NEW AFRICAS - Pernod Ricard

entreprendre
#58
Another viewpoint
on convivialit y
Spring – Summer 2013
SPECIAL
REPORT
NEW AFRICAS
new FRONTIers
SPECIAL
GUESTS
Pernod
Ricard’s
special
guests
Sitoyo Lopokoiyit
His motto on Twitter – “Work
+ Determination = Success” –
expresses the dynamism of
Kenya’s younger generations.
As the Head of Marketing and
Strategy at telecoms operator
Safaricom, Sitoyo Lopokoiyit
has big ambitions for his
company, and his country.
There are already more mobile
payment accounts in Kenya
than there are bank accounts.
Safaricom, meanwhile, gathers
17 million subscribers for
its mobile services.
James Parker
Behind the enterprise social
network Chatter®, used by
the Pernod Ricard Group since
November 2012, is Salesforce.com,
a San Francisco-based
group specialising in CRM,
where James Parker holds
the post of Customer
Success Director. His role
is to support his customers
in the implementation of
their projects and to ensure
the success of the tools they
use, particularly by encouraging
their adoption by all users.
James Parker worked in
distribution at Virgin and
Le Printemps before joining
the California-based company
seven years ago.
Charles Rolls
From gin to tonic, it’s a very
short leap... After turning
around the Plymouth Gin brand,
in 2005 British entrepreneur
Charles Rolls, 52, co-founded
Fever-Tree to offer a range
of mixers that showcase the
flavour of great spirits.
For his Premium tonic, he uses
the finest quality quinine, which
is sourced from the Democratic
Republic of Congo. He also
procures bitter oranges from
a mountainous area of east
Tanzania. Fever-Tree mixers
are distributed in 38 countries
around the world.
Bill Russo
Whether in Egypt, Nigeria,
or his home base of South
Africa, former US Marine
officer Bill Russo helps
distribution companies to
develop their growth strategies.
With McKinsey since 2007,
he is a specialist in the
consumer patterns of Africans.
He recently led a large store
transformation operation there
for a leading clothing retailer.
Entreprendre, Another viewpoint on conviviality. No. 58 / Spring – Summer 2013
Pernod Ricard. 12, place des Etats-Unis. 75 116 Paris, France. Tel.: +33 (0)1 41 00 41 00. [email protected]. Publishing Director: Olivier Cavil.
, 146 rue du Faubourg-Poissonnière,
Publishing Manager: Alix Gauthier. Editorial Coordinator: Louise Sarica. Consulting, Design & Creation:
75 010 Paris. Production: E-Graphics, 146 rue du Faubourg-Poissonnière, 75 010 Paris. Editors: Joachim Cannes (Special Report), Louise Sarica.
Photo credits: Philippe Lévy (Special Report), Fabrice Dall’Anese (Editorial), Frédéric Stucin (Crosstalk), Marc-André Desanges, Studio photo Pernod Ricard.
Illustration: Matthieu Appriou (Profile). Special thanks to Laurent Pillet, Marc Beuve-Méry and Valentine Arigi.
2 entreprendre # 58
entreprendre
A n other v i ewpoi nt
o n conv i v i al i t y
11
Spring - Summer 2013 – no. 58
04
EditoRIAL
By Pierre Pringuet and Alexandre Ricard
07
Panorama
Molecular cocktails, mobile applications,
the return of absinthe... Decoding the underlying
trends in the Wine & Spirits industry
10
ProfilE
High Net Worth Individuals:
Profile of a demanding consumer category whose
choices determine tomorrow’s codes of luxury
11
12
19
28
24
26
28
30
32
34
Special Report:
NEW AfricaS, NEW FRONTIERS
Feature
The other face of Africa
Portfolio
Snapshots of nights in Nairobi… by Philippe Lévy
In perspective
Interview with Bill Russo, director specialising
in Africa at McKinsey & Company
Facts and figures
Economy, demography, technology:
Africa in figures
Success Stories
The achievement of Jameson in South Africa
and Passport in Angola
Mapping
Update on Pernod Ricard’s presence in Africa
Crosstalk: Meeting of two créateurs
de convivialité
Enterprise social networks: Interview with James Parker
(Salesforce.com) and Olivier Cavil (Pernod Ricard)
34
For the long run
Pernod Ricard’s sponsorship of the Centre Pompidou, Paris
3
E
ditorial
Our new frontier
A bright future for Africa
It is the entrepreneurial spirit, one of the Group’s core values,
which inspired the name of this magazine, Entreprendre,
launched by Pernod Ricard in 1983. Thirty years later, the
entrepreneurial spirit continues to guide us on our road to
leadership. That’s what we will show you in this special issue
devoted to sub-Saharan Africa.
Leadership is above all a mind-set: it challenges the status
quo, and seeks new and more potent growth drivers. Being
an entrepreneur means behaving as a leader. No position
is fixed; no market is stationary. Going beyond, pushing the
boundaries: that’s what we set out to do. And it’s exactly what
drives the men and women of Pernod Ricard in Africa today:
they are the pioneers of our new frontier.
On my last trip there, for the official inauguration of Pernod
Ricard Kenya on 31 January, I could see both the excitement
of our new teams and the potential of these markets. In the
first half of the year, we recorded sales growth of 13%, more
than twice that of the Group. We have been in South Africa
since 1993, and we have recently set up six new subsidiaries
or sales offices in Ghana, Nigeria, Angola, Kenya, Namibia
and Morocco. One hundred new employees have joined us
since last July.
Our ambition is simple. We want to do the same in Africa
as we have done in Asia, and we have everything it takes to
get there: every one of our new employees is motivated by
the same entrepreneurial spirit that existed 25 years ago in
Shanghai and Singapore. Every day, Africa gets closer to becoming a major growth opportunity in our quest to capture
leadership.
With over a billion people, one-sixth of the world’s population, exceptionally dynamic demographics, a rising rate of urbanisation, and an economy growing three times faster than
the world’s, Africa represents a real growth opportunity for
Pernod Ricard. But with 54 countries and over 2,000 dialects,
Africa can’t be looked upon as a single market or culture. It is
precisely for this reason that we’re banking on having a direct
subsidiary in each major country.
• Pierre Pringuet
Vice-Chairman of the Board of Directors
and Chief Executive Officer
4 entreprendre # 58
The Group arrived in South Africa twenty years ago and has
been remarkably successful there. For eighteen months now,
we have been deploying an accelerated expansion strategy
in the rest of the sub-Saharan region. This growth strategy
is based on assembling local and international teams who
share the same entrepreneurial spirit that motivates us all,
every day, around the world. Add to that our portfolio of
brands such as Jameson, Chivas Regal and Malibu, whose
reputations precede us amongst the continent’s emerging
middle classes.
We thus have all of the ingredients needed to make this
continent a new region of expansion and a driver of future
growth for our Group. Africa’s future is most definitely
bright!
• Alexandre Ricard
Deputy CEO
and Chief Operating Officer
Alexandre Ricard (left)
and Pierre Pringuet,
at the headquarters of
Pernod Ricard, in Paris.
5
panorama
Evolving consumption patterns, innovations, new
businesses, conviviality and responsibility... A review
of the underlying trends in the Wine & Spirits industry.
