If you want loyalty, get a dog.
That was the headline for a panel at the Growthbeat marketing conference in San Francisco, CA on August 17, riffing off the uphill battle marketers face when trying to accomplish the holy grail of brand loyalty.
In an on-stage interview with VentureBeat Founder and Editor-in-Chief Matt Marshall, Moët Hennessy CMO Jon Potter cited attribution as the biggest challenge for Hennessy, a French multinational brand that, because of a law that was established after Prohibition, can’t sell its booze online.
Potter told a crowd of about 400 people that Hennessy's luxury spirits brand was struggling three-to-four years back, challenged with a decline in sales and aging consumer base.
Founded in a 1971 merger of alcohol brands and now part of a larger company called LVMH (alongside iconic French fashion brand Louis Vutton), Moët Hennessy sells a portfolio of high-end spirits and wine, from cognac and Dom Pérignon to Belvedere vodka and Grand Marnier.
Potter has helped spur a turnaround, at least this year: half-year operating profits from the wines and spirits unit rose 4.6% in the first half of 2015, while sales rose 2% in organic terms, according the company’s earnings statement.
A key factor in the transformation?
A major increase digital ad spend, can be attributed in part,up from 2% a few years ago to a predicted 20% in 2016, Potter said. The marketing mix includes experimentation with big data and virtual reality, paired with consistent efforts in native advertising like this 42-minute music video featuring some of the biggest rappers and presumably, Hennessy drinkers.
“[Our digital ad spend has] increased because it couldn’t go any lower,” joked Potter on stage.
Hennessy has been able to tap into a younger customer base in an “authentic” way by tapping the rapper Nas, who was rapping about the company’s cognac long before he was a paid spokesperson.
The brand partnered with Millennial tastemakers like Complex and Vox to execute its native ad campaigns.
“Creating unique content that is true to the brand and true to the big idea is critical for us,” said Potter.
Growthbeat, the two-day conference from technology publication Venturebeat featured speakers from companies big and small, from startups like Meerkat, Foursquare and Zenefits to brands like Cisco, Target and and Visa.