san miguel beer Oktoberfest - brand building or community relations destruction?

WAWAM! is a great supporter and believer of events for brands. when done properly - with executional flair and strategically well thought out, it can build brand equity and create great consumer excitement.

events also work better if they are big and grand in scope. this is no different from other marketing efforts, great ideas should be seen and felt by as many of it's target market. in fact for events, big and grand is a bigger need than compared to other marketing efforts.

most events, like the oktoberfest, are intrusive in nature. and that is where this san miguel event failed, intrusive in a different way.

while it did well for san miguel beer, they got what they wanted - 15,000 participants, guinness world record possibly broken and lots of press coverage day after, including front page coverage like this news article, BUT - the event also inconvenienced the city and neighborhood where they held it.

to hold the event, they closed two streets - the long one in front of their headquarters and the smaller street beside their building. they closed these streets since tuesday or wednesday last week. they held the event last Friday.

the san miguel office is located in one of the busiest streets in that part of the commercial district in pasig city. both are actually main streets - they are the main access roads from pasig to EDSA and SM Megamall. closing one side of the road, they removed 50% of the access road and they did cause monumental traffic in the area. cars coming from pasig going through julio vargas st. took 45 minutes to more than 1 hour to go to EDSA or megamall.

these streets are public roads, for the use of the public, san miguel corporation do not own these roads where they can do anything in their property. i completely disagree with a company who conducts it's brand building event and in the process inconvenience the public in general. that is not good corporate citizenship.

is there a particular brand equity building reason why they needed to do the event in front of their corporate headquarters? i don't think there is. if there is, i don't think it matters to consumers. they could have held it in a stadium like the Ultra in pasig, close to their headquarters or in MOA, by the bay where they already own the boardwalk. i don't think it could have mattered if they held it in MOA or at the Ultra, people would have come just the same and the city would have not been inconvenienced.

it's hard to understand why a corporate giant like san miguel whose sense of social responsibility is keen will do something like that. worst, why did the local government officials allow this to happen? the local government officials' mandate, the very reason they were elected into office is to serve the people. but in this case, they seem to have served san miguel corporation acting like they were employees of the company and disregarded the people they were supposed to serve.

an evening's event affected the lives of thousands of commuters and car owners who use that road for 4 whole days! that sounds very uncaring and yes it's a WAWAM!

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15,000 toast world’s longest beer bar
By Beverly T. Natividad

Philippine Daily Inquirer

First Posted 01:57:00 09/07/2008

MANILA, Philippines—In Heaven, there is no beer.

That’s why last Friday, more than 15,000 people flocked to San Miguel Avenue in Mandaluyong City to celebrate the country’s famous brew with the annual Oktoberfest and at the same time set two Guinness world records.

Barricaded with a long line of steel sheets, the whole length of San Miguel Avenue, from the intersections of Lourdes to Julia Vargas Streets, was transformed into a 603.5-meter-long beer bar complete with four concert stages.

This beer bar has toppled the Guinness record for the longest bar (220 meters) held by Taiwan.

article parsed, read in full here : http://newsinfo.inquirer.net/inquirerheadlines/nation/view/20080907-159163/15000-toast-worlds-longest-beer-bar

pepsi philippines net profit drop -21% due to +529% increase in marketing expense. what marketing??? where???

PDI news article (march 13, 2008, business section) headline says: "Marketing costs hit 4Q income of Pepsi". article goes on to say net profit dropped -21% to P143M versus year ago period. marketing expenses rose to P232M from only P37M or a whopping +529% increase during the period from previous year.

what marketing effort??? did anyone notice pepsi spent +500% more during that quarter? just looking at that huge increase, you would have expected pepsi to be ubiquitous and must have created so much buzz that our consciousness should have been filled with nothing but pepsi. don't think that really happened.

makes you wonder where they spent all that marketing money supposedly spent over a 3 to 4 month period. that's an amazing amount for such a short period of time. they spent in 3-4 months marketing budgets of many brands that are spent over 1-3 years! so where did they spend that? with that kind of money spent and yet consumers didn't feel it's impact, the proper conclusion is - they threw all that money into the bermuda triangle, not the philippines.

the article states over-all sales rose ONLY 5%, with non-carbonated drinks remaining flat while non-carbonated drinks rose +34%. ahh..... so it seems those sales performance data is telling us -whatever it is they did in marketing, they were very ineffective that their sales growth was minuscule.

we can assume that since pepsi's core business is their carbonated drinks brands, it stands to reason that they must have spent a large chunk of that marketing expense behind that business. for their carbonated drinks sales to remain flat after such a huge marketing expense mean their marketing efforts were a dud!

when pepsi philippines did an IPO (initial public offering) and listed in the philippine stock exchange last year , i avoided it like hell. i thought pepsi has in their hands very huge challenges in the philippine market. and a key problem is lack of quality marketing and lack of marketing funds. now we know that marketing funds were put behind it, but the results were dismal!

of course it depends in what areas of marketing they put all those money. different companies define marketing expense in many ways. these could be marketing funds put behind consumer-oriented activites or for some companies, they see distribution or logistics as a marketing expense.

the other key weakness of pepsi in this market is weak distribution. they are up against coca cola and san miguel who have been giants in distribution muscle and depth in this market for many years. but in the case of pepsi, consumer marketing is a bigger need. also, any marketing person know that to get a jolt on sales and market share, consumer marketing is the way to go. so we can assume bulk of those marketing funds were channeled into consumer marketing.

conclusion? not only is it a lack of quality marketing, its pathetic quality. how else do you explain a +500% increase in marketing expense yielding only a pathetic +5% in sales? will any of the marketing staff put that kind of achievement in their resume? (time to change the marketing team and ad agency!)

nope, their marketing effort didn't have fizz! sigh!