September 12, 2019

What B2B Marketers Can Learn from Drinking (and Marketing)

At Drugstore Publicis, a luxury shop on Champs-Élysées, you’ll find more than a typical pharmacy. You’ll find Joel Robuchon’s L’Atelier Etoile restaurant, a bookstore, a cinema, imported olive oils, cigars, and wines. Plus, they are also actually a drugstore in case you need a prescription filled.

This summer, you may have also found host Drew Neisser chatting with Corneliu Vilsan, Director of Marketing Operations EMEA & LATAM for Pernod Ricard. Running the marketing of an international beverage titan, with a portfolio ranging from Jameson Whiskey to Malibu Rum, to Absolute Vodka and far beyond, is certainly a tall order. On this episode, listen in as Corneliu shares how he does it, and the wide range of tools he uses, from influencer marketing to cultural analysis, new approaches to data analysis and social listening, and more.

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Full Transcript: Drew Neisser in Conversation with Corneliu Vilsan

Drew Neisser: Bonjour, it’s Drew. And this is a special intro for a special episode. It’s special because I recorded it in Paris. It’s special because my interviewee is a B2C marketer, not a B2B marketer, but I think there are a lot of insights for B2B marketers here as well. We talked about the essence of the brand and how they discovered it. We talked about targeting and how to think about your targets somewhat differently and understand them culturally. We talked about research and, of course, we talked about gin because I am a big gin fan. Keep in mind, this is recorded in a drugstore. There is going to be a fair amount of background ambiance. Here you go, we’re off to Paris. I hope you enjoy it.

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Drew Neisser: In our continuing adventure of Renegade Thinkers Unite bringing you new experiences, here we are in a store in Paris on the Champs-Élysée. Not too far from the Arc de Triomphe and we’re in something called the Publicis Store. And I have a very special guest today. His name is Corneliu Vilsan, who works for Pernod Ricard and has an extraordinarily interesting background.

I’ll let him tell you some of it but let me give you the highlights. He started as an electrical engineer in Romania, he got an MBA at the University of Pittsburgh, and then started working at Schneider Electric, kept going, worked at Johnson & Johnson for the last many, maybe 15 years or so, has been in the alcohol, the fine beverages business, if you will. We’re standing in this liquor store and we’re looking at some brands. First of all, welcome to the show.

Corneliu Vilsan: Thank you.

Drew Neisser: Let’s pick a brand here. I see a brand that maybe a few Americans have heard of and we were talking about this, how do you innovate in that category? We’re looking at a brand; talk a little bit about Monkey 47. You purchased this brand, right?

Corneliu Vilsan: Yes. It’s a crossbrand we purchased a few years ago, I think it was four years ago. It’s made in the Schwarzwalk, a black forest somewhere in the mountain area of Germany, a beautiful boutique distillery overlooking the mountains. It’s probably one of the fastest-growing brands. It’s a beautiful product and it has beautiful marketing as well.

Drew Neisser: So what’s interesting to me about this is, we’re going to relate all of this back to B2B somehow so stay with us on this. But when you’re a giant company, one of the challenges that you have is to innovate. What a lot of companies do in the US, say Adobe, they buy smaller brands for them like Marketo or Magento. But they have a challenge, which is how do they keep the essence of that original brand while continuing to grow it and take advantage of the savings at big companies. Talk about how you’ve treated Monkey 47 in a way that has been able to help it grow but not lose its essence.

Corneliu Vilsan: You’re right. You need to treat very carefully the programs because one of the reasons consumers buy is because they have the most thought and a founder behind me, who is emotionally engaged with the brand and is the keeper of the quality and of the tradition of the brand.

So this is what we did. We let the founder continue to do what he was doing before. We provided, you know, the distribution muscles, the financing, the quality control, and the liberation from a big company like Pernod Ricard. is already gone. And he notices that, for example, I remember he told us that one year ago he had an issue sourcing one ingredient and he couldn’t find it on the market, so he just called the operations guy in Pernod Ricard and one week later, he got it. This was a big advantage for him. He’s part of the family.

