Learn Whisky Marketing with LVMH #4 – Conclusion

by Oliver Klimek on November 12, 2009

In the first three parts of this series I looked at Glenmorangie, Ardbeg and the SMWS. Now let’s try

Putting it All Together

But hold on a minute! Wasn’t there also a third distillery involved in the LVMH/Glenmo deal? Yes, you remembered right, the bundle also included Glen Moray, a fairly unspectacular distillery – “tier 3″ as they call those in the whisky buisiness – producing mostly for blends. Well, this doesn’t go well with LVMH’s luxury attitude, so they decided to sell it.

Now when you look closely at the three portfolio items, it becomes apparent that LVMH was pursuing a cunning plan, as Blackadder’s Baldrick would put it.

  • Whisky styles
    Glenmorangie: unpeated, various degrees of finishing
    Ardbeg: various peat levels from gentle to intoxicating
  • Brand images
    Glenmorangie: Conservative, a touch of glamour
    Ardbeg: Progressive, celtic heritage
  • Consumer appeal
    Glenmorangie: Middle aged to old, distinguished
    Ardbeg: Young and freaky
  • Whisky experience
    Converted blend drinker, casual single malt drinker -> Glenmorangie 10, Ardbeg Blasda
    Regular single malt buyer: The rest of the Glenmorangie of Ardbeg ranges, according to personal taste and wallet size
    Experienced Malthead: SMWS single cask bottlings

With only three items in their portfolio, LVMH has managed to embrace the totality of single malt drinkers. Horizontally by personality, taste and age profile as well as vertically for any experience level. By giving Glenmorangie a little glamour appeal they hope to lure blend drinkers form the mass market into the high profit single malt market. And as the ultimate pinnacle for the true whisky experts there is the Scotch Malt Whisky Society where members can elaborate on the vanilla fudge notes in the 7.11. “Blue Oyster Cult and Red Hot Chili Peppers”

What LVMH did here was in fact adapting classic warfare tactics to marketing: Surround your enemy so they can’t run away, and then go for the leaders in the centre.

It becomes obvious that the Glenmorangie takover was a highly efficient and thoroughly planned manoeuver, and it seems they can already begin to rake in the cash.

Now is This Good or Bad?

The answer to this question depends on your standpoint. From a business view, this is brilliant textbook marketing. But is such a development really good for whisky in general?

I am a firm supporter of variety in whisky. This “one size fits all” approach may be highly profitable. But when marketing departments decide over the product range of distilleries, the variety is bound to suffer. And we must not forget that marketing and product design costs money. And this is money that can not be spent on buying better quality casks or improving distillation technology. It just makes the whisky more expensive without giving it more intrinsic value.

To put it shortly: What may be good for business is actually bad for whisky. Marketing driven, streamlined products have nothing in common with what Scotch whisky really is: A drink for heart and soul made with love and passion.

Let’s hope that not all distillery owners want to learn from LVMH. Scotch whisky has always been a hand crafted, artisan product. This great heritage is seriously endangered when marketing tells the stillmen what to do.

Slàinte Mhath!

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{ 1 comment… read it below or add one }

Peat March 12, 2013 at 11:33 am

How strange that you would specify “Ardbeg: Young and freaky”, when I’m neither at all. I’ve not seen much in the way of their marketing, but with no intent other than to lay my curiosity to rest, I tried and loved Ardbeg 10 and Uigeadail solely on their fragrances and flavours.

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