BUSINESS

WHISKEY TROUBLES

WHISKEY TROUBLES

UK - 2021-02-16

Not only is the online purchase of whiskey and other distilled products in the UK a frustrating and expensive undertaking for continental Europeans at the moment, but for small distilleries, especially in Scotland, it is currently extremely difficult to completely impossible to sell alcohol into the European Union Member States.

The confusion over the necessary forms to send alcohol currently makes it almost impossible to send even a single pallet of spirits on its way. On both sides of the new border, he said, shippers, producers and trade customers are unprepared to deal with the changed conditions, which also vary from country to country in the EU. While large companies can still ship whiskey across borders in large quantities, small distillers are hard-pressed to find carriers willing to take on the multiplied formalities.

Many importers have sold out of stock, and it is currently impossible for distillers to send new goods to Germany. It is already failing because the carriers are unable to quote transport costs.

Many CEO's and Managing Directors of are complaining that no carrier will accept small shipments of one or two pallets to the EU. Alan Powell of the British Distillers Alliance (in reference to press statements) also does not believe, that the situation will improve substantially once the bureaucracy has settled down. Alcohol shipments from the UK to the EU would be much slower and much more expensive compared to before, because the procedure would remain complicated, because even with the authorities in place, it would still be three times the work compared to before Brexit. And that would hit the small producers much harder than the big companies.

Text: Red / Photo: William Bout by Unsplash

Photo: Dylan de Jonge by Unsplash

 

 

MARKETS IN CRISIS MOOD?

MARKETS IN CRISIS MOOD?

EUROPE - 2021-02-17

Might be now the last good moment to face up to the update and, for many, the challenge in market or customer communication and to arrive in the 21st Century - because, as is well known, after the crisis is always before the crisis. The global restrictions have of course influenced and permanently changed the demand for goods and services. For many traders, the outbreak of the COVID 19 pandemic could not have come at a worse time.

The impact of the restrictions is already showing an increased administrative burden and media agencies report that more is to be expected in the coming weeks.Reactions to this extraordinary situation differ depending on the industry and the provider. One thing is clear, however: Major shifts in consumer demand.

Customers are now relying on online retailers to meet their needs more than ever before. In the past few weeks, the world has changed so much that we hardly recognise it - and marketing has changed too. If you take a look at the reactions in marketing, you can see different approaches by the suppliers - depending on where they find themselves, want to find themselves and probably will find themselves in the new consumer landscape - even if not always entirely voluntarily and intentionally. Due to market uncertainties, lack of planning and general budget cuts in marketing, some suppliers have reduced their activities within marketing channels.

Let's observe three categories:

First: Too little demand Suppliers experiencing a decline in customer demand have to make difficult decisions. Management's instructions to cut all costs are understandable - however, research and observation of economic history, has long shown - actually since the Great Depression of 1920 - that those who increase their marketing spend in times of crisis benefit in the long run. It is important that suppliers separate the impact of the Corona virus from other factors and continue to adhere to best practice. Both commercial customers and consumers will remember how they were dealt with during the crisis, which in turn will affect their brand loyalty in the future. Some suppliers who experienced low demand paused their marketing activities to reflect and reassess their position in the new consumer landscape - including an analysis of inventory and supply capacity.

Second: Too much demand The grocery industry is a well-known example of excess demand. Here, retailers have been prompted to pause their marketing activities in recent weeks. In some cases - especially with consumer goods, medicines and food - websites even had to be taken offline temporarily and virtual queues introduced in order not to overload server capacities, not to deepen the situation in the customer hotlines and service phone numbers of a wide range of providers, from grocery retailers to credit card companies.

However, it is the niche products of small retailers in particular that tell us what consumers are looking for during the restrictions. Whether it is sports equipment, leisure wear, toys or board games, gardening tools or takeaway food - all of these are in high demand and for the most part it is the small suppliers who are seeing strong demand for their products and services.

Many smaller businesses are usually more agile and can or should react more quickly - and that is an enormous advantage in a time when physical shops had to close overnight. For this reason, they were also often able to successfully get customers from offline to online shops. In addition, smaller companies had the unique opportunity to reach significantly more customers with a small budget, as Amazon, the market leader in online business, drastically reduced its advertising expenditure in March.

When is an increase in demand too much? When some retailers couldn't accept new orders because they didn't have the resources to do so - either due to a lack of availability or a lack of delivery capacity. But these measures are usually short-lived. Because with new optimised processes in the supply chain, many of these traders have the chance to establish themselves in the markets and build up new regular customers.

