Article

Network profile: DrinksTV

Recipes, how-to videos upsell beverage shoppers into premium brands.

March 18, 2007 by James Bickers — Editor, Networld Alliance

For liquor retailers, in-store advertising isn't about convincing people to drink — it's about convincing them what to drink. Good in-store merchandising reaches beverage customers at different levels, always trying to get them to move up to the next level of quality — and, as a result, the next price level.

"We're not trying to get the value shopper to jump into buying Belvedere vodka," said Phillip Jarrell, vice president of DrinksTV, which operates digital signs in 355 liquor stores across the country. "We're trying to get someone who is spending $22 on a bottle of Ketel One to jump up to $29 for a bottle of Belvedere. It's about brand shifting — that's what we do very well."

The company, which launched in December 2006 with a staff of 20, influences those shifts through live-action recipe videos and drink-making tutorials, delivered on screens right above the aisles where customers are choosing between bottles.

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‘I don't think I can do without it'

Ellis Sanchez is the owner of Leti's Liquors in Miami, Fla, the 3,000 sq. ft. store he opened 25 years ago. A no-nonsense man with a gentle demeanor, Sanchez was skeptical when DrinksTV approached him earlier this year to place two of its screens in his store.

"At the beginning, I wasn't sure if I even wanted it," Sanchez said. "Right now, I don't think I can do without it. The recipes are really working. People watch it, and then ask for the bottles."

Drink recipes, carefully designed to influence the purchase of premium brands, make up about half of the content on the DrinksTV network; on these spots, real bartenders show how to mix concoctions like the Bombay Sapphire Breeze and the Oro Azul Bloody Maria. Advertisers also can buy conventional ad spots, which are mixed in with the recipes.

"You can spend your money on outdoor or print media, but you can't track the conversion of those," Jarrell said. "With our system, you can actually start to track and rate the sales pre- and post-campaign."

Jarrell said his company recently conducted a survey of 100 stores on the network, watching the sales of two premium brands before and after installation. On average, those stores saw a 75 percent increase in sales of Famous Grouse, and more than a 100 percent increase for Belvedere.

"We usually say that brands see about a 30 percent growth, but those two brands really blew us out of the water," he said.

One of the regulations imposed on companies doing business with liquor stores is that they are not allowed to give anything to the retailer — as a result, DrinksTV owns and operates every aspect of its network, from the screens and media players to all of the content.

"Everything is absolutely free to the retailer," Jarrell said. "We're just using the airspace in their retail environment."

Jarrell said the company looked at several hardware providers before settling on LG for the displays. "Their equipment and service have been top-notch, and their fail rate is better than we could have expected," he said. "I've heard of a fail rate of 4 percent for the industry, and ours has been well below 2 percent."

Content for DrinksTV is managed and delivered with Real Digital Media's NEOCAST Media Server. The company currently uses DSL connectivity, but will be testing RDM's new satellite offering in the coming months.

DrinksTV also makes its content available in a slightly modified form online; Jarrell said the goal of the online spots is viral marketing as opposed to call-to-action. The company's in-house team creates roughly 80 percent of content on the network.

Ellis Sanchez said the number of recipes his customers get to see is constantly growing.

"The ads are getting better every day," he said. "The amount of drinks that people can learn about from the screens is amazing — some of these drinks, people have never heard of before."

While DrinksTV has succeeded so far thanks to small retailers like Sanchez, Jarrell said he knows his company needs to make inroads with larger, national chains.

"We know our growth strategy needs to be in the chain business," he said. "That is our initiative when it comes to new acquisition."

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