How To Get Consumer Insight In Real Life Instead of PowerPoint | Paul Thomas | Suntory | Asahi | Imperial Brands | Bottom-Up Cut 005
I remember we met on LinkedIn on a post they use very often that the future of insights is sitting at the back, especially big companies get trapped into let's test it and let's understand what insights do we have and what consumers are saying and let's have focus groups and all these kind of things, we lose touch with the trade and with actually going to the bar. I remember we had a few back and forth on comments on that one. So what's your take on this topic?
Paul Thomas:Yeah. Businesses confuse insight with research. Research is something you pay for. You go to an agency and they run a big quantitative study or focus groups, but there's good old fashioned using your eyes. The best insights are when you have your customers or your consumers in sight, when you can see them, when you can talk to them.
Paul Thomas:Some of the best learnings I've had in my career haven't been paying an agency a £100,000 to do a segmentation, talking to a bartender, trying to understand why a consumer has chosen A versus B. By the time you do an online research, they've forgotten. You need to be in the moment. I've done that from sitting in bars in Abidjan in The Ivory Coast to sitting in premium cocktail bars in London. Good insight persons should wanna talk to their customers and consumers.
Chris Maffeo:How can companies go back to the field and not get trapped into this ivory tower? I remember from my old corporate days, I would speak to marketing people and they would say, oh yeah, I haven't been invited to the trade by the sales team, so I don't know, haven't been to bars. I was feeling like, what? Do you need an invitation to go to bars? So there's a feeling that trade belongs only to sales and then it's their call and it's their fault if sales don't happen.
Paul Thomas:I think there's a little bit of presumptuousness in most marketeers, which is our consumers are like us. When you work for one of the big drinks players and you have your Central London office or New York office, wherever it might be, and people are wealthy, normally white, normally have worked in the industry for twenty years. And people tend to think that, oh, our consumers must be like that. I remember when I was doing some work on the gin brand Gordons, trying to and saying to the kind of pubs where Gordon's is consumed. And I still remember the marketer at the time saying, oh, I'd never go to a place like that.
Paul Thomas:So thinking that all our brands only exist in the top 1% of bars is one of the problems. Not seeing it as real work to your point. We'll sit there in front of a project Gantt chart and tweak it for hours. We'll see that as work, but somehow going out. No.
Paul Thomas:And also, think that's just unfortunately, and COVID has exacerbated it. People don't talk anymore. People are nervous about face to face interaction. I love going and talking to bartenders, to consumers. Even me as a big fat white guy, I turned up in Madagascar and butted into conversations with local guys drinking local rum, and we ended up leaving the bar together at 2AM.
Paul Thomas:A lot of people just don't have that confidence, that willingness to talk to consumers, bartenders, because I think we've all lost a little bit of practice of face to face interaction. And particularly as more and more people work from home, work from home quite a lot, there's nothing wrong with it. Human interaction is the bread and butter.
Chris Maffeo:I feel what you're saying because even when I do trade visits with people, they look at me like I have a kind of like a magic stick to be able to talk to bartenders and so on. Like, I'm gifted, you know, like, I'm taking them to the zoo. And I and I can talk to animals.
Paul Thomas:So easy because most bar obviously talking about the more professional end of bartending. Most bartenders bloody love talking about drinks. They want to tell you about the recipe they've made or the extra special cocktail that they've concocted because they love it. They'll always talk about it. Very often, it's more stopping them talking about it, which can be the challenge.
Paul Thomas:But yeah, people are nervous or we go out and we do, I've seen lots of examples, particularly when you go around like more developing markets, Chris, where they know that someone senior is coming round. So the four or five bars that they know they're taking you on, the sales team have juiced it all up. They've made sure that your brands are perfectly stocked. They've basically given the bartender a tenor to make sure that it's your brand that they recommend. So it's quite artificial.
Paul Thomas:Just get out there. There are pubs, bars, just go and talk to people. And honestly, you'll learn more in that afternoon than you will in the £100,000 project with a research agency.
Chris Maffeo:It reminds me in my previous corporate days, I used to manage The Americas and I went to Chile, to Santiago, and I was the one that they had prepared it
Paul Thomas:for.
