The objective of this report is to critically analyze the application and influence of three consumer behavior aspects on the Chivas Regal marketing activities. Through the study of marketing activities in the whisky market by different channels, this report focuses on three relevant consumer behavior topics: culture, motivation and value, reference group to Chivas Regal marketing activities in China. In this report, first of all, it introduces the background of Chivas Regal, and then analyses marketing activities using consumer behavior theories. Lastly, there has a recommendation about Chivas Regal.
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Background of Chivas Regal
Chivas Regal as the product of a unique place, a proud lineage of whisky makers, was produced by Chivas Brothers more than two centuries’ of history, and purchased by the Pernod Ricard Group in 2001 (CHIVAS REGAL, 2009). Chivas Regal embodies the values of sharing, conviviality, entrepreneurship, integrity and commitment, and it is a brand that was built on craftsmanship and patience and these values are inherent in its products. Under heritage of its brand, it was rated one of the world’s most powerful spirits brands (Anon., 1999).
The significance of researching in the Chinese market
According to annual report of Pernod Ricard (2009), the company posted 29 percent organic growth and has become the biggest global market for Chivas in China. Chivas Regal, through innovative branding and marketing techniques, it has become one of the most recognizable and cosmopolitan alcohol brands in China. With a market insight and cultural knowledge, it can be found that the Chinese consumers are far more responsive and willing to part with their cash – they just need to feel that the brand cares about their market segment (WORDPRESS, 2009). Therefore, as a rich culture heritage and conservatism country, its success has a certain amount of research significance.
New campaign-“Live with chivalry”
Recently, Chivas Regal has launched a new global campaign draws on the fundamental values of modern men. It aims to reinforce the exuberant and luxurious essence of the brand (Centaur Communications Ltd, 2009). Meanwhile, it can bring back some positive values into modern life, and create significant awareness and stand out for Chivas Regal. The campaign, entitled ‘Live with Chivalry’, builds on the previous ‘This is the Chivas life’ campaign.
Without a doubt, no product can ignore the cultural context when entering a new country; in addition,a consumer’s culture is the vital leverage to determine the success or failure of specific products (Solomon, et al, 2006). Thus, to discuss how Chivas Regal obtains a great success in the Chinese market, it has to consider the two main parts, which is the distinction of alcohol culture and club culture between China and western countries.
In China, drinking alcohol is always a way to celebrate the happiness in their life. For example, parents invite relatives and friends to enter ‘jiu xi’ ( an alcohol banquet and the life of every person) for starting a month or 100 days after a baby’s birth (Gunde, 2002). In modern times it has a pity change that friendship depends only on the volume of drink being consumed, and not the elegant ones of the past that involved poetry or music. In this regard, it seems to run counter to Chivas Regal’s tasting of life and savoring brew. In western country, drinking alcohol more presents as a communication tools and expresses a certain style and attitude (Mintel, 2009). By compared between their difference of alcohol culture, it can be indicated a problem how to change Chivas Regal market strategies and activities to link up the alcohol culture in china, which will be discussed later.
Ever since club has been introduced into china, it was gradually influenced by traditional Chinese culture, forming a kind of Chinese cultural characteristics of the club culture. There are three main different characteristics, including club operating hours, the volume of drinking, and purpose of drinking in the club (CCC, 2009). It is necessary that to explain the volume and purpose of drinking deeply, in terms of Chinese drinking culture, it has a common phrase-‘If we are good friends, then bottoms up; if not, then just take a sip’, which causes a high volume of drinking condition. Thus, beer and some low alcohol wines are more popular in club as opposed to spirits. Another obvious distinction is that the purpose of hit bar, in western countries, they pay attention to the process of enjoy the chatting and making friends with each other. Conversely, Chinese are generally using more drink to reflect friendship.
Chivas in Chinese culture
Considered with Chinese culture interference, Chivas Regal had taken a in-depth analysis of alcohol consumer in china, eventually accurate grasped the market pulse. The runaway success of Chivas can be attributed to the new way of drink, blending Chivas regal with ice and green tea. In this new way of drink, it can not only lower the alcohol concentration, and also not affect the taste, that is the innovational way to keep the Chivas into Chinese drinking culture.
According cultural context analysis, it is not difficult to discover the secrets for success, first of all, it did a perception process in educating new consumers who constantly pursue the fresh and fashionable lifestyle, in this process, Chivas Regal did the ‘This is Chivas life’ campaign, which is developed into ‘Live with Chivalry’ in Chinese market, which paid more efforts on the internet and club. Secondly, it has launched a type of PR strategy, with advised to build a friendly relationship with different club to display their product in prominent place and recommend costumers to taste their products. Lastly, Chivas Regal is bundled in promotional packages with ice and green tea, which is most famous drinking method in china. Therefore, it is easy to find Chivas package in well-know club and KTV across the main city of china. This new trend of Chivas drinking method is still dominated in Chinese market.
