Beverage marketing guru Patrick Henry calls it the “St. Patrick’s Day challenge.” “When customers walk into a bar on St. Patrick’s Day, they might get a green derby at the door from Anheuser-Busch, a glow necklace from Miller and a keychain from Coors,” says Henry, principal of Patrick Henry Creative Promotions, a Houston-based marketing agency specializing in food and beverage brands. “Then, they go up to the bar and order a Heineken.”
On-premise beer promotions, in other words, are not an exact science, despite all the consumer research and millions of marketing dollars spent on them.
It’s not that beer promotions don’t work. “If the featured brand’s POP (point-of-purchase materials) work, if they catch people’s attention and spark impulse purchases, that brand’s sales go up by a minimum of 25% and sometimes as much as 150%,” reports John Beck, vice president of marketing for Bennigan’s, the casual-dining chain based in Plano, Texas.
But beer promotions do have to be handled carefully to make an impact and the right kind of impact, at that on the customer. Although Old Chicago, a 50-restaurant chain, owned by Rock Bottom Restaurants, Inc., features selection of 110 beers, the restaurants do not run more than one promotion at a time. “We want to keep the message clean in the restaurants,” explains Steph Steil, director of marketing for the chain.
Perhaps the most important thing to keep in mind about beer promotions, say restaurant and bar operators, is that, although the beer company’s goals and those of the restaurant or bar are similar everyone wants to sell more beer, they are not identical.
Beer companies, of course, want to sell more of their beer.
“But my mission in life is not to sell a specific brand, it’s to make sure the customer is drinking something anything other than tap water,” says Tim Johnson, director of purchasing and beverages for Champps Entertainment, Inc., a chain of 32 company-operated and 13 franchised sports bars, headquartered in Englewood, Colorado. The trick, says Johnson, is to know when the goals of beer company and restaurant operation are compatible and when they are not.
Steve Reynolds, one of the two founders of the Yard House, a beer-themed restaurant chain in California that just opened its fourth location, agrees. Though the Yard House restaurants offer what they claim is the largest selection of draft beers in the world, with 180 to 250 tap handles each, they do not do beer promotions per se.
“It doesn’t make any sense for our long-term growth to encourage the sales of one brand over any of the others. We want them all to sell,” Reynolds explains.
The entire point of the Yard House’s huge selection is to give the guest the experience of choosing from among so many different styles and brands. That said, Reynolds does see a place for one type of point-of-purchase material. “We do take beer coasters, as many as we can get,” he says. “We have so many beers to choose from that sometimes the coaster acts as a subliminal message when the customer is having a hard time deciding.”
Other operators stress that they choose beer promotions that fit their concepts. “The promotions we do are all about our brand, about building our brand personality,” says Bennigan’s Beck. “Cinco De Mayo is a great example. We have yet to figure out how to make that work [with the chain’s Irish flavor.]”
Pick and Choose
Most large chains are able to demand customized promotions from suppliers. Many, in fact, come up with their own promotional ideas and then look to what kind of support their suppliers can provide. But, Champps’s Johnson points out, “No one has a lock on great ideas. Most beer companies spend millions of dollars on advertising and promotion and you should tap into that, use that.”
He advises taking from a promotion those elements that will work for your operation. “I’m also a firm believer in not taking something just because it’s free,” he says. “Often, if it’s not worth paying for, it’s not worth doing. Take what you need and if you don’t get everything you need for free, that’s fine.”
Old Chicago, for instance, does not use point-of-sale materials from suppliers. “We develop our own, with our own look,” says Steil. On the other hand, Steil does find incentives for a restaurant’s staff or give-aways to customers to be useful, in markets where legal. For example, the chain runs “mini beer tours” for St. Patrick’s Day, Cinco De Mayo, Oktoberfest and the holidays. Like the chain’s famous World Beer Tour, where customers try to taste all 110 of the restaurants’ beers and earn prizes as they do, participants in a mini-tour try all the Irish beers listed for the St. Patrick’s tour or all the German beers listed for Oktoberfest. And the prizes for the mini tours are often give-aways, such as t-shirts, provided by the beer companies.
Even if a promotion fits with an operation’s concept, it is important to look at what the promotion is designed to do, exactly, and how that fits in with the operation’s goals. “If customers end up trading into one beer and out of another that had a better profit margin, that’s not good,” explains Dave Brown, senior beverage marketing manager for Applebee’s International, which has over 1,300 restaurants in its casual-dining chain. “We look for things that will drive more bar sales as a whole.”
