Pernod Ricard: Revolutionizing the Indian Alco-Bev Market with AI
A Bold Move into Artificial Intelligence
In a highly competitive Indian alco-beverage market, Pernod Ricard is making waves by fully embracing Artificial Intelligence (AI). This strategic decision is yielding impressive results, such as doubling sales conversion rates and reallocating a significant portion of its marketing budget based on data-driven insights. The French spirits giant has undergone a five-year transformation, embedding AI across its Indian operations, and the dividends are becoming increasingly noticeable.
Staying Ahead of the Curve
Simon de Beauregard, the Chief Transformation Officer, asserts, “AI and Generative AI (Gen AI) are essential tools that help us maintain our winning edge in India. We are ahead of the curve.” As the company navigates the complexities of the Indian market, leveraging AI across its value chain—from consumer insights to sales execution—is becoming pivotal. With India now ranking as the company’s second-largest market by revenue, the stakes have never been higher.
India: A Strategic Growth Engine
“India is a must-win market for Pernod Ricard; it’s a growth engine,” de Beauregard states emphatically. The company has witnessed continuous growth and believes this trend will persist due to favorable market conditions and evolving consumer preferences. The introduction of AI has further solidified its strategic position within this lucrative market.
The Power of Proprietary AI Tools
Pernod Ricard’s flagship AI tools—Maestria, Matrix, and D-Star—are essential components of its success narrative. Maestria gathers in-depth market intelligence by engaging directly with over 18,000 consumers, while tools like Radarly analyze digital conversations to identify emerging flavor trends and consumer preferences.
Consumer-Centric Engagement
To maintain a consumer-focused approach, Pernod Ricard is employing in-house AI tools that facilitate personalized, data-driven engagement. This strategy enables the company to tailor its marketing campaigns to resonate more effectively with its target audience.
Data-Driven Marketing Strategies
The Matrix tool, specifically designed for the Indian market, links marketing expenditures directly to sales return on investment (ROI). “We’ve been able to reallocate up to a third of our marketing spends, which is significant,” remarks de Beauregard. This data-driven approach allows for more effective promotional strategies across various brands and consumer touchpoints.
Remarkable Marketing Improvements
The impact of these AI initiatives is noteworthy, with a 50% improvement in key marketing performance indicators such as view-through rates and click-through rates. Campaigns like ‘One Billion Films for One Billion Fans’ and ‘the Imperial Blue Superhit Nights tour with Harrdy Sandhu’ have particularly benefited from this hyper-personalization.
Enhancing Consumer Engagement
“The success of our campaigns reflects a substantial increase in marketing KPIs, including a 50% rise in engagement rates,” de Beauregard emphasizes. This surge in consumer engagement is crucial for building brand loyalty and enhancing overall market presence.
D-Star: The Game-Changer
One of the standout tools in Pernod Ricard’s AI arsenal is D-Star, a frontline sales platform that aggregates essential on-ground data. By analyzing store formats, SKUs, and flavor preferences, D-Star offers intelligent recommendations to sales representatives, helping them select the right products for the right outlets. This has already proven successful in West Bengal, where the company secured listings in 150 out of 300 newly identified outlets for Ballantine’s scotch whisky. The success of D-Star is now being scaled across the nation and even internationally.
Redefining Premium Spirits
While technology is revolutionizing the backend, Pernod Ricard is also reshaping the premium spirits landscape in India. The company, which produces over 97% of its Indian portfolio domestically, has recognized that higher price segments are experiencing faster growth. This trend aligns with the ongoing premiumization of the market.
Embracing Premiumization
“Premiumization is a long-term trend that is accelerating,” notes de Beauregard. The introduction of Indian single malt Longitude 77, priced on par with 12-year-old imported labels, signals a bold confidence in the domestic market’s evolving taste preferences.
Blurring Lines: Local Meets Global
The distinctions between local and global, as well as mass and premium, are increasingly blurring—not just in pricing but also in performance. With 24 bottling sites and a state-of-the-art distillery and winery located in Nashik, Pernod Ricard has established a vertically integrated operation that not only caters to domestic consumers but also exports products to various global markets. The company’s recent announcement of a ₹100 crore investment in another facility in Maharashtra further underscores its long-term commitment to India.
AI as a Core Element
For Pernod Ricard, AI transcends being just a buzzword; it is woven into the very fabric of the organization. The company is re-envisioning how liquor brands can scale intelligently, sell accurately, and connect personally with the Indian consumer.
Focus on Return on Investment
“The effectiveness of our tools is ultimately measured by the return on investment—whether that’s in revenue, market share, or employee satisfaction,” de Beauregard explains. The focus on these metrics is where AI is delivering tangible results for the company.
The Future of the Alco-Bev Market
As AI continues to shape the landscape of the alco-bev market, Pernod Ricard is poised to lead the charge. Its commitment to leveraging advanced technologies to drive growth and consumer engagement sets a benchmark for the industry.
The Road Ahead
With the Indian market evolving rapidly, the integration of AI promises to unlock new opportunities for Pernod Ricard. As consumer preferences shift and competition intensifies, the company’s strategic foresight in adopting AI will likely pave the way for sustained success.
Conclusion: A Trailblazer in AI-Driven Business
In summary, Pernod Ricard’s journey in the Indian alco-bev market exemplifies how the integration of Artificial Intelligence can lead to significant growth and consumer engagement. By utilizing advanced tools and data-driven strategies, the company is not only enhancing its operations but also reshaping the future of the spirits industry. As AI continues to evolve, Pernod Ricard’s commitment to innovation positions it as a trailblazer in the market, setting a standard for others to follow.