In order to keep the dominant place in china, Chivas Regal has take off the ‘Live with Chivalry’ to reveal the new lifestyle of modern men, and to arouse the precious values of this society, which is defined as ‘Gallantry, Honor, Courage and Camaraderie’, related with a certain of Chinese value standard. Moreover, it is vertical route to keep the younger, flashier bar market and attract the more sophisticated group.
Evaluation on Chivas Regal’s marketing activity
According to comprehensive understanding of the Chinese market, Chivas Regal has harvested a vast successful. China as a high-heritage and high- absorbent country, has basically accepted the market activities of Chivas Regal. The main excellent points Chivas Regal have done is that to seize the market opportunities and grasp of current consumer behavior trend. The new drinking style-Chivas with green tea is also the key ingredient to adapt to the Chinese market.
Motivation and value
Push & Pull factor in Motivation
Motivation is the process that cause people to behave as they do, as well as can be intrinsic (push factor) and extrinsic (pull factor) (Solomon, et al, 2006). In terms of push factor, it can be inner impulse to fulfill a certain need, which emerges from a gap between a consumer’s current situation and some desired goal (Foxall, et al, 1998). Referred to Chinese market, it can be found that the target audiences are desired to use luxury goods to achieve upper-lever needs that are Belongingness and Ego needs, even for Sefl-actualization. Therefore, Chivas Regal employs the ‘live with chivalry’ campaign, which intended to arouse the spirit of modern society, and use various activities to attract consumers buying behavior (Solomon, et al, 2006). That is recognized as a process of meeting high status and self-respect, and pursuing ideal self-image. Meanwhile, it is fit to Chivas effect in Chinese market, which means a more luxurious equals to better social status.
From the perspective of pull factor, it can be found that self schema is activated from outside that can be ads, print, theme party and chivas studio of ‘live with chivalry’. In this point, it is highlighted two distinct target groups in Chinese market. There are some distinction between Chivas Regal 12 and Chivas Regal 18, Chivas Regal 12 mainly target in 25-35 years old, they like to highlight the self-style, willing to share all kinds of wonderful experiences with friends; Chivas 18 focus over the age of 35, it even more emphazises on the ‘successful person’, they require high quality of leisure time, honorable status, and gallantry (Globrand, 2009). Hence, Chivas Regal implements marketing activities through different approaches in China. Targeted at younger segmentation, it had launched ‘voice of Chivalry’- virtual band performance in major well-known club, by way of world-class music experience and party experience, developing young pioneer to identity the ‘Chivas Regal’ brand personality and to participate in the ‘live with Chivalry’ experience. Chivas Regal 18 years, the consumer based is relatively positioned at higher levels, mainly through a small salon, art co-operation to display the high-level taste, high quality of life, a sense of luxury.
Owing to distinction between needs of target consumer, the product of Chivas Regal selectively used its marketing activities to attract and motivate consumers in China, and in this way to satisfy hedonic needs that are subjective and experiential (Solomon, et al, 2006). Here, consumers might rely on Chivas Regal to meet their needs for courage, honor, gallantry, camaraderie, and so on.
Over the process of purchase decision, consumers will face some inevasible choices, which maybe positive and negative(Solomon, et al, 2006). Thus, they always tend to seek valued product to reach a goal. In this case, Chavis Regal has done some possible solutions to these dilemmas.
The type of conflict can be happened is approach-avoidance in Chivas Regal purchasing. The two obvious negative consequences attached to Chivas Regal is that money drain of high price and health problem. In the presence of these negative outcome, Chivas Regal made a range of publicity to brand value, such as Chivas Heritage and exclusive blend publicity campaign, leading to convince consumers that it is worth in that. With respect to another avoidance is that excessive drinking causing health problem, Chivas Regal has used amount of activities to praise ‘enjoy life’, which is different from Chinese wine culture that more drink means more friendship.
As one of the world’s most powerful spirits brands, Chivas Regal possesses a train of precious values in the brand, whilst, it is used into different campaign to present its value, from ‘This is Chivas life’ to ‘Live with chivalry’. According to Solomon, et al, (2006), individual motivations are often driven by underlying values. For the sake of conforming with the value of high degree of consumer group, Chivas Regal takes meaning (Gallantry, Honour, Courage and Camaraderie) on its products in the ‘Live with chivalry’ campaign, that can help the person to attain a value-related goal-Chivalry spirit in modern society. In China, the company launches a virtual band to show different value and personality in different member, leading consumers to match themselves into brand values and persuade purchasing behavior.
Evaluation on Chivas Regal’s marketing activity
Chivas Regal has successfully launched a new campaign globally, which foucs on the consumer high level needs, particularly, it creates a virtual band in china to represent four different values to match different personalities. In this ‘Live with Chivalry’ campaign, it makes sence for ‘This is Chivas life’, to specific the needs of self-realization.
Humans as social animals, have to be into a group or some groups. According to forms of reference group influence, it reveals that Chivas Regal involved into the Value-Expressive influence, which can enhance the image of themselves, possess the chivalry spirit, and be admired or respected by others (Solomon, et al, 2006). In the ‘Live with Chivalry’ campaign, it has done online and off-line activities to identify and exert influence on them.
