When a product is marketed at a discounted price a lot depends on its customers. One of the reasons why a product is discounted is if the brand is trying to grow their awareness and attract a different set of customers. Many a time, whiskies go on discount due to over production or the store where the products are is trying to clear their shelves. Often times this is also done to offer new whiskies to old customers, so that they go beyond the usual range of commonly identified labels. Price reduction does not really mean that the product is of a low quality.
It is normally believed that the higher the price of the product the better is the quality. Even at tastings, one observes that some customers directly relate price to higher quality. They enjoy the whisky, but when they are told the price which could be modest, one sees impressions changing. There is a lot of difference in the price between the entry level of a whisky brand and the aged variant of the same whisky. Brands like The Dalmore, The Glenlivet, Chivas Regal, Ballantine’s, The Balvenie have both expensive mid to high range whiskies which make them a luxury brand and also younger variants. As such, at times positioning with consumers becomes a challenge. Most folks who identify the “Glen” range with entry level base whiskies cannot fathom why an older variant is exorbitantly priced.
The fact that the higher priced product will be considered of a high quality and the lower priced product will be considered of a low quality cannot be changed. It is rather unfair. The best thing to do is to make customers taste the whisky and let them decide if they want to purchase it or not based on their taste and merits of the whisky.
Can a brand lose its drinkers from discounting, or is it just a way to get more drinkers?
On another perspective, a brand that discounts their products a lot might lose customer as well since people start relating price to better quality. They assume that their prestige will go down if they consume products which are low in price. They are discerning customers and do not want mass products.
In a ‘Value For Market’ like India, price plays a huge role. Whisky brands need to be conscious when pricing since the mother brand can have a lot of variants from 12 YO, 15 YO to even 40 YO. Once the customers enjoy younger variants and relate to the “house style” they will go up the age chain. In single malts, where the product is more a journey of discovery and discernment, these are enjoyed for taste and while price plays a role, its more the “whisky” that is the deciding factor. In blends, price plays a higher role since most customers will pick up attractive deals. This does not downgrade blends, but Single Malts have an “individual expression.”
Discounts are best laid out as offers for sampling and enjoying new flavours.
sandeep@spiritualwhisky.com