Mauricio Vergara has made a marketing career in the beverage industry, working for iconic brands such as Coke, Fanta, and now Grey Goose at Bacardi.
Vergara joined Bacardi in 2013 as vice president, marketing and sales for Latin America. His ascent at the family-owned company has been quick: In April of last year, he was named the global marketing head of rums for Bacardi, and then soon he after was appointed new CMO North America and global lead for Bacardi rum and Grey Goose vodka.
In an exclusive CMO.com interview, Vergara covered a mix of topics, including the benefits of working for a private company, why customer engagement needs to be both online and off, and the thinking behind Bacardi’s recent House Party campaign.
CMO.com: What made you want to be a part of the Bacardi team?
Vergara: Bacardi has an amazing portfolio of brands, whether that’s Grey Goose vodka or brands that we just acquired, such as Angel’s Envy bourbon or Banks rum. Then, the whole history of the company is amazing. If you think about a company like that in the current context of the corporate world, a company that has been able to stay a family-owned business for more than 150 years and still be one of the largest spirit brands in the industry, that’s also very compelling. The way we run the business is very different to the big corporations that are publicly held. We’re a lot more focused on the long term.
Another part that is also very interesting for me is it’s a Latin company. Our heritage is totally Latin. I identified with that through my own roots. I was born in Mexico, but my family is totally international. My wife is from Venezuela. I have two kids who were born in different countries in Latin America. So that for me was very appealing.
CMO.com: How would you characterize Bacardi’s marketing strategy?
Vergara: We’re changing the way we’re doing marketing in Bacardi. We are a lot more data-driven, embracing the new world of content and digital, engaging more aggressively with our consumers, and behaving as a leader of the industry. We’re making a revolution in the way we look at marketing in this company.
CMO.com: Take me through what might be a typical day on the job for you and your main responsibilities.
Vergara: I would say my key responsibilities are ensuring that we’re building stronger brands for the future. The spirits industry is all about the equity of our brands in the long term. That’s what sustains the business. So a lot of my day is [focused on] defining that longer-term vision and strategy for our brands, working with the commercial teams to make sure that we’re delivering return on investment, [and] then working with my team to ask: How do we optimize that?
I spend a lot of my time also in people development and making sure we’re building strong leaders for the future of the organization.
CMO.com: Part of your job involves talking with consumers. Is that done digitally on social media sites, through calls, or just getting out there?
Vergara: It’s a combination of ways. Social listening and digital communications are increasingly growing. As you may know, we recently changed our agency partners from a media perspective to BBDO for creative and OMD for media planning and buying. Right now we’re putting a lot of emphasis on how are we using new platforms ... to really understand and have a day-to-day understanding of how our consumers are reacting to the things that we are putting out there in the marketplace. So digital is helping us a lot in not waiting for reports or research and relying on the traditional research, but to be always on the pulse of the consumer.
But then the other part is definitely just the old-fashioned going out there to the street. I don’t think we ever should underestimate that as marketers, because just going to a club or a bar and sitting there, talking to the bartender and asking what consumers are ordering is critical. Do they ask for a brand? Or since they don’t even know what to drink, [does that] mean the menu plays an important part of it?
Then there’s the trade—the bar owner or store manager in terms of understanding when people come to your shelf, how do they shop for rum? Do they start choosing a flavored rum versus a white rum, or do they start by a brand? I think this is very powerful because that then informs how should we do our merchandising or lay out our shelves, making sure we’re doing it not from a desk, but from a true understanding of what happens in the street in real life.
CMO.com: How do you use the data and metrics you’re collecting to make choices that’s going to help the company grow?
Vergara: I think there’s a big shift going on right now from using research to explain the past to a lot more predictive analytics in terms of saying, “OK, if I put this type of message out there, this is how consumers are reacting,” and we increasingly can see how that results in sell-through or consumer pull. So we’re using those analytics to optimize our media investment. Should I be shifting investment from Facebook to Twitter or even messaging? I have five different edits of the same video content. Which one is resonating more? Therefore I can shift my investment across different pieces of content.
So one of the ways we’re starting to use these analytics is to optimize our investment and make investment choices in terms of both the type of content, but also where is the right vehicle or media that we should be using? This is putting a lot of pressure on the agencies, or it’s changing the way we work with agencies because it’s also demanding agencies to be a lot more data-driven. I remember the times where you put it on TV, and then you didn’t care about it anymore until the next month or maybe the next few months. Now we’re making the decisions on a day-to-day basis.
CMO.com: You mentioned Twitter and social media. What role does that play?
Vergara: You will definitely see a huge shift in Bacardi to digital content than from where we were in the past. We are, of course, in the beverage alcohol business, but I think about spirits more as lifestyle brands. When you frame it that way, say a brand like Grey Goose, if I really want to be part of the lifestyle of the type of more affluent consumers, they live in a digital world. It’s not even optional. So we’re shifting a lot of money, a lot of focus, and a lot of resources into content and digital.
That being said, I think that we have to be careful also to move into a black or white world. Are we canceling all of our TV investment? No. I think we need to understand what is the right mix of media for the different brands we have because a brand like Grey Goose will be different to a brand in Latin America that behaves closer to a beer. I think that when you go into the digital or content world, there’s so many platforms that go into mobile or content generation rather than traditional advertising or partnerships. We’re trying to embrace that world in a much more holistic way than just saying, “Yes, we’re going to shift investment to digital.”
