|Building the Johnnie Walker Brand | |Amitava CHATTOPADHYAY, Nina Paalova | |INSEAD Case Study: Building the Johnnie Walker Brand | |Copyright: 2006 INSEAD | | | | | | | | | | | | | |This case focuses on the global strategy and the radical steps required to reverse the declining trend in sales experienced by | |Johnnie Walker, the flagship brand in Diageo's portfolio (which included Guinness, J, Smirnoff and Tanqueray), and restore its| |former prestige.
Research associate Nina Paavola under the supervision of Amitava Chattopadhyay, the L'Oreal Chaired Professor | |of Marketing-Innovation and Creativity at INSEAD, reviews the history of the brand from its creation in 1820, and describes the | |factors contributing to its decline: the Asian crisis, new trends in alcohol consumption, competition from new spirits, and | |changes in men's lifestyles and aspirations. | | | |For Stephen Morley, Global Brand Director for Johnnie Walker, the stakes were high: Johnnie Walker was a jewel in Diageo's | |crown, representing almost 25% of the company's total gross profits. The key question for him was how best to position the brand| |so as to meet the stretch targets set by the Board. | | |His team's analysis revealed that Johnnie Walker's position was being eroded in emerging and developing markets due to increased| |competition from new spirits, beer, wine and champagne, as well as the rising cost of doing business as a result of duty | |increases, counterfeiting and distribution issues.
It found that in key mature markets, sales of Johnnie Walker clearly depended| |on an aging consumer base. Moreover, consumers were failing to perceive the differences between Scotch brands due to the fact | |that the value of standard and deluxe blended whiskies had been undermined by the growth in super-premium and malts. | | |In 1999 Diageo instituted a new global approach to managing Johnnie Walker as it sought to develop the right positioning and | |re-establish the brand's credentials. Essentially this meant tapping into the fundamental consumer motivations emerging from | |evolving social change worldwide and appealling to customers on a more personal level.
Consumer research revealed that Johnnie | |Walker was associated with distinct brand values such as substance, excellence and masculinity, which were relevant to men at | |different stages of their lives. One particular study by Research International about the changing role of men in society seemed| |to have particular significance. | | |Pondering the results of the masculinity study, the team wondered if a common positioning for the Johnnie Walker brand should | |replace the current separation between Red Label, Black Label and the Super Deluxe Malts? Which elements of the long-standing | |associations and icons linked to Johnnie Walker could be best leveraged to build a positioning platform? The pressure was on to | |provide some answers as the foundation of all Diageo's brand strategy was the identification of 'the key brand benefit'- the | |single most powerful asset of the brand in meeting the consumer's needs. |