Chris Maffeo:And I had briefed the the guys, don't prepare anything. I want to see the reality. It was actually a disaster and it was like on and off trade and this mom and pop store. You cannot fix those like that. They are just like wild animals.
Chris Maffeo:And then I remembered that one of the sales guys there literally felt sick after the visit.
Paul Thomas:He couldn't
Chris Maffeo:come for dinner. He was really, really sick. Like how ashamed he was of the mess he had showed me. And I spoke to the team there and I said, that's exactly what I wanted to see that I, I thanked him for that because I want to see the out of stock in the fridge and I want to see the reality. I want to see the guy complaining about the pricing in the market.
Chris Maffeo:And that's exactly why I flew 17 to come here. Otherwise, like, I could just see it on PowerPoint.
Paul Thomas:You know, I remember once I was in Ghana and we were having lots of conversations with the Guinness brand house about they wanted to push posters and wool plaques, lots of branding onto the inside of the bars. And consistently the local market said, it won't work. We don't want that stuff. So I went out there. Within five minutes, I realized why, because most of the bars turn the lights off to save money, and the only light comes from the TV or from something illuminated on the walls.
Paul Thomas:Guinness can spend all that money with all this beautiful point of sale materials and no one would have been able to see it. And again, you don't get that unless you go because you think a bar in Accra must be the same as in London. Right? Because that's my only point of reference.
Chris Maffeo:Some of this vicious circle and catch 22 on insights and research comes from the fact that some people have lost touch with the entree, as you were saying. So they feel relegate entree to some specially gifted people that can talk to bartenders and can go to bars at later hours. And so it's like, let's ask this guy or this girl rather than actually realizing how simple it actually is to go to a bar. And so it's like, oh, let's ask Paul. Paul knows because Paul is the entree guy and he will know.
Paul Thomas:They'll delegate to their insights team. Can you go and talk to bartenders and find out? Can you go and talk to consumers and find out? I've worked for two Japanese companies, Beam, Suntory, and Asahi. And the Japanese have a wonderful way of combining many ideas into one word.
Paul Thomas:And there's a word called Gemba. Gemba is something that we focus on a lot at Beam, which is it means being where the value is. So you need to spend as much time as you can, where the value is created. And the value is created where money is transferred, where money is handed over. That might be in the off trade.
Paul Thomas:That might be in the on trade, but that is where you'll understand the drinks industry. I can read a thousand IWSR reports and know nothing.
Chris Maffeo:That's
Paul Thomas:a great word. And it's something that we're really trying to push because most organizations don't go out, don't spend the time. A former employee of mine, I won't mention which, won't let people buy drinks on expenses in the alcohol industry. If you're not buying your competitor's product and you're not talking to people about, well, why are you choosing that rather than my product? How the hell are you going to know?
Paul Thomas:Your brand tracker is not going to tell you that's for sure. Yeah. It's almost seen as too much fun. Sometimes I think. Yes.
Paul Thomas:Yeah. They're just going to the bar. They're just going to get pissed or whatever or drunk.
Chris Maffeo:Because there is a perception, like I see it myself with, like, I spent all summer actually working and I went to bars and I didn't go off to bars with friends. I went with sales teams. I went with clients, customers and so on. And then like some friends of mine, they were like, oh, you never call me when you go out.
Paul Thomas:And I
Chris Maffeo:was like, yeah, because I'm working. And I joke about this and I always say I just drink for, for work. I don't drink for leisure. It's, there is a misperception in the trade that an expense on a drink is something that is fun rather than an investment that leads to a point that I was discussing on a previous episode on the fact that many brands, especially the smaller ones, don't see that as a valuable investment. So they rather do a huge party, which might be useless because there's no distribution or presence rather than actually spending the first thousand dollars they get as an investment going to bars and ordering a drink and talking to people.
Paul Thomas:It's not just small companies. Lots of companies are willing to spend a lot of money on things the marketing team will enjoy. Big parties, big celebrations. It's going to look great on their Instagram. They can wear a nice frock, pick a special shirt.
Paul Thomas:No. No. I'm going to go around my top 10 bars and I'm to talk to each bartender and I'm going to try and work out why they will continue to list my product. The the story and the sales that they give to consumers to choose my product, how my product looks on the menu, that's valuable work. A nice party might be good for PR, might be good to create some office rumors and some gossip.
