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Marketing and Sales, Seagram, Stories and Myths

Quality Control

December 6, 2010 No Comments

I can’t tell you how many times I’ve heard or even used the expression — “It’s all about what’s in the bottle” — when referring to the appeal of a spirits brand.

It’s homage to the intrinsic appeal of the product and recognition that image alone is not sufficient.

Couple of interesting questions…

If that’s the case why do some awful tasting brands of booze sell well? To maintain my friendships in the industry I won’t cite any examples but lets just say there are brands that sell more on image than product taste.

The more important question is, who decides if it’s “in the bottle?” For the smart marketer it’s based on consumer taste tests, sensory panels and research of that nature. Generally there are benchmarks, action standards and criteria or hurdles of acceptability.

Except when the owner or senior executive decides that he/she knows better than the consumer.

At Seagram there were the owners who made the decisions and their deputies who established the criteria.

I once asked the head of quality control who had been trained by Mr. Sam about Jack Daniels and got a 20-minute lecture on what was wrong with the quality of the brand. I protested that his view of the product was counter its performance in the market place and consumer appeal. Good thing Mr. Sam was long gone by this time or my head would have been rolled down the building plaza.

A good friend who was there when Seagram introduced a Scotch called 100 Pipers recently told me a story that illustrates the point.

Despite the fact that the company owned Chivas Regal, the leadership at the time, from Mr. Sam on down, was Canadian whiskey driven. So when the idea of 100 Pipers came along the QC folks, led by the owner, kept rejecting the formulation until it reached their notion of acceptability. Research was ignored; R&D and production was ignored; they kept fiddling with it until it tasted the way they thought it should. They felt that no one wants to drink Scotch so take the Scotch taste out.

The result — a good tasting Canadian whiskey that Scotch drinkers hated and Canadian whiskey drinkers wouldn’t consider. It never clicked.

Guess what? According to data I recently saw, it sells over 2 million cases today with more than half of that in Thailand. Who knew?

Still made by Chivas Brothers and owned by Pernod Ricard. Bet it tastes like Scotch too.

Tunnel of Love Tour

November 16, 2010 1 Comment

I first heard this expression when I was running Seagram America’s marketing and went with the CEO to visit markets in South America.

His view of senior management market visits can best be summed up as follows: “What a waste of time. Everything we will see in the stores will be staged for our visit. It’s a tunnel of love tour but we need to do it.”

I felt he kind of missed the point a bit. Market visits were, and still are, designed to “see how we look” and in that regard it’s in the human condition to put your best foot forward. But you can’t stage how the competition looks and what they are up to at point of sale and who can control what Mr. Retailer has to say.

My favorite tunnel of love anecdote took place in a large, important US market known more for its on-premise business than retail stores. Nevertheless, the distributor wanted to show us how good he and our local marketing and sales reps were doing and how our floor programs stood out.

The entourage — a better description might be the sheriff and the posse — went off on the visit/tour and once inside a store, some spoke to the owner or manager while others checked the displays and floor programs.

A member of the group was fascinated by a multi-case display of one of our brands and the very attractive and large case card that accompanied it. Never having seen it before, but still admiring it, he called others over to have a look. Someone touched the case card and to his surprise, smudged it. It was hand painted… and still wet. We all smiled at what appeared to be a permanent holiday display that obviously had just been put up for our visit. “That’s okay,” someone said, “maybe it’ll stay up and look how much real estate the brands have.”

Smiles turned to laughter at the next stop, also a large store with a massive display right at the entrance.

There was the same case card with the same smudge in the same spot.

I have no idea how they moved that thing so quickly.

Retailer Incentives

November 11, 2010 No Comments

He was hired as the head of market research (aka marketing insights) from outside the booze industry. Bright eyed and bushy tailed, he decided that he was going to learn the business by talking to consumers, retailers and the sales folks on the street.

For weeks he did nothing but visit market after market and rode along with local sales managers. He learned a great deal in the field, more than by sitting at a desk and listening to presentations.

Among other things, he learned that the business is based on relationships and, for the most part, respect between the buyer and seller. He learned how the 3-tier system works, how the consumer needs to be factored into the equation and the difference between a smart sales rep and one that’s just going through the motions.

The plan was to see as wide and diverse set of retail situations as possible — bars at night and stores during the day. Some open-ended consumer focus groups were thrown in here and there, just for the learning.

One day he found himself in Detroit. The morning was spent in suburban stores and the afternoon was devoted to downtown. The local sales manager for the company was among the best. Really knew his stuff.

A new word entered his vocabulary — “bank” store. Stores in tough urban settings with thick Plexiglas separating the clerks and the customers.

At one large, important account, the owner greeted the sales rep warmly. In a Middle Eastern accent, said to the sales rep, “How are you? What do you have for me today?”

“We have a Seagram’s Gin program coming up that you might want to look into,” said the salesman.

“What will I get?” asked the owner. “Never mind,” he quickly added, “I don’t need to promote Gin. What’s in your bag? Any tee shirts or hats?”

“No, just shelf talkers, window ads, banners and sales sheets.”

“Paper” said the owner. “I don’t need no paper.” “Got any more Captain Morgan mirrors? My father-in-law saw it in the store and took it home. I want one too.”

“I’m sorry,” said the salesman. “That program ended months ago and it was so successful we ran out.”

“ What do you have in the trunk of your car?” asked the storeowner.

By now the market researcher is watching this interchange with his mouth open and in total shock.

“Listen, I’m just showing this gentleman from New York around the market and different stores. You’re an important account for us and I wanted him to see it. I don’t have sales promotion or loader items. Maybe next time.”

“Sure, sure” said the storeowner. “What do you have in your trunk?”

“Nothing.”

“Come on, come on, what’s in the trunk?” asked the retailer.

With total poise and calm, the salesman handed his car keys to the owner and said, “check for yourself.”

He went on, “but this time leave the spare tire.”

{Got any sales promotion stories you want to share?}