Jim Beam Brands: A Shot of Pesonality

The world has changed since Jacob Beam founded the business that would one day become Jim Beam Brands. The Deerfield, Ill.-based subsidiary of Fortune Brands Inc., Lincolnshire, Ill., has evolved to become a leader in the liquor and spirits industry, both in product innovations and merchandising. Besides its namesake bourbon, the company now markets a variety of small-batch bourbons, vodkas, gins, rums, cordials and wine. Competition has also increased, making P-O-P an essential element of the marketing mix.While hard liquor sales as a whole have been sluggish in recent years, that downward trend may be turning around, thanks to new premium and specialty products, according to the Adams Liquor Handbook 2001Sales of Jim Beam Brands' core products have remained strong, with premium and super-premium products pushing sales even higher. The company's Vox vodka and its line of small-batch bourbons have made great inroads with consumers. And a recent agreement with Swedish vodka maker Vin & Sprit will enable Jim Beam Brands to distribute Absolut vodka through Future Brands LLC, a new jointly-owned U.S. company based on Jim Beam Brands' distribution operations.Although all this activity points to further growth for the company, merchandising comes with a cocktail of challenges. Legal issues, retailer restrictions and competitive forces are enough to leave any distiller with a hangover.As a result, P-O-P is becoming a strategic tool for combating competition and building relationships with consumers, both on-premise and off. The company uses P-O-P to generate awareness of its products and to help define the personality of the brands. Combined with print advertising, radio, outdoor advertising and promotions, all marketing endeavors are integrated to have the greatest impact with consumers."P-O-P has always played an integral part of our brand support mix," says Chris Hess, sales promotion manager for Jim Beam. "The industry as a whole relies pretty heavily on in-store merchandising, probably to a greater degree than other categories. It's our opportunity to help shape the perceptions of the consumer when it comes to our brand."Tom Maas, vice president, global brand management, points out that P-O-P without an effective strategy waters down the effect of merchandising. Maintaining a consistent image at retail is essential. "It is much more important to maintain your image with a display than it is to do something that just creates attention," he says.Spirit of DistinctionJim Beam Brands has risen to be a dear leader in the spirits category, but leadership has a price. Competitors often introduce copycat products that ride on the success of product trends. Sometimes, even the merchandising is duplicated. "For example, we've been incredibly successful with our Pucker line of sweet and sour schnapps," says Joe Karcz, director, global promotional marketing. "As a result, we've seen a number of competitive products come out to try and ride along on that success. Those scenarios happen when you start to lead a category."But personality is harder to imitate. At the center of the company's marketing strategy is a clearly defined personality for each of its brands. This personality, in turn, helps to determine the way the company goes to market with a particular product. Likewise, all aspects of display design are influenced by the brand personality.Once a brand's personality has been established, the brand teams work to develop display materials that support that personality. "Everything that we do starts with the brand personality and position," says Hess. "Then we build programs around that."The design process includes both tactical approaches to P-O-P and the actual materials used to build displays. "We may use a cherry wood for a display for our small-batch bourbons because they are a little more top-shelf," says Maas. "When we do a display for Jim Beam Black, we might use a finished oak piece because it is aged in oak barrels. It's a little more of a mainstream brand."Chris Gretchko, group product director for cordials,says that taste isn't enough to keep a brand top-of-mind with consumers. "To differentiate our products and make them more meaningful to the consumer, we try to have a personality for the brand and something beyond just the taste," she says. "Taste can, in some ways, be replicated."The company's display materials are engineered to reflect the key attributes of the brands. For example, the displays produced to support Vox vodka were designed to showcase the upscale image of the product. Table tents that support the brand come equipped with designer frames to mirror the stylish nature of the brand.The small-batch bourbons take a more practical approach. Table tents and tasting cards were produced to educate consumers about the specific properties and uniqueness of each product. The cards are intended to not only educate consumers, but also to teach bartenders and servers about the products so they can recommend them when the occasion arises.The company's single-malt scotch also gets high-class treatment. "We have special sampling glasses for our single-malt scotch that are along the lines of the finest glassware in the world," says Kathleen DiBenedetto, group product director, super premium products and small batch bourbons. "We treat these brands very differently based on their needs and the consumers' perceptions