Chris Maffeo:Bill building on what you're saying, the selling story and how the bartender explained to people and how the sales team explained to bartender. In your experience, what's the best way? Because I have this feeling that a brand always starts from the liquid and from an organoleptic perspective. Okay, is it peated, non peated if it's whiskey or smoky, non smoky if it's a mezcal. It comes from there rather than category.
Chris Maffeo:I like to take the taste profile experiment because you may be a person who likes sweets or maybe you like smoky flavors. So I could trade you into a mezcal because you drink. So what is your experience and the the starting point in developing your selling story?
Paul Thomas:The bartender doesn't need another whiskey. The bartender doesn't need another gin. Brands will go and they'll talk to the trade, but they'll talk entirely from the position of the brand. This is our history we were founded in. We use handpicked this, we use hand foraged that.
Paul Thomas:Doesn't matter. What matters is how will it increase the margin for the bar and how will it allow them to create something they can't currently do. They don't need 15 strawberry flavored gins. Right? But they might need a different flavored gin because it could make a cocktail they can't currently offer.
Paul Thomas:I think it's around whether flavour profile is your lead. It's around always being clear about what your product will deliver to bartenders that they can't already do. They've got limited space. And if if you're just offering them a me too or something else, what's the point?
Chris Maffeo:To this last point you're making, there's something that I see where insights get wrong, like the in innovation. For example, there's innovation coming into the market that has been lab engineered rather than a flavor that the market needs. And there's a pragmatic take that I have on these things. But I challenge myself sometimes, like I was discussing this with Alex Fritzsat, the owner of Lantiquari in Napoli. And he was saying like sometimes we as bartenders need to be influenced by what happens in supermarkets because if a big company is launching a whatever orange something, it might be that they've got some good results on something that at scale consumer wants, and we may have missed that.
Chris Maffeo:What's the right way of playing with this on the lab versus market? Because you also don't want to listen to five bartenders and create something from There are all sorts
Paul Thomas:of horrifying statistics around why innovations don't work. Companies will very often start innovation based on what they've seen their competitors do, particularly the big players. They will wait for a small craft player to create something, and then they'll make their own version. Right. So they're they're typically driven by what's already there, but they wanna make their version of it.
Paul Thomas:Right? What can we make? We've we've talked about the on trade as being one thing, and it is not. The on trade is you can divide it by price tier. You can divide it by type of venue, by chain versus independent.
Paul Thomas:There will be certain types of bars and bartenders where you absolutely want to seed your product according to their needs. For more prestige, for more valuable items, you want the best bartenders in the world to support it, to want it, to list it, because that's where you're gonna build the equity and the desire for those brands. However, if you're a mainstream gin brand and you want to launch a pink version or a strawberry version or an orange version, you want it in the off trade first because people are gonna try it on promo and then go, oh, I'll try that the next time I'm I'm in the dog and duck. It all depends on your sort of moment in the on trade. Am I trying to get something that's super premium, show my connoisseurship?
Paul Thomas:In which case if I've seen it in the supermarket first, it's going to feel a bit rubbish. Or actually is money a little bit tight and seeing it in a supermarket gives me reassurance to try it at the bar. So it can work both ways depending on the type of venue and bartender you're talking to. But often, by the way, innovation is, you know, they can never talk to either side of it off or on trade. It's more what can we do and what have our consumers what have our competitors already done?
Chris Maffeo:Yeah. There's a lot of stuff to be done on managing expectations now because when I work with companies like this, there's a tendency they want the the brief is let's get into the 50 best bars. And as you can't do that, like nobody, if it's on promo three, four times a year in supermarket chains, no bartender will ever want to have it. But there is an opportunity in regular on trade, casual bars restaurants, we can't have it in top trade. I was just negotiating with a bar and they just told me like, no, these three brands, no chance we're going to list it.
Chris Maffeo:And I agree with them, but then when I need to report that back to a client, then it's just, okay, how do I say it?
Paul Thomas:And this is where this naivety and this ego sometimes comes in, Chris. Every brand manager wants to say that we're in the top bar. We're in Salmon Guru in Madrid. We're in the top 10 around the world. Are your products gonna sell?
