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Suddenly Corona Beer is in Danger of Becoming a Victim of Coronavirus

We all know there is no link between Corona beer and the Coronavirus, but they have an unfortunate coincidence of sharing the same name. After 100 years of building a formidable beer brand, Corona is helplessly watching its brand name become a victim of a devastating global pandemic. Prior to Coronavirus, Corona Extra was the third-most popular beer in the United States. Coronavirus is becoming this century’s biggest catastrophic causing untold amounts of mental and physical mayhem on people, societies, businesses, and countries. Coronavirus destruction will live in the annals of history longer than any pale lager. Suddenly, Corona’s brand name is under attack with no clear direction of what they should do.

Fear Mongering

The first bad press Corona got in association with Coronavirus was from 5W Public Relations. They surveyed 737 U.S. beer drinkers and vigorously promoted their results: 38 percent of beer-drinking consumers would not buy Corona under any circumstances due to concerns about Coronavirus. They also claimed that 4 percent of people who previously drank Corona would stop drinking it — a rounding error.

PRWeek received the release but determined that “it was lacking in credibility…due to previous interactions with 5W and Torossian [CEO of 5W], who has courted controversy in the past and is not averse to a little self-promotion.” The 5W website shows no connection to beer consumers. But they got the results they were looking for. Mainstream media (like CBS News, CNN, Bloomberg, Fox, Vice and New York Post) jumped on the story, focusing on the 38 percent stats without any further investigation. Constellation Brands CEO and President Bill Newlands, owner of Corona, had to address the situation head on. He stated that “these claims simply do not reflect our business performance and consumer sentiment, which includes feedback from our distributor and retailer partners across the country.”

We all know that Corona beer does not causes Coronavirus, at least I hope we do. But people are scared and drinking a beer that shares its name with the virus can make some people uncomfortable. Is this the beginning of Corona beer’s demise or just bad research?

Negative Brand Names

The world is over saturated with brand names, making it almost impossible to break through the marketing noise. Wine brand names have tried to break this barrier with negatively charged brand names. With wine brands popping-up on shelves everywhere like Frog’s Piss, Earthquake, Killer, Fat Bastard, Prisoner, and BoomBoom. Negatively charged brand names are cutting edge. They are notorious and risqué like Fcuk fashions, Heart Attack Grill, Monster Energy drink, Skinny Bitch apparel, and Raging Bitch beer.

While negative words can generate negative feelings, they also create marketing opportunities because they are different and memorable. However, research has shown that extremely negative brand names can create consumer avoidance. But humour and attitude based negative brand names can create excitement, savviness, sensuousness, hipness and daringness that appeals to Millennials. Negative brand names challenge conventions and stand out from the crowd, but I don’t think this is where the Corona beer brand wants to go. It prefers golden sandy beaches, turquoise waters and clear blue skies.

Brand Name Casualty

Every brand works hard to build positive associations through product performance, employees, advertising, promotions, sponsorship, events, customer interactions, and social and community engagements. Once a negative association starts to take hold, its hard for people to separate the two.

A similar unfortunate situation developed for Ayds (pronounce as “aids”) candy. They were a popular appetite-suppressant candy in the 1970s and early 1980s until Acquired Immune Deficiency Syndrome (AIDS) was discovered. The horrible disease also caused massive weight loss in patients. To try to save the brand name, they changed it to Diet Ayds. The negative connotation was still too great to overcome. The brand eventually went out of business.   

In 2005, Hurricane Katrina, the most devastating hurricane to hit southeast New Orleans killed 1,836 people and affected over 15 million residents. At the time, the name Katrina was ranked the 246th most popular female baby name according to nameberry.com. Seven years later, the name’s popularity has dropped 696 spots to 942. Once a negative connotation is placed on a name, it’s hard for people to move on. Once a brand name becomes negative, its almost impossible to turn the tide.

