The company chosen for analysis is Diageo and the product chosen for revamping is Guinness. Guinness is a stout beer whose origin is in Ireland. The product used to be one of the best performing alcoholic drinks in the United Kingdom, however, over the past few years this has not been the case. In 2006, Diageo recorded a three percent decline in sales in Ireland. In 2007, this decline increased to a further seven percent. The company still has no hope for the future of the brand regardless of the vast sums of money that the company has been spending on advertising. In fact, Guinness has won so many awards for their creative advertisements. It seems that Guinness has somehow missed the mark. (Ritson, 2007)There is a need to re-brand this product in order to create a turn around in performance (with special emphasis on Ireland).
Marketing strategy for re-branding Guinness
Product (new name, design, quality, packaging, positioning)
Guinness needs to re-position itself as the beer of choice for the youth. The first step that can take towards that direction is by changing the name of the product it needs to called Guinness lite rather than just Guinness. Additionally, they also need to change the product content for this new name. The company can minimize on the darkness of the drink and its alcoholic strength. Many youth are drawn to lagers and other lighter beers. In order to capture this market, then the company should look for ways of engineering their product to suit that market preference. However, since Guinness has still been performing well among the older market segment (within Britain and Ireland ), then the company might loose that market segment if they follow a different path. In order to maintain that older market, the company should still retain its older Guinness brand. In other words, there will be two offerings; the old Guinness brand and the new one.
Since the company will be introducing a different brand, then they need to change their packaging. Consumer drinking habits have changed within the UK and in Ireland specifically. People are spending their time commuting and working and it has become increasingly necessary for alcohol manufacturers to consider selling their product conveniently in supermarkets. (O’Mahony, 2007) Diageo should re-package the new Guinness lite in a can. The can should have different colors from the old Guinness so that young people can see that they are actually buying a different product from their parents. This will go along way in making it convenient for the home consumer and the youth.
The third and last aspect about Guinness’ positioning will be its Irish heritage. The beer will be tailored for the Young Ireland population. This is an element that will be communicated in the promotional, distributional and pricing strategies as seen below.
Price (price point)
In order to attract the younger consumer, Guinness lite’s pricing should be tailored to suit that category. Since most youth are not yet as financially stable as their older counterparts, then it will be necessary to place the product’s price at a consumer-friendly level. The company should examine what other canned products are going for (the products under consideration should be alcoholic) and then offer theirs at a lower price. This will allow them to penetrate into the canned products segment easily. They should maintain their prices at that level so as to retain their competiveness.
Over the past five years, Guinness has been performing relatively well in foreign markets. In the United States, sales are picking up, Australia and Africa are also giving the brand a good reception. However, the major problem is within the core market-Ireland. This aspect will be the centre piece of the promotional strategies. All avenues sought must communicate Guinness’ rich Irish heritage. It is a known fact that Guinness has actually lost its local appeal. A blog assessing Ire’s perception of Guinness found that most people think of Guinness as the most advertised brand and not a rich, Irish brand. This will be the main message conveyed in the company’s promotional strategy.
The second element that will also form part of the promotional strategy is an appeal to the younger audience. Statistic show that over eighty percent of Guinness drinkers actually fall within the 30-60 age groups. Only fifteen percent of their consumers lie between the twenty to twenty nine age bracket. Part of the reason for this is that many youngsters are looking fro something that will differentiate them from their parents. (Goodman, 2007) Consequently, they would not opt for a product that actually associates them with their parents as is the case with Guinness. This aspect of capturing a fresh consumer element will also form the basis of the campaign.
As much as Guinness has been trying to make great advertisements, they have been missing the mark because they failed to capture the true essence of Guinness which is its Irish heritage. The only way which they can communicate this message effectively is through an advertisement. (Kippen, 2008)The company should create an ad that resembles a documentary. The advertisement will have ten participants and an interviewer. The interviewer will look like a reporter and his/her task will be to ask people about the nature of their Guinness experience. These respondents will all look young and ‘hip’. Each respondent will be found in a different street, shopping mall, car park etc. The main idea is to make the setting appear as natural and as real as possible such that consumers may think that the advertisement was a recording of an actual survey. One of the respondents will describe Guinness lite’s creamy taste. Another respondents will talk about how Guineas lite’s aroma is neither too heavy ion too light; it just right. Other respondents will describe the look of the can while others will talk about its Irish heritage. By using young actors and actresses in the ad, the advertisement will be capturing the new market segment of the younger market. However in order to bring in the Irish connection, all the locations chosen for the advertisement need to be dominant Irish locations. For instance, one of the settings could be at the scene where the Mel Gibson’s movie ‘Brave heart’ was set. Also, some of the respondents could talk about the rich heritage of Guinness and this will make the fact sink in.
Distribution channels can be an important marketing source if utilized properly. Guinness Lite should be a common product in supermarkets and other retail outlets. This represents a shift from the belief that Guinness is primarily a product that can only be drunk in bars. Many Irish drinkers associate Guinness with the common ‘pint’. However, Guinness lite should take a shift from this market segment, they need to make the product easily available to the home drinker. As it has been stated earlier, drinking habits in Ireland have changed and it would therefore be necessary for the company to consider retail chains and supermarkets as their primary distribution channels. In the past, Guinness focused on bars as their major retail distribution channel but this need not be the case for Guinness lite. Additionally, the company can market their products in those distribution channels. They could place a series of posters with images of the respondents who were involved in their Guinness lite advertisement. They need to place different images in different locations. Each poster should have remarks made by a respondent in bold. For instance, one poster could have the words ‘I drink Guinness because its aroma is just right’. These posters need to be distributed in a large number Ireland retail chains so as to boost their image. (Minnini, 2007)
It should be noted here that past strategies usually utilized other channels of distribution such as wholesalers. The same strategy will be applicable for Guinness lite’s mid level distribution but lower level channels will have to be changed.
The essay has examined a range of issues that need to instituted in order to revitalize the Guinness brand. First, the company should re-position themselves as the brand of choice for young consumers. This needs to capture their needs and preferences. They need to change the product content, its name and also its packaging. Pricing, distribution and promotion need to capture this element. However, since the focus is in Ireland, then the company’s promotional strategy should reflect its rich Irish heritage. These two issues are the core concepts that can get Guinness back on truck.
Ritson, M. (2007): when Brands loose their way: Guinness, retrieved form http://www.brandingstrategyinsider.com/ accessed on 18th September 2008
Kippen, D. (2008): Ford Struggling to find big idea, Word Press Publishers
Minnini, T. (2007): Rejuvenating, Revitalizing and reformulating a struggling brand, retrieved from http://www.brandchannel.com/ accessed on 18th September 2008
O’Mahony, C. (2007): Guinness back in the black, The Sunday Business Post, 21st December
Goodman, M. (2007): Things look pretty black for Guinness, The Sunday Times, 24th June