Now that NASCAR has allowed Diageo's Crown Royal brand to sponsor a racing team, the alcohol company looks to raise its overall visibility by touting the virtues of responsible drinking.
For Diageo, it was reason to celebrate. The alcohol and spirits company had successfully lobbied NASCAR to accept a proposal that would bring spirits back into the sport. NASCAR lifted its decades-long ban on liquor sponsorship in November and, in doing so, announced that Diageo's Crown Royal whiskey would sponsor a race team.
"That was a massive highlight last year," says Stuart Kirby, director of PR for rums and cordials in the Stamford, CT, headquarters. "It is those sorts of exciting strides and successes that everyone rallies behind."
Diageo owes that success in part, ironically, to its ill-fated deal with NBC a few years ago. The company had signed a multimillion-dollar ad contract with NBC to broadcast social responsibility advertising.
Facing pressure from Congress and health advocates, NBC nixed what it called a three-month "experiment" in spring 2002. At the time, it was a blow for Diageo. But it set the wheels in motion for what would drive the company's identity as a leader in promoting responsible drinking.
"The leadership role we have taken in our business is based on responsibility," says Gary Galanis, VP of media relations. "That responsibility is one of the key drivers of our business."
Unity through messaging
And that driver is what helps unify a huge operation. For the 2004 fiscal year ending June 30, the world's largest spirits company spent $1.9 billion on marketing, with a minimal amount of that being spent on PR, says Galanis.
Diageo's ever-growing portfolio of spirits, wine, and beer includes more than 300 brands, although just eight account for 68% of the marketing budget - Baileys Irish Cream, Captain Morgan, Guinness, J&B Scotch Whisky, Johnnie Walker, Jose Cuervo, Smirnoff, and Tanqueray. Diageo also has a number of smaller, niche brands, sales for some of which are growing at a robust pace. With so many brands that have different personalities and target different drinkers, it might seem impossible to connect them all to the umbrella company.
"We want more people to understand that the Smirnoff brand, say, is part of the Diageo company," says Galanis. Diageo's PR team believes it has found a way in its social responsibility positioning. Shortly after NBC pulled the plug on the Diageo deal, cable networks, independent TV stations, and network affiliates began siding with Diageo's argument that "beer equals wine equals spirits," and that hard liquor shouldn't be singled out.
"When NBC took us off the air, that is when the floodgates opened up," says Galanis. "We went from 80 or 90 TV stations showing our ads around the country to over 650 TV stations and cable networks that accept spirit advertising. We now cover 90% of DMAs [designated market areas]."
The social responsibility positioning was communicated through other tactics, such as sponsorships, including the NFL's Washington Redskins, as well as in brand marketing. Seven PR directors or "brand publicists," who divide the communications work by product category, work with brand teams to help accomplish that.
"You just can't say 'drink responsibly' because it becomes a generic tag that consumers don't see anymore," says Kirby.
"Each brand needs to take a different approach to communicating that in a sort of brand-centric way. It is about how do you bring this to life in a way that is compelling and consumers will react positively to?" In the case of Captain Morgan, Diageo ran a campaign last summer in which the titular fictional character ran for President. The "Party Without the Politics" effort, created by BFG Communications in Hilton Head Island, SC, included large-scale media events where Captain Morgan could, among other things, talk about responsible drinking. To promote politics-free partying, for example, Captain Morgan would advise: "Liberal with the cola. Conservative with the Captain. Drink Responsibly!"
Diageo also has focused on reaching out to advocacy groups through its funding of The Century Council, a nonprofit organization that fights drunk driving and underage drinking through programs and public awareness campaigns.
"We make it very well-known to decision makers and opinion leaders that we are very serious about this aspect of our business," says Galanis. "Our strategy is constructive engagement with public interest groups and others to strike a common chord so we can work together to come up with a solution for drunk driving and underage drinking."
Galanis thinks its commitment to responsible drinking is ultimately why NASCAR decided to lift its ban. In fact, when the NASCAR-Diageo deal was announced, it won the support of such groups as the National Commission Against Drunk Driving (NCADD). But some of the press featured quotes from advocacy groups arguing hard-liquor firms shouldn't be connected to a sport that sees cars racing at 180mph.
Yet the coverage was balanced, thanks to voices like John Moulden, president of the NCADD, who told the AP that race-car drivers spreading the word about responsible driving could be effective. As it stands, the deal will see Crown Royal sponsor the car driven by Kurt Busch, last year's Nextel Cup champion. The press release from Diageo announcing the deal played up the fact that a "multimillion-dollar marketing budget supporting this sponsorship will include dedicated social responsibility messaging."
The road ahead
Moving forward, the challenge for Diageo isn't growing its established brands. Crediting the "Party Without the Politics" effort, Kirby says Captain Morgan jumped last month to the number three slot of the top spirit brands. Just a few years ago, it had been number five. Now that the established brands are enjoying solid growth, Kirby says, Diageo is turning its attention to smaller brands with a lot of potential. "Godiva cream liqueur, for instance, is one of the fastest-growing brands in the Diageo portfolio, but it is a small brand," says Kirby.
"It is a brand, though, that would directly benefit from publicity because media are often receptive to a lower-profile spirit." As director of PR for Smirnoff and beer, Patricia Costantino is hoping to raise the profile of Red Stripe beer, which she says has been growing by about 15% to 20% year over year.
"There has been very little advertising, and it has grown mostly from word of mouth," she says.
Red Stripe was one of the sponsors this year of Levi's House, which hosts film-industry parties and movie premieres at the Sundance Film Festival. "We hired a photographer and put the photos over the wires," says Costantino. To help grow those smaller brands, Diageo is consolidating its PR agencies. Its current roster includes the Chicago office of Edelman, plus Alan Taylor Communications and Maloney & Fox in New York.
"There are ways in which we can group certain brands that are trying to achieve common goals," says Kirby. "If you were to look at a few brands, like Godiva and Ciroc vodka, those are super-premium spirits that have a common focus in terms of the sort of activities they want to employ to reach consumer targets. So it makes sense for one agency to oversee similar brands and products that are trying to achieve similar goals."
Galanis also says Diageo is considering hiring new PR firms, especially boutique agencies that have expertise in marketing high-end spirits.
"There may be a luxury brand agency that might handle that particular part of the category," says Galanis. "It is not about quick and cheap, but focusing on the brand and being able to deliver in the allotted time frame."
And Kirby says Diageo is still, each day, working toward lifting a ban on spirit advertising on national TV. The communications team believes that by continuing to show consumers, media, and opinion leaders that it takes responsible drinking seriously, it will happen sooner rather than later. "We continue to make inroads to change the up-road battle spirits face in the marketplace," says Kirby.
VP of media relations Gary Galanis
VP of brand communications Jeannine Dowling
PR director (rums and cordials) Stuart Kirby
PR director (tequilas) Brian Wright
PR director (vodkas and beers) Patricia Costantino
PR director (North American whiskeys) Greg Leonard
PR director (premier spirits) Laura Peet
PR manager (premier spirits) Sari Brecher
PR director (wines) Tom Scott