A lighter approach
to wine
When mixology
goes molecular
Like molecular gastronomy, mixology – the art of cocktail creation –
is at the cutting edge of current trends, taking a fun and unexpected
approach to combining textures, colours and flavours for innovative,
stylish and almost futuristic drinks. Flavoured spirits, creative syrups,
dry ice, spices, toasted salt: cocktails now evoke a more sophisticated
experience than the humble happy hour. Many bars now offer a seasonal
cocktail selection which, like a food menu, changes according
to the mood of the bartender – a figure increasingly seen as a “liquids
chef”, and no longer as a mere showman. To meet the demand, brands
are developing increasingly complex products. For example, at the end
of 2012, Wyborowa staged the US launch of ODDKA Vodka – a base
vodka and range of five unconventional flavours, ranging from “Apple Pie”
to “Fresh Cut Grass”. For Adrian Keogh, Marketing Director - Innovation
at Pernod Ricard, this is just the beginning: research will push the
boundaries even further in terms of textures, tastes, and even sensory
experiences. After all, why limit yourself to taste, when the cocktail of
tomorrow could satisfy all five senses?
ODDKA has
created a
completely
new taste,
Electricity,
whose
innovative
texture
creates a
tonguetingling
sensation!
Since the summer of 2012, a clear
trend has been emerging in the wine
segment: freshness. This has led
to a wide selection of “lighter” wines
– pale whites and rosés with relatively
low sugar levels, as well as wines with
lower than average ABV (around
9-10% instead of the average 12-14%).
These light wines, which have
proved to be a big hit in Australia
and Germany, meet a dual demand:
the desire for refreshing summer
drinks, and women’s preference
for lower-alcohol wines.
A study conducted by Jacob’s
Creek revealed that 62% of female
white wine drinkers prefer it to
be light and fresh. This insight led
the brand to develop Cool Harvest,
a range based on varietals that
produce light and fresh style wines,
with a slightly lower alcohol content
than other Jacob’s Creek wines.
The grapes are harvested in the cool
of the night to retain the aromas and
the natural acidity that gives these
wines their freshness. Brancott Estate,
meanwhile, recently launched Brancott
Estate Flight, a low-alcohol wine for
which the Sauvignon Blanc and Pinot
Gris grapes are picked at the very
start of the harvest season.
7
pa n ora m a
Educating young people
on responsible drinking
China, the moon
and the snake
Influenced by non-European communities, the old
continent is becoming increasingly open to traditions
from distant cultures. After Halloween and Thanksgiving,
the Chinese New Year has become an occasion for
many bartenders to create drinks to suit the occasion,
like the Mandarin Mojito, which uses the flavoured
vodka ABSOLUT Mandarin as its base.
The highball, cocktail made of whiskey
and sparkling or still water, also
appeals to the female population
Faced with the global phenomenon of binge
drinking among young people, governments,
NGOs and industry players are working
together and multiplying their initiatives.
Pernod Ricard seeks to prevent alcohol
consumption by minors and to help those
of legal drinking age to become more
responsible. Responsib’All Day 2012 was
the culmination of this process: for one whole
day, the Group’s 18,800 employees joined
forces, leading various actions to promote
responsible drinking based on the theme
“Alcohol and Youth”.
To drive the point home with students, various
programmes are being implemented on the
ground. In Japan, for example, Pernod Ricard
launched the “No Ikki” (No Binge Drinking)
campaign through a variety of communication
channels, including educational materials,
interactive lectures, high-visibility displays
around university campuses, and more.
Another action aimed at students is the
Responsible Party, a programme specially
designed by Pernod Ricard in partnership
with ESN (Erasmus Student Network) to help
students to organise parties in a responsible
way. The Responsible Party aims to convince
students that it’s possible to have fun without
drinking alcohol inappropriately or excessively.
This message is also directed at the general
public through other targeted actions.
www.responsible-party.com
Highball: THE long drink THAT dEfieS FASHION
Introduced in the USA in the 1900s, “highball” is the name given
to cocktails composed of an alcoholic base spirit and a larger proportion
of a non-alcoholic mixer. The best-known version, the Whisky & Soda,
or Scotch & Soda, has come to define the name itself, and has recently
staged a comeback in Japan after nearly 50 years of being out of fashion.
Having been very popular in the country in the 1950s, the highball
(pronounced haiboru in Japanese) is now a big hit with all types
of consumers, from friends enjoying an aperitif, to colleagues meeting
for a drink after work. Some people even order it with meals, occasionally
preferring it to beer. This cocktail also appeals to the female population
because the carbonated water mitigates the whisky’s taste, which some
women find too strong. Served in Japan according to a very precise ritual,
called mizuwari, this cocktail is easy to make, which explains its popularity
with those who entertain at home, and its revival in Europe and the USA.
8 entreprendre # 58
pa n ora m a
Absinthe,
the feisty
green fairy
Absinthe, a word that still sounds
forbidden, is a spirit with an unusual history.
In 1805, Henri-Louis Pernod created Pernod Fils,
the first French absinthe brand which gradually
carried the family business across borders,
with daily production volumes soaring from
16 litres to 20,000 litres. In the 1860s,
the “fée verte” (“green fairy”), as it was
called at the time, became the quintessential
French aperitif, associated with names like
Van Gogh and Toulouse-Lautrec. In 1915,
under pressure from the wine lobby, the sale
Two centuries of
French-style aesthetical
inspiration
of absinthe was banned in France. It wasn’t
until the turn of the 21st century that it was
again made legal under its original name.
This spirit is served according to a specific
ritual: by pouring iced water drop by drop
into a glass of absinthe over a sugar
cube placed on a slotted spoon, which is
itself placed on the glass. Was it this peculiar
ceremony that made absinthe the drink
of choice for artists? Because even after
a century of official prohibition, it remains
a source of aesthetic inspiration: the co-founders
of Kitsuné, the French fashion and music
label, approached Pernod Absinthe with
the idea of launching a collection inspired
by the fée verte. Thus was born a limited edition
of exuberantly coloured bottles, 1,805 in all,
in honour of the year in which the brand
was founded. Two centuries after its creation,
exports of Pernod Absinthe were up 30%
between 2011 and 2012.
Absinthe: a historical
serving ritual.
MobilitY AND convivialitY
The Wine & Spirits industry offers hundreds
of branded mobile applications (‘apps’),
primarily for the iPhone. With cocktail recipes
at the forefront of consumer demand, brands
are creating apps mainly related to modes of
consumption, such as mixology tutorials. The most
popular of these is Drinkspiration by ABSOLUT,
with 555,000 downloads worldwide, which offers
a comprehensive drinks-themed experience and
innovative social navigation. Other apps play
more on the brand universe, such as Malibu’s
Music Mixer, which lets users mix a variety of hot
tracks with a mixing deck, and Ballantine’s Loud
Blue, which features an algorithm that creates
melodies from photos shared on Instagram.
Augmented reality
Some brands push mobility even further
by providing augmented reality content when
users point their phone’s camera at a QR
code on a tag or bottle. Another trend
in app development is one that adds value
to the purchase, such as brand information or
suggestions for food and wine pairings. These
apps often rely on partnerships with suppliers
of services already adopted by users –
geolocation, recommendations, targeted offers,
etc. There are still many avenues for industry
players to explore, but one thing is certain:
there are still many doors that digital media
can open for conviviality.
Scan this flashcode with
your mobile to download
the free application
Drinkspiration from the
App Store (iPhone/iPad)
and the Play
Store (Android).
