Pernod Ricard sharpens big data and commerce edge after blurring marketing and sales

Pernod Ricard is making more concerted moves into CRM, big data and ecommerce channels now that it has completed the unification of its marketing and sales at a group level.

The global business development division was formed this month and is now recalibrating the company’s strategies around luxury, digital acceleration, on and off-trade development, innovation and shopper experiences. Led by marketing vice president Conor McQuaid, who replaced Martin Riley as Pernod Ricard’s top marketer at the turn of the year, the unit's early priority is to shepherd strategic digital investments.

Winning customers at the last 3 feet

Performance-led channels are to receive the bulk of the attention, a move indicative of the company’s more aggressive pursuit of sales through increased visibility behind bars and on shelves. This so called winning customers at the “last three feet” was highlighted by the company as the chief reason for a marketing shake-up that is pulling big data and online sales to the fore of upcoming brand strategies.

Pernod Ricard, chief executive Alexandre Ricard, who now has corporate-wide responsibilities for brands following managing director of brands retirement at the start of 2015, told The Drum: “With digital [the team] is working on global initiatives. We’re investing heavily in getting to know customers through digital insights based on big data. There’s consumer insight that we’re looking to get from digital.”

Customer insights are being mined from Pernod Ricard’s various digital schemes with CRM, particularly to high net worth individuals from its travel business, attracting heavy investment. An advertising platform, dubbed “Travel Trail”, serving targeted offers to affluent shoppers at key points in their journeys is to be extended to Europe and the US following successful launch in Asia last year.

The focus on online sales will also be bolstered through increased support for the company’s click-and-order strategies with the likes of Tesco and Wallmart worldwide alongside its nascent ties to Amazon. Direct selling to customers is also an area of interest although this will be on a smaller scale to the company’s work with retailers due to the costs involved in shipping products to consumers.

Ricard added: “We’re starting to sell to directly to consumers more and there’s the on-the-go digital type of transaction which we’re investing in at a global level.”

Video will also take a larger slice of media budgets moving forward. At a media briefing in London yesterday (16 February) the company was quick to highlight the engagement films for Chivas Regal and Ballantine’s had delivered in 2014, particularly when distilling global ideas locally. Films shot for Ballantine’s “Stay True” global platform, specifically one featuring South African DJ Black Coffee’s human orchestra, have generated 11 million views to date, while a Ballantine’s branded film starring Oscar nominated actor Chiwetel Ejiofor sparked 35 million impressions in China alone.

Luxury lives on at Pernod Ricard

Pernod Ricard’s business development team is also at work on a luxury communications strategy designed its revitalise its presence in a market with healthy emerging market exposure and strong profit margins. This “Power and Grace” platform will come to bear with upcoming marketing for Royal Salute, a brand Pernod Ricard admits has been knocked by China’s clampdown on gifting.

Luxury is set to be a key battleground for spirit makers looking to offset slower volume sales with higher priced drinks and exploit the rise of the middle class in countries such as Asia and Russia. Pernod Ricard's rival Diageo believes the shift can propel revenue from Reserve, its luxury division, to around 20 per cent of its total business by 2020.

Ricard said the changes to luxury along with the other five pillars supporting brand efforts were more about operational gains rather than strategic at a time when “trade marketing and commercial lines are becoming increasingly blurred”.

Bringing clarity and faster decision making to the group

It was this shifting dynamic between the two disciplines that encouraged the business to reconnect brand and local teams in order to quicken the transferal of marketing ideas across the business. The objective was realised by a group-wide restructure, of which marketing bore the brunt, that axed 5 per cent of its workforce – around 900 jobs.

Ricard cited an example of an Absolut activation in Brazil that piloted multi-sensory technology and was translated to Australia just two weeks later as how it wanted to “speed up the decision making of everything we roll out”.

“We wanted to supress the internal and international commercial defragmentation at brand and company level,” he added. “We had teams of people that would travel around the work presenting the new innovations and the strategies and tools for the different markets," he added.

“Over the last few years, technology has evolved in such a way that it gave us the opportunity to come up with collaborative platforms internally whereby the commercial teams input and upload all their activation tools, and strategic guidelines and they’re immediately available throughout the world. And conversely, markets can now upload their latest activations and they’re immediately available in almost real time around the world.”

The operational overhaul closes the chapter on Pernod Ricard’s transformational strategy.

Primed for growth

The business now believes it is set up to pursue top line growth despite a tumultuous first half of its financial year that saw sales in China, its second biggest market, slide 16 per cent year-on-year in the six months to December, Globally, sales rose just 1 per cent in the period to €4.62bn.

Ricard said: “Our [first half] results are solid and in line with the guidance given in October. Our Sales are gradually improving despite an environment that remains challenging.

“I am confident in the strength of our portfolio of premium brands and of our global network that support our three strategic growth pillars: premiumisation, expansion and innovation.”

Investments for Jacob’s Creek in the UK and Absolut in the US are being primed to help accelerate the recovery.

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