‘CAN BEER TRAVEL online?”

Introduction.............................................................................................. 3

Heineken................................................................................................    3
Heineken as a brand....................................................................................  3
Branding history.......................................................................................... 5

E-branding..............................................................................................    6
Internet..................................................................................................... 6

Heineken’s strategy.....................................................................................  6

Functionality and features on the website........................................................ 7

Basics; provide ease of use........................................................................... 7

Brand value................................................................................................ 8

User experience.......................................................................................... 9

Consumer behaviour.................................................................................... 10

Increasing Internet use................................................................................ 11

Segmentation and targeting .......................................................................   11

Conclusion………………………………………………………………………………...   12

References………………………………………………………………………………...   14

‘CAN BEER TRAVEL ONLINE?”

-Introduction-

With the introduction of Internet, the world became smaller since it gave companies and people the possibility to interact and do business with each other without the former geographical constraints.[1] This created a new business environment and a new expression; E-branding. This electronic commerce is rapidly expanding into a fast-moving, open global market with an ever-increasing number of participants (Beltz, 1998). Did this make the branding become more successful or has the Internet taken branding to far? Adbusters.org came up with a new campaign of symbolic protest called ‘Unbrand America’. This July 4th, culture jammers are launching a blast of symbolic disobedience at America’s corrupt power structure – by swapping the Stars and Stripes for the Corporate America flag. This flag is a symbol of what’s wrong with 21st-century America, the country that has sold its soul to corporate rule. Besides this they feel ‘consumerism has become our new religion’. I was wondering whether this is caused by the Internet and how the Internet influenced the branding process, but that unfortunately aren’t questions feasible for me to answer. I’ll therefore focus me on the E-branding with perspectives on further research.

‘Beer can travel’ once were the words of A.H. Heineken. These words have been converted to deeds; Heineken hasn’t only been the biggest brewery in Europe, but also has exported the most beer globally. Since the roots of this success are in Holland, this brand is very special to us. In this paper I’ll take a closer look at the phenomenon e-branding and I’ll specify this to how Heineken stresses its distinctive features online in order to maintain an international leading brand. Alfred Heinekens words became reality through the process of offline branding. I will now look at how Heineken uses E-branding, with most of the practical and economical constraints of the physical world removed, in order to rephrase Alfred Heinekens words into ‘Beer can travel online’.

-HEINEKEN-

Heineken as a brand

First of all it may be obvious Heineken ís a brand. ‘Heineken is in all sense a consumer-oriented brewery. We see our beer as part of the way consumers express their personality.’[2] This obviously corresponds with the definition that a brand is a name or some symbol or mark that is associated with a product or service and to which buyers attach psychological meanings. Advertising is what it’s all about in branding; ‘Advertising is a form of non-price competition by which firms attempt to exert control over the demand curves for their own products through psychological or cultural intervention, and hence represents a pressure away from formal rationality’ (Slater, 2002).

         What kind of brand is Heineken and how does it creates its value to its users? Quality is the keyword for the beer brand; thanks to that constant high quality did Heineken reach its leading position on the international beer market. Even though a beer can’t be seen as a functional brand, because there are no functional benefits which provide value to consumer due to the physical attributes of the product or service (Aaker, 1996), I do believe this constant high quality can be seen as ‘superior performance’  functional brands use as a strategy to ‘win’ from their competitors. Because of this supposed great taste, Heineken can be seen as an experiential brand, because by having this constant quality, the brand focuses on how the user feels while using, in this case ‘drinking’, the brand. But most of all I believe Heineken has become an image brand. Heineken is more then just a beer brand; it for instance also is the sponsor of many national and international sports- culture and music events. The choice for music and culture is because it’s intertwined with the nightlife, what indicated Heineken wants to be seen as an alive and surprising brand. With Heineken as a sponsor of Heineken Nightlife, Heineken Music Hall, Dance Valley, Holland Heineken House, Impulz, Pinkpop etcetera, has it become a concept in the field of entertainment. Important in sponsoring are consistency and credibility, i.e. support multiple events in a sponsor field and to have a similar sponsor policy in other countries.[3] International connection Heineken definitely has with music events like Heineken Jammin’ in Italy, the Jazzfestival in Montreux and Green Energy in Ireland. Sports on the other hand attract a very wide and divers public, so that is the main reason for sponsoring in that area. Heineken for example sponsors the KNHB and the KNLTB (the Royal Dutch Hockey- and Tennis union) and sponsors the Heineken Trophy. 