Home sweet home The renewed emphasis on the “art of entertaining”
at home is creating new opportunities for industry players. In most major cities,
for example, businesses have sprung up offering “kits” for entire meals, while
some bars are looking at launching schemes for takeaway cocktails. Ready-to-drink
cocktails are already common in distribution channels: between Malibu’s pre-mixed
drinks, packaged in portable pouches for sharing, and Jameson’s individually
bottled mixes in apple or cola, the brands are not short of ideas on how to meet
the needs of the at-home bartender.
9
pro f il E
High Net Worth
Individuals
HNWI: Behind this acronym hides one of the most
coveted targets of consumer businesses today –
wealthy individuals whose choices determine
tomorrow’s codes of luxury.
The High Net Worth Individuals
(HNWI) category includes anyone who
has at least US$ 1 million in liquid assets.
Their combined worth is around
US$ 42 trillion and there are 11 million
of them worldwide, mostly from North
America, Europe and Asia. But HNWIs
are primarily citizens of the world,
having more in common with an alter
ego on the other side of the globe
than with one of their fellow countrymen.
Nomads, domiciled in one country and
a resident of many others, their dentist
is in Berlin, their children go to school
in London and they flock to the Singapore
Grand Prix. Among these elite, experts
have identified two categories: “old
money”, whose fortune was inherited,
and “new money”, who have acquired
their wealth on their own. Some
are discreet, while others are eager
to show off their success. But
common characteristics emerge
from numerous studies: HNWIs love
private environments and feeling safe.
They are ultra-demanding customers,
in search of excellence. They are
interested in the arts, sports, the
environment and charitable activities,
making brand involvement in these
areas essential. They attach overriding
importance to expertise and surround
themselves with those who have it advisors, personal shoppers, sommeliers,
etc. Their personal sphere is connected
to their professional sphere, but they
place immense value on family and
unanimously recognise that the greatest
luxury in life is time.
Vadim Grigorian
Luxury and Creativity
Director,
Pernod Ricard
“With HNWIs, ‘traditional’
marketing is impossible. They
want to have a special relationship
with the brand. To win their loyalty
– and they are very loyal – we need
intimate and exclusive events,
exceptional encounters, such as
tastings with master artisans or
private dinners with great chefs.
They are hard to find: they
aren’t on social networks
and are difficult to reach by
phone or email. To make contact,
we go through ‘connectors’,
members of their entourage
who are on hand to advise
them (such as their hairdresser
or tax advisor). The authenticity
of the product, and the know-how
behind it, is paramount. HNWIs
are interested in each material,
every ingredient. They are
in search of meaning”.
10 entreprendre # 58
SPECIAL
REPORT
NEW AFRICAS
NEW FRONTIERS
The entrepreneurial spirit that led Pernod Ricard
in Asia 25 years ago is now taking the Group
to new frontiers with multiple faces. A dive at the heart
of Africa, whose economic potential is rising thanks to
a determined and connected emerging middle class.
To access the photos and
videos of the report go to
www.pernod-ricard.com
or scan this flashcode
with your mobile.
11
FEATURE
SPECIAL
REPORT
They are young, trendy and
optimistic. Men and women alike.
They embody the other face
of Africa – a constantly
changing continent.
W
e could be in New
York, Sydney or
Toronto – any
place where you
might sink into a
comfy chair, barefoot, with your
laptop, beyond which you see the counter
of a coffee shop identical to those that flourish along the streets of capital cities in the
Northern Hemisphere. The customers are
young graduates – cool and connected to
the digital world. All the time. It’s both a
question of economic opportunities and
lifestyle. But we’re a long way from the
Nairobi, the capital
of Kenya, is also
the country’s
largest city, with
a population that
is expected to
reach 4 million
by 2015. Nestled
in the midst
of a wild natural
environment, the
city has abundant
green spaces and
combines tradition
with modernity.
12 entreprendre # 58
West, and the so-called technology gap
between rich and poor. Here in this mixed
business/residential neighbourhood of
Nairobi, along Ngong Road, on the sixth
floor of the Bishop Magua Centre, the community of “techies” – as they’re called here
with less derision than “geeks” and other
members of the new technologies tribe – is
a place to imagine the Kenya of tomorrow.
It’s called the “iHub”, a multifaceted place
where people come to discuss ideas and
projects, develop future applications for
mobile phones, seek funding, or simply create their own business, relying on their own
talent and ability to innovate. “Forty-two
companies have already emerged from this
cluster”, says Rachel Gichinga, a regular at
the iHub. “Everyone wants to create their
own job in an innovative sector. It’s a sign
that young Kenyans are taking charge of
their lives. I’ve seen a profound change over
the last four or five years. Back then, trying
to create your own business wasn’t the done
thing. Young graduates mainly focused on
joining a traditional company, an organisation with a name, an office. Because that
was what our parents expected. That’s no
longer the case. People want to build their
own future.”
Now one of the most dynamic economies
in sub-Saharan Africa, Kenya is on a clear
path of growth. “The Kenyan market is
expected to grow by 15% in the coming
years”, says Marc Beuve-Méry, CEO of Pernod Ricard’s Kenyan subsidiary in Nairobi.
This robust growth is found in a dozen or
so economies in this part of Africa: demographic heavyweights like Nigeria and its
170 million people; countries like Angola
with its vast natural resources; and countries such as those of the East African
Hub, which includes Uganda and Tanzania.
These countries are outperforming the rest
because of the reforms they’ve enacted to
boost entrepreneurship and ensure greater
political stability. All of them have invested
in education, giving rise to generations of
young graduates connected via Wi-Fi from •••
FEATURE
“Everyone wants
to create their own
job in an innovative
sector. It’s a sign
that young Kenyans
are taking charge
of their lives.”
“A wind of
optimism blowing
through Kenya”
Three questions
for Sitoyo Lopokoiyit,
Head of Marketing
and Strategy for mobile
operator Safaricom
on the launch of
its mobile payment
application, M-Pesa,
in Kenya.
Tell us about M-Pesa...
It’s a mobile application that
we launched in 1997 in response
to demand from microcredit
institutions looking for a simple
solution to issue loans, facilitate
repayments and obtain the
best interest rates. Safaricom
understood that this innovative
service could go further.
Having initially been extended
to money transfers, M-Pesa is
now used for paying a wide
variety of bills from a mobile
phone. From electricity to
hospital bills, this system –
which allows all kinds of
payments – has also become
a speedy and widely-used way
to send money to relatives,
which many Kenyans traditionally
did by returning to their village
on weekends. Today we have
15 million customers, a total
of 4 million transactions being
made per day, and we account
for 37% of Kenya’s annual growth.
Does this success reflect
the mood of the country
today?
There is a strong wind of
optimism blowing through
Kenya right now. People
aged 25-35 dream of a
bright future, and they are
dreaming big. Kenyans want
and hope for the best of what
life has to offer in the short
term: a strong educational
system, efficient health care,
good governance and
a country at peace. The time
is right. The opportunities are
there, and the economy is
booming. Telecommunications,
construction, transport and fibre
optics – these industries are
driving the country forward.
Are new technologies also
helping to change Kenya’s
image abroad?
In terms of technological
innovation, Kenya has jumped
full-force into the digital
revolution because our
business environment
made this success possible.