The next evolution that we’re working on right now—you’re going to see it soon in the marketplace—is going to have a huge shift to content and digital. So the way we’re thinking about evolving that platform is instead of having our big TV ad as we did in the previous execution, now we’re going to go to a big investment and a big shift into social, into content, into partnerships with other media partners that are not TV and digital as a whole.
CMO.com: Does Bacardi’s being a family-owned company change anything with the way that you do your job and deal with the people you report to?
Vergara: It changes everything. To start with, I have different interactions with Facundo L. Bacardi [chairman of Bacardi Limited and sixth-generation family member]. We have very frequent interactions where we sit and discuss what the vision of the family is for the business. I feel privileged to have that opportunity because when I sit with him, I have the chance to talk to him about the history of the family, the history of the brand, and then understand the vision and where they want to take the company. Then some of the investments and the decisions we make for the company are not driven by what Wall Street is going to say because our stock has to move. They are driven based on a very long-term vision on how we keep this company growing for the next generations of the family.
The feeling of a true family-owned company is here on a day-to-day basis, and that translates in the way we care about our people, we develop our people, and it creates a completely different atmosphere in the way we do business, which I think is very relevant for the spirits industry because we value relationships. We understand what relationships can create for this business. A lot of our customers love doing business with us because we think about them as part of the extended family of Bacardi.
CMO.com: What keeps you up at night?
Vergara: My biggest worry is the health of our brands. A lot of my work is defining the long-term vision and strategy of our portfolio. Where is it that we’re going to grow? Where are the opportunities in the marketplace? I spend a lot of my time talking to consumers to really understand what is happening out there that is changing the trends and the way consumers are behaving. When they go out to bars, what’s changing? There was a big shift from nightclubs to lounges. What does that mean for our portfolio and the way that our brands engage?
CMO.com: Can you talk about a successful marketing endeavor you have brought to the company?
Vergara: We did change the paradigm big time in Mexico with William Lawson’s blended Scotch whisky. It’s a market dominated by Johnnie Walker, and in two or three years we were able to convert William Lawson’s into the fastest-growing Scotch brand in Mexico. We’re now the market leader in Scotch with William Lawson’s. The way we did that is we shifted a lot of resources out from TV and into experiential marketing. We did a lot of events in the area supported by a big digital platform. The results we got from there were amazing because we were able to see that by really connecting with the younger consumers.
CMO.com: What can you tell me about the recent House Party campaign?
Vergara: House Party is a fresh, new take on the Bacardí rum brand as it is an authentic take on a Millennial’s world, capturing the energy of their life. At the same time, it is the evolution of “Bacardí Untameable Since 1862” in a 30-second TV spot, an experiential House Party campaign and comprehensive digital, mobile, and partnership strategy designed to connect with Millennials on their terms, in their world, in their way. It reflects the brand’s desire to dominate the category once again.
We want to fuel that modern-day hustle. Our heritage and history is very important to us, and we wanted to create something where consumers feel like we can be part of their story and they can be part of ours. That’s why the ad isn’t overly stylized or overtly ad-like. We want to connect with Millennials in their preferred channels, so we’ve put together a really strong multichannel approach across the entire program of activity. House Party, in particular, is an occasion where we can bring the Bacardí Untameable brand story to life in a more relatable way and celebrate those who use their ingenuity to let nothing get in the way of a great party. Check it out at www.YouTube.com/Bacardi and #BacardiHouseParty.
CMO.com: There has been a lot of talk about the growing interest in rum in the industry. How is Bacardi dealing with that?
Vergara: There’s a big resurgence of rum. All the industry publications are talking about how rum is one of the categories that is going to pick up in terms of growth. My biggest goal for that is that Bacardi will be leading that growth for the rum category and positioning Bacardi again as one of the strongest leaders in the industry.
CMO.com: Looking ahead, what other goals do you have for yourself and the company?
Vergara: I think about the Bacardi rum brand as one of the most iconic brands in the industry. So reigniting the icon that Bacardi is one of my biggest goals. Over the last years, we’ve struggled a little bit with the brand. Bacardi has all the assets now, and we have the platform and the positioning to drive the growth of rum again.
The other goal is that we have a beautiful portfolio. Grey Goose basically invented and created the super-premium segment in vodka, not only in the U.S. but in the world. We’re still the leaders by far in that segment, and now there is actually a big trend going again in the spirits industry. The segments that are growing in the U.S. are premium and super-premium. So how can we really take that trend that is moving into more premium because people are looking for more quality and authenticity and craft in their drinks. That positions Grey Goose to retake or accelerate growth again.
Then if you go out of the U.S., part of my global responsibility for Grey Goose is to expand the brand more aggressively. There’s a huge opportunity to do what we did in the U.S. in other geographies. The brand is already growing double digits in many geographies outside the U.S., so a big thing for us is to lead that expansion of that segment across the globe.
The third one has to do with our small luxury or premium brands. One of my key ambitions is to make sure that they are set for success, and we’re incubating them to really make them big brands over the next 10 to 15 years.
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