Heineken also creates their image by focusing on who uses the brand. Not to long ago there was a television commercial on the Dutch television, with Jennifer Anniston from Friends. Another good example is a commercial of Heineken in Britain. In 1969 the sales were sufficiently encouraging to brew a special version, which would deal with the problem of the punitive level of duty imposed on beer in Britain. The sales of this beverage soared thanks to one of the most memorable advertising campaigns in British history. With a sonorous voice-over from the Danish entertainer Victor Borge, the advertisements traced unlikely successes and reversals of historic fact due to the consumption of Heineken ‘which refreshes the parts other beers cannot reach’.[4]

Branding history

Heineken is one of the largest and most advanced brewers in the world. The Heineken brand is the most valuable international beer brand. Operating in over 170 countries, through its own breweries and through export and licensing partners, Heineken has the widest global presence of all international brewers. Europe accounts for over half of Heineken’s sales volume. At the end of 2003, Heineken owned over 115 breweries in more than 65 countries and employed 61,271 people.[5] Heineken’s goal at all times is to defend and strengthen this leading global market position and preserve its independence. One of Heineken’s strategies for attaining this goal is maintaining a strong portfolio of beer brands, with Heineken as the leading international premium beer. So the Heineken beer isn’t the only brand of the Heineken Group; it has a total of over 80 brands, with Heineken and Amstel beer as the two principal international brands. In this paper I’ll restrict me to the branding of the beer Heineken.

         For a leading company like Heineken, innovation in marketing, communication, packaging, brewing technology and supply chain management is important. The portfolio of beer brands must be developed and regularly updated to keep offering high added value for its customers and consumers. ‘We communicate brand value through a totally integrated marketing mix: packaging, point of sale material, merchandising, promotion, sponsoring, strong local advertising and the Internet.’[6] What I thought was striking about this quote is that they mention Internet as something separate. On the one hand that sounds logical because it is something new what has a lot of new opportunities in the branding process, but on the other hand Internet probably already is involved in the merchandising and advertising for example. Daniel Janal (1999) also points out how the Internet doesn’t exist in a vacuum, but is a part of the sales chain, just as important as for example an advertisement in a magazine. Internet should be integrated into your marketing program just as you would use public relations, advertising, direct mail and outbound calls to make more sales. The Internet is but one more tool to use in your marketing program to build brand identity and sell more products and services.

Its worldwide success has been built on three key principles: product quality, understanding the diversity of the markets and relevant communication. Today’s Heineken is still brewed by the same dedicated family that has been brewing Heineken since the beginning, and its unique, unrivalled recipe still hasn’t changed. There hasn’t been advertising from the beginning. Continuing with Gerard Heineken’s philosophy that, ‘A good product is recommended by its use alone’, the company refuses to deploy advertising seriously, seeing it as useless and rather low-class. When Alfred ‘Freddy’ Heineken enters the business as a sales promoter in the US, he develops the marketing expertise to later internationalise the company in the 1950’s and 60’s. In comparison to Gerard Heineken, Alfred Heineken does believe in brand and marketing. He is living proof of the fact that, with slick marketing and advertising, you can bamboozle millions into drinking a brand regardless of any intrinsic merit.[7]  When he entered the company he realised that the brewery had to break from the restraints of the Dutch market and become an international giant. This means he had to cross many boundaries, what nowadays with the Internet would have been much easier.