Champps’s Johnson agrees. “It has to make sense for your operation,” he says. “Most importantly, you’ve got to do research and know your guests and what they might like.” He also considers the profitability of the product being promoted. “You don’t choose the lower-end items [to promote,]” he explains. “We look for higher profit margins. That is a key factor.”
Likewise, many operators try to stay away from anything that smacks of discounting. “We charge full-price 99.9% of the time,” says Yard House’s Reynolds. Like many operators, Reynolds does not want to “train” his customers to look for and only come in for discounted prices. Reynolds, for example, has come to regret a Monday night football promotion the Yard House restaurants have been doing since the first one opened in 1996. On that night, customers can buy a half-yard of beer, in a keepsake glass, for a slightly lower price. Now, Reynolds feels the chain is stuck with that promotion because so many regulars have come to expect it.
Ideally, a promotion can do more than just increase the sales of a particular, established brand, say these operators. Johnson, for example, likes promotions for new brands. “It’s a great way to introduce a new brand, for us to see if there is a market for them,” he points out.
Or an operation can use a promotion to draw business in during what is usually a slow period. “We do a lot of late-night promotions, like karaoke,” says Johnson, “and we will feature brands during those times.”
And the best promotions can bring people in. “We’re looking for sales overall, of course,” says Old Chicago’s Steil, “but we’re also looking for increased visits, either a person new to Old Chicago or a customer coming for an extra visit.” Likewise, Champps’s Johnson looks for promotions that “are so much fun, they draw people in.”
Timing can also be everything. “The holidays, Christmas and New Year’s, are not a big beer-selling time. Everybody is selling wine and champagne than,” points out Patrick Henry, “but the week leading up to the Super Bowl is a great time. And every operation should have beer promotions in the summer.” And while Henry finds Cinco De Mayo to be “huge, gigantic,” one of the two biggest beer holidays, St. Patrick’s Day being the other, he finds Halloween to be of relatively minor importance. “It’s a one-night promotion,” he says. “I would say, absolutely, promote it, but not a lot.”
When it comes to sports, Henry says football remains the king of beer promotional opportunities. His firm does five times as much work for beer on football as it does on any other sport. “Football is where it is,” he says. Another sport, basketball, has one period that is also especially big for beer, Patrick finds, the NCAA tournament or March Madness.
Even with football, promotions have to be carefully targeted, Henry says. “Don’t focus a lot of money on Monday night football,” he advises. “Years ago, it was so popular,” he says, but that was before people could see as many football games as they do now. “It used to be you might see one or two, if you were lucky games on Sunday night, so Monday was a bigger deal,” he explains. “Now, every sports bar can show every NFL game and Monday is irrelevant.”
Pick a New Day
Jacque Dickinson, president of Cenmarx, a promotion agency based in Stamford, Connecticut, advises looking for opportunities to promote that are not event-specific. “No one ignores the primary sporting events, St. Patrick’s Day, Halloween or the Fourth of July,” he says, “but often you’re just screaming a few decibels louder than the crowd. A non-calendar-specific [promotion] can have more of an impact.”
Recently, Guinness moved its Great Guinness Toast from February to November for much the same reason. “Promotion is already heavy in February and March,” explains Kevin Kells, brand director for Guinness, “but no one seems to own November.”
And of course, operators look for promotions that are well planned. Old Chicago’s Steil looks for promotions that are “really simple, easy and easily communicated to the staff.” “And being able to see immediate results is always nice,” she adds.
In situations where suppliers can legally offer restaurant staff incentives, she looks for ones that are relevant to her employees. “T-shirts are nice, but gift cards free cash, in essence are huge,” she says.
Steil also looks for promotions that run no more than four weeks. “After four weeks, both the staff and the consumers lose interest,” she says.
Suppliers argue, however, that promotions shouldn’t be cut too short. “My advice to operators would be don’t just do one promotion and then end it, after one night,” says Erica Stallmer, spokesperson for Boston Beer Company. “It doesn’t build consistency, habit for patrons. The best way to build a following is consistency. People are creatures of habit.”
And then, of course, there are the legalities. “The one thing that is not fair to beer companies is that an owner/operator, hearing about what someone else is doing in a different state, can think that the beer company is not looking out for them,” says Patrick Henry. “The reality is the beer companies are so regulated by [state] laws and they’ve got to do it legally, 100%, they can’t jeopardize their licenses.” In California, for example, a beer company cannot give away anything to consumers that is worth more than 25.. “That’s a very, very cheap keychain or a straw,” says Henry.
Getting Down to Business
Operators and suppliers, large operations and small all agree that the success of a beer promotion ultimately depends on what happens at the local level. “It’s where the magic happens,” says Bennigan’s Beck. “You sell beer one at a time. It’s a hand-to-hand, person-to-person business.”
