2013 Digital IQ Index: Spirits

Excerpt from the 2013 Digital IQ Index ®
: Spirits
To access the full report, contact membership@L2ThinkTank.om

January 8, 2013
SCOTT GALLOWAY
NYU Stern

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Spirits
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1

Inquire about your brand’s ranking: Info@L2ThinkTank.com

: Spirits

Thirst
The Spirits industry is a digital laggard when compared to its prestige peers. Strong regulation
Watch the
Spirits Video
Click to Play

and an opaque online path to purchase coupled with baby boomer executive leadership has
resulted in digital underinvestment. However, we believe the industry is poised to evolve from a
patchwork of pet projects to a hotbed of digital innovation as several factors converge:
• Digitally savvy Millennials will be the next decade’s • Fifty percent of all retail purchases now begin online.1 display ads, 34 percent to search engine marketing and 59
primary engine of growth. The 78 million-strong cohort Although regulation, to date, has hamstrung e-commerce percent to digital video. Spending on mobile is expected to
encompasses the most active consumers of alcohol for Spirits, brands and retailers are starting to get in the increase 71 percent.2
and social media. Millennials are 50 percent more likely game. Evidence includes Diageo’s enterprise site
to cite user-generated content as their primary influence thebar.com. As e-commerce comes into focus, Spirits Digital IQ = Shareholder Value
on purchase decisions. brands have a seminal opportunity to leverage advances This study attempts to quantify the digital competence of
in technology and processing power to establish direct 69 global Spirits brands. Our aim is to provide a robust tool
• The returns on Spirits brands’ traditional marketing
relationships with their end consumers. to diagnose digital strengths and weaknesses and help
investments, including high-budget TV campaigns,
brands achieve greater return on incremental investment.
celebrity endorsement contracts, and event • Creative digital programming provides a brand “halo”
Like the medium we are assessing, our methodology
partnerships, are increasingly recognized via extended effect, strengthening a marque’s association with
is dynamic and we hope you will reach out to us with
engagement online. From Diddy’s prolific tweeting for innovation. Digital is the marketing equivalent of “skinny
comments that improve our methodology, investigation, and
Cîroc to Johnnie Walker’s “House of Walker” program, jeans,” helping a brand appear younger and hipper.
brands are leveraging digital programming to build As Spirits brands increasingly reallocate capital from findings. You can reach me at scott@stern.nyu.edu.
equity and capture market share. traditional broadcast and print to digital channels, there is
an opportunity to sprinkle an Apple—and Burberry—like
• The emergence of a “cocktail culture” makes digital
pixie dust across their range of products.
programming a practical place to invest in educating
consumers about mixology. • The shift is beginning; alcohol marketers plan to increase Scott Galloway
digital spending 43 percent in 2013. Specifically, they Professor of Marketing, NYU Stern
expect to allocate an additional 36 percent to digital Founder, L2

2. “Beer, Wine & Spirits: Engaging Millennials (and Drinkers of All Ages) via Social Channels,”
1. “The Local and Mobile Future of eCommerce,” Ian Griffith, BevSites, April 15, 2011. eMarketer, September 17, 2012.

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: Spirits

ABOUT THE RANKING
The Methodology
Mobile Site Innovation

20% 30%
• Compatibility • SMS
• Functionality • Geolocal (Foursquare)
• Load Time • Other Mobile Initiatives

Mobile
Mobile Applications Site
• Availability
Functionality & Content 80% Brand Translation 20%
• Popularity
• Age Gateway • Aesthetics
Compatibility, optimization, and • Functionality
• Site Technology  • Messaging & Visuals
marketing on smartphones and tablets • iPhone/iPad/Android
Differentiation • Navigation & Site Search
• Retail Locator & Account Capture
• Brand Content
• Product Page 
• EU5 Presence

30%
Brand presence, community size,
content, and engagement
Facebook YouTube
• Likes • Views

Social Media • Growth • Number of Uploads
ng
0%
ti
ke
• Tabs & Applications • Subscriber Growth Search Blog Mentions

ar
2
• Responsivenes • Viral Videos • Traffic & User Generated Content
• Engagement • YouTube Search Visibility
ta lM ia,
an
d • Web Authority • Mentions

igi
• Sentiment
Twitter Emerging Social Media
m ed ts • SEO & SEM:
• Followers D tal for Email Marketing
igi g ef
• Instagram Advertising & Innovation
• Growth , d tin • Frequency
rch ke
• Google+ • Display
• Frequency • Pinterest ea mar
S l • Retargeting • Content
• Programming ai • Brand Initiatives • Social Media Integration
em • Promotion

