1. Why are Diageo, Pernod Ricard, and other marketers of global spirits brands localizing advertising campaigns in emerging markets?
2. How do consumption habits for products such as Scotch whisky vary from country to country?
3. Why are some spirits products and brands strictly local pastis in France, for example, or Maotai in Chinawhereas others have global potential?
4. What strategies should Diageo, Pernod Ricard, and other Western spirits brands pursue in China?
Scotch whisky is a textbook example of a global product. Wealthy consumers with discerning palates do not hesitate to pay premium prices for top global brands such as Chivas Regal and Johnnie Walker. Moreover, Scotch drinkers everywhere associate the amber spirit with aspirational goals such as success and achievement. In the late 1990s, Diageo, the owner of the Johnnie Walker brand, launched a global advertising campaign featuring the tagline Keep walking. The theme, which was developed by Britains Bartle Bogle Hegarty (BBH) advertising agency, was keyed to the brands logo: a redcoated, top-hatted gentleman in mid-stride. However, as BBH staffers working on the Johnnie Walker account understood, the things that constitute achievement can vary from culture to culture.
In China, for example, the self-satisfaction that goes along with achieving a goal may not be enough; acknowledgment of the achievement by peers is also important. For this reason, BBH created a localized marketing campaign for China. One ad depicted two golfers hitting increasingly extreme shots, which included teeing off from the roof of a golf cart and a ball that was hit from underneath a crocodile. The campaign coincided with rapid market growth; after China joined the World Trade Organization (WTO) in 2001, tariffs on spirits imports were cut from 65 percent to 10 percent. According to the Scotch Whisky Association, total Scotch exports to China totaled £39 million in 2014, up from just £1.5 million in 2001. Today, Johnnie Walker has a 34 percent share of Chinas whisky market.
BBHs Orlando Hooper-Greenhill explained the insights that were incorporated into the campaign: Johnnie Walkers marketing in China needed to reflect the importance of peer group and family perceptions of an individuals achievements, while also accommodating the fact that whisky is a youthful drink. Hooper-Greenhill also noted that in China, whisky is consumed in a wider variety of settings than in the West. Thus, it was necessary to adapt the message to reflect the different contextsfor example, rural areas versus urbanized areasin which whisky is consumed.
Market segmentation is an integral part of Diageos approach to the Chinese market. As Kenneth MacPherson, managing director for Diageo China, has noted, the complex demographic composition of Chinas huge population, coupled with the countrys vast geographic expanse, means that consumption habits and patterns differ significantly. The first segment, guanxi men, are status-driven businessmen ages 3545 who spend a great deal of time networking and trying to set up business deals. The second segment is strong independent women, also in the 3545 age bracket. A third segment is composed of upwardly mobile men and women ages 2535 who want to be seen as cutting-edge. Finally, the choice generation consists of those in their twenties who seek out new experiences.
Although Johnnie Walker has achieved great success in China, the brand is in second place behind Chivas Regal, which commands a 50 percent market share. For decades, Chivas enjoyed a global reputation as the deluxe Scotch whisky. As was the case with Johnnie Walker, the brands promotional strategy also frequently called for global advertising campaigns. For example, in the early 1990s a print campaign was keyed to the slogan There will always be a Chivas Regal. The campaign featured a series of universal images and was translated into 15 languages. Managers in each of 34 countries were authorized to choose individual ads from the campaign that they deemed appropriate for their markets.
Exhibit 13-9
Enjoy 24/7 customer support for any queries or concerns you have.
Phone: +1 213 3772458
Email: support@gradeessays.com