Berry inspired
A line extension is a tricky thing. If it's well thought-out and makes sense - if consumers actually want the new product - a line extension can increase market share and solidify brand loyalty. But a poorly conceived line extension wastes money, alienates retailers and tries the patience of consumers.
When Finlandia introduced its Arctic Cranberry vodka recently, it did so for the best of all possible reasons: growth potential and consumer interest. While sales of imported vodka have remained relatively flat for two years, flavored vodkas, led by Absolut Citron, have grown nicely. From a consumer stand-point, cranberry flavored vodka is a logical choice: It's the third most popular mixer with vodka, after tomato juice and orange juice.
Even though Finlandia could see the writing on the wall, introducing a new flavor wasn't something the distiller did lightly, says Chester Brandes, president of the Finnish National Distillers, New York City, the U.S. subsidiary of Finlandia. "From a historical perspective, we were never convinced that flavors were the way to go in this category. So we have spent the last five years shoring up our core franchise in the U. S and other regions of the world. felt it was very important that before you go out launching line extensions, you better make sure your core brand is healthy.
"Notwithstanding the fact that our brand is the No. 3 in the category, we had to take note of the growth of the flavor, and wanted to find out what consumer interest was in trying new flavors."
Fruits to berries
Over the course of some two years, Finlandia conducted research with its target audience - 25-to 34-year-old vodka drinkers - to determine which, if any, flavor to go with and, once cranberry made a strong showing, which formulation to produce.
In the early research, consumers were asked about their interest in trying vodka flavored with everything from citrus fruits to exotic berries. Not surprisingly, cranberry made a strong showing, which was good for Finlandia - a major grower and processor of cranberries.
But a cranberry-flavored vodka would have to be red - take out a cranberry's color and you take out the flavor, vodka formulators said - which was clearly a problem, Brandes says.
"Finlandia has always been positioned as a clean, pure, clear product, so the idea of doing a red Finlandia threw up some red flags in Helsinki. In addition, since Absolut Citron and the rest of the category were clear, we thought we should attempt to do a clear product. However it turned out that it is impossible to retain the essence of the cranberry flavor without the color. We felt that the concept was so strong, why not let the consumer make the decision in terms of how color would affect their perception of the product?"
Which formulation?
The next job was to test the various formulations to find one target consumers liked most. For that, Finlandia relied on one-on-one interviews.
The distiller chose one-on-ones over focus groups because respondents can offer their opinions without influence from others, Brandes says.
"We wanted very objective views. We didn't want people to feel any pressure from the opinions of other respondents. I think you get better feedback from one- on-one interviews. It's been my experience that if you have a strong personality in the focus group, that person can tend to dominate and influence the independent decision making process of the group," Brandes says.
Mike Anastas seconds that emotion. Anastas, president of Focus Probe Inc., New York City, conducted the interviews for Finlandia.
"I think taste is very individual, so I wouldn't have considered [focus groups] for this project. It is my view that regardless of how you control the dynamic, what other people say affects the response of the next respondent. It's supposed to - that's what a group is for.
"The group technique, which was developed primarily in the social sciences, is a near-perfect forum for exploring the unknown. You don't really have to form a lot of questions, you just form a subject and an outline guide - we call it a moderator's guide, we don't call it a questionnaire. We're exploring in these groups, and the fact that the industry has converted the convenient group form into an evaluation tool should be seriously questioned."
Respondents for the one-on-ones were upscale young New Yorkers who said they drank vodka regularly and at least occasionally drank it unmixed. Upscale urban professionals were targeted because research showed they use cranberry juice as a mixer more often than the nation as a whole. Most were 25 to 34 but interviews were done with people 35 to 49 to gauge their interest as well.
"We only wished to talk to people who are used to drinking raw vodka, either frozen, chilled, stirred, or on the rocks. We considered them to have an experienced palate," Anastas says.
Keep up suspense
After answering questions about the brands of vodka they drank, how they drank it and what mixers they liked, participants were introduced to the Finlandia Arctic Cranberry concept via three different bottle labels that were under consideration.
Once respondents saw one of the labels, they wanted to taste the vodka. "Their mouths were watering at that point," Anastas says. To keep up the suspense, before they could sample the vodka, they had to tell Anastas what they expected it to taste like.
Anastas made sure that each respondent was served their sample (1/2 shot) under the same conditions. "I was careful to keep the vodka at a cold temperature, measure the precise amount. I poured it in front of each of them. I didn't want there to be anything different that might influence the results."
With the sample evaporating on their tongues, respondents used a 10-point scale to indicate whether the vodka met their expectations. Then Anastas asked them to free-associate their impressions, during which he would probe for clarifications on negative or positive comments.
In his notes, he made a plus sign or minus sign next to respondents' positive or negative comments. These notes were given to a coder and entered into a computer to allow analysis of how frequently respondents made various comments.
Sequential learning
As the research process continued, this information, and observations made by Finlandia representatives during the one-on-ones, helped the distiller understand why various formulations of the cranberry vodka scored the way they did. This sequential learning was time-consuming, but it ultimately proved the best way to develop the formulation respondents liked best.
"For example, [Finlandia representatives] watched the responses to one of their formulations and after a few of the interviews, they said, 'You can stop the interviews.' The words coming out of the respondents' mouths were echoing a doubt they had when they brought it over from Helsinki'" Anastas says.
"They could have gone with the earlier formulation and it would have been OK, but the last one, which is the one that they went with, was much more what people expected."
(Anastas says that the Finnish observers were quite shocked at the openness of the American respondents. "As they sat behind the glass, they said, 'Where do you find these unusual people? You ask them a question and they go on and on.' And I said, 'That's what they're here for.' And they said, 'In Finland we would never do that. We don't share our feelings with strangers like that.' They were flabbergasted. They were mesmerized to watch these complete strangers spill their whole story about a half-shot of vodka." Makes you wonder what it would be like to do qualitative in Helsinki . . .)
Changing habits
The proliferation of flavored vodkas is a response to changing alcohol consumption habits and the tastes of the target group, which is younger and skews female.
Research has shown that these consumers value flavor over alcohol content. In fact, at 60 proof, Arctic Cranberry is at the government minimum for flavored vodkas. (Standard premium vodka is 80 proof.)
"It's a different concept than what is out there, because the alcohol content is lower - which is something we did on purpose," Brandes says. "That decision was based on our belief coming out of the research that consumers are more interested in flavor, they want something that's easier to drink and not as strong. In a sense we may be on the verge of creating a new category."
Nowhere is the youthful bent more evident than in the bratty print ads for Arctic Cranberry, developed by Goodby, Silverstein & Partners. The copy from one of them reads, "You scan the men around the bar and you are certain that the male of the species is truly doomed. Then it occurs to you that a man could have invented
Finlandia Cranberry Vodka. And suddenly these creatures with blank stares and cellular phones don't seem so bad after all."
Another ad concludes with, "We could've just used clear artificial cranberry flavoring. But then our vodka would be pale and spiritually void. (Like your boss.)"
"Many young people are inundated with the Absolut advertising and as soon as they become 21 years old they're ready to order their first Absolut. From our perspective, we needed something to trip them up. We're hoping that this concept is interesting and unique enough that they'll try us, like us and discover that Finlandia has a regular vodka, too," Brandes says.
Now being distributed nationally, the product met with great response when it was introduced in New York and Miami this fall. If the reaction of vodka drinkers in those markets is any gauge, Finlandia's new vodka will be berry successful.