STRATEGIC MARKETING

CASE STUDY

ON

ABSOLUT VODKA – CREATING ADVERTISING

HISTORY

Submitted to

Dr. M R SURESH

Submitted by

Group – B5

Agnimitra Das – 18129

Bharath Kumar B Y – 18131

Giridhar K -18133

Karthik K – 18136

Praveen Ben – 18140

Case facts

 Absolut Vodka was launched in US in 1979. It is a subsidiary of Vins&Spirits (V&S)

which is a Swedish company.
 The company was able to reach 6 million litres sales in the year of 1983 and 20 million
litres by 1987.
 The vodka was made from high quality grain and it was exported to 16 counties in 1986
 The vodka was in expansion phase from 1999 to 2003
 The company launched Absolut Vanilla in 2003.
 Total sales of V&S in 2002 was amounted to SEK 9093 million, of which 61% came
from Vodka.
 The main competitors include Smirnoff ,Wyborowa from Poland Finlandia from
Finland, Cossak, Puschkin , Stolichanaya from Russia and Other locally manufactured
vodka like Viin and Sochu
 The company believes in constant improving, Entrepreneurship, mutual trust and a
strong sense of ethics: these are the foundations upon which build their values

Core Issues

 How to develop an innovative advertising which helps in creating brand recognition

and brand awareness among consumers
 How would the same helps in differentiating a product especially when competing in
product categories where there is not much scope for differentiation
 Communication channel
 How to shift from traditional print media to digital to promote the product

The Xavier framework can be incorporated in the scenario of the Absolut Vodka’s case. The
following would be the construct of the Xavier framework in the given backdrop:

 Environmental Analysis: There was a rise in the consumption of Vodka in the west
and it became more mainstream. The Vodka was often related to lifestyle and vouge.
The drink was more identified with Russia and hence the attaching of the Russian
identity with the names of the vodka brands became prevalent.
 Market Analysis: There was the situation of entrance to sixteen countries and USA
was a rapidly growing and lucrative market. Certain section of the market that didn’t
consume vodka earlier started consuming vodka and showing interest towards it.
  Customer Analysis: There was advent of new customer segments and the market
became more and more segregated. The drink which was earlier consumed by more
aged and sophisticated men, found its place amongst the younger generations and also
amongst the women.
 Competitor Analysis: The major competition was from the Russian companies as they
annexed and occupied major portion of the market in USA. There was also competition
from the European counterparts and also from distant countries like Japan. The major
chunk of the vodka produced was based on and extracted from potato.
 Company Analysis: Established in 1917 in Sweden and had an array of portfolios. The
company had years of experience and expertise and had been a government
establishment for a long time. They were one of the leading vodka companies in Europe
and was third in terms of export of vodka to USA.
 Marketing Mix Analysis: The product was vodka which was not based on potato. It
was based on grain which made it distinct from the other available vodka brands. The
place was USA, where the brand was trying to enter and establish itself strongly. The
price was on the higher side as it targeted the premium segment. The promotion ranged
from modifying the exterior appearance and texture of the bottle and deciding on the
spelling of the brand name to engaging major artists for promotion of the brand.
 Strategy Formulation: A multitude of strategies were adopted by the company. It
included communicating about the purity of the product and the divergence from other
brands (potato based and grain based). It also included having different themes and
essence of the vodka they produced, involving artists and models in the campaigns

SWOT Analysis

Strength:

• The bottle

• Flavours and varieties

• Distilled in only one location

• Strong Promotional activities

• Universal brand recognition

Weakness:
 • Cost

• Restrictions on advertising

Opportunity:

• Growing beverages market

• Growing Online sales

Threat:

• Competition

• Government policies

Marketing Mix

Product

 Absolute Vodka is available in different variants such as grapes, apple, cherries and
many more
 The presence of alcohol along with different flavours makes Absolut Vodka one of the
best vodka in the world
 Have a good relationship with the customers globally

Place

 Started in Sweden
 Present in 126 countries

Price

 Price is affordable for the customers even though there is high government tax on it

Promotion

 Advertising in different channels such as print media, media, digital campaigns

 Different kind of bottles is one of the main attractions of the campaigns
 They have one of the longest running ads campaigns in the sector

1)What were the various issues that V&S have to keep in mind before coming up with the
appropriate brand name and a brand image, give the fact that Swedish vodka was not
expected to find ready acceptance in the target market, US?
According to the research it was concluded that sales were determined by its shelf presence
and the bottle design.

 Lars Olsson Smith seal

 Text and design of the bottel
 Usage of colours
 Bottle cap
Origin of brand did not matter as much as the image it carried.

2. Discuss the role advertising pays in increasing brand awareness and brand loyalty
among customers, especially for products which have very subtle differentiable
attributes? In the above context, examine the impact Absolut advertisements had on its
target audience. Do you think that advertisements fulfilled their purpose?

Brand Awareness

 Consumers’ ability to retrieve the brand from memory when given the product category,
the need fulfilled by the category or purchase as a cue shows the brand recall.
 One of the brand recognitions which they have been exposed earlier was Consumers’
ability to recognise the brand

In the context of Absolut Vodka :

 Absolut Perfection : Positioning “Simplicity & Purity”

 Russian Soldier ad : Challenge to Russian Vodka brand Stolichnaya
 Association with Art : Becoming part of American Culture
 None of the ads were targeted to consumers below 40
 1986-88 Launch of flavours Pepper & Citron

3)‘The Absolute advertising campaign is successful because it is contemporary.’ How did

TBWA maintain the ‘freshness’ of the Absolute campaign? Discuss with respect to the
brand’s association with different media: art, fashion, technology and music.

 Absolut converted their biggest weakness to their greatest strength, the shape of the
bottle of Absolut Vodka is emphasized in all their advertisements.
 Through their witty and creative ads, they catered perfectly to their target audience.
  One of the USP of the brand is its on-source production at an exclusive location in
Sweden. The bottle’s labelling clearly spells out the rich history and heritage of the
brand.
 TBWA maintain the ‘freshness’ by portraying brand values through Clarity, Simplicity
and Perfection by establishing through fashion, art, music etc.
 Absolut success followed a well-integrated identity campaign, which is also its brand
personality. So the brand is associated with fashion designers, artists and singers that
collectively depicts an Absolut “Lifestyle”.
 TBWA brought out ads for every season of the year, festival themes; whether it is art,
photography, technology, fashion or music. Absolut had till now stood for brilliance in
advertising.
 Absolute Vodka entered into the fashion world with a small dress. Association with
fashion world through continuous sponsorship of key Fashion Shows in New York City

4) Even though Absolute ads have been depicted in different media, the central theme of
the campaign has remained unchanged (the bottle and the two-word slogan) over the
years. In light of the above statement, do you think that the campaign will manage to hold
sway or lose in impact in the near future? Give reasons to support your arguments.

 More than 1000’s of the ads in the campaign have featured or make sly reference to
Absolut’s distinctive bottle, with the stubby neck and see-through label.
 The ad they focused basically portraying the shape of the bottle as an aesthetic concept
sold the idea. Innovative and highly standardized advertisements positions Absolut as
a ‘special’ product.
 Consumers wanted interaction, inspiration and involvement, that’s the reason why most
of the ad campaign was launched. It gave the consumers a chance to express their ideas
about the two-word slogan used in the ads and given Absolut a good brand recall and a
strong brand equity source.
 The campaign will definitely hold their way in the near future because the ads they were
creating will be based on current trends in the market, whether it is art, photography,
technology, fashion or music. Absolut had till now stood for brilliance in advertising.