According to CNNIC Report on Internet Development in China (2009), China’s online population and online commercial value has doubled, this environment provides more opportunities to share their interests with each other who never met before. In order to catch up with this advantage, Chivas Regal has paid more attention to build virtual communities in the ‘Live with Chivalry’ campaign. Besides the blogs and boards etc, in which consumers’ shared passion for a brand can translate into a feeling of marketing legitimacy (Cova, et al, 2006). It also sponsors some off-official website communities to give devotees of Chivas to meet and share their experience. Simultaneously, in order to coincide with the core idea of ‘Live with Chivalry campaign’, the new internet resource encourages Chivas consumers to join the Chivalry movement to share their chivalry experience. ‘Join the movement’ create a range of attractive items to consumer to find themselves and motivate Chivas consumers to live with chivalry in their hearts.
The crest represents young unique identity and knight’s loyalty. Therefore, it fixes the position in this knight group, and maintain brand loyalty.
OUR VISION is the manifesto of knights, using some encouraging manifesto to enhance the cohesion of ‘knight team’ and persuade them to buy. One manifesto- “Let’s raise a glass to resistance movement, to the gentlemen warriors battling to preserve a different way of life”, it can stimulate your pursuit of Chivalry life and be eager to join this team (CHIVAS REGAL, 2009).
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Whilst it offers a platform to share their story by celebrities in ‘Live with Chivalry’ option, in which shows various story of high roller to inspire consumer to follow like this, and Chivas Regal makes use of Value-expressive influence to persuade individuals feel that purchase and drink Chivas can help show others what they are or would like to be (Solomon, et al, 2006). This will motivate and encourage consumer to drink Chivas Regal, moreover, it can achieve the process of seeking ideal self-image.
Chivas Studio group
Consumer as a member of their groups, try to follow actions of those around them, constantly preferences are shaped by their group memberships (Solomon, et al, 2006). In connection with group behavioral trait, Chivas Regal runs abundant of social activities to manufacture group effect and deliver the nature of luxury and passion in their group. The most successful social event is Chivas Studio, which draws a star-studded cast of international A-list celebrities, designers and artists (CHIVAS REGAL, 2009). By means of these events, it takes a great influence and charisma on consumers and especially on the devotees. Chivas Music Studio group represents a fashion, enthusiasm, energy reference group, which directs the consumer to imitate and join them.
In Chinese Mainland, Chivas Studio shifts into Chivas Music Studio (Voice of Chivas), which focuses on fashion younger groups in well-known city club. For example, it will host a Voice of Chivas in popular club-Happiness Terminal in the December 19th.
In this event, Chivas Regal invests huge funds to builds up a idealized lifestyle, and overtly impacts the power of celebrities in influencing consumer-purchasing decisions. It is committed to bring out feast that dancing of life, drinking of Chivas Regal. According to Solomon, et al, (2006), If a person admires the qualities of a group, he or she will try to imitate those qualities by copying the referent’s behavior, particularly when the celebrities with you face to face.
Interactive communication provides the consumer a approach to garner more supporting arguments for the purchase and to support for the final decision from others (Solomon, et al, 2006). The WOM gives prominence in consumption of Chivas Regal, for example a crowd of friends went to club, they always chose the brand which is suggested from their friends and recommended from comments of website. On the basis of WOM tends to be more reliable and trustworthy compared with messages from more formal marketing channels (Solomon, et al, 2006), Chivas Regal performs huge value-express ads to encourage a person who might be highly involved with ‘Live with Chivalry’, and turn out some activities, such as salon, Chavis Music Studio and free cocktails taste, to cultivate a group of initial well WOM transmitter.
Evaluation on Chivas Regal’s marketing activity
Chivas Regal has built a creative virtual reference group in new campign, in the ‘join the movement’ website process, the knight group can avoid the geographical and cultural differences to attract potential consumer. Meanwhile, the Chivas Regal paid more attention to the Chivas Music Studio, which connect with virtual band to hold cycle performance in well-known club.It has verfied that this Chivas Music Studio has gained a great success through the phenomenon of panic purchasing tickets.
It is recommended that Chivas Regal should take more marketing activities to attract the more sophisticated group, which is weaker compared with younger group. For instance, business men are more prone to drink traditional wine in their commercial affairs. Furthermore, the Chivas Regal website is still developing at present period, it is suggested that more traditional and promotional events, which has done well in Thailand and Hong Kong, china by donating true Chivas crest and fashionable laptop. Confronted with massive competitors’ swarming into Chinese market, Chivas Regal should also pay more attention to PR function in their marketing activities, to enhance the relationship in the sales chain.
In this report, it has analyzed how the three different parts influence the Chivas Regal to lay down marketing activities. Besides, it reveals how the Chivas Regal do its marketing activities to explore and consolidate consumer needs. Basically, Chivas Regal has walked a fine line in chinese market, especially in club and KTV subsystem, and ‘Live with Chivalry’ as the dominate marketing campaign, has effective used ‘thinking globally, acting locally’ strategy to trace the consumer behavior in china. Therefore, Chivas Regal gained a successful foothold in china; have to ascribe to intensive study of consumer.
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