Drowning Sorrows

As the saying goes “when times are good, people drink — when times are bad, people drink.” Beer and other alcoholic beverages sales continue to rise as people self-isolate and worry about their future. No sports, no clubs, no concerts, no events of any kind, yet Nielsen data showed that beer sales rose 34 percent year-over-year for the week ending on March 21. Sales of Constellation Brand products, owner of Corona, are up higher at 39 percent, led by the Corona family, which is up 50 percent. Impressive until you compare it against toilet paper sales which are up 160 percent!

Corona Beer Virus

Since the end of January, the hashtag “corona beer virus”, “beer virus” and “beer coronavirus” have continued to trend upwards on Facebook, Instagram, and Twitter. Some followers support of the brand, while others mock the virus and beer with creative memes. As the Coronavirus situation continues to intensify and people are in lockdown, connecting with friends and family through video conferencing online is the new normal. Corona beer has become an online celebrity for all the wrong reasons. Kellan Terry, senior manger of communications at Brandwatch, says that young people tend to laugh at what they consider to be dystopian events as a coping mechanism online. Having your brand associated with a deadly virus isn’t a healthy trend with or without the name.

Then, corona’s next problem appeared. Corona launched an online campaign for their new Corona Hard Seltzer with the slogan “coming ashore soon.” Twitter followers quickly attacked the campaign as “bad timing” and in “poor taste” amid the spread of Coronavirus. Corona promptly removed the slogan.

Beer Branding

Marketing alcohol is like marketing water; its not the taste that matters, its the brand image. In a classic blind taste study done in 1964, regular drinkers of certain brands failed to rate their brand as significantly better than the other samples. In fact, regular drinkers of two of the five types of beer scored other beers significantly higher than the brand that they stated was their favorite. There have been many other studies since with similar results. In 2018, the beer manufactures in the United States spend close to $1.5 billion on advertising. Constellation Brands ranked 2nd with a $368 million ad expenditure on Corona and Modelo. Beer brands live and die on their image. Corona brand marketing executives are likely increasing their own alcohol consumption in these unprecedented times.

Brand Reaction

Corona owner Constellation Brands has over 100 brands in beer, wine, spirits and, more recently, cannabis. Each brand gets its allotted marketing, brand support, and funding. So far, they have been lying low. If sales are good, why rock the boat? Reputation expert Andy Beal says, “The real threat would come if Corona were to dive in and capitalize on this by running some crass social media post.” In light of the seriousness of the situation, he cautions that “they should not make light of it.”

This isn’t about online social strategy (which Corona isn’t involved in). They do the bare minimum on social channels. Sitting on the sidelines and hoping this will eventually blow over isn’t a leader strategy either. The challenge is all alcohol brands make money on the image of people having fun. The Corona brand is all about sandy beaches, hot sun, and total escapism. John Alvarado, SVP of Brand Marketing for Corona Extra says Corona is “a carefree brand that encourages consumers to relax and enjoy life no matter the situation.” The Coronavirus is the antithesis to these positive vibes.

Brand Survival

Today, the Corona virus is attacking the United States with the fierceness never before seen in our lifetime. The Coronavirus crisis is affecting millions of people’s lives and livelihood. Consumers will judge brands on how they helped and stepped-up through these terrible times. Stress can cause people to make inappropriate jokes to lighten the mood; right now, Corona beer is one of those jokes. After all the turmoil, deaths, and dramatic life changes, can Corona bounce back as the king of carefree and sunny times? Will the emotional shock associated with one of the world’s darkest moments destroy the Corona name? Can a brand name live with so many negative connotations? In these catastrophic times more alcohol will be consumed than ever before. Hopefully after the hangover of isolation is over, Corona beer will still live on.

Stay safe and healthy.

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The Power of a Brand – How to Extract Value from Nothing

Years ago in my economic classes I learnt that supply and demand determined the price/value of most products especially commodities. If this is true, why is bottled water more expensive than gasoline? This is the result of building a powerful brand.

