ON-TRADE VODKA: The Trendy Tripple

AS THE MOST fashionable – and mixable – spirit, vodka is a prime beneficiary of the cocktail trend that is thriving across the UK. Beyond London, various cities including Leeds, Manchester and Edinburgh are renowned for their cocktail culture, with the country’s growing number of style bars a natural habitat for premiums and super-premiums. Meanwhile, numerous high street venues have upgraded their design and brand selection to provide additional opportunities.

But in an already crowded category, ever-more vodka brands are chasing those venues, whereas various style bars are streamlining their selection. “In our bars we’re trimming our vodkas; we have an entry level which is the house vodka, and with other brands we try to cover the range of different styles,” says Steve Manktelow, Ignite Group operations manager.

Some bartenders have also developed a “bored of vodka” attitude, and are focusing on other categories. So, in this context what’s the best way of getting through to bartenders and ensuring they get behind a brand?

“With a small clique of bartenders you need to get technical, and convince them the product is as good as you say it is. These bartenders act as a halo to so many others who aspire to being like those technically-minded bartenders. However, getting too technical too soon can switch them off, but so can not getting technical enough,” says Claire Smith, international communications manager for Belvedere vodka. Roger Harrison,  head of marketing for light spirits at Pernod Ricard, adds, “real heritage, provenance and the functional taste profile between brands interest bartenders.”

Who you know
With more brands now focusing on education, generic category training is becoming the norm in key accounts. “I want them to understand how vodkas can differ on the palate, differences that can be derived from the ingredients. I want bartenders to have a sense of discovery which they can relate to,” says Smith. With key bartenders now so knowledgeable another vital factor is “a sales rep who can answer all their questions – that goes a long way,” says Manktelow.

Brandbuilding in the on-trade relies on various factors, including recommendations and bartender knowledge being passed onto consumers. But this also depends on how open consumers are to discovering brands. And as style bars are the locations where the most knowledgeable staff interact with the most aspirational consumers, they are a crucial area.

“A lot of the time people try new things because the staff suggest it. Occasionally it’s down to a friend’s recommendation – only a very small percentage try something because they don’t know it. But it’s also about who else drinks a certain brand, and consumers like to buy into a lifestyle when buying a luxury product,” Manktelow continues.

Another key prompt for consumers can be purely visual. “Customers are now more open to asking questions and trying new things, and interesting packaging definitely helps. A lot of vodka packaging has been the sexiest in the past few years. A lot of the time consumers look at the back bar and say ‘that look’s interesting,’ which is the beginning of a dialogue with staff,” says Andy Pearson, bar operations manager at Roast restaurant in London.

Message in a bottle

As the on-trade continues to provide more choice, in terms of sheer numbers as well as variety of location, tracking the target audience around town is another issue. “Consumers don’t just go to a certain type of bar, it’s occasion-led and it’s what they want for that particular evening, so you need to maintain who you are in every bar you are in. Whether they’re drinking in a pub, style bar or local bar, you have to ensure you are communicating the same message to consumers,” says Johna Cameron, Absolut marketing manager.

As different types of venues have their own trends, this provides varying opportunities. In nightclubs, for example, larger bottle sizes have become a factor. But there’s also a practicality involved with larger bottle sizes. “In many clubs there is now a minimum spend to have a table, and a larger bottle size that is more expensive makes it easier to achieve that. Bottle to table service will continue growing,” says Justin Smyth, brand manager of Ketel One, which is managed by Inspirit Brands.

Meanwhile, the perception of vodka in this environment is also changing. “In clubs in particular vodka is becoming almost synonymous with Champagne for celebrating or having a good time, so where you drink and what your drinking occasion is, will increasingly  determine what you drink,” says Smith. 

Brand and deliver
With branding playing such a key role in vodka, the motive for brand call is a key consideration. “I think, for a part of the market, brand call is based on the product itself. For others it’s the fact that they like to be seen drinking that product. The bulk of it in clubs is based on image, in bars it’s half and half, image and product,” says Manktelow.

While trading up has been an industry catchphrase for some years, “Trading up is growing slowly, I think status, seeing an ad campaign, and what people around you are drinking is driving this,” says Smyth.

As some brands offer premium and super-premium variants, one consideration is whether there are advantages when trading consumers up within the same brand name.

“Consumers understand Absolut and the brand’s provenance, and Level is very much in the style of Absolut in terms of packaging. But there are differences in the distillation method so it’s something new from the makers of Absolut. For bartenders there’s certainly an area of interest when we launch a new product, and Level has been very well received,” says Cameron.

With the growth of interest in flavoured vodkas, the same question applies, do flavoured line-extensions of established brands have an automatic advantage?

“Bars are more likely to accept your product if they are familiar with the brand name, and there’s consumer demand for it. And if consumers are familiar with the brand name of a new product it gives them an idea of what to expect of the quality,” says Cameron. Smith adds, “People who have tried our flavours are really impressed and that lends itself well to the mother brand as they assume it’s a quality product, and by association they think Belvedere is easier to drink.”

In the mix
Despite the growth of cocktails, it’s vodka plus a mixer that accounts for the majority of consumption. The advent of premium mixers also provides opportunities to trade up, not only in terms of the vodka brand, but also what it’s mixed with.

“Fever-Tree is being listed for the prestige of being a great quality product. What surprised us is how much Fever-Tree tonic water is consumed with vodka. With table service in bars and restaurants the bottle is presented at the table, and you get visible branding which is a tremendous opportunity,” says Charles Rolls, Fever-Tree MD. And it looks as though a hierarchy of mixers will become a more established feature. “I think, increasingly, upmarket bars will offer a standard and premium option of mixers,” he continues.

So, with the market already intensely competitive, what does the future hold? “I expect the number of super-premiums to grow, but also to see a consolidation of brands on the back bar, established brands will continue to grow, and over the next year to 18 months there will be more trading up,” says Smith.

 Â© db March 2007