MARKETING BRAND BUILDER: Volcanic vodka

William Grant has found an intriguing niche in the market with a ‘steam-driven’ Icelandic vodka. Björk would approve, says Ben Grant

The use of energy in business is becoming an ever more pressing issue; growing consumer awareness is putting pressure on companies to become more efficient, not to mention, of course, the steadily rising costs. This looks certain to become increasingly problematic for the energy-intensive process of distilling. But one brand, Reyka vodka, is perfectly positioned – both geographically and ethically – to flourish in the new carbon-conscious trading environment.

Iceland straddles the Mid-Atlantic Ridge, the meeting place between two of the tectonic plates. This puts the island in the middle of an area of dramatic geothermal activity, with a landscape characterised by volcanoes and geysers as the heat from the core of the earth seeks an escape route. Reyka – the Icelandic word for “steam” – is an important source of heat and energy for the islanders. Holes bored deep into the earth draw steam to the surface where it is used to power machinery and provide free central heating. And it plays a crucial, not to mention unique, role in the vodka brand’s production process, for it is produced in the only distillery in the world powered entirely by geothermal activity.

Given its isolated location, small population and pristine natural wilderness, it is hardly surprising that Iceland is one of the true pioneers in the field of environmental sustainability. The country is leading the way in terms of developing new low-impact technologies and has a strong cachet in consumer’s minds as a nation defined by purity; it has escaped the contamination and pollution with which filthy humans have tainted most of the rest of the earth. Similarly, vodka is a category defined by unadulterated purity; this is the quality that brands seek to extol most vocally.

Scottish spirits company William Grant & Sons recognised the strong linkage between the perception of the country and the predominant quality consumers are seeking when they buy vodka, and thus Reyka was born.

Pure genius
The theme of purity is reinforced by the raw materials that are used in the production of the Icelandic spirit. Many drinks brands trade on the fact that they use water that is either glacial or from exceptionally pure springs, indicating how

much this factor resonates with consumers. Reyka uses water drawn locally from the Grabrok spring, which comprises melted glacial water that has been filtered through 4,000 year old lava. It contains far fewer dissolved particles than the leading mineral water brands – in fact, when the spring was studied by the New York Analytical Office in 2002,

the scientists recalibrated their equipment as they were so surprised by their findings. This means the water used in Reyka is so pure that it does not require any treatment or purification prior to bottling.

“There is definitely a strong story behind Reyka,” says brand development director, Elwyn Gladstone, “which is certainly not the case with some other premium vodkas. But we want to give a subtle message about the brand, and let consumers explore the story themselves.” The label includes a picture of a volcano and the name, to reiterate, means “steam”, but beyond these two factors the messaging is pretty indirect. Notably, there is no specific mention of the sustainable energy used in distillation. The reason for this, Gladstone explains, is that if you claim environmentally sound credentials then this must be true at every level, or the brand runs the risk of a serious backlash.

“You have to be very careful not to shove information down people’s throats, and we make an effort to avoid suggesting that the brand is really worthy,” says Gladstone. Reyka is targeted at a  niche market of savvy young consumers, people who Gladstone says, “know more about marketing than the marketers”. In order to resonate with this notoriously sceptical consumer base, the brand has to establish desirability with a message that intrigues and engages. The story then needs to be planted through effective PR and a highly informative website, enabling drinkers to educate themselves in their own time and on their own terms.

Packaging prize
The brand was initially launched in the US in October 2005, and was made available in Iceland and the UK at the end of the year, with a focus on the high-end off-trade and selected specialist retailers. At last year’s drinks business awards, Reyka picked up the packaging prize. Interestingly, the latest markets for roll-out are China and Taiwan because of the strong potential for white spirits. The brand story resonates with Chinese consumers and it is also easy to pronounce. Current capacity with a single still is 100,000 9-litre cases per year, but Gladstone says this can be rapidly increased should the market demand greater volumes.

© db April 2007