The telecoms regulator
is encouraging this trend:
it wants to ensure that the
entire population benefits
quickly from these advances
and adopts them fully. I imagine
us in a few years’ time to be
somewhere between South
Africa and Dubai. Now, business
leaders from around the world
are coming to Kenya. When you
see how far we’ve come in the
past eight years, there is good
reason to be optimistic.
13
FEATURE
“As a result
of Kenya’s
booming
economy,
Nairobi
is seeing
shopping
centres and
malls sprout
up one after
the other”
Kenya has become an
African benchmark
for information and
communication
technologies.
An illustration is the
iHub, a Nairobi-based
incubator that
has helped to launch
some 40 start-ups.
Left photo: Inside
the Radio Capital
FM studios with
its star presenter
Grace Makosewe,
who organises some
of the most popular
events in the Kenyan
capital – the Kitenge
Festival, Shoe Lounge,
and more.
14 entreprendre # 58
FEATURE
••• Lagos, Accra or Nairobi. “In countries such
as Nigeria and Ghana, if you ask, ‘what’s
your main reason for wanting to make money?’ People will tell you, ‘to pay for a good
education for my children’”, says Bill Russo, a
director specialising in the Africa region at McKinsey & Company, and the author of a study
on the rise of the African consumer.
“This is a complex continent, with huge disparities within a single country, which is why
our approach is city-based”, says Laurent.
Marc explains, “In Kenya, it’s no longer rare
to earn $2,500 a month, and we believe there
is now a population with annual incomes of
over $10,000; they are potential targets of our
brands, including in the Premium segments”.
he long-awaited emergence
of the African middle class is
now a reality. It is this class,
and its appetite for consumption, that is driving the
markets of the continent’s
emerging countries. “Consumer spending accounts for two-thirds of
the growth in sub-Saharan Africa, which is
around 7-8%”, says Laurent Pillet, Managing Director of the region for Pernod Ricard.
He adds, “In 2050, the continent will have a
population of about 2 billion people, which
is another factor in its growth”. In Kenya,
this emerging class now represents 17% of
the population of a country that currently
has 42 million inhabitants. They are young,
urban, entering the workforce with master’s
degrees in hand, concentrated in the Nairobi
urban area and large cities such as Mombasa.
“Kenyans’ tastes are evolving, because they’re
no longer embarrassed to ask for what they
want or to pay the price to have it”, says Anna
Othoro, who heads the new Kenyan satellite of the luxury concierge service, Quintessentially Lifestyle. In her role, Anna has
first-hand knowledge of the expectations of
her country’s upper classes, which represent
about 5% of the population. “In the last two
or three years, all the international brands
have come to Kenya, because there’s a strong
local demand”, she says. “Before, Kenyans
went to Dubai to purchase consumer goods,
but now they’re available here. And Kenyans
are no fools – they are well-versed in recognising quality when they see it.” According
to Anna, nearly all sectors are being buoyed
by this growth, especially telecoms, banking,
food processing and real estate. “We’re seeing luxury property developments springing
T
up, including villas that are sold with a golf
course, swimming pool and movie theatre. At
nearly €2 million, these are the first to sell”,
she says.
A result of the economic boom, Nairobi is also
seeing the development of shopping centres
and malls. “There used to be four, but soon
there will be twenty-nine”, predicts Anna.
Long confined to city centre office districts,
retailers are now opening up across the capital. “People today want to work, play and eat
in the same place”, comments Martin Kariuki,
a copywriter at Capital FM, Nairobi’s leading radio station and the soundtrack for this
rising generation of Kenyans. Ensconced in
their downtown offices, the station’s writers
resemble its listeners: a generation of thirtysomethings, open to the world, outgoing, and
with an unshakeable belief in a better future.
“It’s amazing – it seems like the country is
constantly changing”, says Martin. “We’re
working hard for this, so we want to play hard,
too.” In the bars, restaurants and night clubs
of Nairobi, this middle class is now showing
up, and it’s set on living life to the full. It’s a
privilege previously reserved for Kenyans in
the diaspora who’ve come back to the country
for a few weeks. “They’ve also played a role •••
15
FEATURE
“Africa: A land
of flavours”
THREE questions to Charles Rolls, co-founder
of Fever-Tree, a range of Premium mixers
launched in 2005, made from ingredients
produced in three African countries.
How did Fever-Tree
come about?
I was heading up the Plymouth
Gin brand at the time.
At a tasting to find the best tonic
in New York in 2000, I noticed
that the tonics didn’t measure
up to the quality of the gins.
Instead of enhancing them,
these mixers were masking
their taste, subtlety and aroma.
A glance at the labels of these
products on both sides of the
Atlantic revealed that they were
full of saccharin and second-rate
ingredients, which meant
that they were very aggressive
on the palate. Three years later,
with my new business partner
Tim Warrillow, we developed
the idea of creating a range
of Premium mixers guided
by taste and based on
the finest natural ingredients.
the purest. It’s the search
for quality, above all, that
guides us.
How have your products
been received?
They’ve been very well
received: we have distribution
in 38 countries. In Africa,
we supply a major hotel
in Marrakech, and another
in Luanda, Angola – via Portugal.
It’s very exciting to see our
products on this continent,
even if they got there via almost
accidental channels! Our
approach is based on quality
and taste, and I’ve always
believed that Africa has
much to offer in that area.
The new Kenyan
middle class goes
out to clubs that could
easily be mistaken
for those of London
or New York.
How did you identify
the best ingredients?
Some of them come from Africa.
For the tonic’s main ingredient,
quinine, we located the best
source in the world in the
eastern Democratic Republic
of Congo and found a local
supplier. The bitter oranges
are grown in Segoma,
in a mountainous area
of eastern Tanzania. Lastly,
to make our ginger ale,
we “do our shopping”
in Ivory Coast. We source
these particular ingredients
in Africa because that’s
where we find the best and
16 entreprendre # 58
•••
in our economy’s take-off”, says Anna, “with
their experience, their needs, except that now
they’re investing here”. It’s a trend that Martin
confirms: “If a Kenyan living in New York or
London goes to an extravagant club one night,
he’ll try to recreate that space here”.
In these new spaces with their blend of Kenyan professionals, Western expats and the
golden youth of the Indian minority, there
is a new focus on high-end consumption
and the search for Premium brands. “Kenyans want to treat themselves by drinking
international brands”, explains Tilak Ruparel,
co-manager of Slater and Whittaker, one
of Pernod Ricard’s main distributors in
Nairobi. “This is especially apparent once
consumers hit their thirties. They’ve settled
down, they earn a good living, and they’ve
developed their palates and refined their
tastes. That’s when, almost automatically,
they will abandon brandy for Premium
whisky or vodka brands – hence the success of Jameson and ABSOLUT.” Jameson
accounts for 70% of Pernod Ricard’s net
sales in Kenya, after twelve months of active presence during which sales by volume
jumped ten-fold. “Kenyans know international brands and are demanding consumers; they pay close attention to the marketing, the packaging, the message”, says
Marc Beuve-Méry. This encouraging start
is no surprise to Laurent Pillet: “Consumers know our brands: as soon as we launch
them, we see phenomenal growth”.
What’s more, conviviality is at the heart of
life in Kenya. For every celebration, every
get-together, there is a drink that goes with
it. Marc illustrates: “We’ve identified two
types of socio-cultural situations which
correspond to two types of ranges. In Kenya,
in Kiswahili, it’s called “Mpango”: the
planned time together, the party arranged
between friends, with a predetermined
location, which is our target for the Premium range. Then there are the “casual”
occasions: the after-work drink with colleagues, or whilst watching a football game
on a Saturday afternoon; settings that
don’t warrant an extra expense, and which
are well-suited to a mid-range product”.
