Niche marketing for SIDS in a climate of decreasing preferential treatment.

1
Niche marketing for SIDS in a climate of
decreasing preferential treatment.

• David B. Smith
• Cockspur Rum, Barbados
• AOSIS, Dominica, September 30th 2003.

2
Cockspur is brand volumes are relatively small
all volumes are global totals in 000 of 9 ltr.
equiv. c/s

• Cockspur 95
• Key Global Brands
• Bacardi 19,400
• Smirnoff 17,000
• Absolut
  7,500
• Johnnie Walker RL
  6,900
• Jack Daniels
  6,700
• Pernod Ricard 6,600
• JB 6,000
• Baileys
  6,000
• Ballantines
  5,600
• Jose Cuervo
  5,500
• Local
• Stolichnaya (Russia)
  50,000
• source Impact International Feb 2003

3
Cockspur the history of a small island brand and
a national treasure.

• First produced at the West India Rum Distillery,
  Brighton Beach, Blackrock, Barbados in 1884
• A Dane, Valdemar Hanschell, a small merchant
  trader set up a ships chandlery for which a
  reputable rum was a key portfolio item.
• Cockspur remains a local island rum for c100
  years
• In mid 1980s the brand owner, Goddard
  Enterprises Ltd (GEL), starts to export the brand
  to other Caribbean islands St. Lucia, St.
  Vincent, Bahamas
• At the same time Cockspur is adopted by the
  visiting West Indies cricket fans from Bermuda
  and a strong export market is developed.
• Visitors to Barbados start to seek a product to
  adopt post their island experience

4
Cockspur the history of a small island brand and
a national treasure.

• Throughout this period, significant Bajan
  communities have developed oversees in the US,
  Canada the UK amongst others.
• GEL seeks export markets and individual
  distributors are appointed in these markets to
  supply the Bajan communities needs.
• To grow volume by broadening the brands appeal
  to new consumers outside the core Bajan consumer
  base, a global distribution deal is sought with a
  multinational drinks sales marketing company,
  namely Grand Metropolitans IDV.
• IDV take equity in the Cockspur trademark.

5
Cockspur the history of a small island brand and
a national treasure.

• International growth targets are set and rum is
  laid down to age to meet the targeted
  demand.
• Shareholder pressure leads to market place
  consolidation and ruthless focus on core brands
  by the multinational drinks companies
• 1997 IDV and UD merge to from Diageo Drinks and
  Cockspur falls of their radar.
• 2000 Management of Cockspur is transferred back
  to Barbados and the whole process of developing
  export markets commences again.

6
Export market partner selection is critical to
success for a small developing brand

• Long term business aspirations of both parties
  must be aligned.
• Agree what level of priority your brand ranks
  within your partners business.
• Know trust your business partners.
• Contracts are a means of protecting yourself in
  relationships.not a document by which the
  relationship is run.
• Learn about your export marketplace in
  depth.only then can you truly understand your
  partners business development proposals.

7
A niche brand must have a core reason for
existing.

• Any brand must have a unique product benefit to
  succeed
• Without this even multi million backed brand
  development will fail
• For a niche brand without large advertising
  promotion (AP) investment this reason for being
  becomes even more critical
• Cockspur can only exist as an export brand at
  present because the Bajan communities oversees
  demand the brand something from home over
  here.
• With limited AP funds, these consumers become
  the brands ambassadors introducing it into the
  indigenous community

8
A niche brand must have a core reason for
existing.

• Word of mouth endorsement is the most powerful
  marketing tool.
• Many island brands have a colourful history, true
  heritage and are associated with traditional
  production values.
• All these are an aspiration to the consumer
  seeking new and challenging brands to make
  statements about their own individuality.

9
Small island brands must be championed by all
oversees staff at every possible opportunity

• Live the brand
• be proud to be seen ordering drinking the brand
• present bottles as gifts
• sample to your friends colleagues
• Ensure the brand is present at all Tourist
  Authority / Diplomatic events
• these organisations can be integral to creating
  an export market in the first instance
• Market Promote at both ends
• talk to potential consumers of your brand in
  their market whilst they are visiting yours

10
Import duties will dictate retail selling prices
(RSPs)

• Each markets import duty strategies differ
• government coffers
• protection of local market brands
• a level playing field for imported brands
  (regional bias)
• If your reason for being is strong enough then
  consumers will understand the resulting
  RSPs
• If it is not strong enough then success in the
  marketplace is unlikely unless heavy AP
  investment is in place.