Absolut Vodka

Taking Brands Global

Group 5

ABSOLUT Flow

• Brand Identity

• History

• ABSOLUT in the US

• ABSOLUT in India

• Global Strategies

• Key Learnings

• References

Brand Identity

• Core Values– Clarity– Simplicity– Perfection

• Established through– Advertising– Fashion– Art– Music

Brand Personality

• Product is associated with being– Smart– Stylish– Creative – Witty

ABSOLUT in Sweden

• Overnight success since 1879

• Lars Olsson Smith – The King of Vodka

• The ABSOLUT Hero

• The name Absolut

• Åhus, Sweden

• Absolut Ice Bar

Global Facts

Absolut vodka sales till date

Absolut in USA

Distribution System for spirits in USA

Product Segments

The different product segments are as follows:

• Platinum

• Super-premiumf

• Premium

• Standard priced

• Popular priced

Reasons for entering USA

• In the last fifteen years since its introduction in the US markets, the consumption of alcohol in the USA has decreased by 20%

• Health trend• Tendency to drink ‘less but better’• More pure alcohol

• 1970's – American consumers accounted for 60% of the vodka purchased worldwide

• The gross margin on imported vodka represents about 40 per cent of the total gross margin

• The biggest single market is the U.S., where growth happened @ 30% (approx.)

“It’ll never sell”

Absolut faced big challenges during launch in the U.S market in 1979:

– Insignificant brand name

– Association with a country that has no vodka-producing tradition

– Absence of a label and packaging

– Results of primary market research

Background

• Biggest vodka market & highly competitive

• The destination for the first shipment of vodka was Boston

• In its first year on the US market, only 10,000 nine-liter cases of Absolut Vodka were sold

• By 1985 – leading imported vodka

• Till 1994 – Absolut Vodka distributed by Carillon Importers

• In 1994 – agreement with Seagram Co.

Despite the challenges

Today, Absolut:– commands 70 percent market share. Design was a major factor

in this success

– Design contributed to the five asset categories of brand equity:• Brand awareness

• Brand loyalty

• Brand personality

• Brand quality

• Brand associations

• Andy Warhol/Keith Haring

• Partnership with the Artist

• Integral Part of Absolut Image

Art-Supportive Marketing

Absolut Statehood

• Absolut commissioned one artist from each of the 50 states

• Artwork included icon

• Artists signed 300 lithographs

• Partnered with USA Today

• Full page advertisement

• Lithographs sold for 300 dollars each

• Unveiling in a state every other week

• 2 year campaign

Statehood

Communication

• Absolut Insight

• Absolut Access – CRM efforts

• Predominantly print ads

• Global branding, local touch

Absolut Fashion – DKNY

Facts about the current US market

• Absolut grew by 7% in 2007 as compared to 2006

• Full distribution and 98% brand awareness in the (U.S.) consumer (market)

• Growth rate faster than the market in general

• Market share 10.5% – 11% of the total US vodka market

• Sales rose to 4.9 million nine-litre cases in 2006, up from 4.7 million in 2005

ABSOLUT in India

Reason to enter India

• Growth rate of the white spirits market is 25 – 30%

• Whiskey was looked upon as a “mature” drink

• Preference towards cocktails

Absolut in India

• Distribution– Kyndal – Bonded warehouses (Mumbai and Delhi)

• Fashion– Absolut Fashion is entering India– Plans to do the Metropolis act

Background

• No discounts• Smirnoff is the most popular brand.• Competitors having strong distribution network.• Challenges

– communicating in a regulated market.– Import duties levied

• Associated itself with Manna art• Events

– Class of ’84– Drink mixing sessions by celebrity bartenders– “Mulit Cocktail Lounge”

• Vrinda Gokhale• Cory Walia

Global Strategies

Events

• Sampling program – Magic cards – 1000 events, 18 magicians– Take away gifts (t-shirts, deck of cards…)

• Gay events– Tom of Finland

Global Distribution

• Ships it to 126 markets

• Maxxium and Future brands are the major distributors.

• Strategic holdings– Maxxium (25%)– Future Brands (49%)

• Streamlined operations

CRM

• Components– Inside information to the world of Absolut– Invitations to events– Gifts

• Inside information–  Stories about the world-famous ads– In-depth product features, especially about

new flavours– An ever-expanding collection of recipes

CRM

• Invitations– Tasting and sampling events – Parties presented by ABSOLUT– Concerts, films and other performances presented by

ABSOLUT

• Gifts– Reproductions of noteworthy ads– Coffee-table style drinks book personalized with

ABSOLUT <YOUR NAME> on the cover– The ABSOLUT DECK playing cards

Worldwide Communication

• The first ad was “Absolut Perfection” which came in 1980.

• Criteria– The bottle should occupy

the centre stage– No particular lifestyle to be

considered• 15ft high sculpture – Ice

Hotel• Has created campaigns

for the gay market• Absolut Pictures• Absolut Road Trip

Worldwide Communication

• In an Absolut world• Presents a bold and optimistic world view

– Rickshaw rides– Music downloads– VIP treatment

• Associations:– Fashion– Art– Music

• Only alcoholic brand advertised on Ftv• Music

– Absolut DJ site – 1998 – Absolut Tracks – 2003 – Lenny Kravitz – Breathe

Art

• Eminent artists– Andy Warhol

• In 1985 after getting convinced by Andy Warhol– Laurence Gartel – Digital Art– Hans Godo Frabel – Glass– Gianni Versace – Fashion Designer

• ABSOLUT GLASNOST (1990) • ABSOLUT EXPRESSIONS (1997) • ABSOLUT ORIGINALS (1998-1999) • ABSOLUT GENERATIONS exhibition at the

Venice Biennale in 2003

Fashion

• David Cameron's dress debuted in 1988.

• ABSOLUT NEWTON

• ABSOLUT VERSACE

• ABSOLUT RUIZ DE LA PRADA

• ABSOLUT TOM FORD

• ABSOLUT GUCCI

• ABSOLUT GAULTIER.

Website

• Three websites– www2.absolut.com– www.absolut.com– www.absolutdrinks.com

• Interactive– Visions– Games (82 bottles)

• Global feel• Newsletters and memberships

Absolut - the Essence of Vodka Purity

Local variations

Events

Association with art, fashion, music

Evolving strategyThe Icon

Through “leverage” to “collaboration”

Elements of Success in Global Branding – Alcohol Industry

• Associate with fields which do not have any boundaries

• Product profile– Clarity

– Consistency

– Quality

– Responsibility

• Become a brand-driven organization and culture• Implement a measurement system• Market research results need not always be

true.