What elements would need to be in place for Heineken to consider an acquisition bid or will it remain independent?
As our global CEO Jean-François van Boxmeer recently said, we are proud of our heritage and identity as an independent company. The Heineken family and Heineken’s management are confident that the organization will continue to deliver growth and shareholder value as an independent company.
You joined Heineken USA in February after a successful run with Heineken Brazil where you grew the brand significantly in about four years. How did you help with that growth?
It was a mix of right brand, right place, and the correct strategy as we took advantage of consumer demand for international brands. We acquired FEMSA [the beer division of Fomento Económico Mexicano SAB, producer of Dos Equis]. That gave us good access to the market, and we also double downed behind Heineken.
Brazilian consumers were keen for a change, so we had a competition with [Anheuser-Busch InBev] brands, such as Stella Artois and Budweiser, which were positioned as premium brands, and we succeeded to achieve leadership of the international premium segment and stimulated growth of that market. [Per Nielsen, Heineken’s share of premium rose 12 points from 4% in 2009 to 16% in 2014.]
What learnings from Brazil are you using with Heineken USA?
How to bring relevance to consumers in an impactful way. We took advantage of demand for international brands, but the key to success was our ability to stand above the crowd. We need to do that in the US, which is a more competitive and crowded market.
If you don’t stand out, you are not going to be noticed. Nowadays, there is too much being offered to just be bland vanilla. Last year, Heineken USA developed a new commercial marketing team that focuses on leveraging category trends and shopper needs and occasions to best drive increased brand loyalty across our portfolio.
Heineken’s Newcastle Brown Ale had a successful year with its If We Made It Super Bowl program. How did that effort affect the brand?
We won 13 awards at Cannes and that helped us with this bold move to go totally into digital video. Making the decision to deliver all of our content through digital channels was quite challenging.
In terms of reaching the right consumers with this content, it allows us to have a variety of executions in a short period of time. We’re at the highest numbers in terms of awareness and the highest value in terms of trial. [Trial is up since December 2013 from 60% to 71% among Millennial males aged 21 and over, and brand awareness increased 6 points in the same period.]
The campaign also drove more than 1 billion consumer impressions that were made up of traditional and social media, which were mainly driven by earned media.
Sometimes you feel the need to go to TV for reach, but now you can have higher reach through digital. [Following the Super Bowl, the Newcastle brand achieved a triple-digit increase in sales numbers in stores where the product was being promoted.]
Will Heineken go the digital route for more brands?
Yes. We’ve been working with vendors to measure the impact of sales and prove that this is the right decision and educate all of the stakeholders about the effectiveness of this new communications strategy.
What about campaigns for the main Heineken brand?
We launched Routine Interruptions to support the global cities campaign for Heineken. The effort was a summer-long series of social experiments and activations to get people outside of daily routines.
It kicked off with The Ringing Payphone featuring Fred Armisen (left), which was a social experiment that asked if New Yorkers walking by a ringing payphone will pick up and listen to the person on the end
of the line. Those who did received an invitation to an Armisen comedy show. We will focus on ideas such as these in 2015.
What are your goals going forward?
Our major goal in the US is to establish the organization as a true portfolio company. For many years, we were too focused on the Heineken brand, which is half of our business, so the challenge is to build the portfolio when it comes to Dos Equis, where we see the opportunity to double the brand in the next five years, and the same with Tecate, focusing more on the bicultural Hispanic consumer, as well as all the new innovations we are introducing into the marketplace.
With Strongbow Cider we believe we can change the size of the US market, and Desperados is a spirit beer, which is a new segment. All of those efforts will establish a new portfolio for the company.