‘Glocal’ approach leads vodka revival

As the vodka category tentatively recovers, big brands are increasingly looking for ways to add local relevance to global operations. But is a ‘glocal’ approach sustainable and can it win consumer hearts?

This year Grey Goose rolled out its Extraordinary Summer campaign across 20 cities in Europe and the US

Could vodka finally be shaking off its colossal hangover? The pain from market contractions, courtesy of Russia’s financial crisis and American flavour fatigue, has been acute. It may be early days and the green shoots of recovery still yet seeds, but a new wave of vodka innovation and optimism is taking hold – and it’s a tonic comprising global concepts blended with local activations, a ‘glocal’ approach, that’s offering relief.

Take Pernod Ricard. Parent of vodka stalwart Absolut, the recipient of a €404 million (US$450m) write-down in 2015, the global drinks giant had seen its vodka business go off the boil. But factor in not one but two locally-focused concepts, and suddenly the group seems back in the game.

Local flavour

The concept of co-founder and former Absolut employee Åsa Caap, Our/Vodka is one Pernod Ricard product gaining serious traction. “I was in the marketing department for Absolut five years back, and all the trends that were in front of us back then were pointing in the craft direction and the local movement,” Caap explains.

Her vision was for a “family” of vodka distilleries around the world, each under the Our/Vodka umbrella, but with a hyper-local approach. With five distilleries up and running – in Berlin, Seattle, Detroit, Amsterdam and London – and Los Angeles, Miami and New York set to come online in 2016, the network is building. Each site has its own local team of “partners”, who “really care about their city” and are entrusted with business development at that site.

“We have just employed a guy now who will set up a global distribution to distribute the portfolio outside of the local markets,” shecontinues. “We could really make a global brand out of it outside of the distillery markets, and that’s happening already now.”

Pernod Ricard isn’t putting all its glocal eggs in one basket, however. In March 2016, the US arm of the business announced the launch of Smithworks vodka, a product “born and bred in the tradition and the values of the American heartland”, explains Kate Pomeroy, vice president of innovation, Pernod Ricard USA. Smithworks was inspired by the Fort Smith production site, its workers and the local area. Distribution is limited to Arkansas, Colorado, Missouri, Kansas and Oklahoma.

For Pomeroy, it was Pernod Ricard’s portfolio approach which led to the creation of such a hyper-local entity. “Absolut is a really important brand for us, and that is targeting a nightlife, higher energy kind of occasion. Smithworks we thought could have a role in the portfolio, both from a Heartland perspective, but also from an occasion perspective – more of a hanging out, casual friends getting together kind of occasion.”

Summer spirit

Occasion is one of the drivers of Bacardi-owned Grey Goose’s glocal approach. 2016 sees the brand roll out its Extraordinary Summer campaign across 20 cities in Europe and the US. While the umbrella initiative is universal, the local activations feature a number of more tailored elements.

Over five months, Grey Goose will host Boulangerie Bleue pop-ups in the locations, through partnerships with local chefs. The concept space will offer brunch, lunch and dinner, summer drinking and dining, while “transporting” consumers to the French Riviera. Visitors will access the space through a traditional French bakery, to reinforce the winter wheat Grey Goose raw ingredient.

While the individual pop-ups are based on individual cities, the fundamentals of the Boulangeries will remain consistent, said Tom Swift, Grey Goose global vice president.

“We looked at the occasions particularly around North America and Europe, where our target consumer will be over the summer,” Swift explains. “Core cities” for him are those “seasonal playgrounds” comprising celebratory events, film festivals and so on. “The creativity is what makes it exciting.”

Meanwhile, LVMH’s Belvedere also took a key campaign on tour. Launched in March 2016, the Be Natural Manifesto and Spritz campaign had an international schedule prepared to kick off its message of low-and-no sugar naturalness, supported by 12 long serves in its Belvedere Spritz Collection.

“The manifesto doesn’t change; they are our ‘10 commandments’, if you like, that illustrate our commitment to keeping it simple, real and clear, which is how we define the word ‘natural’ for Belvedere,” explains Ali Dedianko, global director of education at Belvedere. “However, within these ‘10 commandments’, there are many local initiatives that further our global objectives.”

Belvedere has developed a series of Spritz serves

With three leading players rolling out four major concepts at once, consumer appetite must surely be aligning to the glocal message.

“I’ve recently been asked to speak at different seminars and one question I get a lot is on the personalisation trend,” says Caap. People want to personalise and move closer to their own concept, she explains. “I think this is what we do, but in a unique way. We make cities unique, and [the bottle] carries the name.”

The intersection between global lifestyles and awareness, and also a sense of local community also interests Caap. “In one sense, we are more global than ever but at the same time we are very local. Somehow Our/Vodka is the same thing, and this attracts millennials. I think they see themselves, or we see ourselves nowadays, as global citizens, but we still care more about our local neighbourhood, our local community. And Our/Vodka is addressing both needs.”

