Wednesday, April 1, 2015

Marketing Diageo Style

This just in: one of my confidential sources at Diageo sent me a recording of a marketing meeting that took place sometime in mid-2013.  I've changed the names in order to protect my source, but all of the participants are high level executives in Diageo's marketing department. Here is the transcript which provides a fascinating look into the marketing practices of the world's largest spirits company.

Roger: Thanks for coming to this meeting on short notice.  I wanted to talk about our bourbon problem.  As you know, we've got a shortage of available warehouse space.  Well, that's partly because we have thousands of barrels of very old, mediocre bourbon, mostly from the Bernehim distillery, that we have no use for. We've got to dump it somehow. I need ideas.

Peggy:  Easy, put it in Bulleit.  We need a new source for that brand anyway.

Roger: I thought of that, but this stuff is too old for Bulleit.  We could only dump small amounts in at a time, and that wouldn't do much toward ameliorating the stockpile.

Peggy:  Okay, so start a new brand. Maybe bring back IW Harper.  We get a press hit for the new brand, folks buy a bottle to give it a try, and we dump all the old crap into it.

Roger:  Great idea, I think that's a plan.

Don:  Wrong!

Roger:  What do you mean Don.

Don:  You know what I see here?  A lack of creativity.  These old stockpiles aren't a burden; they're an opportunity.  Sure, you could pour all of the bourbon into one new brand, get one press hit and people will buy one bottle, but then they'll realize that it's mediocre bourbon and they'll never buy another one. But why release one new label when you could release five or ten. Hell, release a new one every month.  Then you get a press hit for every bottle, plus reviews, blog posts and tweets every month.  People will collect them all.  They'll post pictures of them on Facebook with comments like "Boom" or "This just happened," and other people will see the posts and buy them all because it said "boom."

Roger:  Don, I don't think I made it entirely clear how mediocre this stuff is.

Don:  Oh, I'm sorry, did I accidentally walk into a meeting of the quality control department?  I thought this was marketing. Come on Roger, don't be naive. Sure, people will buy the first release and maybe it will suck, but then they'll think, hmm, maybe the second one will be better, and if that one sucks, maybe the third or the fourth will be better.  Think about it. These are old bottles of limited edition bourbon.  It's like printing money. People can't not buy them.

Peggy:  Don, with all due respect, I don't think our customers are that stupid.

Don:  We'll see Peggy. We'll see.


My Annoying Opinions said...

And even the people who get wise to us and make fun of us will continue to review these bottles and give them added respectability.

U.V. said...

Just called K&L and there is already a waiting list for the first three releases.

Funky Tape said...

When are the suits over there going to come out with their own bobble heads? It's the only 'extremely rare' and 'collectible' crap I'm interested in.

Anonymous said...

But which one was the mole? My guess is that it's "Don".

Josh Feldman said...

"It's over oaked"

"We have a solution for that. It's called 'hard filtration'".

"Won't that make the whiskey overly soft and devoid of character?"

"Bingo. Smooth".

Anonymous said...

Lost Prophet is good, at least?


Anonymous said...

Diageo probably has not the brightest marketing department :D
However I tried Barterhouse 20yo bourbon. I really like the whiskey. It was also rated 90 points by Whisky Avocate. Not sure why they say it is all bad.

Plus they sell it at reasonable price compared to other whiskey companies. At 20 years old good bourbon for $80 they do not have much competinion.