Repositioning of vodka brands sparks shuffle

01 October, 2007

Take clear leader Smirnoff out of the equation, and there are real signs of change in the vodka category, with the other brands in the top five playing musical chairs.

Glen's double-digit growth might now be routine, but cash and carry brand ­Chekov has knocked Halewood's Red Square off the third spot. And despite Whyte & Mackay's £5 million investment in a long-term repositioning strategy, Vladi­var has been elbowed out of the line-up, with Absolut steaming in to take its place.

Absolut's impressive performance speaks volumes about the growing momentum for trading up to the novelty niche in the off-trade. Having taken the bold decision to move away from the on-trade's higher margins and try its luck in the off-trade, the brand is developing its classy premium image with a grapefruit flavoured addition called Ruby Red and a global multi million pound ad campaign.

Despite Red Square losing more than 20 per cent of its value and dropping to fifth position, the brand is one to watch going into 2008. Last month Halewood repackaged Red Square in a move to strengthen its position in the mainstream vodka market. Marketing controller Richard Clark says the new look is designed to position it as a competitor to vodka brands under £10 rather than more expensive premium names. "It's a different proposition to Smirnoff and not in Absolut's area. It's in the competitor set of Vladivar," he says. With the brand using advertising straplines such as "hand filtered through the tail feathers of white doves" to poke fun at vodkas that undergo excessive distillation, Halewood could see a surge in sales as consumers are swayed by humorous, tongue-in-cheek marketing campaigns rather than repetitive claims to heritage and quality.

Much has been said in the press about a Russian vodka showdown, with First Drinks Brands' latest addition Russian Standard throwing down the gauntlet to the mighty Smirnoff. And with Pernod's Stolichnaya also playing the genuine Russian vodka card, Diageo has been honest enough to admit that the war is hotting up. "It would be arrogant not to see it as a challenge or to ignore it," says Smirnoff's marketing manager Chris Lock.

But with Smirnoff dominating such a large percentage of the category and ­Diageo's considerable marketing muscle,

it doesn't look like it's going to be toppled from its lofty position. It's the brands ­sitting in Smirnoff's shadow where the genuine interest lies.

Off-trade vodka value

Year to 11/8/2007: £695 million

Year to 15/07/2006: £637 million

Change from Aug 2006: +9%

Top five vodka brands

1 Smirnoff Red Label +4%

2 Glen's Vodka +33%

3 Chekov -2%

4 Absolut +56%

5 Red Square -21%

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