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Transparency Market Research estimated that the global market for bottled water was worth about $157.3 US billion in 2013. In North America more bottled water is sold compared to milk or beer in terms of volume. Canadean research estimated that the global bottled water volumes would reach 233 billion litres in 2015. With all of Canada’s fresh water, they only produce less than one percent of the world’s bottled water (2.29 billion litres). However, United States remains the fastest growing bottled water market outside Asia.  Mainly due to more health conscious consumers shifting away from sugary carbonated soft drinks.

In many emerging markets, the scarcity of clean water makes bottled water a necessary staple rather than a value-added refreshment beverage like juice or soda. In North America, the water in your tap is generally the same stuff you buy in the bottle. The big difference is that tap water is constantly tested to ensure they follow the drinking water quality guidelines. Bottle water doesn’t have the same stringent guidelines, expect for not containing any “poisonous or harmful substances”. Let’s hope that the big brands follow some type of quality control.

Clean drinkable water is generally available throughout North America where bottled water companies’ position their brands on quality (healthy choice) and convenience (portable and handy). From this foundation the category gets complex with pricing strategies, water source and lifestyle attributes.

Magician duo Penn & Teller in their show Bullshit did a spoof on bottled water.  In a fine dining restaurant in Southern California they proved that the general public can’t tell the difference between tap water and $4 a litre bottled water.

 

ABC’s Good Morning America conducted a blind tasting experiment in 2001 where they sampled branded bottle water such as Poland Spring, O-2, Evian and the popular New York City tap water. The results shouldn’t surprise you – Big Apple water beat them all.

 

If  bottled water is the same thing as tap water the real difference is branding. Tap water is a commodity with no brand. It comes from any unmarked tap – hot or cold. You take the same thing, build a formidable brand image and you can extract a premium by the litre (or ounce) at a time. Here is the secret on how to create brand value:

Power of Emotional Connection

Byron Sharp, professor of marketing science at the University of South Australia and author of How Brands Grow, says building a brand is based on “physical and mental availability” suggesting most brand purchase decisions are made with the emotional brain. A brand needs to trigger instinctual responses.

Ammar Mian writer at SocialRank says the emotional tipping point for bottle water occurred in the early 1980’s when Perrier launched its ‘Earth’s First Soft Drink’ campaign. This campaign embraced the belief that their sparkling water comes from the purity of nature, straight from mother-earth. This emotional connection resonated with consumers who are more health-conscious and want an alternative to soft drinks. Other premium bottle water brands followed suit with images of purity, youthfulness, healthy and natural. Water can’t get any better than this unless you turn it into alcohol. Here’s more on Emotional Branding.

Power of Convenience

A brand must be easy to buy – when and where you want it – ideally everywhere. Not unlike tap water. Remember the days of drinking fountains? We though they were convenient – if we could find one. But it was like drinking from a water hose – only one quick sip if there was a line-up.

The biggest growth development in the bottle water industry has been the mass distribution systems. Dominated by the same companies that have covered the world with sugar water like: Coca-Cola (who has such popular brands as Dasani and Glacéau smartwater), Nestle (who has all the water champs such as Perrier, Pure Life, S. Pellegrino, Deer Park and Poland Spring) and PepsiCo (who has Aquafina).

Where is Evian in the distribution mix you ask? In 2002, Evian signed a distribution agreement with Coca-Cola Co., Inc. which ended in 2014. Then Evian found new wings with distribution partner Red Bull. And Fiji Water? Dr Pepper Snapple Group website states that they distribute Fiji Water in various territories.

Power of Fame and Attention

Getting people to pay for a free commodity like  water is hard work. It takes a great deal of investment to build a distinctive brand. Successful brands need big bank accounts to ensure the advertising messages get noticed and the brands stays top-of-mind.

Back in 2003 ( an article in The New York Times) TNS Media Intelligence/CMR estimated Aquafina spent $24.6 million and Dasani spent $18.8 million on media, while Evian spent only $800,000.