Digital IQ Classes
Genius 140+ Gifted 110–139 Average 90–109 Challenged 70–89 Feeble < 70
Digital competence is a point of Brands are experimenting and innovating across site, Digital presence is Investment in digital is limited or Investment does not
competitive differentiation for these mobile, and social media platforms. Brands integrate functional yet predictable. inconsistent across platforms. match opportunity.
brands. Campaigns are consistently digital in both offline events and wider marketing. Success in one dimension does
integrated across dimensions and not influence the others.
promote path to purchase.



: Spirits
To access the full report, contact membership@L2ThinkTank.om GENIUS
Absolut
Bacardi
Jim Beam
GIFTED
Johnnie Walker
Smirnoff

DIGITAL IQ RANKING
Hennessy
Maker’s Mark
Sailor Jerry
Jack Daniel’s
Grey Goose
Jägermeister
Captain Morgan
RANK BRAND DIGITAL IQ RANK BRAND DIGITAL IQ RANK BRAND DIGITAL IQ Belvedere
Cîroc
gifted AVERAGE
Jameson
Baileys Irish Cream

4 137 11 122
Stolichnaya
Chivas Regal
Crown Royal
Southern Comfort
Diageo Mast-Jägermeister Ballantine’s

1
Malibu
140 Patrón
Sauza
The Glenlivet

5 135 12 121 Rémy Martin
Ketel One
Hendrick’s Gin
Cointreau
Diageo Diageo
The Macallan
Woodford Reserve
Pernod Ricard GENIUS CHALLENGED
The Balvenie

6 13
Havana Club
130 116 Kahlúa
Finlandia
Courvoisier
Moët Hennessy Moët Hennessy Campari
Don Julio
Beefeater
el Jimador
Highland Park
1 140 7 128 14 112 Jose Cuervo
Knob Creek
Laphroaig
Ardbeg
Beam Inc. Diageo gifted Grant’s
Svedka
Average
Glenfiddich
Grand Marnier
Glenmorangie
7 15
R

Bacardi GENIUS 128 108 Tanqueray
Skyy
Disaronno
William Grant & Sons Pernod Ricard Bombay Sapphire
Bushmills
St-Germain
FEEBLE
Martell Cognac

9 127 16 103 The Famous Grouse
Wild Turkey

1 140
Brown-Forman Diageo
Three Olives
Bulleit Bourbon
Dewar’s
Ultimat Vodka
Russian Standard
The Botanist
J&B

10 123 16 103 1800 Tequila
Aberlour
Mount Gay Rum
Beam Inc. GENIUS Bacardi William Grant & Sons*

© L2 2013 L2ThinkTank.com. REPRODUCTIONS AND DISTRIBUTION PROHIBITED *Owned by SPI Group but distributed through William Grant & Sons through 2013. 4


: Spirits
Absolut
Bacardi
Jim Beam
GIFTED
Johnnie Walker
Smirnoff

DIGITAL IQ RANKING
Hennessy
Maker’s Mark
Sailor Jerry
Jack Daniel’s
Grey Goose
Jägermeister
Captain Morgan
Cîroc
Average challenged AVERAGE
Jameson
Baileys Irish Cream

18 102 24 96 32 89
Stolichnaya
Chivas Regal
Crown Royal
Southern Comfort
Pernod Ricard Pernod Ricard William Grant & Sons Ballantine’s
Malibu
Patrón
Sauza
The Glenlivet

19 101 26 94 32 89 Rémy Martin
Ketel One
Hendrick’s Gin
Diageo Rémy Cointreau Pernod Ricard Cointreau
The Macallan
Woodford Reserve
CHALLENGED
The Balvenie

20 27 32
Havana Club
99 93 89 Kahlúa
Finlandia
Courvoisier
Brown-Forman Diageo Pernod Ricard Campari
Don Julio
Beefeater
el Jimador
Highland Park

21 98 28 92 35 87 Jose Cuervo
Knob Creek
Laphroaig
Ardbeg
Pernod Ricard William Grant & Sons Brown-Forman Grant’s
Svedka
Glenfiddich
Grand Marnier