An d that’s where communication comes in. At Bennigan’s, the operators of the restaurants are involved from the very beginning, from when promotions are first conceptualized and designed. “I don’t want anyone to walk into a restaurant, see the promotion running and say, ‘Who from corporate thought of this?'” says Beck. “Six to 12 weeks in advance, our marketing team, our training/education and culinary teams and a group of operators sit down to plan a promotion. All three groups of us agree or we don’t move forward with the programming.”
Champps’s Johnson concurs. “There has to be operator buy-in. It has to make sense,” he says. “Part of my job is to sell the promotion to the operators and to make sure they know what they need to do. The local distributor and the local bar manager: they’re the ones that are going to make it happen.”
Communication is key, from beer company to wholesaler to operator, from headquarters to bar manager to waitstaff. “From a brewer’s standpoint, we want the development [of a promotion] to be sound, the tools right there for execution and we want it to be really simple to communicate,” says Tim Schoen, vice president, presence marketing for Anheuser-Busch.
Both suppliers and operators stress that communications take time. “We try to get all the details on a promotion out a minimum of six weeks beforehand,” says Shawn Higgins, director of national accounts, on-premise, for Labatt USA. “The operators need to get the word out to waitstaff and need to get all the details buttoned up weeks ahead of time.”
But when everything works operator and supplier goals mesh, everyone involved knows what’s happening, what their role is and what the goal is then a beer promotion can mean much more than just a temporary bump in the sales of a particular brand.
“At the end of the process, the consumer walks away with an impression both of the operator and of our brands,” says Anheuser-Busch’s Schoen.
In other words, you’ve created a buzz.
Building Your Promo Season
Various beer brands already have their 2002 promotional schedules set. Here are some of the on-premise initiatives you can expect to hear about soon.
Labatt Blue will spend a lot around hockey next year, with the Labatt Blue Hockey Challenge, designed to take ownership of recreational hockey in the U.S. The expanded Labatt Blue Hockey Challenge for 2002 will feature up to 12 qualifying tournaments, and every team will have an opportunity to play its way to the regional championship. Old favorites and new POS will allow for more consumer interaction.
Labatt Blue will also focus on “Summer Hours,” themed around Friday afternoon happy hours, longer days and extending the summer beyond Labor Day. Program 1 of “Summer Hours” will begin with the Red White and Blue Celebration lasting from mid May through July 4. “Summer Hours” Program 2 in July and August will provide a new, fresh look. “Summer Hours” Program 3 will celebrate the continuation of summer beyond the Labor day holiday with the “The extend your Summer” promotion.
As an overlay to “Summer Hours” programs, the Labatt Blue brand experience will be brought to life in the form of the Labatt Blue outfitters’ tour featuring the Blue Light deck, the ultimate beer toy visiting key markets.
Miller Lite celebrates Mardi Gras with point-of-sale materials that are designed to connect Miler Lite to all the dazzling entertainment found in Mardi Gras celebrations. Vibrant on-premise materials include banners, wall decorations, posters, flags, table tents, beads, t-shirts and glow buttons.
Miller also invites legal-drinking-age consumers to “Show Your Irish” on-premise this St. Patrick’s Day with a promotion that includes wristbands that bar patrons can wear and find out if they’ve won a prize. Other on-premise materials include wearable merchandise such as rugby shirts, t-shirts and green-and-while top hats. On-premise display materials include banners, posters, table tents and magnets.
Miller Lite/Miller Genuine Draft Baseball
Miller Lite and Miller Genuine Draft put their stamp on the Great American Pastime with point-of-sale materials that feature contemporary designs honoring players, fans and teams. Point-of-sale materials leverage official team logos and colors in specific local markets where team sponsorships are in place. On-premise point-of-sale materials include banners, magnets, string pennants, table tents and posters.
Carlsberg has struck an exclusive deal with the closed circuit network that has the rights to most of the European games televised in the US. Soccer bars around the country will be approached with pint specials and authentic giveaways like soccer jerseys. As a result, 60% of the “soccer bars” in the U.S. now serve Carlsberg. Spring promotions for Carlsberg will give consumers the opportunity to win an expense-paid trip for four to the final match of a major European club soccer tournament – the UEFA Cup.
In Ireland, Carlsberg has been involved with St. Patrick’s Day. Last year’s “When Irish Eyes Are Smiling” promotion will be running again this year, giving consumers a chance to win a trip to Ireland.
Lowenbrau debuted draught in a number of markets in the months leading up to Oktoberfest and may plan to roll out into other markets in the months ahead, leveraging Oktoberfest and all the opportunities for sampling and display that the event brings with it.