linked in facebook twitter rss

  • Interbrand
  • Brandchannel

your chance!
your chance!
Nemiroff Vodka
 

Nemiroff


  Nemiroff
na zdorovye!
by Valentin Pertsiya
August 18, 2003

If we believe the Nemiroff company’s own PR efforts, consumers around the world will be asking for Nemiroff instead of Smirnoff in the very near future. Located in the Vinnytsia region of Ukraine, Nemiroff exports to 35 countries and retails between Smirnoff and Stolichnaya in price range.

The brand name doesn't copy its rival, Smirnoff. It's simply the name of the place where the factory is situated. The name was written in the Roman alphabet as opposed to Cyrillic to create the impression among Slavic consumers that the vodka has foreign roots. Easy enough for a non-Slavic person to pronounce and without negative connotations in English, the name is the company's only international marketing success so far. However, lack of attention to other brand-building details may thwart the company's plans for global dominance.

 
 

Nemiroff has its eye on Smirnoff. In two years the company wants to go shot to shot with the American-owned brand. That means it hopes to reach sales of 14 million deciliters of vodka, 10 to 11 million of them to be exported, half to Russia and the rest to other countries.

Meanwhile, Nemiroff's current international presence seems negligible. Last year the company produced a little over three million deciliters of vodka, exporting only a fifth of that. A little more than 100,000 deciliters were exported beyond the ex-Soviet Bloc, which amounts to 2 million conventional half-liter bottles. Only 225,000 deciliters were sold in Russia (less than 0.2 percent of Russia's practically boundless vodka market), a country in which Nemiroff hopes to build its international brand presence.

These may not be very impressive international figures but the company's sales are growing exponentially and it's been a leader in Ukraine for eight years already. As almost all high-quality raw alcohol used for vodka production in the former-Soviet Union was made in Ukraine, and the Ukrainian market is currently more competitive and organized than the Russian market, Nemiroff could conceivably reach its goal of conquering Russia. A major flaw, however, may be the lack of a well-functioning distribution system.

As the company goes global beyond Russia, however, it may find itself in an opposite situation: delivering a product to stores in the West is not a problem; the problem is getting people to buy it. Nemiroff’s problem may be that the brand appears to be blurred and developing chaotically, perhaps as a result of its earlier history.

In Soviet times there were 20 identical vodka trademarks produced in all factories of the country. The Western consumer knows at least one of these standard vodkas: Stolichnaya (or Stoli), which is prevalent in the Western market. When the USSR broke up in 1991 and Ukraine gained independence, most alcohol factories were privatized or new businesses were built. Competition wasn't stiff and shelves weren't full of high-quality products, so there was little need to build brands; consumers bought whatever was offered. This situation has changed over the past three years as brands began to spring up and consumers are bombarded with heavy advertising campaigns of new vodka brands. Each new brand strives to create a unique positioning, differentiating through packaging and emotional appeal. Strangely, long-standing market players have had the poorest track record in this competition for consumer preference. They are simply demonstrating their product range as they had in the past (some companies produce up to 100 SKUs under one name). Their best ads look like well-designed sale posters with bland copy.

After researching Ukraine's vodka market periodically during the last three years, Nemiroff’s problems become more apparent. Using a brand essence model, it is possible to split the brand into four components: attributes, benefits, values and personality. Consumers make statements describing these components in preliminary qualitative research. Then potential users apply these components to brands in special surveys using both qualitative (e.g., focus groups) and quantitative (e.g., telephone surveys) research.

For example, the attribute "This vodka is originally packaged" may be ascribed to a vodka brand if its package is really different from others, or not ascribed to any brand if all of the packages look similar. Therefore, brand models are built out of a list of 120 to 160 statements (30 to 40 per brand component). As a rule, three or four competing brands are analyzed. If consumers ascribe the same statement to different brands, a special analysis determines whether to attribute this statement to one or to none of the brands. Therefore, if a brand was unable to build clear associations between itself and values in consumers' minds, its model may include no statements at all. It will be empty!

That's exactly what's happening to Nemiroff: its model includes only a few attributive descriptors, which is obviously not enough to maintain the brand's position locally, let alone fight for the international market.

The company’s advantages over its competitors can be summed up as:
- High product quality;
- Loyalty born out of its 8-year market presence; and
- Strong sponsorship presence at top sporting events.

Historically, there's been one bestseller among the company's more than 100 SKUs: vodka in a black package that bears the company's name but has no name of its own. Consumers call it "Black Nemiroff."