For Belvedere’s Dedianko, it’s about sharing the message – the naturalness and the Spritz serves – in as relevant a way as possible. “We apply the principle of ‘Think globally, act locally’,” she says, referring to the development of the Spritz serves. “Thinking globally and acting locally is the only sustainable approach to business as far as I can see. We aren’t living in a one-size-fits-all world so we need to adapt ideas and practices locally, while still thinking how these changes will affect the world on a whole.”

Authentic appeal?

It might make sense from a corporate perspective, but how can ‘glocal’ remain authentic to those consumers on the ground in very localised towns and cities?

For Smithworks, being visibly present in the vicinity is a must for an authentically local brand. “I think the local touch is very important to people in the Heartland,” Pomeroy explains. “So far we’re engaging on a local level with events.” The brand has been present at Kansas City Fashion Week and the Steel Horse rally, a non-profit charity motorcycle event held in Fort Smith.

“We’re really focused on local events that also kind of get the word out about Smithworks, and to show our support for local markets.”

It’s the emotional intelligence of a campaign that is critical for Our/Vodka. “I’m a mother of three, and I’m quite price- conscious when I go shopping,” Caap outlines. “I look at the price tags in thegrocery store, but every time I pick organic… I move from brain to heart – this is like an emotional choice.” This is why it hurts so much if someone cheats, she adds – it’s more sensitive because it’s an emotional choice.

“If you try and do something in this context on the craft/local territory you have to be aware of this. You have to have good intentions and be very careful, especially if you are one of the big guys because then people are going to watch you even more carefully if you have the right intentions,” she cautions.

Question of taste

Ingredients are essential, too. Grey Goose’s Extraordinary Summer activations recruit local chefs, armed with local ingredients. The Be Natural Manifesto also uses taste to ensure authenticity. “We want to celebrate the different tastes and flavours from around the world, while still respecting our Polish roots,” Dedianko says. Spritz recipes are customised with a local feel and adorned with different garnishes. In addition, she continues: “The Naturalness Manifesto was created to show our transparency as a brand,as well as our commitment to sustainable practices, and above all else, the authenticity of our product.”

Smithworks sources its water from Lake Fort Smith, and uses corn from Kansas, Missouri and Oklahoma. Our/Vodka too, in spite of its global umbrella, has a uniquely local approach to raw material sourcing. “Every distillery, everything we do should have one part local, one part global,” Caap details. “But the local part should always be the majority because we’ll build a global trend with the local pieces.”

As such, in terms of production, all but one small part of the raw ingredients is determined by the individual distillery’s surrounding area. Berlin, London, Amsterdam and Seattle all use local wheat as the base for the vodkas, while Detroit uses corn and the Los Angeles site uses grapes. Domestic water sources are of course utilised as well.

“Then we have one small ingredient – it’s called a low wine – that we distil in each distillery but comes from Sweden. So it’s one little piece that [means] they’ll always have the global touch.”

The global/local hybrid might just be the approach to reviving the vodka category

In theory, the glocal movement should well resonate with consumers, especially millennials. But what of the bartending community? T. Cole Newton, owner of LA bar Twelve Mile Limit, agrees that a focus on local ingredients is key if brands wish to remain “appealing to local markets without pandering”. Local pop-ups featuring local chefs, local mixologists and local ingredients would enable a brand to engage markets in more meaningful ways, he reckons.

However, a local, tailored approach would not generally endear him personally to a brand. “Usually when global brands try tocater their products to a local market, it’s basically through iconography – in New Orleans that usually looks like masks, beads, trumpets and fleurs de lis. These symbols are so overused, it’s essentially meaningless.”

Meanwhile Elliot Ball, co-founder of London’s Cocktail Trading Company, is more likely to embrace a glocal effort – as long as it is genuine. “Where brands go wrong is just adopting buzzwords and imagery, whilst relying on financial/retro support to really incentivise,” he says.

But can a glocal approach really work? Yes – if there’s a CSR/philanthropic element, argues Newton. “If the attempt is to appeal directly to consumers, and not just industry professionals, then I would recommend programming that provides meaningful support to local charity organisations.”Ball, however, sees a larger issue – and a challenge vodka faces on many levels. “The problem with my local market is the people with buying power aren’t really the people to which a vodka should be tailored. Those guys are more interested in finance.”

Undue cynicism

From a bartender perspective, he continues, those who aspire to be “mixologists” have a certain – largely unwarranted – cynicism for the category. “More and more people are taking the perspective of vodka whereby they favour something that’s just decent, bullshit- free, and which customers are going to be willing to pay for.

“Perhaps a two-stage process is the natural conclusion: appeal to the bartenders about basic quality, but have retro deals in the back pocket for their bosses,” he muses.

The challenge of convincing bartenders the merits of a glocal approach may be an additional test, but the vodka category needs a shake-up – and the global/local hybrid might just be the approach to do so.