of these brands."The DeKuyper line of cordials, with more than 50 different flavors, has a different design challenge since it is unlikely that a retailer will display the entire product line. To address this issue, Gretchko designed a modular display that allows retailers to choose which products to showcase. The display features umbrella graphics that can be matched to any of the DeKuyper products."The piece has its own look," says Gretchko. "Then there are lug-on pieces that allow us to put in different bottles during different times of the year or different bottles in regions of the country with different taste preferences."Focus on On-PremiseOver the past five years, Jim Beam Brands has refocused its merchandising and is now giving special attention to on-premise customers. The switch from off-premise-centric programming to targeted on-premise campaigns coincides with the company's recent product introductions, which include a variety of premium and super-premium products.While both categories are growing as a whole, getting consumers to try new products in this price arena can be difficult. Consumers have a tendency to be hesitant to purchase an unfamiliar product in this price range, says Karcz. "Premium and super-premium products are a lot more difficult to gain trial off-premise," he says. "On-premise, a consumer can try a glass of fine bourbon without necessarily purchasing the whole bottle. When you're dealing with premium and super-premium product, you're already facing a bit of a hurdle."Hess says one of Jim Beam's strongest on-premise promotions has been "The Back Room." This program started four years ago and ties the company's bourbon with music acts. Sponsored acts perform in small music venues in 26 different markets. A variety of P-O-P materials including table tents, posters, banners and inflatable bottles is used to promote the events, as well as the Jim Beam brand."This is a long-term program for us that people are really identifying with," says Hess. "Each year, we get more and more people following this program. We've hit a point where consumers actually anticipate and look forward to it."The company's Vox and DeKuyper lines are being aggressively sold to on-premise accounts as well, says Gretchko. Since mixability is an important aspect for both of these brands, the company has worked to pair the products together to promote new drinks. For example, a recent promotion teamed Vox vodka with the company's Sour Apple Pucker schnapps. The result is a new trendy drink called the "Appletini.""Mixability is very important to our brands," says Gretchko. "We take a strategic look at our brand objectives for the year and try to translate those into P-O-P."This on-premise focus doesn't mean that the company is abandoning its off-premise merchandising. Far from it. Hess says the company continually looks for ways to integrate its on- and off-premise campaigns. For example, The Back Room program was brought to off-premise retailers in the form of a 50-case display that was designed to resemble a stage.The Appletini program, too, is attempting to bridge its way to traditional off-premise retail accounts. "We're working to educate the consumer and gain appetite appeal so that when consumers are shopping in stores for something to take to their next occasion, they think of us," says Gretchko.For super-premium products, DiBenedetto also produced a permanent 50-case display for off-premise retailers. "It's a showpiece that retailers keep up because they like the way it decorates and adds value to their stores," she says.Display DistillationKarcz stresses that the company's goal is to have a single well-crafted message for consumers for each product. The retail venues may change and the display materials may have to be adjusted accordingly, but the message remains consistent. The message is determined during the brand planning process. A variety of departments are called in to discuss the brand plan for the coming year, including the company's marketing services agencies, Communicator Marketing, Chicago, and Culver Advertising & Design, Milwaukee."They get involved from a very early stage," says Karcz. "We will brainstorm potential solutions to brand issues before the brand plan is finalized. They help to shape the plan, as well as to bring it to life through cre- ative development."Once the plan is set and initial creative ideas are in development, senior management and team members from the sales organization get involved. "That really serves as a disaster check for our program concepts to make sure that they don't run afoul anyplace," says Karcz.As display projects progress, different departments are called in to give their opinions. For example, the company's industry affairs department reviews display programs to ensure that they meet legal requirements.The marketing services agencies develop materials from the initial concept stages through the reproduction of art. The project is then turned over to the internal purchasing department at Jim Beam, which contracts with print suppliers and display manufacturers.The company works with a wide assortment of vendors including Bish Creative Display, Lake Zurich, Ill.; Carqueville Graphics, Streamwood, Ill.; DUCO Technologies, Henderson, Nev.; Everbrite Inc., Greenfield, Wis.; Flair Display Inc., Bronx, N.Y.; Prolam Inc., Libertyville, Ill.; Rapid Displays, Chicago; Sleepeck Printing