Drew Neisser: So the story behind it. We talk a lot about storytelling in B2B, but obviously consumer brands and in particular at the adult beverage category. The stories are essential. What is the story of Monkey 47? Can you sort of articulate that?

Corneliu Vilsan: Yeah. He’s actually the owner is a genuine professional and the owner is called Alexander Stein, the inventor of Monkey 47, and he was working for Nokia before, but he was in love with Schwvald, the Black Forest, and with the gin category. So he found the recipe of an Englishman that was living in Germany a long time ago. So he recreated the recipe and he sold it by himself in a few bars in Germany before extending and extending it to other countries. And of course, the chance as he was close to going bankrupt because, as you know, entrepreneurs usually have a cash flow problem and if the brand doesn’t start to grow before you finish your resources, you are in danger to go out of business. But he was lucky as well. And we were lucky to do a project with him a few years later.

Drew Neisser: And so what’s interesting to me, we were talking before. Recording, by the way, we are in a liquor store, so there’s gonna be noise and you’ll hear some background, that is someone tearing open a carton to refill, restock. But what’s interesting to me is you have a very I’m going to call it a precious product in the sense that it has a lot of craftsmanship and handmade and so forth. And if you immediately put this in every place, it would lose some of that sense of exclusivity. So you’ve been careful with the distribution of this product?

Corneliu Vilsan: Of course. So we follow the owner’s philosophy buy one, get one. So we have a very exclusive distribution. We don’t run promotions at all. As you see here, its probably the most expensive gin, and there’s no promotion. We try distribution at exclusive stores and place bars, iconic bars all around the world. And it’s working. Of course, this gin is the golden girl, it keeps the brand in a prestigious category, we have limited editions every year. Very limited editions that are sold out in a few hours. I can tell you, the guys in Pernod Ricard are in love with this brand. We very often drink it. Although we have, you know, hundreds of brands, we can choose from but it’s our favorite brand. You may know as well.

Drew Neisser: It’s a great story. I’m a gin fan. I probably mentioned that on the show before, but I discovered probably at 27 at the monkey bar, the famous monkey bar in New York City. And of course, they have this gin. As we sort of think about the brand and the story, how do people sort of discover this? I mean, we know that awareness matters. People have to discover it. It’s one of the seven gins right here that we’re looking at. So how is it marketer and you guys are mass marketers. How do you help them get discovered?

Corneliu Vilsan: It’s about focus and working with prospectors, as you call them in B2B. For us, it’s bartenders. They’ve been very influential, especially bartenders from the best bars. In the beginning, you need to be accepted by them. If they don’t like it, you will not succeed. They need to love the product. They need to love the brand, the story, and be convinced by the quality of the product. We do a lot of our focus here, then it’s about inviting them to receive the brand, hopefully inviting them to Germany to see all that the brand is produced and falling in love with it the first place and the [production] as we call it. That’s the recipe for many spirit brands. Premium plus brands have a similar story.

Drew Neisser: Yeah, it’s funny, I’m remembering one of the first episodes I did for the show, I interviewed Lee Appelbaum, he was the CMO of Petro and Spirits. They had invested a lot in the facility in Mexico to bring people down because they wanted to show the craftsmanship. This is important because you don’t see that on the bottle, you just see the label. On the influencer part, and there is an equivalent in B2B, there are lots of influencers that have an impact. An analyst or for heavy users if you’re in the software world you have to get the developer community involved. There are lots of similarities here. Let’s talk about it as we keep thinking about this gin. How big can a brand like this get?

Corneliu Vilsan: It will always remain a niche. We don’t intend to make it a mass market. Right. We invest, as I said, a lot of money with influencers and creating unique experiences, unique liquids for the consumers. So it will never go mass market. Otherwise, we’re given a choice, but it will remain a niche. It is a very small market, less than 1 percent market share.