21 29 36
Glenmorangie
98 91 86 Tanqueray
Skyy
Disaronno
Pernod Ricard Rémy Cointreau Beam Inc. Bombay Sapphire
Bushmills
St-Germain
FEEBLE
Martell Cognac

23 97 29 91 37 85 The Famous Grouse
Wild Turkey
Three Olives
Bulleit Bourbon
The Patrón Spirits Company The Edrington Group Gruppo Campari Dewar’s
Ultimat Vodka
Russian Standard
The Botanist
J&B
24 96 31 90 37 85 1800 Tequila
Aberlour
Mount Gay Rum
Beam Inc. Brown-Forman Average Diageo*

© L2 2013 L2ThinkTank.com. REPRODUCTIONS AND DISTRIBUTION PROHIBITED *Owned by Tequila Don Julio, S.A. de C.V. but distributed by Diageo. 5


: Spirits
Absolut
Bacardi
Jim Beam
GIFTED
Johnnie Walker
Smirnoff

DIGITAL IQ RANKING
Hennessy
Maker’s Mark
Sailor Jerry
Jack Daniel’s
Grey Goose
Jägermeister
Captain Morgan
Cîroc
challenged AVERAGE
Jameson
Baileys Irish Cream

46 84 46 79 53 73
Stolichnaya
Chivas Regal
Crown Royal
Southern Comfort
Pernod Ricard William Grant & Sons ILLVA Saronno Holding Ballantine’s
Malibu
Patrón
Sauza
The Glenlivet

46 84 46 79 54 71 Rémy Martin
Ketel One
Hendrick’s Gin
Brown-Forman Constellation Brands Bacardi Cointreau
The Macallan
Woodford Reserve
CHALLENGED
The Balvenie

48 48 55
Havana Club
83 77 70 Kahlúa
Finlandia
Courvoisier
The Edrington Group William Grant & Sons Diageo Campari
Don Julio
Beefeater
el Jimador
Highland Park

48 83 48 77 55 70 Jose Cuervo
Knob Creek
Laphroaig
Ardbeg
Diageo Moët Hennessy Cooper Spirits International challenged
Grant’s
Svedka
feeble Glenfiddich
Grand Marnier
Glenmorangie
50 83 50 76 57 69 Tanqueray
Skyy
Disaronno
Beam Inc. Moët Hennessy Pernod Ricard Bombay Sapphire
Bushmills
St-Germain
FEEBLE
Martell Cognac

50 81 50 76 57 69 The Famous Grouse
Wild Turkey
Three Olives
Bulleit Bourbon
Beam Inc. Diageo The Edrington Group Dewar’s
Ultimat Vodka
Russian Standard
The Botanist
J&B

52 80 52 74 59 67 1800 Tequila
Aberlour
Mount Gay Rum
Moët Hennessy Gruppo Campari Gruppo Campari



: Spirits
Absolut
Bacardi
Jim Beam
GIFTED
Johnnie Walker
Smirnoff

DIGITAL IQ RANKING
Hennessy
Maker’s Mark
Sailor Jerry
Jack Daniel’s
Grey Goose
Jägermeister
Captain Morgan
RANK BRAND DIGITAL IQ RANK BRAND DIGITAL IQ Belvedere
Cîroc
AVERAGE
feeble Jameson
Baileys Irish Cream

60 67
Stolichnaya
66 50 Chivas Regal
Crown Royal
Southern Comfort
Proximo Spirits Proximo Spirits Ballantine’s
Malibu
Patrón
Sauza
The Glenlivet

61 62 68 39 Rémy Martin
Ketel One
Hendrick’s Gin
Cointreau
Diageo Pernod Ricard The Macallan
Woodford Reserve
CHALLENGED
The Balvenie
Havana Club
61 62 68 39 Kahlúa
Finlandia
Courvoisier
Bacardi Rémy Cointreau feeble Campari
Don Julio
Beefeater
el Jimador
Highland Park

63 61 Jose Cuervo
Knob Creek
Laphroaig
Ardbeg
The Patrón Spirits Company Grant’s
Svedka
Glenfiddich
Grand Marnier
Glenmorangie

64 58 Tanqueray
Skyy
Disaronno
Roust Bombay Sapphire
Bushmills
St-Germain
FEEBLE
Martell Cognac

65
The Famous Grouse
57 Wild Turkey
Three Olives
Bulleit Bourbon
Rémy Cointreau Dewar’s
Ultimat Vodka
Russian Standard
The Botanist
J&B

66 53 1800 Tequila
Aberlour
Mount Gay Rum
Diageo



: Spirits

Key Findings Retail Locator Site Features
Percent of Sites with the Following
Path to Purchase December 2012, n=25

While regulatory constraints prevent end-to-end
e-commerce, top brands are utilizing their sites to drive
users to on and offline points of purchase. Thirty-six percent
of brands incorporate retail locators (taking an average of
two clicks from the main page to find a destination). Just 84%
40 percent of brands with retail locators featured maps Locator hosted on
brand site
and directions, and only eight percent auto-detect location
through IP addresses.

