Name: Nida Barros ID: 6019088 Section: 11

Case Study IV.1 Absolut Vodka

1. Main motivate for Pernod Ricard's acquisition of V&S (including Absolut Vodka)

in 2008.

 Pernod Ricard wants to gain more share along with vodka portfolio and wanted

to compete with Diageo, the largest vodka producer. He sees the potential in

Absolut Vodka and wants to gain more revenue as well that’s why he wants to

own them. With the acquisition, Pernod Ricard group own the Absolut Vodka

which is the second larger vodka producer.

2. Alternative marketing strategies to increase market share.

a. Absolut Vodka in the US

 Since the market share of vodka in the US has reached a saturation point and as

the trend of US, consumers concerns more about health. They drink cleaner and

purer alcohol and those type of alcohol are categorized as Super-premium.

Absolut Vodka could promote their drink as pure and cleaner drink in order to

complete with Smirnoff who is the world’s most popular vodka producer which

present themselves as a premium drink and has 22 percent market share in the

US.

b. Absolut Vodka in Europe

 Vodka consumption is the highest in Europe along with how consumers are

well-educated about alcoholic beverage and their appreciation of vodka quality.

So, regarding the political uncertainty and lack of infrastructure in some

 countries are external problems. What can Absolut Vodka do is promote the

quality of its product since people there understand the quality of vodka.

c. Absolut Vodka in other parts of the world

 Since the internet has been used by almost all ages, Absolut Vodka could create

a viral video of its product and promote them as trendy drinks. In addition, for

each region. Absolut Vodka could create a specific video for each region by

adding drink culture of each country/regions in order to make viewer from

overseas to feel relatable.

 Another way is like how Stolichnaya was included in Eminem’s music video

for Love The Way You Lie. Absolut Vodka could be included in a music video

of a famous artist from each country/regions as well. In order to raise

awareness of the brand.

3. Recommended region for Absolut Vodka to allocate more market resources

 Definitely Europe because of the highest volume number showing they

consume vodka the most in which excluding the homemade vodka which

means that it is even higher than the number showing in table 1. Meanwhile, in

the US, the market share of Absolut Vodka has reached a saturation point so it

might be unnecessary to allocate more market resource there. However, it

might be the time of Absolut Vodka to move forward and attacking the number

regional market share in Europe, the Smirnoff.

4. Did Absolut Vodka have the right competencies for achieving international success

for its Absolut Cut?

 No, because they failed in delivering sufficient volume in Canada, Australia,

and the UK. The reason may be because they target only the mature drinker

and came up with the mature campaigns, unlike another brand that has a

different advertisement to attract under-age drinker. Which is actually the right

thing for them to do so just to avoid criticism. This case is kind of tricky, they

may not really go directly into the market because of a certain moral reason

that’s why they failed. Besides, the FAB product is popular among the younger

drinker as well.

 Another reason is that their marketing strategies may not effective enough to

catch the mature drinker in these countries. Moreover, the volume of each

region for these countries are low except the UK from Eastern Europe.     

5. Should Absolut Vodka relaunch a mixer product in the global FAB market?

 Absolut Cut has a potential in FAB market. They should relaunch it and change

it a little bit. The shape of the bottle for example. In FAB market, the vodka

products are perceived as trendy and suitable for drinking directly from the

bottle. Redesign the bottle to be trendier, connect its image to both young and

older drinker since the FAB product is popular among consumers within 18-30

years old. Push and connect the product to a nightclub, stylish bars or into the

cocktail culture because these places are the most popular places for consuming

the drink and would raise awareness of the product among the target drinker.