Drew Neisser: Right. That’s interesting. One of the things that big companies struggle with, we see these companies struggle to innovate because they’re looking for the next billion-dollar brand. The problem is most billion-dollar brands started as a million-dollar brand and a 5 million and 10 million. Eventually, they get to a billion, but it takes a lot of energy to create a brand like this in a specialty brand. Okay. So as we wrap up, is there anything else that you think from a premium standpoint that marketers and listeners can learn from some lessons from the Monkey 47 story?

Corneliu Vilsan: Having a good quality product is not enough these days. Nowadays everybody has good quality. This is a must, but it’s not enough to succeed in the markets. Fortunately for us, as marketers, marketing has a very important model, continues to have a very important low. I believe in creating a nice story, communicating in an engaging way with consumers. Topping the list, I was looking for answers ahead, end of the world and they will be kind of famous. Each has its own influencers. It’s probably more important with digital nowadays those influencers are growing without us, always controlling everything. We used to control advertising in the past with the media. Not anymore. Now it’s the consumers in control. Keeping an eye on what’s happening in the digital world, having a close link with them will continue to make us relevant in the market. Otherwise, we could get too far away from the consumer. You may lose contact and you might miss opportunities, or your brand might become irrelevant.

Drew Neisser: It always comes back to listening. So speaking of that, stay with us if we’re going to take a quick break. And come back for good stuff from Paris.

BREAK

Drew Neisser: All right. We’re back. We moved into a different section of the Publicis store, which is really a very interesting, beautiful store. We’ve looked at a wide collection of alcohol, and of course, we moved right into the champagne section and Perrier-Jouët, which is a Pernod Ricard brand. I thought that was an interesting way of starting a conversation about global and local. How do you manage global brands, recognizing the differences in culture, and so forth? Let’s talk about that and maybe in the context of champagne.

Corneliu Vilsan: Thanks for asking me this question, because I did recent work on cultural differences among the different parts of the world. I’m responsible for more than 50 countries worldwide on three continents, Europe, Middle East, Africa, and Latin America. So we have a very diverse range of countries, and we define them in two big categories: progressive markets and traditional markets. For Western markets, some of the countries in the Western and Northern Europe where we have become a spirit’s point of view. It’s a big trend on low alcohol and no alcohol and gender equality and wine. Traditional markets are traditionally more conservative, so the less innovation than the progressive markets. The consumers stick to the category. I know the changes are happening much slower. It’s more for playing into a culture where when customers want to show that they succeed in life they buy. Sometimes they buy brands that can’t afford or, they can barely afford it, which doesn’t help us all. From a global marketing point of view, this is very important to think of because we can’t have a global campaign. You can have, let’s say product-focused campaigns globally. That will also continue to grow. But when we engage emotionally with the consumer we need to be locally relevant. Content relevant to the local consumer, and that is made more and more by the local markets. According to some global guidelines. So I think that the role of the local affiliates is growing. Versus previously when campaigns were done centrally for the whole world. Now we see more and more what we call the lead markets creating with the center to make campaigns that are relevant globally. We see in my region roughly five different cultures or subcultures dictating what we can say about the brand. Then the bigger the brand the more important it is to be locally aware.

Drew Neisser: Interesting. So you’re responsible for Europe and Latin America, right?

Corneliu Vilsan: Yeah. Europe except for France and Ireland. I have many African countries, I stopped counting up to 50. I think we have like 80 countries now covered by my region.

Drew Neisser: Wow, that’s a lot. Is there a different campaign for, let’s say, Perrier-Jouët, which is you know, it’s French champagne with very certain perceptions about it. How do you know? Is that something that would get adjusted on a local market?

