The ‘other’ audience
Kane Stanford looks at the importance of lobbying when it comes to
shifting the dial for liquor businesses…
A nice little truism in marketing is that the most important people in the process are the target audience. They are the ones who pay us their hard earned money, after all.
But in the liquor industry, most brands don’t get much money from the consumer: they get it from a distributor, retailer or bar. And then there’s another group that wields significant power, controls a lot of the P&L, and can make or break your industry: the politicians.
They control the laws that dictate what goes on labels, what goes into the bottle/can, what can be said about the product, how much tax is paid, and when, where, and how the product can be sold.
Picking up on tax alone, for a standard $50 1L bottle of gin, the first $32.22 is taxes and levies.
That leaves just $17.78 for:
• distributor and retailer margins
• discounts/specials
• marketing
• sales commissions
• staff, rent, transport
• and don’t forget the cost of the goods!
So, politicians and the political machine in general have a huge influence on the success of your brand and business. But how does marketing relate to this audience?
“Politicians and the political machine in general have a huge influence on the success of your brand and business.”
Normally, it’s in the form of lobbying. As with marketing, it’s about trying to convince an important decision-maker to do something – it just happens that this is a small group of decision-makers with a huge impact, as opposed to consumers who are small in individual impact but are (hopefully!) huge in numbers. A different type of target audience, but an important one on which the liquor industry must focus.
Big booze often gets a bad rap in some media circles for its lobbying, with claims they have politicians in their pockets and huge sway over the laws that come to pass. But ask any of these alleged puppet masters if this is true and they’ll laugh you out of the room. And it will be a small room, because these groups are far from loaded and usually have just one person charged with lobbying. They spend most of their days providing industry feedback to select committees, government bodies, and acronym-laden government agencies like FSANZ, MPI, MBIE, NZTE and MoJ.
I’ve been the chair of an industry lobby group (Spirits NZ), and I’m married to a politician (with non-booze portfolios, don’t worry!), so I’ve had the unique view of seeing both sides of this dance in action.
I’ve yet to see a lobby group convince a politician to do something they don’t want to, no matter the strength of the argument. But the good ones can be convinced that unshackling industry from red tape / outdated laws can help business drive the sector forward; that listening to interest groups on all sides can be a valuable shortcut to tapping into public sentiment; and that industry experts can help avoid unintended consequences of legislation.
As I write this, a plethora of political parties are claiming credit for the Fisheries Bill backdown and, more topically for the drinks industry, letting us all enjoy a drink on Easter Sunday. The changes to the holiday trading rules were a brilliant (albeit overdue) move by politicians to give both business and consumers what they want. Props to Kieran McAnulty for spearheading it.
Liquor lobbyists will of course lobby for what is best for their members and the industry, but that doesn’t mean these things can’t also be better for consumers and the country. Liquor associations have banded together for years to run harm reduction campaigns like cheers.org.nz and run very successful nationwide programmes to reduce underage drinking.
Spirits NZ works with Distilled Spirits Aotearoa to put on the NZ Spirits Awards and build exposure and market awareness for local spirits producers. And ahead of the upcoming excise tax update in July, brewing and hospitality industry groups are working together to put New Zealand’s very high excise rates onto the political radar.
It’s a difficult time for all involved in the liquor industry, so it makes sense to band together, pool resources, and point some of the marketing towards those with influence over political decisions that can have far-reaching effects for the sector – be it politicians in power (or those who might be one day) or government bureaucrats.
Or, you know, maybe give corporate box tickets to some of their husbands once in a while. Dunno, just an idea.
Kane Stanford has worked for 13+ years in liquor marketing in New Zealand at Independent Liquor, Bacardi and Besos Margarita. Now in FMCG, he is also Head Strategy Judge at the 2 Degrees Auckland Chamber Business Awards. Kane has nominated himself for several marketing awards, but never won.