These new, demanding, thirty-something
consumers are also women. Their names •••
FEATURE
Angola: a land
of contrasts AND
opportunities
With average growth of 7% per year, mainly
on the back of oil exports, Angola is the third
largest economy in Sub-Saharan Africa, after
South Africa and Nigeria.
T
he country plays host to
over 500 foreign companies
which account for 40% of
its GDP. Many Chinese and
Portuguese nationals, often
young graduates, are settling
in the country. Angola’s current appeal is certainly due to its precious
underground resources, but also to nearly
ten years of political stability after several
decades of war – a time when the country
imported 100% of its consumer goods.
“Of course, today there is a gap between
GDP and other development indices: 70%
of the population lives below the poverty
line, in contrast to the 1% of very rich. But
the emergence of a new middle class – that
we still need to identify within the remaining 30% of the population – is expected to
boost the economy and improve these data.
Still, this middle class live mainly in Luanda, where wages are relatively high, especially in the oil industry”, says Jean-Baptiste
Mouton, Director of Pernod Ricard’s new
Angolan subsidiary.
From a partnership with a local distributor
to the launch of a subsidiary
utor recently retired. “We took the opportunity of this withdrawal to open a subsidiary
in September. It’s a process that’s in line with
the Group’s overall strategy in sub-Saharan
Africa”, says Jean-Baptiste. In a spirits market that is 80% dominated by whisky, Angola
currently represents 12 million cases. “It’s
going to give us great opportunities in the
medium and long term”, he says.
A high value on brands
Angolan consumers place a high value on
brands. They are willing to pay the price
difference for a Premium label. The middle classes are particularly attached to
Ballantine’s and Passport, with the latter
almost seen as an institution. Per capita
consumption is generally high and extends
across the country. “Moments of conviviality are highly prized by Angolans”, adds
Jean-Baptiste. “The notion of sharing, a
culture that loves celebration, and a growing need for social recognition, explain
their special relationship with spirits.”
Ballantine’s, Chivas Regal, Jameson and
ABSOLUT Vodka are reaping the benefits
of this market’s optimism.
Pernod Ricard’s products have been on sale
here for about a decade, but the local distrib-
17
FEATURE
•••
“South Africa,
the testing ground
that started it all”
are Felly, Wangu, Mathilda and Immaculate:
four Kenyans, active, educated professionals, who meet “as often as possible” at their
wine and spirits tasting club. On this late
Friday afternoon, they’ve braved the chaotic rush-hour traffic to meet in a small, private room at The Explorer, a venue that is a
cross between a cocktail bar and a lounge.
Across from them is Nelson Aseka, Jameson’s Ambassador for East Africa. On a
low table sit three glasses each, for testing the differences between Irish whiskey,
bourbon and Scotch. Nelson starts with
the history of the brand and explains its
manufacturing process, including its triple
distillation process. Wangu asks, “What’s
the best way to serve it?” The four nod in
agreement when Nelson shows them that
“water doesn’t spoil the whiskies’ taste”.
After a thirty-minute tasting session,
these ardent rugby fans slip away to begin
their evening in the heart of The Explorer.
Mathilda, who also admits to being keen
on Martell Cognac, says, “Of course, our
good pay allows us to learn about and buy
products like Jameson. It’s mainly a question of income”. And when asked what
their men think about their weekly “girls’
night out” with a glass of whisky, she exclaims in surprise, “We’re in the twentyfirst century now! The world has
changed”. Kenya has too.
Pernod Ricard’s first foothold on the African
continent, South Africa has given the Group
a choice position within its Wine & Spirits industry –
a success the Group owes largely to Jameson.
When Pernod Ricard arrived on the continent in 1993, South
Africa was its bulkhead: a pioneering country where the Group
put down roots after the first post-apartheid elections, which
celebrated the election of Nelson Mandela as South Africa’s
first black President. The first brand distributed there by Pernod
Ricard was Jameson whiskey. As the Group prepares to celebrate
two decades of active operations, South Africa remains an
experimental testing ground for the Africa of tomorrow, when the
rest of the continents’ markets are mature. It is in this country of
50 million inhabitants, the largest African economy (accounting
for over 30% of sub-Saharan Africa’s GDP), that multinationals
are setting up to begin their own relationship with the continent.
South Africa owes its growth to its abundant natural resources,
and more recently to the services sector, particularly finance.
“The country is attractive yet full of contrasts, with GDP growth
of 3% to 4%”, says Conor McQuaid, CEO of the South African
subsidiary. “That rate of growth is not enough to bring
down unemployment – which is over 25% – but there are
real opportunities for consumer goods such as spirits.”
Growing demand on the market for Premium spirits
Jameson whiskey
tasting at
the Explorer,
a cosy bar in
central Nairobi.
18 entreprendre # 58
South Africa was not greatly impacted by the financial crisis
of 2008-09, however the Group’s strategy in South Africa
“has always been aimed at the emerging middle class
consumers”, says McQuaid. After 20 years there, Pernod
Ricard boasts a value market share of 13%, with a presence and
significant growth potential in the Premium and ultra-Premium
segments. Jameson, for example, embodies almost the entire
Premium Irish whiskey segment (98%). While growth is less
robust in South Africa than in countries “where everything
remains to be done”, the demand for Premium spirits will rise.
The main beneficiary of increasing “Premiumisation” will be the
whiskies sector, both Scotch and Irish – a segment that soared
by 7% in 2011 and outpaced the largely domestically produced
brandies in terms of volume for the first time in 2012. “We are
seeing strong growth not just for Jameson, but also for Chivas
and The Glenlivet”, says McQuaid.
Johannesburg, in South Africa, is an ideal base for analysing
consumer expectations on the continent, which in turn will
develop Pernod Ricard’s ability to innovate in sub-Saharan
Africa. An observatory and a testing ground, the Innovation
unit of Pernod Ricard Sub-Saharan Africa is a key part
of the scheme: “Innovation lies at the heart of our strategy”,
says Paul Campbell, director of this department. “African
consumers have different tastes and it is our job
to understand these differences.”
FEATURE
portfolio
Conviviality in Nairobi… Photographer Philippe Lévy
pictures a night inside the trendiest places
of Kenya’s capital city.
All of Nairobi’s
elite flock
to the “Fashion
High Tea”,
an annual
event that
celebrates
fashion.
The funds raised
by the event
are donated
to an NGO
that cares
for children
suffering
from cancer.
19
FEATURE
portfolio
From Denmark
to Africa...
Bo Concept,
the Scandinavian
furniture
designer, made
a splash with
the inauguration
of its Kenyan
store.
20 entreprendre # 58
FEATURE
Fashionistas,
unusual cocktails...
The hip nights
of Nairobi could
easily compete
with those of other
big cities around
the world
The Ice-Man,
a company that
specialises in
ice-sculpting,
created a
fountain that
simply needs
to be filled
with ABSOLUT
Raspberri to
produce a mix
at the right
temperature.
21
FEATURE
portfolio
Shortly after
7pm, with night
falling near
the equator,
the bars on
Electric Avenue
– Crooked Qs,
Qstakes,
Havana,
Bacchus,
Rezouras, and
more – start
to come alive.
