Deutsch_Scott_07aI attended the National Beer Wholesalers Association (NBWA) annual meeting in Las Vegas recently with 2,500 people in attendance. Now, before you go and start making comments…I didn’t see the outside world until I left for the airport. Boy, Caesars Palace is a large property!

 This was my first time to NBWA in Vegas and I’m glad I went. This event is special because it gives you a very good sense of what’s happening in the economy and how some of the larger beverage companies are approaching their marketing. I was fortunate enough to sit through the Anheuser-Busch (A-B) wholesalers meeting where they discussed market share by key categories with an emphasis on Bud Light and their marketing strategies by target market with an extended conversation around Millennials. More on Millennials later.

 When you get to listen to industry leaders talk about their business you learn how smart these people are. What was exciting to me as a marketer was the detailed discussion on sales analytics and the use of this analysis to help drive differing marketing communications strategies. I was thoroughly impressed with the A-B approach and their open communications to their vast wholesaler network. A-B did an excellent job discussing their sales by market segment with an emphasis on understanding what’s really happening in the craft beer market, which is garnering much coverage.

P1020842 But, to me the most fascinating conversation was about challenging the retail belief of some that beer was not as profitable as some other staple categories. With the help of independent consultants A-B was able to truly quantify the gross margin and total profitability of their products within a convenience store environment. Apparently too many people are focused on the buy margin discount and not the total gross margin. They did a superb job at showing how proper merchandising of a select set of SKUs positively impacts gross margins. It was very clear that having strong product offering at key price points is important to the A-B wholesaler and their retail customers. As someone outside of the beer industry, the open and frank discussion on “the market” was an excellent opportunity to better understand how this very important market to Vocollect Voice is ultimately thinking. Our ability to help our wholesale customers select more cases more accurately at a lower cost than traditional methods is a real value driver to wholesalers who are being squeezed with higher operating costs and growing pricing pressure from their retail customers. 

 Next up was an interesting conversation about market messaging and an open review of strategic thinking, with an extended discussion of how to engage and influence the millennial buyer. The conversation about positioning certain brands vs. the competition was really easy to follow since so much is spent annually promoting beer products. As a sports enthusiast, it was a fun discussion to listen to an analysis of messaging objectives with these well-funded integrated campaigns. One of my favorite slides was a side-by-side image of recent advertising campaigns from the top four lite beer producers. They all could have been produced by the same agency and all the actors looked like they all shopped at the GAP and selected from the same rack. As a market leader, A-B had its messaging copied and thus their competitors were able to leverage A-B spending to their advantage.

As a market leader in the voice market, and the market maker for voice, Vocollect Marketing also sees this similar follow-the-leader issue. It’s a whole lot cheaper to copy someone’s thinking and creative, than to design your own. After all, the leader of a market typically does market and positioning analysis, so we’ll just copy the message to minimize any real product differentiation. This follow-the-leader marketing approach keeps us on our toes and challenges us to always look for ways to clearly differentiate Vocollect Voice from “inferior” voice products. It’s fun to watch competition scramble for a couple months to figure out what we are doing. This past year has really been fun since we introduced our SRX2 wireless headset that when combined with SoundSense, as part of our BlueStreak Speech Recognition, provides a user experience that is unmatched. Think of it as our 25-can pack. Those in beer industry know what that means to gross margins.

Another part of the advertising conversation was making sure A-B was successfully attracting millennial buyers. It is strategically important to attract this set of buyers, so they are a part of the family for generations to come. The investments by A-B in learning how to engage these buyers is exciting, but clearly has made many of their wholesalers uncomfortable. Their questions during the 40-minute Q&A made this very obvious. I’m not surprised. Think about it, the head of beer wholesaler today is probably in their 50’s (if not older). What is their personal engagement with texting, Twitter, Facebook or Pinterest? Meanwhile, the millennial buyer is not watching TV or reading magazines and newspapers. 

 A-B gets it! They are trying various digital campaigns to engage this generation. A generation that has a very different engagement process. As an example, communications with my 19-year-old daughter at college is mostly via text. Email is not her preferred communications approach anymore. And her time on Facebook… is becoming a fading platform of interest for her and her friends. Marketing to the millennial means communicating where they are at and how they want to be engaged, without “selling them”. Millennials have a strong “help your fellow man mindset,” so it’s vital to figure out digitally how to frame an engagement with a “helping and socially moral” dimension.  So, keep at it A-B Marketing.

 I could not end this entry without discussing the trade show at NBWA. First for the business then, to the “only at NBWA.”

P1020775NBWA was an excellent trade show for Vocollect by Honeywell (we were acquired in September by Honeywell). Lots of customers stopped by the booth to say hello and discuss their use of Vocollect Voice and to see for themselves our exciting new SRX2 wireless headset. Many customers have said that Vocollect Voice with the SRX2 is a “game changer” for the beer industry. Companies are reporting some impressive results and are able to show even greater cost savings with the new technology. Having no headset wires on a worker in beer wholesale distribution is a great enhancement for the worker experience (as well an enhancement to their safety) and a real value differentiator for Vocollect Voice and our partners serving the beer industry.  By the way, it was great to see so many Vocollect Partners on the floor showing off their seamless direct integration capabilities to Vocollect Voice.

And now to my “only at NBWA.” I must say that Las Vegas and NBWA knows how to throw a trade show. Just do not bring your Human Resources team to the conference. As you would expect this being a show around beer, the beer was flowing everywhere….think Napa Valley vacation on steroids and not having to be concerned about driving … walking from booth to booth was the preferred mode of transportation.  There was no beer at the Vocollect by Honeywell booth and I have pictures here to validate the statement… I just wanted to make that clear to anyone in Honeywell HR reading this… here are a couple shots to give you a sense of the NBWA conference trade show floor.

Here’s a shot or two of some of the “only at NBWA” and the booth staff next to the Vocollect by Honeywell booth. I told you. Only at NBWA in Las Vegas.

P1020862 P1020857

 It’s a great show because all the decision makers are here for three days. It’s a great show because every beer company puts forth its best marketing effort with large teams attending to meet with their wholesalers and distributors. It was a great trip.

 In the end, what happens in Vegas, stay’s in Vegas.