However, neither loyal consumers, nor buyers of other brands can describe Nemiroff’s brand in terms of its difference(s) from competitors, emotions accompanying product consumption, target audience or the personality behind the name. All this suggests that the Nemiroff brand doesn't exist in consumers’ minds.

This situation may be passable for Ukraine. It may also be tolerated in Russia for some time. But it's not going to work in the established markets of Europe and the US where the company's management is dreaming of expanding. The main stumbling block may not even be the sophisticated marketing and advertising strategies that these countries will require. The first meeting with a Western distributor the company's marketing specialists will have to answer the questions: "Why should I add another vodka to my portfolio?” and “How will your product be different from competitors?" It’s unlikely that anyone will be interested in a story about product quality and previous successes in Ukraine.

The battle for consumers in the West is not in the store, its in consumers' minds. Sophisticated consumers are shopping with an established list of favored goods, which is seeded through companies' marketing efforts. A new vodka brand will require a clear brand model to build the necessary perception to be included on that list.

Consumers in highly branded markets will not pay US$ 30 for half a liter of Ukrainian vodka solely on the strength of its quality. Nemiroff has to overcome its rather standard looks and a name that looks like it is stolen from Smirnoff. Until the Ukrainian vodka gets a brand, Western markets will remain off-limits.

 
     
  

Valentin Pertsiya is general manager and co-owner of BrandAid, a brand consulting company in Ukraine.

  
     
 commenting closed Add Social Bookmark bookmark  print
 suggest topic  recommend ( 9 )  email

  brandchannel profile archive   2011  |  2010  |  2009  |  2008  |  2007  |  2006  |  2005  |  2004  | 2003  |  2002  |  2001
 
 
Dec 22, 2003 Barbie - what a doll -- Brad Cook
  Barbie: 45 years old and still on the scene
   
 
Dec 15, 2003 Krave's - sweet success -- Geoff Kirbyson
  Krave's satisfies an aching sweet tooth.
   
 
Dec 8, 2003 Red Robin - nesting -- Alycia de Mesa
  Red Robin lacks some consistent ingredients to success.
   
 
Dec 1, 2003 Cirque du Soleil - contorts -- Robin D. Rusch
  As Cirque du Soleil stretches beyond the big top, does it risk crashing?
   
 
Nov 24, 2003 Slim-Fast - shaken -- Abram D. Sauer
  Slim-Fast’s positioning looks a little anemic next to latest trends like Atkins and South Beach.
   
 
Nov 17, 2003 Ted - ted on arrival -- Aaron Danzig
  From bankrupt United Airlines comes... Ted.
   
 
Nov 10, 2003 Weather.com - reigns -- Diane O'Brien
  Weather.com takes the web by storm.
   
 
Nov 3, 2003 BAPE - going bananas -- Patrick Williamson
  Japanese underground brand BAPE poises for world domination.
   
 
Oct 27, 2003 Richardson Partners Financial - enriched -- Geoff Kirbyson
  An old brand re-emerges after years of dormancy.
   
 
Oct 20, 2003 Gucci - family baggage -- Vivian Manning-Schaffel
  The ups and downs of haute couture.
   
 
Oct 13, 2003 Cubs - throw a curve ball -- Abram D. Sauer
  No team sucks quite like the Chicago Cubs.
   
 
Oct 6, 2003 Silly Putty - stretches -- Randall Frost
  The serious business of selling Silly Putty.
   
 
Sep 29, 2003 Evenflo - winning formula -- Brad Cook
  There’s a lot of competition in the nursery these days. How does baby products brand Evenflo measure up?
   
 
Sep 22, 2003 Backroads - leads the pack -- Adeline Chong
  Making inroads on the global tourism trade.
   
 
Sep 15, 2003 Germany - die neu marke -- Patrick Williamson
  Can Germany change world perceptions with a branding campaign?
   
 
Sep 8, 2003 loveLife - ground breaking -- Ron Irwin
  LoveLife takes on the high-risk behaviors of South Africa’s youth.
   
 
Sep 1, 2003 Teva - making tracks -- Diane O'Brien
  Teva’s history reveals its soul.
   
 
Aug 25, 2003 Himalaya - trails -- brandchannel
  Himalaya educated the public on ayurveda, but then lost an opportunity to own the category.
   
 
Aug 11, 2003 Fuse - frayed -- Abram D. Sauer
  Scrappy Fuse claims to threaten MTV and wipe out crappy television. Is it set for success?
   
 
Aug 4, 2003 IKEA - put together -- Brad Cook
  IKEA's mega-stores house a captive audience.
   