Paul Thomas:So it might not be the top 1%, it might be the top 20%, it might be the top 50%. If I wanna make money and I wanna retire, I'd launch a mainstream product because they will be a 100 times the size of the most special prestige and quality spirit in the world. Now those spirits are beautiful and lovely, but they'll never sell much. We shouldn't be snobby about the other half of the entree where most of these products are drunk. Go down the dog and duck and see big pat behind the bar selling your gin and tonic, and it's beefy to all its Gordons.
Paul Thomas:Those brands are worth hundreds of millions. Let's not be snobby about them and manage your expectations. You're right.
Chris Maffeo:You're not gonna get that brand into the ritz. You know? What's your take on when the brief is about rejuvenating brands or a huge gin brand or whiskey brand and and so on? What's the the play that innovation can have in that one?
Paul Thomas:It can be pure liquid. Going back to Gordon's launching Gordon's pink revolutionized that brand and made it a cool brand that young people wanted again. Right? It can be simple innovation. It can also be serve strategy.
Paul Thomas:Serve your drink in a new way. Take the guys at Campari with Aperol. They've taken over the world with a serve. That liquid's existed for hundreds of years. It's not wildly different from a Campari spritz.
Paul Thomas:It's pretty much the same stuff. However, by finding the right glassware, slice of orange, launching it in the entree, simple serve strategy, that's also innovation. We tend to think of innovation as new products. Innovation can be a new serve, a new garnish, new glassware, new way of talking about the brand with Barton. There's all of that.
Paul Thomas:It's still innovation in my world.
Chris Maffeo:There's a lot about consistency and discipline in doing that because whenever I'm talking about Aperol Spritz, there is a tendency to to say, look at how they grow. I they've done it for twenty years. It took them twenty years to do an overnight success. No?
Paul Thomas:Yeah, exactly.
Chris Maffeo:And they stopped doing a serve. Some people stopped doing a serve just because they got bored or because the brand manager has done it for a year and a half.
Paul Thomas:This is a real challenge. Marketeers, we talk about the on trade having a problem with rotation of staff, but it's also the same with marketing directors, marketing managers. They all move on. They go to different brands, different companies, and everyone wants to come in and change it. The brands that have typically done well, look at Hendrix.
Paul Thomas:You still would expect Hendrix to be of a slice of cucumber. It would be weird not to have it. Guinness, if it's not poured in two parts, I'm not gonna be happy with it because they've created a ritual. Probably, it probably doesn't really make that much difference to taste, but by innovating, by getting people to expect it in that way, you're never gonna change it. They are brand new for me.
Paul Thomas:Look at Magnus ten years ago, put a couple of ice cubes in it, new serve, and it became the most popular side of brand in The UK.
Chris Maffeo:I remember we both worked on Peroni on on the different ages. Like, we didn't have the pleasure to work together. Otherwise, it would have been big fun.
Paul Thomas:I'd have seen you in the bar. That's for sure.
Chris Maffeo:And that's what I meant about the meeting room. Peroni with the glassware. The glass that Peroni launched was then copied by all beer brands kind of thing. The serve on pilsner with the foam and the three type of pores and so on. And again, it's, it's about the discipline in, in that.
Chris Maffeo:Also on playing, for example, when it comes to garnish, I feel it's about having it. Does it make sense? Like the cucumber, it makes sense because there is cucumber now. And sometimes I feel companies are, oh, Hendrix has done cucumber. Let's do the cucumbers, hengum, but you haven't got any cucumber anywhere in your recipe or you don't talk about that at all.
Chris Maffeo:So what's your point of putting the cucumber?
Paul Thomas:No. I completely agree. I think all of this industry starts with the liquid. Everything about the brand positioning should be about the liquid. Guinness made of more.
Paul Thomas:Why? Because it's made with roasted barley. Peroni made with the beautiful Italian wheat and lemon. Everything in this industry needs to come from the liquid and be true to the liquid. And that's where brands like in the past, Smirnoff have lost their way.
Paul Thomas:They used to be all about triple distilled and purity and quality. Then suddenly they had cherry bakewell flavor, hazelnut flavor, bubblegum flavor. Like, be true to what you are and stick to it.
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