The Beam locator is ubiquitous across the parent’s six
brands, though it is not always deployed in the same way. In
some cases, the locator is fully integrated into the brand site
(Jim Beam) while in others, it is incorporated through a pop-
up window (Maker’s Mark) or a separate URL (Knob Creek).
Diageo’s Don Julio and Crown Royal both link to thebar.com
for retail locations while Brown-Forman’s el Jimador and
Southern Comfort use Google Maps.
72%
Search by address/zip

32%
Search by specific
products 56%
Distinguish between
bar/restaurant/retail

8%
Auto detect location
by IP address

40%
Include map directions



: Spirits

Key Findings
Account Data Collection Account Features
Loyalty December 2012, n=25 December 2012, n=25
Only 36 percent of brands offer account sign-up through
68%
their sites, suggesting a significant missed opportunity. 64%

Brands with account functionality captured between six and
48%
30 data points upon sign-up with an average of 16.5. This 44%
ranged from mailing address (64 percent), opt-ins for direct 36%
32% 32%
mail (44 percent), and mobile alerts (36 percent), as well 28% 28%
as varying degrees of consumer product preferences (28
percent) and consumption habits (32 percent).

Incentives also varied. Some brands lured loyalty members
with news and events that went largely unseen. Others
provided rewards like personalized bottle labels or bags.
Patrón and Laphroaig were among the strongest, offering
Mailing Opt-In for Opt-In for Consumption Product Account Access to Personalization Incorporate
bottle registration/lookup, which allows the brands to track Address Direct Mail Mobile Alerts Habits Preferences Program is Events Features Facebook
Branded on Site Connect
purchase location and habits.

The Account Continuum
68% Percent of Brands With the Following Features:
December 2012, n=25
48%
32%
16%
8%
4%

Branded Account Access to Ofﬂine Events Dedicated Section of Site Event Signup via Site Product Purchase Tracking Transactional Loyalty Program
or Microsite
Sophistication



: Spirits

Key Findings
Facebook Top 10: Facebook Brands
Presence on the big three social media platforms, Facebook, Number of “Likes” by Aggregate Global Community Size
Twitter, and YouTube, is nearly ubiquitous at 100 percent, 94 December 2012
percent, and 94 percent, respectively, and experimentation
on emerging social media platforms is rapidly increasing.

Although Facebook serves as the hub for most social
activity, community sizes lag other industries. The average
U.S. Facebook community was just over 500,000, while
global brand communities averaged just over one million,
incorporating regional and product-specific pages. The
importance of social media to the industry cannot be 8,139,366 likes 7,188,711 likes
overstated, especially given the regulations around site. Smirnoff Jack Daniel’s
n=53 n=39
According to April 2011 data from ROI Research, 15 percent
of users purchased an alcoholic beverage as a result of
content encountered on a social network. Though this rate
of influence lags auto and food, at 21 percent, it exceeds
personal care and non-alcoholic beverages (13 percent and
eight percent, respectively).3

5,819,603 likes 5,369,753 likes 4,053,885 likes
Key Bacardi Johnnie Walker Captain Morgan
n=20 n=51 n=33
Europe

North America
Asia

South America
Africa/MENA
Global
3,618,879 likes 3,320,414 likes 2,801,254 likes 2,138,178 likes 1,933,097 likes
Baileys Irish Cream Absolut Jose Cuervo Skyy Hennessy
Total “Likes” n=20 n=47 n=18 n=12 n=28

3. “Beer, Wine & Spirits: Engaging Millennials (and Drinkers of All Ages) via Social Channels,”
Debby Garbato, eMarketer, September 17, 2012.


2013 Digital IQ Index: Spirits

2013 Digital IQ Index: Spirits

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2013 Digital IQ Index: Spirits