 
Jul 28, 2003 Crayola - smell of success -- Abram D. Sauer
  Crayola draws on 100 years of success to manage its brand in the technology age.
   
 
Jul 21, 2003 Book-Off - the new used -- Patrick Williamson
  Book-Off shakes the dust off the Japanese book industry.
   
 
Jul 14, 2003 Joburg - discover -- Robin D. Rusch
  Joburg finds that an unbranded state is not worth living.
   
 
Jul 7, 2003 Combi - grows up -- Robin D. Rusch
  Sporting a brand new look, Combi sets out to turn heads in the pint-sized world of toddlers.
   
 
Jun 30, 2003 Footprints - urban sole -- Robin D. Rusch
  Birkenstock steps out of its well-worn sandals and launches a new line of shoes for the urban design community.
   
 
Jun 23, 2003 Charles Shaw - cheap swills -- Diane O'Brien
  Two Buck Chuck sobers up the wine market.
   
 
Jun 16, 2003 Burberry - square -- Diane O'Brien
  Burberry tries to keep a stiff upper lip while everyone from Posh & Becks to Ja Rule flout the brand.
   
 
Jun 9, 2003 Sony - powered -- Brad Cook
  Sony covers our world.
   
 
Jun 2, 2003 Quaker Oats - lumpy road -- Michael Standaert
  Quaker Oats normally serves it up smooth, but there have been a few lumps for the hundred-year-old brand.
   
 
May 26, 2003 New York Times - bad times -- Abram D. Sauer
  What happens to a paper’s reputation when it gets caught publishing news that’s not fit to print?
   
 
May 19, 2003 Playboy - exposed -- Abram D. Sauer
  Is Playboy still desirable at 50?
   
 
May 12, 2003 John Deere & Company - breaks ground -- Michael Standaert
  John Deere & Company continues to thrive after planting the seeds of its brand over 160 years ago.
   
 
May 5, 2003 LucasArts - building empires -- Brad Cook
  Can videogame brand LucasArts stay fresh with old content?
   
 
Apr 28, 2003 Al Jazeera - tough enough? -- Abram D. Sauer
  Will Al Jazeera fight its new competition as successfully as it fought censorship?
   
 
Apr 21, 2003 DC Comics - super -- Brad Cook
  DC Comics may be able to leap tall buildings in a single bound with timeless superhero icons like Superman and Batman, but the market for comic books in the US remains firmly rooted in the kid market.
   
 
Apr 14, 2003 Dannon - cultured -- John Karolefski
  If Dannon "means yogurt" can it ever move beyond milk products?
   
 
Apr 7, 2003 Puma - pounces -- Abram D. Sauer
  When Puma found its brand skewered in recent spoof ads, should it have just laid back and enjoyed it?
   
 
Mar 31, 2003 ICA - on location -- Stefan Engeseth
  Swedish food retailer ICA is stocked with clever ideas to promote its wares.
   
 
Mar 24, 2003 eBay - sold! -- Brad Cook
  What would you bid on eBay’s brand?
   
 
Mar 17, 2003 Yao Ming - falls short -- Abram D. Sauer
  Yao Ming demonstrates how not to build a brand through advertisements and endorsements.
   
 
Mar 10, 2003 Venter - steep grade -- Ron Irwin
  After being dragged through mud, Venter tries to go back to making trailers.
   
 
Mar 3, 2003 NASA - lost in space -- Abram D. Sauer
  Has NASA lost touch with the American public?
   
 
Feb 24, 2003 American Humane - empowered -- Robin D. Rusch
  American Humane redefines its 125-year-old brand.
   
 
Feb 17, 2003 Toyota Prius - charged -- Judith Graham
  Can Toyota find a market for its hybrid car, Prius? Much of the challenge will likely be in educating the consumer.
   
 
Feb 10, 2003 Match.com - love at first click -- Judith Graham
  How does Match.com win the hearts of singles?
   
 
Feb 3, 2003 Disney - mighty -- Brad Cook
  The Disney brand started with a mouse and grew into a multimedia kingdom.
   
 
Jan 27, 2003 James Bond - die already -- Sultan Omar
  What makes this fictional brand last forever?
   
 
Jan 20, 2003 Snapple - the best stuff -- Vivian Manning-Schaffel
  How does Snapple keep the creative juices flowing? By reaching out to its target market for ideas.
   
 
Jan 13, 2003 Altoids - cool -- Abram D. Sauer
  How does Altoids stay fresh?
   
 
Jan 6, 2003 Bose - breaks the sound barrier -- Brad Cook
  Retailers may be out of tune, but luxury brand Bose is music to some consumers’ ears.