Co., Bellwood, Ill.; Tukaiz Communications, Franklin Park, Ill.; and United Displaycraft, Des Plaines, Ill.Marketers on the brand team and the agencies stay in contact with the vendors throughout display production to ensure that the original creative concept is kept intact. "The film work and printing can be fairly subjective, so we work very closely with our suppliers to make sure that the right look and feel is being achieved," says Karcz.The salesforce is also very active in the display production process, says Karcz. "They help us allocate our budgeting dollars toward pieces that they feel they can get placed," he says.Displays find their way into stores in a number of different ways, depending on the particular market. In certain markets, display services companies are commissioned to build displays in stores. Some markets use the company's distributor merchandising units. Also, Jim Beam's internal salesforce is often utilized to place materials in their accounts.In states that sell liquor through state-run stores, displays have to be approved. "The displays go in front of a review board, and if they like them, then you get placement throughout the state," says Karcz. "If they choose to pass on the display, it tends to not get placed. We have to operate on a customized basis, state by state."Planning CyclesMost of the company's P-O-P is designed to last in-store for a three-month cycle. The planning is usually conducted once a year and targets the first three quarters of the year. The holiday season is planned separately and given special attention since that is the key selling quarter for most brands."We actually start our planning for the holidays right after the first of the year," says Maas. "We're pretty much done by March or April. Some of our competition actually does it a year in advance, but we see the benefits of getting the previous holiday season's sales results and display feedback."Different brands take advantage of different seasonal opportunities. For example, the company's Hot Damn schnapps was used in a promotion to highlight Octoberfest. The program was called "Hotoberfest" and promoted enjoying a shot of the cinnamon schnapps with a beer.When national programs don't work for a particular region of the country -- for thematic or legal reasons -- Jim Beam's regional marketing directors are called upon to design programs to fill that gap. "The regional marketing directors will step in and try to develop programming that supports the brand in the tone and feel of the national programming but is more suited for a specific state's needs," says Karcz.Though the company doesn't do any formal research to assess display effectiveness, it does use ACNielsen and IRI data to track sales. Marketers also regularly meet with the company's Distributor Council to get feedback from the, field. In addition, every two years the company gathers its internal on-premise specialists for a meeting called the "On-Premise Forum." Key account people come together to discuss what is happening at retail and brainstorm on different approaches to merchandising.Customization and ChainsIn the quest for differentiation at retail, both chains and independents are asking for customized display programs, says Karcz. The company addresses these requests in a number of ways, such as customizable menu insert cards. Customization programs are generally handled through the national accounts on-premise team. "They can address the needs of a smaller retailer and they will do what they can to help retailers who are interested in promoting our products," says Karcz."It's obvious that chains have impacted the way we merchandise because they have limited point-of-sale," says Maas. "Many times, we have to tailor a display program directly for those chains. The good news for us is that they don't dominate like they do in some other industries. The independent liquor store is still very important to our business."The company often tries to adapt existing programs to a particular retailer's needs, rather than construct a completely new program. For example, the national accounts group recently worked with the BW3 restaurant chain to customize Jim Beam's "Friends in a Flash" national program. The program was designed to run parallel to the national promotion, with consumers entering to win similar prizes. However, BW3's version of the competition featured its own prizes for consumers who entered at chain locations.Plans for the coming year differ by the particular brand, but aggressive merchandising is on every brand's schedule. The super-premium products are going to promote new drink recipes and trends, such as the Appletini, says DiBenedetto. Also, the brand will attempt to expand past its high-end accounts to get a broader consumer audience.Hess says the Jim Beam brand will move forward by continuing to support its Back Room program, as well as producing more mass displays. The company will also be making a push for its Jim Beam Black bourbon by integrating it in national programming.Gretchko will be busy promoting the DeKuyper line by supporting key flavors as individual brands. "There are certain brands that are consumer-recognized, and we will do materials that are specific to those brands," she says. "We may have some new product introductions and point-of-sale plays a major role in that."

Jim Beam Brands: A Shot of Pesonality

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