Freddy Heineken's major role in the explosion of his beer's sales internationally was brand image and marketing. ‘I don't sell beer, I sell warmth,’ he once famously said. Warmth, curiously, meant the colour green. Green labels and green logos abounded and became synonymous with the name of the company wherever the beer was sold[8] No matter where you are, the green bottle always signals the natural, refreshing vitality of the brew and there is no technology, not even Internet, which can change that! This already was a great establishment, the recognition and psychological meaning people attached to the green bottle alone, made Heineken a successful brand. Then Winning the gold medal of honour at the world Exhibition in Paris, having Heineken supplied tot the Eiffel tower restaurant and being honoured with a special jury prize in Paris all before 1900, makes it almost seem unnecessary to advertise any more. In 1999, in the Netherlands, the Heineken brand is voted ‘Brand of the Century’ and Alfred Henry Heineken is proclaimed advertiser of the century. The very first commercial-utterance dates from before the world war two, ‘Heineken’s bierbrouwerij maatschappij N.V.’ advertised with slogans like; ‘Heineken’s beer, het meest getapt. This happened by means of wall paintings. The slogan ‘Heerlijk Helder Heineken’ dates from 1958, which now is the most frequent and recognisable form of advertising for the consumer. A very memorable form of advertisement took place in 1928, when an aircraft wrote a Heineken ad in the sky above the Olympic Games in Amsterdam and in 1968 the first Heineken advertisements appeared on TV and radio. According to Wyckoff and Colecchia (1999),  marketing and advertising are the sectors in branding that are probably most affected by the use of the web. I’ll now take a close look at how Heineken applies e-branding and how marketing and advertising needed to be adjusted online.

-E-BRANDING-

Internet

E-branding refers to activities carried out when using digital technologies to build or maintain brand equity (Brattö and Gustavsson, 2001). Just before I’ll look at Heineken’s E-branding strategy, I want to look at the characteristics of these digital technologies, which have affected business extensively and how brands could be build.

         First of all Internet has an incredible information richness since it is text base and there are almost an innumerable amount of websites online, which each present information on different kinds of issues. This simultaneously makes the business environment more transparent, since Internet offers the possibility to access this information and for instance, compare prices. Second, in contrast to other mass media like radio and television, Internet offers the possibility for users to interact with each other. The information gathered by the company can be used in order to present messages that are developed with regards taken to the individual user, thus is it possible to personalize this message. Since the online users are not communicating directly, face-to-face, the web can be claimed to be anonymous. Very important is then, how Internet is increasing the globalisation. This is because the Internet is a network of connected computers, which is owned by no one and is more or less worldwide covering. These characteristics all have direct influence on the E-branding strategies, compared to the offline branding. In de rest of this paper it will become clear how these characteristics are involved in E-branding strategies.

Heineken’s strategy

Advertising a new brand online or adjusting your branding strategy to these new opportunities the Internet offers isn’t easy. That’s one of the reasons why there is a lot written about marketing online, e-commerce and e-branding. Dan Janal for example, is an internationally-recognized speaker, Internet marketer and best-selling author. His most famous books are ‘Dan Janal's Guide to Marketing on the Internet,’ (John Wiley & Sons, 1999), and ‘Online Marketing Handbook.’

 What's an online marketer to do to get people to come to their websites? Go offline. You can't rely on banners and search engines any more. You have to use traditional marketing methods to boost online visits (Janal, 1999).

An advantage Heineken had when they first launched their website is that they already had leading position in the offline world. Besides that there is no obscurity possible about the URL of de website; every country has its own URL which exists out of ‘Heineken’ and the concerning domain extensions and all the websites have a similar layout. Besides that you can reach all the websites from the different countries via Heineken.com. According to Janal (1999), this is important because consumers don't like to be confused. If they have the slightest hesitation about you, your brand, or your identity, they will pass you by. By integrating the web into your marketing program and using the same design, look and feel and messages, you will reinforce your image and themes to your customers, who in turn, will reward you with sales and loyalty. Even though Heineken already is very successful, the branding process never stops; a brand always needs to keep interesting their consumers and thus needs to keep coming up with new advertising strategies. Attracting a crowd of surfers to your site is just the first step, then you need to convert those browsers into buyers. Improving this conversion rate is one of the most effective uses. ‘Even a modest conversion rate improvement offers a huge upside potential,’ noted Jeff Seacrist, director of marketing for Web analytics firm WebTrends.[9]

Key factors for competing in online markets include to create strong brand recognition, to build user communities and attract advertising, to provide ease of use, variety of value-added services, functionality and features and quality of support, to establish strategic alliances and to expand on international markets (Wyckhoff and Colecchia, 1999). I’ll now look at how Heineken uses the opportunities of the Internet through e-branding in differentiating itself from their competitors who provide a product that appears to be identical in order to keep their leading position.