Ten years later, Evian is still spending around a million in measured media annually according to Kantar Media . Over the years, Evian has lost market share to the more aggressive competitors, sitting in 3rd place behind Fiji Water and Smartwater. Eric O’Toole, president-GM at Danone Waters North America (parent company to Evian), contributes the brand stabilization in recent years, in part, to the launch of the Baby & Me advertising effort. Great creative never hurts if you can’t afford to advertise year-round. See more on Creativity.

 

The soft drink industry is notorious for using celebrity endorsers to help push their sugary drinks (check out a partial list of famous celebrities and soft drink brands). The top bottle water brands use the same branding tool to build credibility and gain the coolness factor. Evian has used Maria Sharapova, the young and popular tennis champion. While the elite Fiji Water has uses the former James Bond star Pierce Brosnan. Glacéau smartwater has used actress Jennifer Aniston to create a buzz around their relatively new brand.

A Memorable Story

Great brands always come with a great brand story. Many bottle water brands have great stories that would put National Geographic to shame. My favorite is the Fiji story or as some say the Fiji myth. Fiji Water, natural artesian water bottled at the source in Viti Levu (Fiji islands). Its a leading premium bottled water in the United States and fastest-growing worldwide. Here is their story of the world’s finest water. It should be for the price of $3.50 – 4.00 per litre (3 times the price of gasoline). For more on Storytelling.

 

Stunning Design

Water has no distinct taste, no unique colour, and no smell. All water feels wet – physical there is no difference from one glass of water to another, so packaging is king. If nothing else is going to sell you, it must be the memorable packaging. The packaging must fit the great stories and celebrities who would never drink it, if it didn’t look good.

Packaging can help define a brand experience. Do you remember the first iPhone, iPad or iPod you unwrapped from its packaging? The simplistic and beautifully designed box with everything in its own place – clean and white. A perfect brand fit.

 

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Since 2008 Evian has been working with some of the world’s most prestigious designers to create a limited edition bottle each year. Evian has worked with such creative artists such as Diane von Furstenberg, Paul Smith, Christian Lacroix, Jean-Paul Gaultier, Elie Saab, KENZO and most recently with Alexander Wang (2016 limited edition bottle). Former zone director for the Middle East & Indian Ocean for Evian, Elias Fayad explains the limited edition concept: “Our water is untouched by man and perfected by nature, so we attempt to give the bottle an artistic expression.” In a September 9, 2015 press release from Evian, they explain each collaboration as “a renewed celebration of purity and playfulness and a reinterpretation of evian’s spirit through art and design.” I have to remind myself that we are talking about a simple natural resource that can be found anywhere on the planet – water.

Dreams or Nightmares in a Bottle

Water is living proof that anything can be branded and can be elevated from no value to high value with sufficient investments. It is through these investments and the ability to create a strong brand image that brand value is achieved. In essence, consumers are buying dreams in a bottle. Dreams to be on a pristine tropical island or a youthful energetic baby once again. Stories of spiritual purity, blissful health and a fountain of youth – the water of life. Potentially over $200 US billion worth.

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But there is a dark side to this story. While dreams are created and value generated from the replenishing resource, there is a social cost. Today, Wikipedia lists over 144 bottled water brands, and from the statistics, the market continues to grow. The Pacific Institute, which conducts research on water use and conservation, has estimated that bottled water is up to 2,000 times more energy-intensive than tap water. It is estimated that in 2006, U.S. bottle water consumption used the energy equivalent of 17 million barrels of oil and produced over 2.5 million tons of carbon dioxide – in one year. There’s also the worry that we are shifting water consumption from one region to another, creating an imbalance with consequences to our planet and to our future.

Just because we have the ability to create formidable brands to extract more value, it doesn’t mean we should. As marketing and brand experts, it’s important we use our craft wisely. We must balance the benefits for the consumer, society and environment. We must be careful on how we use the power of the brand.