Third: Push/pull effect There are many suppliers that are still affected by the pandemic, but where online demand remains fairly constant. These include companies like department stores that offer both in-store and online offerings. We see that loyal in-store customers are also buying from the online shops, but at the same time there are drops in demand in certain areas, such as women's clothing. This push/pull effect means that the business performance and thus the customer movements - even these in the online area of the business remain relatively constant.

Text: Red. / Foto: Erik McLean by Unsplash

TIME FOR SMARTER MARKETING?

TIME FOR SMARTER MARKETING?

EUROPE - 2021-02-17

How should suppliers from these three categories do marketing during the existing restrictions?

Good marketing is as good as the bundling of measures and activities itself. There are several crucial factors: Data-driven decisions: It is more important than ever to make decisions based on data. Because these help to understand which channels deliver the greatest return and, above all, from which campaigns this is generated - so this is how you ensure that marketing activities have the greatest possible impact and that resources are used optimally. However, there is no need to explain that neither marketing nor digitalisation is miraculously self-healing; it is an applied science.

This includes the fact that all relevant information must be stored and retrieved. In this way, the "where-from/where-to" effect can be clearly analysed and promoted. However, many SMEs that certainly belong to the niche businesses listed above have this knowledge and know how to use it profitably in the long run? The entrepreneur should make sure that the above data is taken into account and that it is clear which activity provides added value. Capturing the data and determining movements based on data will ensure that the campaigns that are further up the sales channel cannot be overlooked.

It is important that all decisions made during the crisis are both based on data and implemented according to best practice - but it is also important to stress the importance of continuity - The submarine strategy: you are only temporarily visible in the market - the rest of the days you are submerged, is absolutely counterproductive here and certainly does not generate repeat customers.

Sending the right impulses. No brand or company wants to lose customers or partners because it sets the wrong tone or comes across as putting profits before people. Providers have an obligation to both their employees and their customers to provide the performance to continue. This positioning must be clearly communicated to campaigns and customers. Unfortunately, in many industries - such as aviation - this is currently happening to a very limited extent. Therefore, it is extremely important to understand who the clients are. It may be that even at the beginning of the year it was absolutely clear who the audience was. But because of the pandemic and the economic circumstances and shifts in demand it has caused, a different demographic may now feel targeted by marketing activities than before.

Suppliers will attract new online customers, many of whom are likely to be making their first ever online purchase. This could be particularly true for the older generation of customers. A market study in October 2019 revealed: That 71 per cent of customers in Central Europe prefer to make their first purchase from a brand in-store. Since this was not possible due to the closure of physical, i.e. offline, shops, the opportunity arose to attract new customers online. Even now, online retailers can benefit from limited access to shops and should therefore adapt their messages to this new target group. For this, simple language should be used that is understandable for everyone and puts the USP in focus.

Supporting other businesses. The changes in consumer demand in all parts of the retail industry offer suppliers the opportunity to form so-called affinity partnerships with other brands. With some brands experiencing too much demand and others too little, both customers and other businesses can be supported by directing the volume in the market movement - i.e. traffic - to suppliers that are not in direct competition but offer complementary products and services.

With the help of so-called "publisher tracking", these affinity partnerships can be established and their activity measured. Each brand acts as a reference for the other. It can improve the perception of one's own brand by providing customers with information about other companies that may be relevant to them and thus produce added value.

Networking on the Network. Before a company decides where to invest, industry trends should be analysed and considered. Is the company in line with developments and the current situation? To find out, the network can be asked to regularly provide data showing how much the industry is growing compared to its own activity. This knowledge helps to identify both the success of the company's activities to date and where more focus should be placed. With current events leading to major changes in consumer behaviour on an almost daily basis, the situation can change quickly. Looking at the big picture on a regular basis allows for quick reactions and the best chance of meeting customers' expectations. If neither tools nor knowledge are available for these tasks, professional support is certainly advisable - keyword: market monitoring is becoming more important than ever.

What does the future hold? The current situation presents marketing experts and companies with new challenges and completely changed parameters. These are parameters that change extremely quickly and redefine the strategists' time horizons. More and more brands are taking advantage of this opportunity to do good - by supporting systemic professions, enabling their customers to easily send donations to charities or adapting their own product variety to the current demand.

Positive examples include: distilleries and breweries that have become the linchpin in the production of disinfectants. Or Chanel that has agreed to make its factories available for the production of personal protective equipment such as mouth and nose protection, etc. However difficult the situation, such actions and initiatives show the strong spirit of community solidarity and cohesion. A big bright spot for all in digital marketing is definitely that the short term forced shift to online shopping and the related willingness to not only accept but also use online as a full-fledged channel will only be beneficial for the long term future of the industry.

Text: Red. / Photo Rodion Kutsaev by Unsplash