Corneliu Vilsan: The way it is not always the campaign? Because you know, we can’t advertise everywhere. So might be a difference in the market and the way the brand is marketed. For example, the channel, some markets are more driven by specialty stores or supermarkets. So depending on the market characteristics, you might have different ways to implement a global campaign and then local relevance in terms of design. If you cannot advertise, the design of your displays or the design of your leaflets to be the way you communicate the message or your social media strategy has to be relevant local.

Drew Neisser: And so when thinking about, in any of the research that you did globally, what were some of the differences that you sort of identified on a cultural basis?

Corneliu Vilsan: I would mention just one on this show of culture. Countries, where showing off is a sign of contest and somewhere showing off, is a sign of success. You can’t be a successful businessman if you don’t show it to the whole world, including Saturday night in a club. I think this is one of the biggest cultural differences. I would say, this makes a big difference when promoting the brands in our region, but could be not only developed markets but in emerging markets such as Africa you might have different parts of the continent in show-off culture and another part of the continent not being part of show-off culture. That’s interesting from a cultural point of view.

Drew Neisser: I would say it’s similar in the US. You go into a bar in New York City and there will be a table, people will buy a very expensive bottle for the table in New York City. That’s not necessarily going to happen in the Midwest. Generally speaking, different. Then I would also imagine that there’s lots of conversation in the U.S. among marketers about the differences between Gen Z and Millennials and Gen X and of course, boomers and as brands. Has had an impact on your category? I imagine tremendously. Yes? Young people coming up and they may have different tastes and so forth, but you have to adjust to.

Corneliu Vilsan: Of course, the example of absolute vodka. In the 70s at the time, Andy Warhol was a big influence in the night scene in New York. Nowadays, the painters are not such big influencers. Now, it’s the small rappers and DJ’s so on, and so we also changed our strategy accordingly. We work much more with influencers, either social media influencers or influencers in their field or expert influencers in the field particularly. This is a big change in marketing. Marketing is more granular, it’s less about the push and it’s more about the pull. Letting influencers play a role in your brand makes the job even more interesting than before in marketing.

Drew Neisser: Yeah, I think it’s true, and it’s funny as you’re talking, I’m hearing many of the same words that we would talk about in B2B with social media and the influence there. We’re going to take a quick break and stay with us.

BREAK

Drew Neisser: Ok, we’re back. We’re still in this wonderful, really interesting store. I mean, I’m looking at it, within the store, there’s a famous or very premium macaroon, as it’s called, Pierre Hermé. We’ve got alcohol and then we’ve got this just massive different array of caviar exactly up to Trojan caviar, which all New Yorkers will recognize. OK. We were talking about, social media, and the impact that’s had on your business. I think the same is true in B2B one of the things that is interesting to me is you guys really have to pay attention to brand health and the way brand health used to be measured with sort of traditional tracking. You’ve sort of developed something interesting that uses social. Can you talk about that?

Corneliu Vilsan: Yes, of course. Actually, marketing effectiveness is my favorite area and of course, social listening is an important part of that. We try different methods for measuring brand equity. We used to have normal tracking, but we’re not satisfied anymore. It’s difficult to predict what will happen to the brand before it’s ready for a backward-looking, so we will look to find out something which is more forward-looking. Trying to predict what would happen rather than to explain what happened in the past.

We developed a new method. Globally for us, I can say that it’s combining traditional research with social media, listening to the best of both worlds. We still are interested in KPI and brand communicators, but we also use artificial intelligence to analyze social media conversations on both sides of the media to understand how consumers feel about our brands. Sometimes we are very traditional in the way we think customers speak about the brands, but the words or phrases they use when they consume our brands are very often different from corporate thinking. We are just at the beginning, we just started, and we have the first results. It’s amazing. The whole company is very excited about this new methodology. Which as I mentioned it is about creating insights, using artificial intelligence. Still the humans have a big role in that. Big data doesn’t interpret data its just data. Humans need to interpret it. You need good experts to interpret that data. That’s probably an evolution in the market research industry. Using more technology to find out what was behind the words the consumers use, what is behind the images, the photos, videos. To try to decode the message the consumers want to send to us.

