Royal Salute, the exclusive whisky brand crafted from a blend of Scotch whiskies aged for a minimum of 21 years, is one of Pernod Ricard’s flagship brands in South Korea. It consistently ranks among the top three brands in its price range and the company wants to ensure it remains a top choice for generations to come. To accomplish this, they decided to reassess their pricing and promotion strategies and branding approach.
When existing insights fall short
Pernod Ricard operates in a decentralised manner, so to reach this ambitious goal, three key divisions collaborated closely: Pernod Ricard South Korea, the Global Travel Retail division and Chivas Brothers – the distillers of Royal Salute since 1953. First, they analysed the data already at their fingertips to uncover potential reasons for a stagnation in sales. When this did not provide clear answers, it became evident that a more thorough understanding was needed to address the issue effectively.
As Pernod Ricard’s trusted partner for pricing questions, boobook was the obvious choice to help uncover these insights. “After working together on more than 50 projects, they know our business inside and out. For a strategic project like this, considering other parties wasn’t even on the table,” explains Tim Austen, insights & effectiveness lead at Pernod Ricard Global Travel Retail.
A 360-degree approach
A holistic perspective was adopted, as examining an issue from multiple angles is essential when redefining key business strategies. Tim highlights the value of this approach: “The idea was to cover all bases. We wanted to understand the viewpoint of different experts in each of the entities, and through analysing existing data, we sought to understand the issue from a historical perspective. In addition, we wanted to get under the consumer’s skin and capture how they perceive different whisky brands and types – such as blended versus malts – and how macroeconomic factors came into play. Lastly, we needed to build a data-driven business case to support our new pricing and promotion strategy.”
It resulted in this combination of methodologies:
- Interviews with stakeholders from all three entities involved were conducted, to gain a deeper understanding of the broader context. A wealth of valuable insights was unlocked by bringing together the perspectives of experts in branding, pricing, and whisky connoisseurs.
- Data audit: a wide range of behavioural data was analysed, either confirming or challenging the stakeholders’ hypotheses. Sales and pricing data, media investments, spending power, travel and gift-giving behaviour, inflation, exchange rates and other data served to map the entire competitive and market landscape to understand all factors at play.
- In-depth conversations with consumers primarily focused on the brand image of several whiskies in the market and the macroeconomic factors that influence shopping behaviour.
- Large-scale shopper listening, concentrating mainly on price and promotion, including a conjoint analysis to identify the optimal pricing and promotional strategy. The ideal price gap between duty-free and local shops was also assessed to ensure optimal performance across both channels.
From recommendations to implementation: bringing the insights to life
Tim values the clear, actionable insights and recommendations on pricing, promotion and branding that boobook delivered. These findings formed the basis of a solid business case, which was embraced at the C-suite level, and now serves as a roadmap for both short-term and long-term objectives. “All three entities use it as a shared resource. Pricing and promotional strategies, along with branding direction, are now being considered in light of the new insights."
The stakeholder interviews and data audit contributed significantly to the widespread adoption of the recommendations by ensuring alignment across all parties. The ability to support the consumer insights with behavioural data helped convince everyone of their validity. “Having an experienced partner by my side who anticipated potential challenges – such as timeline issues – was invaluable. This project set a new benchmark for how different entities can and should collaborate when addressing issues that transcend individual divisions. We are already replicating this approach in another country, which is a testament to its value,” Tim concludes.
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