Beverage producer Bacardi is forced to put all efforts towards the retail this year but is also developing creative initiatives to support the hospitality and catering industry. Online platform Drinksplease, originally from the Netherlands, is now introduced in Belgium.
Focus on e-commerce and consumption at home
It is an understatement to say that the corona crisis has a severe impact on the alcoholic beverages industry. Two consecutive lockdowns in which the hospitality and catering industry has had to close in quite a few European countries hit the market. It forced companies to reinvent themselves. François In Albon, who has only been managing director of Bacardi in the Benelux and Nordics since September, is not losing heart. “I won’t say that this is our best year in terms of top-line growth, but we will survive it. We are always following the consumer and the shopper, so we are moving from the bar to e-commerce and consumption at home. We have taken several initiatives to limit the damage.”
Last spring there was the ‘#RaiseYourSpirits’ campaign, in which Bacardi invested 1.5 million euros to support hospitality and catering companies, for example by setting up takeaway initiatives. During the reopening last summer, the company launched the ‘Back to the bar’ campaign: each employee could invite three family members or friends for an enjoyable evening with cocktails. “Supporting on-trade sales is an important part of our strategy. We now want to maintain the partnership to be ready for reopening. We have already helped out around 300 outlets with a ‘bring the bar home’ cocktail delivery service.”
Personalised gifts
E-commerce has become an important pillar for the producer in times of corona. A few employees who, in better times, were active in the events industry, developed the online platform drinksplease.nl out of nowhere. This online store is aimed at consumers: orders get delivered within 24 hours throughout the Netherlands.
“We discovered that people love personalisation. So, we did a trial with gifts during the first wave: on Father’s Day you could order a bottle of Bacardi Carta Blanca with a personalised message, and it turned out to be a resounding success. During the second wave, also, we put a strong emphasis on premium gifting, because now that people can’t go out, they want to pamper themselves and each other during these difficult times. You can get bottles of our premium brands such as Bacardi, Grey Goose, and Cointreau engraved as gifts. People can’t go to the bar, but we follow them to celebrate at home. We’re also going to bring the online platform to Belgium”.
“Fish where the fish are”
Before the end of the year, Bacardi will focus strongly on the retail channel, where sales have risen by double digits. “We believe that people will party, Covid or no Covid. People will treat themselves at home. Compared to last year, we sold fifty per cent more displays for our premium brands and aperitifs. From now until the end of December, all our hospitality staff will go out to the stores to build displays, in 1800 stores in Belgium. This includes proximity stores as well because people are shopping closer to home due to the corona crisis”.
People of the head office will also go on-site to meet consumers during this period. “We have to fish where the fish are. This way, we protect our very agile employees: they move from one channel to another. There is no silo mentality here. We want to avoid having to put staff on furlough and keep it to a bare minimum.”
Keep innovating
In December, the company will invest heavily in advertising campaigns across the Benelux, especially for the novelties Bacardi Premium and Bombay Bramble, a gin with a natural infusion of blackberries and raspberries. “Even in difficult times, we continue to innovate our brands to come out stronger.” After Christmas, Bacardi wants to focus on ‘mindful drinking’: less but better, or alcohol-free. “In the Netherlands, there is dry January, in Belgium, there is Tournée Minérale in February. We have beautiful products that respond to that demand. We have launched an alcohol-free Martini and the tests are astounding: serve it with tonic and people won’t taste the difference. We use real Martini as a starting point and take out the alcohol.”
In Belgium, food retailers have already started strong promotions on champagne, because the producers want to get rid of their stocks. Will other types of alcohol follow suit? “It is not within our strategy to hold big discounts. We believe in our brands. Of course, we have promotions, but not crazy things such as 1+1. We don’t want to damage our brands. Nor would it be in line with our commitment to responsible drinking. We adopt a long-term vision.”
Brand ambassadors
Are retailers more open to real partnerships during this time? “I am not naive,” says François In Albon. “I’m from France and I’ve also worked in Germany, places where trade relationships are mainly transactional with a focus on price. But I am very surprised that every top-to-top meeting I now have with customers, both in Belgium and in the Netherlands, is constructive: we talk about how we can develop the business, how we can become more agile… The big retailers are having a very good year in terms of alcohol sales. What we offer them is instore execution, but also great flexibility when it comes to supply. For example, we make mixed pallets, or we can adjust the schedule. We also support them digitally and in e-commerce, because Covid-19 is accelerating that evolution.”
Furthermore, the independent specialist stores on both sides of the border are very enterprising, according to the chief executive. “That gives me great pleasure. They make gift boxes for companies, they set up their own online store, sometimes grow at double-digit rates… They are a small channel in terms of turnover but an interesting sounding board for our premium brands. We are not the largest in our industry, we are not going to win the war with advertising, therefore we lack critical masses. But when whisky lovers ask for advice in such stores, they play an important role as ambassador of our brands”.
Opportunities for strong brands
What expectations does François In Albon have for this holiday season? “I am an optimist. All the literature on crises says that people are reassured by brands they trust, in which they believe. They want to pamper themselves and their families, so they are prepared to pay a premium. I think people are tired of the second wave and will want to celebrate. And we have a brand portfolio that goes well with that. I am confident: we have brands that consumers love, we are close to our customers, and we are accelerating on trends such as e-commerce and digital. This is why we will come out the other end stronger.”
It is also a matter of hoping on a reopening of the hospitality and catering industry. “I think this crisis will end one day. Maybe it will be a different world, maybe it will be a slow recovery. I don’t yet dare to count on big music festivals in the summer of 2021, but people will need to meet again, celebrate together, at home but also outdoors. We are social creatures.”
