In focus: Alcohol

Marketing imperatives:

Alcohol brands still depend on mass-media advertising for communicating their values to consumers. But the rising tide of legal restrictions around the world means that brands cannot rely on paid advertising indefinitely.

Instead alcohol brands should look to influential but underused owned channels, so they can continue to communicate just as effectively, but in ways that are not vulnerable to tougher advertising legislation.

Touchpoints ROI Tracker:

Based on consumer research, Touchpoints ROI Tracker is Publicis Media’s brand contact measurement and planning tool. Since 2004 a total of 1,123 Touchpoints projects have been completed across 66 countries, comprising 992,289 consumer interviews that provide contact point metrics for 14,914 brands in 330 product and service categories. The data for all projects are stored in a single internet-accessible database. This database provides normative and trend data for 290 touchpoints.

All rights to the MCA® measurement system including CCF™, BEP™ and BES™ are owned by Integration (Marketing and Communications) Limited and licensed to Publicis Media Limited and its affiliates.

Consumers around the world spend about US$600bn on alcoholic drinks each years. Six of the world’s biggest 100 advertisers, as measured by Advertising Age, are alcohol advertisers: Anheuser-Busch InBev, Heineken, Diageo, Pernod Ricard, Molson Coors Brewing and Suntory Holdings. The industry has struggled with weak sales in recent years, but started to pick up in 2017 as larger companies began to meet demand for high-quality craft beers and premium spirits in developed markets, and for economy brands in emerging markets.

Alcohol advertisers rely heavily on paid advertising for brand communication. The top six advertisers alone spent US$15 billion on advertising in 2016. According to our proprietary research, paid media is responsible for nearly half of all consumer experience of alcohol brands.

We use our Touchpoints ROI Tracker tool to monitor trends in brand communication over the full range of paid, owned and earned touchpoints. One of its outputs is Brand Experience, which measures the reported importance of each touchpoint in shaping consumer attitudes and influencing consumer behaviour. It tells us that 47% of alcohol Brand Experience comes from paid media, compared to 40% for owned media and just 13% for earned media. Two of the five touchpoints that contribute the most to Brand Experience are paid media touchpoints: newspaper ads by retailers at number one, and TV ads at number five.

However, this reliance on paid media means that alcohol brands’ communications plans are vulnerable to disruption and may not be sustainable in the long term. Governments around the world face continued calls for further restrictions on alcohol advertising. Lithuania has just enforced a ban on alcohol advertising on TV, radio, print and the internet, and Australia and Ireland are debating new restrictions. Alcohol brands face a ratchet effect: regulations are sometimes tightened, but rarely if ever loosened. Alcohol brands should plan for having less access to paid media in the future, and potentially no access at some point.

Our Touchpoints research shows that alcohol brand owners are underusing some valuable owned assets that could be used to mitigate any loss of paid media channels. These assets have above-average influence – that is, they are more likely to change consumers’ beliefs and behaviours when they encounter them. But they have below-average brand association – so consumers are less likely to encounter them. By making them more prominent, brands can make the most of their high ability to sway consumers.

As the chart shows, brands have the opportunity to reach potential customers more effectively through samples and live events, which have high influence potential. This is a combined measure of the underuse of these touchpoints (the gap between their reach and the reach of the average touchpoint), and their extra influence (how much more likely these touchpoints are to influence behaviour). Most of them are expensive at scale, though, which is why brand websites are so important. Although they have less absolute influence potential, they put the brand within the reach of everyone. Having a robust brand website with compelling content and a coherent story is probably the most efficient way of improving the effectiveness of alcohol brand communication.