Pernod Ricard on why it's putting a stake in the ground with the appointment of an IoT agency
Alcohol giant Pernod Ricard is doubling down on its mission to turn bottles into media platforms with the hire of a dedicated Internet of Things (IoT) agency – a move it claims is a first for an FMCG brand.
It’s a strong signal of intent for how important Pernod Ricard believes understanding the IoT and where the brand fits within that to be for its future. SharpEnd is a self-styled "agency of things" and has been tasked with managing the global IoT account; primarily scaling IoT processes, partnerships and learnings that emerge from new trials of technology.
Speaking to The Drum, the group's global digital acceleration director, Antonia McCahon, said the move is a "massive departure" from Pernod Ricard's usual brand building investments, but explains it makes a "whole lot of sense" for a company that has always been big on events and activating consumers in moments of consumption and conviviality.
"It's a departure in one sense because we’re really heavily involving technology in the way we activate our consumers, but in the other sense it’s actually a return to the foundations of what build the Pernod Ricard brand,” she said.
“This notion of being with consumers and that role in augmenting their social experiences with one another and we really see that the IoT can really play a big part here."
It’s not the first time Pernod Ricard has worked with SharpEnd. The agency was behind a massive project involving the rollout of 40,000 NFC-enabled Malibu bottles last year and Malibu's smart 'Coco-nect' cups, which allowed UK consumers to remotely alert bartenders that they needed a refill.
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This firmly cements the FMCG company’s vision for excelling in the IoT space. In 2015, its Absolut brand opened the doors to its own IoT lab in Stockholm, announcing it would launch a series of trials in 2016 to test the theory that the future of marketing is predicated on creating services rather than buying media.
When it launched the IoT hub, the brand saw it as a key component in a wider plan to combat a considerable sales decline in the US - it's biggest market. At the time, it said it wanted to bottles into media platforms to monetise homelife, provenance and on-demand.
McCahon said that in appointing a permanent agency in SharpEnd, Pernod Ricard is looking to build on the triumphs of its test and learn approach in this area.
"We are starting to see success across the board in the different experiments that we’re putting into place and we’re now looking at scaling some of the best practices," she asserts.
The wide spectrum of different use cases for the tech can include, according to McCahon, experiential pushes and animating crowds in nightclubs through to the bottle becoming a media platform in its own right; enabling the brand to enhance experiences at home.
For example, to mark St Patrick's Day in Ireland a Jameson whisky campaign saw the company activate the family crest on Steve McCarthy’s limited edition label with an NFC tech, giving users will get access to exclusive competitions and content via their smartphones.
In developing markets, where counterfeit is an issue connected bottles be traced to understand where the product is within the supply chain.
"We've done experiments that haven't proven successful," admitted McCahon. "Sometimes it's because of the choice of technology, or comes down to the fact that consumer adoption of that technology isn't as advanced as it could be so we're looking at different tech for different regions and markets."
Coming back to the theme of the bottle as a media channel, the digital lead says in the off-trade the brand has been satisfied with an "incredibly promising" scannable bottle neck tag initiative in Spain, which it plans to roll out in other markets.
"More and more we're looking at these pockets of excellence and starting to scale throughout the group and that will be our focus in 2018 moving ahead," she added.
When Absolut launched its IoT hub Markus Wulff, Absolut marketer heading up the connected bottles drive stressed the tests were focused on the consumer not the brand, and that any additional insights were a bonus.
McCahon explained that the attitude remains the same, and that as of yet the brand hasn't reaped the financial rewards of the data afforded by connectivity. "It's really early days, but what we are gaining is a load of intelligence on our consumers and how we can make a better product to fit their needs."
While Pernod Ricard is still working with its roster of traditional agencies, SharpEnd founder Cameron Worth believes that his firm's escalation to becoming a global innovation partner focused on IoT for one of the world's best known alcohol brands further validates the need for others to follow suit and work with specialists in this field.
"It's a flag in the ground for the industry. In the same way that brands appointed digital, social and mobile agencies because they realised that was a transformational opportunity, the IoT is no different,” Worth suggested.
"Just because we're working with a new set of technologies doesn't mean we need to adapt to new models or new process, it just means that brands need to work with the right people to maximise that opportunity."