we had a viable brand.

Ah, viable, what a good word. Like the cliché, it’s in the eye of the beholder.

The good news was that the proposition made good sense and was indeed viable including differences from Absolut in ingredients and distillation process. The up charge of $3 to $4 higher than the other super premiums was well justified in terms of the resulting taste and initial reactions.

There were two main problems. First, V&S wanted no association between Sundsvall and Absolut, even going so far as to bypass Absolut’s longtime agency (TBWA) in favor of an agency in Boston. There was no reference to Absolut anywhere in the marketing material. No opportunity for synergy or leverage.

The bigger problem was that the package did not live up to the super premium expectation or price point. It was, at best, blah. I couldn’t find a photo on the Internet so you’ll have to take my word for it. But I remember research that indicated that servers and distributors liked the taste but felt the packaging “too plain” and “too discreet vs. competition.” Someone described it as “a clear barrel with an orange shrink wrapped top.” Those are the most positive things we heard.

No surprise that after a strong initial push the brand just languished.

The scene now shifts to the Seagram Advisory Council at some offsite location and serious winter watering hole. Don’t be fooled, the invitees were the best and brightest distributor management people in the business. While the afternoon and evenings were fun, the 5 or 6 hour work sessions were grueling. This was an occasion where the supplier was on the chopping block and got to hear about strengths and weaknesses versus competition. No BS, no holds barred, all straightforward and candid remarks.

Occasionally, there would be moments of reticence where the distributors kind of hemmed and hawed, not wanting to offend. That’s what happened when the subject of Sundsvall came up. Lots of looking at the floor.

I knew why but needed my management to hear the problems first hand from our customers who obviously didn’t want to offend or appear negative.

Question after question was lobbed and the answers were platitudes and fluff. Finally, I pushed and said, “Why is Sundsvall doing so poorly?”

One very senior manager from a very large wholesaler operation had the courage to call it like it was. He told the Absolut Truth and said, “Arthur … it’s simple —  the baby is ugly.”

A few months later the brand was gone. What a relief.

To this day I believe that the V&S senior manager who never wanted an up market brand in the first place, did all he could to sabotage the effort. It wasn’t the only mistake he made.

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Cultural Differences

Now for something totally different and unrelated to the booze business…

My last posting on vodkas from around the world stimulated a lot of conversation about Americans doing business internationally. My friend Ernie Speranza, a toy industry executive and former head of marketing at Toys R Us told me the following story that I want to share with you.

“Ah, the fun of working for an international company. While not as much fun as the spirits world, the international toy world had its share of strangeness too.

We (Toys R Us) were opening our first store in Saudi Arabia and the night before we opened the authorities came in and told us we could not open because of the packaging for Bathing Suit Barbie. It seemed they were concerned that people could not handle such an obscene display of western flesh…. or plastic.

We then had to work into the night using black magic marker on the see-through packaging in order to hide Barbie’s breasts. Here I am, an MBA, the head of marketing for arguably the largest toy retailer in the world with 20 years experience in marketing, and I am sitting on a concrete floor in an Arab country under penalty of jail time using a black magic marker to hide Barbie’s breasts. You just can’t make this shit up.”

A new product idea — Burqa Barbie

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Getting back to the booze business, Ernie once told me a story of his experience doing business in Japan and I used his story when working with the Absolut brand owners.

Let me set the stage for you… When we started working with our Swedish partners, every now and then they would lapse into conversations with each other in Swedish. Since their command of English was as good or better than many of us, we were a bit dumbfounded and not sure what to make of it. Invariably we were told something like, “oh, please excuse us, it’s sometimes easier to share our thoughts among ourselves in Swedish.” Sure.

On one occasion I decided to relate a story my friend Ernie had told me about a trip to Japan to open the retail market there on behalf of Toys R Us.

They brought an American with them who was fluent in Japanese, and was told to not to let it be known that he was translating. His role was to quietly inform the American team of what actually was being said. The meeting was with a leading Japanese ad agency to discuss messaging, media and related topics. As the meeting ensued, the Japanese translator was giving sanitized answers to the American team’s requests and the American translator was providing the real statements.

When the Japanese ad folks were supposedly saying “good idea”, “we understand what you’re looking for and we’ll work on it” they actually were saying things like “they don’t understand the Japanese culture or people” “keep smiling and shaking your head, they will go home soon and we’ll do what needs to be done.” Ernie kept telling his translator to keep a low profile and his role will be revealed when the time is right.

After an entire morning of this, it was time to go to lunch. The agency execs were still making comments and their Japanese translator kept sanitizing their remarks. Finally, the team from the States could no longer take it. As the waiter came by to take the table’s order, Ernie whispered to his American translator, “now!”  In fluent Japanese, this American, who had sat quietly through the meetings and just taking it all in, began to order food in perfect Japanese. The agency executives turned pale and lowered their heads.

Ernie said, “Please tell them that after lunch we will start all over.”

When I told this story to the folks from Absolut, they just smiled and nodded their heads.

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Absolut Tales

The Gulfstream took off from Stockholm’s Arlanda airport with a full load of executives, all of whom had the satisfaction of knowing that the global distribution rights to Absolut were signed, sealed and delivered.

If you’ve ever flown on a corporate jet, you know how great it is. You board quickly and easily, take off on time (or even ahead of time) and generally are met on the tarmac a few steps from the plane and off you go.

Despite this great convenience, I’ve heard people complain about the absence of frequent flier miles, which always makes me laugh at the silliness of the thought. For me, however, this particular flight had one disadvantage — it was full of Seagram brass. Every one of the 14 seats was taken and there was no place to hide. And, every one of the 14 had 5 or 6 ideas about marketing and how best to grow the brand further. After all, we were taking over the brand from the legendary Michel Roux who grew the brand with a series of innovative and effective marketing actions.

While getting the brand elated us, we were also mindful of the daunting task ahead. Especially the marketing guy…me.

This was best summed up by the owner who, after laying out his thoughts and vision, said, “Arturo, I have four words for you — don’t f**k it up.”

Michel Roux was indeed a hard act to follow. Carillon Importers was part of a large corporation, but he ran the brand entrepreneurially, with vision and resources to take this fledgling brand to renowned marketing levels.

There is a great story about Michel’s brand champion efforts that I recently asked him to confirm. I wasn’t sure if it was true or a booze business myth.

It seems he was in the Detroit airport waiting to depart when he noticed a man wearing an Absolut t-shirt. Alarm bells went off in his head for two reasons. First, there were no Absolut t-shirts and he and didn’t want them, so clearly it was counterfeit. Second and most important, the man in question (according to Michel) must have weighed over 350 pounds and despite the triple XL size, it was a very snug fit.

Clearly bothered by his brand portrayed in such a manner, Roux stopped the man, told him he was looking for that particular t-shirt and offered him $100 to buy it. The man accepted the generous offer. They went to a souvenir store, bought a replacement and now Michel owned it.

The man left happy with this transaction and the Absolut t-shirt was promptly tossed in the trash.

True story.

In my opinion, the Absolut brand has gone through 4 periods in its development. The first era was with M. Roux and Carillon Importers. Next came the Seagram years and further, albeit different, growth. The third period was one in which the brand began to languish despite the efforts of some (but not all) capable people. Today, the ownership of the brand is in the hands of Pernod Ricard with the difficult task of once again polishing its luster.

I plan to cover the Absolut story from these vantage points in the future.

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