Drew Neisser: And just so several things that you mention there. You know, obviously brand health is so important in your category, but it’s very important in every category. It’s something that you selling these types of products have always had. When you talk about artificial intelligence you mentioned the ability to look at photographs and video. How does that actually work?

Corneliu Vilsan: An artificial intelligence system will be able to decode the place that consumers actually consume our product. Based on the surrounding images, you can find out if you are in a bar or restaurant or at home. While shooting the program so you can read the labels, if you’ve got any labels in the picture, you can see the number of people in the picture and the moods they are in too. We also analyzed the text associated with that. As I mentioned, we are just at the beginning. We have a very good start. The results are amazing. For the first time, we use this to inform our decision making.

Drew Neisser: That’s what I want to get at because it’s one of the issues in B2B marketing, all of the measures are lagging indicators. First and foremost, revenue is a lagging indicator rate because so much had to happen before that product actually got sold. Obviously it is an important indicator, not an indicator, an important metric because everybody cares about it, but it’s not going to tell you what’s going to happen next quarter or the following quarter. You mentioned that this becomes predictive in terms of you can see the momentum behind a brand or a category. So we can talk about that. Then let’s also talk about the kinds of things that you’ve learned.

Corneliu Vilsan: We build more and have more experience, we can analyze what consumers talk about now as opposed to what they were talking about in the past. Then we are able to predict where the market is going before this actually happens. Let me give you an example. We see more celebrity-driven brands being developed. Consumers talk a lot about it, although the number is very small. You know, we look at the big brands and the big trends. You can note this from social media, a very small trend emerging that might become big in the future, so we captured that very early from the market, which we were not able to do before. Because of the ways that this works, if it is not a representative sample then it will not get noticed and we’re not getting bought. So, we set up a much more accurate view about what that is, and this informed software innovation.

Drew Neisser: That’s funny. I think we saw over there the George Clooney tequila. I think it’s fairly certain that Ryan Reynolds has a, I don’t know if that’s a gin or a vodka, but the very funny ad that we saw that he uses. I think it’s Ryan Reynolds, not Bradley Cooper. So that’s one. That would help you either identify a company that you were going to acquire, a brand that you say, oh, this could be a big momentum, or was you may adjust your marketing for a brand to try to find an influencer?

Corneliu Vilsan: Exactly. For example, music is very important for us. Especially with the Gen Z you mentioned before. If you want to market towards this generation, you want to understand better what kind of music they listen to what kind of singers they follow. Social media a big one. Of course, there are other ways, but social media is one of the ways to identify these trends. Believe me, I know very few, very few bands or singers that Gen Z is interested in nowadays. We need somebody to inform us and social media is one of the ways to do it.

Drew Neisser: Well, I have one for you. There’s a young lady by the name of Clairo who is my first cousin, once removed, is a drummer for and they’re playing with Khalid who is a rapper in Madison. They’re on a global tour right now. I think she’s only 20, so she’s you can’t quite hire yet, but she’s up and coming. So that’s one, that’s just a mid-sized thing. That makes sense from a transit point. Getting back to the metrics. Are you able to then distill this information into a new kind of metric for brand health that where you can say, OK, we can look at this brand over here and say it’s healthier based on this information because there is social noise? And it’s more predictive?

Corneliu Vilsan: Yes, we are. We are not there yet 100 percent, but we are at the beginning. But we have a good size already. We have now a global dashboard that we can see in our office in Paris which we did not have before. And of course, we’ve been having so many markers benchmark in different markets, in different brands gives us some unique insights that we couldn’t have before when the research was sitting in a different figure. Even if the trends are difficult to spot by benchmarking one brand across different markets. We can see what works, what doesn’t. And comparing that with the performance of the brand in the market we can create some correlations that can refer to some investigation with another researcher.

Drew Neisser: So one of the things that you mentioned that I was surprised about was pink gin as a trend here now in Europe. So should we expect to see more pink gin? Is that going to show up in conversations in the United States?