22 entreprendre # 58
FEATURE
The crowded bars
of Electric Avenue
are bursting with
communicative
energy
23
FEATURE
In
perspective
Bill Russo, a director specialising in
the Africa region at McKinsey & Co.
consultancy firm, is the co-author
of a recent report(1) that confirms
the dynamism of about fifteen African
economies, boosted by commodity
prices, explosive population
growth, and the growing purchasing
power of the urban middle classes.
Is it fair to say that Africa is a booming
continent today?
Yes, you could say that. It’s undeniable, and all the
figures prove it. Africa’s growth is fuelled by commodity
prices, which account for 24% of the growth. No one is
unaware of the global economy’s need for the natural
resources that are abundant in Africa. But that doesn’t
account for everything. Despite outside perceptions to
the contrary, there has been enormous progress made
in terms of political stability. The number of conflicts is
declining overall, and many governments have initiated
reforms to improve the business environment, which
are now paying off. Africa also has the distinction of
having 60% of the planet’s unused arable land. Given
the need for farmland to support the world’s growing
population, there could be a “green revolution” in Africa
– that is, sustained development through a policy of
high-yield agriculture.
Is this trend likely to continue?
Yes, of course, since commodity demand is expected
to keep rising, favouring the countries that have them.
Yet since the 2000s, less than a tier of Africa’s growth
has come from commodities, and 45% has come from
consumer-facing or partially consumer-facing sectors. This
growth, then, is mainly being driven by African consumers!
The population boom will fuel this economic dynamism
with a young, more educated and urbanised population
– productivity is four times higher in the cities than in the
countryside. We have calculated that by 2030, Africa
will account for about 40% of population growth. Those
new consumers, whose needs will be enormous, will
contribute to Africa’s growth through industries such as
food processing.
And we shouldn’t overlook the importance of noncommercial sectors, such as education, which are making
constant progress. This is a huge step, as it translates
into more skills and talent that will lend credibility to the
domestic jobs market. The continent is now attracting the
interest of the rest of the world.
24 entreprendre # 58
FEATURE
Forget the stereotypes!
How well do you know Africa? Here’s a short quiz
to test your knowledge.
1/ In the decade from 2010 to 2020, Africa’s population
will grow by:
Which countries are driving the continent’s growth?
Aside from South Africa, which has the most advanced
economy but where growth is relative (+3% GDP per
year), the most dynamic economies are Nigeria (+7%)
followed by Angola. Kenya, Tanzania and Uganda – the
countries of the East-African Hub – are booming, and let’s
not forget Ghana, Senegal, Zambia and Mozambique.
What does this dynamism mean for the
African people?
Most importantly, it means the growth of purchasing
power for a segment of the population, and consequently
the emergence of new types of consumers in Africa.
Their “discretionary” spending is rising sharply, or in
other words, the share of the budget not dictated
by basic necessities. However, these populations are
concentrated in 10 of the 54 countries that make up
Africa. A total of 81% of Africa’s consumer spending in
2011 came from these 10 nations.
A. 0.2%
B. 2.3%
C. 25%
2/ What is the proportion of Africans who think
their situation will improve very significantly
in the coming years?
A. 5%
B. 29%
C. 55%
3/ What percentage of sub-Saharan Africans believe
that the major food brands offer better quality?
A. 44%
B. 60%
C. 90%
For the correct
answers, see
the McKinsey report
on consumption in
Africa by scanning
this flashcode with
your mobile phone.
What characteristics define these consumers?
Firstly, their optimism and their confidence in the
future. For example, in Ghana, 97% of the population
believes that their personal situation will improve in the
next two years.
In terms of behaviours, they are also very price-sensitive
consumers; they do a lot of research to find the best deal,
but are concerned about product quality: low prices are
associated with low-quality products or services.
Purchasing decisions are brand-driven. There is, in fact,
a strong affiliation with brands, a kind of loyalty, although
they remain very attentive to fashions and trends. This
is reflected in a wide variety of purchasing behaviours.
Self-image is important, and enhancing it through
consumption is a factor to consider.
As young people – 51% of Africa’s population is under
20, versus just 28% in China – and seekers of product
information, African consumers are big users of social
media. New technologies have taken hold quickly in
Africa, and have changed how consumers view the
world. In Africa, making a purchase using a mobile phone
isn’t something exceptional: In Europe, people are only
just starting to do so. But Westerners and Africans alike
view shopping as a social activity, a pastime to share
with friends.
What should a multinational company seeking
a foothold in Africa do?
Firstly, the distribution structure in most countries is still
dominated by the informal sector, even though that’s
rapidly changing. To give you an example: the South
African distribution chain, Shoprite, plans to open more
than 700 supermarkets in Nigeria in the coming years.
But that doesn’t mean the informal sector will disappear
– it will always play a key role. Secondly, it’s important
to understand that companies may face particular
difficulties, such as the supply of energy. One company
official told me recently that his number one expense was
for diesel fuel. That’s because he was affected, like the
rest of the population, by frequent power outages and
had to resort to using generators. The question of talent
is also crucial: for those who want to penetrate local
markets, their priority must be to recruit local talent and
use them to develop the capabilities of the company or
subsidiary. The employee’s first months on the job should
be considered as a final training period. They shouldn’t
necessarily be expected to perform right from the word
go. Lastly, what applies for recruitment also applies for
development: the African continent is changing rapidly,
and companies choosing to operate there must support
that transformation dynamically and proactively.
(1) The rise of the African consumer. McKinsey & Company, October 2012.
25
FEATURE
FACTS AND FIGURES
Africa today is more dynamic than ever. By 2050, Africa’s population will
have doubled to two billion people. Nigeria, which currently has a population
of 170 million, will become the third most populous country in the world,
behind India and China. The economic potential of this market
is undeniably promising.
85
YOUNG,
URBAN AND
CONNECTED
Africa’s population is the youngest
in the world: half of its inhabitants
are under 20. In China, this age group
is just 28% and in Europe, 22%. Africa’s
urban areas are home to 40% of the
total population, compared to 45% for
China and 30% for India. Moreover,
the use of mobile phones and digital
tools is skyrocketing; 57% of internet
users log onto social networks, often
via their mobile phones.
26 entreprendre # 58
million households
in Africa have an annual
income of over $5,000;
there will be 130 million
of them in 10 years’ time.
Between
7 and 8%
That’s the overall
annual growth
rate of sub-Saharan
Africa over the past
decade. Consumer
spending, particularly
amongst the emerging
middle classes,
accounts for two
thirds of this growth,
far ahead of natural
resource use.
84%
of city dwellers
in sub-Saharan Africa
say that their situation
will improve in the next
two years.
Thus showing great confidence in their continent’s economic growth.
FEATURE
Between
44%
of consumers in
sub-Saharan Africa
associate quality
with international
brands, and
consider a branded
product to be
of higher quality.
African consumers
are loyal to
the brands and
businesses they
like: 70% say they
are loyal to a small
selection of brands,
and 55% always
shop at the same
grocery store.
5 and 30 Depending on the
country and segment,
that’s the rate of growth
of modern trade in Africa.
It’s a sharp rise, even if it still represents a minor share
of the various markets.
In
2009
%
DiversitY
Africa is a land of
diversity, including
religious. In the
countries of subSaharan Africa, it is
estimated that 63%
of the population are
Christian and 30%
are Muslim. This is
in contrast to North
Africa and the Middle
East, where 91% of
citizens are Muslim.
Source:
• The rise of the African
consumer, McKinsey & Company
(flash code p. 25).
• www.oecd.org/africa/
China became Africa’s
largest trading partner,
surpassing the United States.
The share of Africa’s trade with emerging countries
has increased from 23% to 39% in the last decade.
Among emerging countries, Africa’s five largest
partners are now China (38%), India (14%),
Korea (7.2%), Brazil (7.1%) and Turkey (6.5%).
27
FEATURE
success stories
Jameson Irish whiskey in South Africa, Passport Scotch whisky in Angola:
A look back at two successful models in Africa from
the Pernod Ricard brand portfolio.
Jameson
in South Africa
S
outh Africa is the first country in
Africa where Pernod Ricard established a presence. That was in 1993.
Since then, Jameson whiskey has
been unstoppable in gaining market
share, forging its path behind the
now famous tagline, “Triple distilled,
twice as smooth”.
South Africans today consume 200,000 cases of
Jameson per year, having been won over by Irish
whiskey’s characteristics thanks to a multitude
of marketing and tasting campaigns aimed at
potential customers. As explained by Conor
McQuaid, CEO of Pernod Ricard South Africa:
“In South Africa, we’ve successfully deployed
the global vision of the brand”. In a country
where whiskies are now duelling with brandies
for volume leadership, Jameson has won over
consumers through its taste profile, emphasising
its distinction. “We saw that there was a demand
for a whiskey with a distinct taste and we played
that card”, says McQuaid. That’s how the brand
gradually gained a foothold. “We targeted the
right consumers, young increasingly affluent
socialites, wherever they came together to enjoy
time together, to help customers discover the
taste of Jameson and raise its visibility”, explains
McQuaid.
Despite a strong emphasis on a consistent
advertising message, Jameson’s success isn’t due
to its positive image alone. “In essence, the brand’s
greatest strength is that people drink it mainly for
its taste. South Africans just want to drink what
they enjoy.” Jameson therefore partnered with the
rising generation of writers and directors in South
Africa to create Jameson First Shot. This yearly
cinematic partnership allows the winner to make
his or her first film, starring a famous actor. Last
year, it was Kevin Spacey; this year, Willem Dafoe.
28 entreprendre # 58
FEATURE
Passport Scotch
whisky, a bestseller
in Angola
I
n the minds of Angolans, Passport is more
than just a whisky. Even today, the brand
symbolises “the companion of the hard
years”, says Jean-Baptiste Mouton, Director of this southern African subsidiary.
The number one Pernod Ricard brand
distributed in Angola, Passport, was one
of the only foreign products available during the
long years of conflict. “Our local distributor at
the time established the brand in what amounted to a war-time economy”, adds Jean-Baptiste.
This aura still benefits Passport, even as Pernod
Ricard set up its own subsidiary in Luanda, in
September 2012. For Angolans, Passport is both
a serious product and an international brand, but
one that remains affordable. Sold at around $10 a
bottle, “Passport conveys an image of prestige and
respect, whilst figuring prominently in the traditions and everyday lives of Angolans”, says JeanBaptiste. Their weekends, too, one might add, in a
country where celebration and a genuine culture
of sharing help Passport to keep its number one
position among foreign brands. Another reason
for its success is its easily identifiable packaging:
a square, green, no-nonsense bottle. But more
importantly, “it’s a brand that has never stopped communicating with its
consumers, making them the focus of
its message”, Jean-Baptiste explains.
“We are actively working on the
development of Passport’s image.
The product is in all three distribution channels of the African
market: modern supermarkets,
on-trade, and informal distribution – small shops, mobile retailers – so it can be found almost everywhere”, he concludes. All those
factors have led Passport to be the
first brand of Scotch whisky on
the Angolan market.
29
FEATURE
CASABLANCA
mapping
In afriCA
Pernod Ricard is confident of the strong growth
potential of its business across the continent.
For the past 18 months, the Group has led
a series of settlements – a campaign that will be
the starting point of its development in Africa.
Morocco
whisky, vodka, anise-based spirits
ªPresent in Morocco for many years,
P
er no d R ic a rd , wh ich
currently generates 90%
of its net sales outside of
France, has been present
in A f r ica since 1993,
through its South African
subsidiary. In keeping with
its decentralised organisation and growth
model, over the past two years the Group
has opened other subsidiaries in priority
markets. “No fewer than six new sites have
been opened in Ghana, Namibia, Nigeria,
Angola, Kenya and Morocco. Africa is going
to be a leading growth region”, says Pierre
Pringuet in this issue’s editorial. Consisting
of both international managers and native
professionals, the teams are independent and
trained in the way multinationals operate.
To win over customers and capture opportunities, products must adapt to the various
African markets in terms of price, merchandising, range, packaging and so on. “When we
set up Pernod Ricard in Kenya, we thought
about the consumers, their motivations and
consumption patterns”, says Marc BeuveMéry, Director of the East African subsidiary launched in August 2012. Each regional
market has been dissected. “It’s a city strategy
rather than a country strategy, due to the huge
cultural differences across the continent”,
says Laurent Pillet, Managing Director of the
sub-Saharan region for the Group. He adds
that “10% of the population accounts for 70%
of economic activity”.
Traditionally, the continent is considered a
market for brown spirits, with whisky and
brandy posting the highest sales. The population’s outward turn, reversed migration,
foreign partnerships – all go in the direction
of expanding the offer of spirits brands, from
the most standard to the ultra-Premium.
Jameson, Ballantine’s, Passport, Chivas
Regal, The Glenlivet and ABSOLUT are all
booming brands today. “To achieve our tar-
30 entreprendre # 58
Pernod Ricard set up its own subsidiary
there in 2012.
gets, we need to focus on a specific feature
of the African markets: distribution, which
is dominated by the informal sector. We are
striving to get closer to consumers”, says
Laurent Pillet. Laurent Lacassagne, Chairman & CEO of Pernod Ricard Europe,
to which the African subsidiaries report,
concludes: “Africa already represented 5%
of the Europe entity’s profits in 2011/2012.
Our priority for the next five years will
be to expand our brands’ presence and
raise awareness of their image and values
amongst consumers”.
Abidjan
Accra
Ivory
Coast
ª Sales office
established in 1993.
Ghana
whisky, vodka, champagne,
anise-based spirits and bitters
23
%
GR OW T H
in net sales of
Pernod Ricard’s
brands
(Top 14
and Key local
brands)
in sub-Saharan
Africa between
July 2012
and
February 2013
ªOpened in November 2012,
the Pernod Ricard sales office
in Ghana handles brand sales
and marketing in West Africa.
It also supervises the sales offices
in Gabon and Ivory Coast.
Nigeria
cognac, champagne, whisky
and vodka
ªA demographic boom, rapid
urbanisation, an expanding middle
class: Nigeria looks like the most
promising market in the region.
The subsidiary was established
in December 2012.
NamibiA
whisky and brandy
ªThe subsidiary was created
in September 2011, but Pernod
Ricard’s brands have been
in Namibia since 1993 through
the South African subsidiary.