Corneliu Vilsan: I think so. I think gin, is flying everywhere. We’re no longer conscious that it’s not the single market that doesn’t have gin. I didn’t look at the pink gin in the US, but I think it’s it’s growing in the US as well, not to the same extent. I’m sure it would come one day or another thing. Still, I think tequila is quite strong in the US which is not the case elsewhere. But so there is some, you know, regional differences. It’s not global anymore. Pink gin came from the consumer needs to have a fancier not complicated drink. Gin was there to offer that experience. A fancy, colorful, flavorful drink that is easy to make for the bartenders and that the consumers enjoy.

Drew Neisser: And I think there’s some, I’m going to stretch here. But so what’s interesting, so Gin and Tonic is the most popular drink of gin. It’s kind of boring looking. I mean Beefeater has been around for a long time. It’s been around for a long, long time. You make it pink. You put some tonic in it or something else. Suddenly it looks new. Plus, you bring on that probably a different group of more women, perhaps, and it really refreshes the brand. And we think about how do you keep sort of keep a brand alive and invigorated sometimes something as simple as just color can make a big difference.

Corneliu Vilsan: Yeah. Gin, as a category was done 10 years ago, it was seen as a dusty category consumed by older people. Very few predicted what would happen. Then also started about 5, 7, 5, 6 years ago. We noticed that switching the consumer preference and we offered the consumers the option of having a tasteful pink strawberry option. We’ve also bought some, recently, another brand called Mouthy, it’s a gin made in Italy. It could be big in the U.S. in maybe one, not more than two years. Could be huge.

Drew Neisser: So as I think about this and I’m going to stretch even more to help bring this back to what others who are not working in the alcoholic beverage category, can think about. One, every three alcohol brand has a story; an essential story at the heart of it. And when they lose that story, they lose their way. And I would argue that every essential B2B brand needs a story. Two, we talked about purpose-driven storytelling in this. A lot of alcoholic beverage brands have a very distinct purpose. Whether it’s a celebration or certain brands are associated with, say, like sailing because it’s right for after sailing. So if there’s a purpose for it and I think when a brand doesn’t have a purpose and it finds itself without it. It’s interesting, as the champagne category, its purpose is New Year’s Eve and is there the problem with that, of course, is it means that 40, 50 percent of the sales are in like one day. That’s a problem for a category, but you sort of learn to live with it. So there’s two. Number three, we’ve talked a lot about these are very competitive categories. There are lots and lots of choices. The same is true in every category that I’m aware of in the B2B market. There are lots and lots of competitors and brand matters. It matters because you are going to choose a brand that you recognize. For the most part, it’s very hard to try a new brand because you can’t trust it. Recognition and awareness come back to be really important. Those are three, maybe four. I wonder if you have any summary thoughts for the listeners, as we wrap up this show in Paris and any other thoughts on the lesson here, that you think that other marketers can learn from your category.

Corneliu Vilsan: I think one way or another, one of them would be terroir, and this especially Pernod Ricard. Great terroir for all brands. Champagne, of course, it is only champagne in France and tequila in Mexico and absolute vodka in Sweden. Pernod Ricard is becoming more and more important nowadays, it used to be less relevant and is now becoming more relevant in a clever way. It’s artificial intelligence, but you need to use natural intelligence to make it work. Artificial intelligence by itself would not give us a competitive advantage unless it’s used in a clever way that is relevant to the customer. I’m working a lot in this school to demonstrate how new technologies can be leveraged in marketing to bring new insights and to create a competitive advantage for companies.

Drew Neisser: What a great and surprising summary. Who would have thought that as we were talking about alcohol, we would be talking about artificial intelligence? Generally, we would have talked about the loss of intelligence. I think that’s a great place for us to wrap up. Corneliu, thank you so much for being on the show.

Corneliu Vilsan: Thank you. Thank you for having me.