LAGOS
FEATURE
1 subsidiary
st
1993
Creation of the
continent’s first
Pernod Ricard subsidiary
in South Africa
GABON
LIBREVILLE
ª Sales office
Nairobi
created in 2009
Kenya
angola
Luanda
whisky and champagne
ª Pernod Ricard
leads the Angolan spirits
market, a result achieved
in part thanks to the
success of Passport
whisky. It’s one of
the most spectacular
launches for a subsidiary –
this one was inaugurated
in August 2012.
whisky, liqueur and vodka
ªCreated in August 2012, the Kenyan subsidiary generated 70%
of its net sales for the year through Jameson whiskey. It’s a country
where Premium brand products are a sign of attaining a certain
social level. The subsidiary also handles brand sales and marketing
for all of East Africa and the Indian Ocean islands.
Windhoek
South Africa
whisky, brandy, vodka, tequila, rum
ªPernod Ricard opened its first African subsidiary there in 1993.
CAPE TOWN
South Africa remains a priority market for the Group, one which
the subsidiary leads in super-Premium whiskies and local rums.
31
C rosstal k
Enterprise social networks
Accelerating
innovation
and creativity
Familiar to the public at large, social networks are
no longer confined exclusively to the private sphere.
They are now making their way into the workplace,
in versions tailored to the professional environment,
and with an ambitious aim: to accelerate value
creation by connecting employees.
AN interview WITH Olivier Cavil,
Communications Vice-President at Pernod
Ricard, and James Parker, Customer
Success Director at Salesforce.com,
to learn more about the challenges
of implementing Pernod Ricard Chatter®.
In November 2012 Pernod Ricard launched its
enterprise social network which uses Chatter®,
the solution developed by Salesforce.com. What
motivated this choice, and what does it mean?
Olivier Cavil: Salesforce.com is the world’s most
innovative company according to Forbes magazine,
and Pernod Ricard ranks 15th. Both of our companies
have an innovation-driven business model, so it was
only natural that we meet. Indeed, that’s the whole
point of an enterprise social network: to continuously
increase opportunities for contact between employees
to generate more ideas. But it’s only a first step: imagine
the day when we can do the same thing with our
customers, and why not our consumers? Beyond
the business interest, this type of tool is also a way
of spreading our corporate culture. In a highly
decentralised Group, shared values are what bind
us all together. Pernod Ricard Chatter® is a direct echo
of several of the core values that form our Group culture:
conviviality, of course, based on sharing with others,
but also entrepreneurial spirit – taking the initiative
is always applauded. Lastly, the instant sharing of
information improves our reaction times on the ground.
James Parker: Chatter® makes it possible to connect
all employees, whether they already see each other
in everyday life or are brought together around
the globe by a community of interest. In the second
case, a collaboration platform creates new interactions,
overcomes traditional barriers and promotes more
cross-functional and value-creating ways of working.
It differs from mainstream social networks like Facebook
or Twitter through a system of private groups and
applications that protect the confidential nature
32 entreprendre # 58
of information while making the adoption easier through
similar ergonomic characteristics. It also incorporates
the principle of self-restraint which is fostered by nonanonymity.
Practically speaking, isn’t this just another tool
for employees to manage when they’re already
feeling overloaded by the number of tools at
their disposal?
James Parker: A powerful enterprise social network
reduces the flow of e-mails sent to large groups of
recipients: we have observed a 30-40%* decline in
the number of e-mails received by customers who have
adopted Chatter®. It avoids grouped emails
that employees cast out when they have a specific
question but have no one around them with sufficient
expertise to provide the answer. A social network
makes it easier to locate this expertise wherever it is,
whether it is next door, in another department, team
or affiliate. It enables the building of a secure knowledge
base which can be navigated by following people, groups,
applications like project management, topics, or simply
through a research using hashtags.
Olivier Cavil: An enterprise social network requires
a rethink of traditional forms of communication based
on a vertical approach of conveying a message from
sender to receiver. Here, everyone is a sender and
a receiver at the same time, regardless of position
or hierarchy. It’s very transparent. These networks can
C rosstal k
to re-work the concept for easy adaptation
to other markets. All in the space of just two weeks!
James Parker: Above all, an enterprise social network
leverages the talent on the ground. Each businessenhancing best practice can be put forward and
everyone has a role to play. It’s easier to find someone
who’s already encountered the same problem, or find
the knowledge you’re seeking regardless of function,
hierarchical position or geographical constraints.
It is a bit of a cultural change of course, especially
in countries such as Germany or France, where the
hierarchy is more highly respected. However, any
obstacle to adoption is quickly overcome once users
understand the interest of each use-case. The statistics
gathered from our customers are very encouraging.
We surveyed 5,500 customers out of 170,000 that
have activated Chatter® and found that employee
commitment was up by 34% and the number
of ideas by 29%*.
What challenges will these networks face
in the coming years?
Above:
Olivier Cavil
Group
Communications
Director,
Pernod Ricard.
< Left page:
James Parker
Customer
Success Director,
Salesforce.com.
be seen as “intranets 2.0”, a new form of internal Group
communication, more in line with the expectations
of Generation Y for whom one-way communication
is no longer imaginable.
The success of such a tool thus depends on
widespread employee use. How do you persuade
them to adopt it?
Olivier Cavil: After a four-month test phase (July
to October), we launched Pernod Ricard Chatter®
on 29 October 2012 with all 18,800 employees being
switched over to the network in one day. The preparatory
phase identified “use-cases” that highlight the tool’s
immediate business interest. This can take several
forms: sharing best practices and digital innovations,
anti-counterfeiting, competitive intelligence, marketing
launches, etc. For example, Pernod Ricard Brasil
launched a street marketing operation in São Paulo
as part of the ABSOLUT Greyhound campaign. The video
of this promotion on Chatter® has been such a big hit
with other subsidiaries that the brand owner has decided
Olivier Cavil: History shows that new tools do not
entirely replace the old; they simply provide a more
appropriate response to a given need. We will continue
to send e-mails in some situations, such as when
privacy is required in a message. We’ll also continue
to relay key messages to our employees through our
traditional intranets. For the Group, Pernod Ricard
Chatter® is part of a more global perspective: some
external partners have already joined in, and in the near
future some customers will too. Our aim is to establish
a more immediate and on-going relationship with our
stakeholders. We’re only at the starting phase of building
a true digital ecosystem: it’s a real cultural change.
While we may have been successful in this first phase,
with more than 50% of our employees now using
Chatter®, we have to ramp up our efforts to show
how it can simplify their everyday lives, so that this
tool becomes the natural medium of “innovative
conviviality” in the future.
* Salesforce.com survey led by Market Tools on May 2012 with 5,500 Chatter®
customers regarding their perception of the tool and its benefits for the company .
Chatter and the “C” logo are trademarks of Salesforce.com, Inc. and are used
under licence.
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For
the
lo n g
ru n
Committed to
contemporary art
2001
Designed by Renzo Piano and photographed in 2001, the terraces of the Centre Pompidou
have been named the “Terrasses Paul Ricard” in honour of the Group’s founder and
his commitment to creation in all its forms, particularly contemporary art.
Pernod Ricard, a sponsor of the Centre since 1997, backed its renovation from 1998.
34 entreprendre # 58
For
the
lo n g
ru n
2012
The Centre Pompidou Virtuel website has gone live thanks to its partnership
with Pernod Ricard. Open and seamless, it offers the public free access to all
content produced by the Centre. This innovation further promotes cultural
sharing and marks a new phase in the historical relationship between Pernod
Ricard and the Centre Pompidou.
Scan this flashcode
for direct access to the
Centre Pompidou Virtuel.
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