Moment 106 - Marketing Principles That Made Brewdog Billions: James Watt

Going to your marketing thesis, because this is really what's defined Brue Dogg in the eye of the consumer. In the eye of someone like me, that doesn't honestly drink beer, but knows about the brand and considers it to be a famous brand and watched it on LinkedIn and social media over the years, build it, sort of a claim. What is your principles that underline your marketing thesis? Because your marketing thesis is very, very different to pretty much nearly all brands in this country. There's maybe a 0.1% that maybe you've copied or that have been inspired or that chicken and egg, I don't know who came first, but it's a very unique thesis towards marketing. What depends on it? We've got two very simple tests that we apply to everything that we do from a market perspective. The first test is, would or could another business do this thing? If the answer is yes, we've got to seriously consider why we're doing it. The second test is, if I spend a pound on this, is it going to give me a 10 extra turn, how a competitor would spend that pound? We are in an industry dominated by global behemoths of businesses who are hundreds of times our size and we're closing that gap and we want to close that gap, but we only close that gap by making our market and our communications, everything we do work so much more effectively than theirs. If our market is only as effective as theirs, we don't close that gap and we lose. The two tests are, could or would another company do this? Is it going to give me a 10 extra turn versus how my competitor would spend that money? If I'm thinking about how to drive a better return on marketing, and then I think about what you've done, I see what we've got to be probably bolder to win share of voice. We've got to try and win headlines in more extreme ways because nobody's going to be writing about you for the fun of it. If you're a smaller sort of challenge brand, then the second thing I think is we've got to do that on new platforms. We can't fight out on TV or in newspapers because those are where you throw huge amounts of money and you get a return. New platforms and new approaches. That's very much signified what I've seen from BrewDog. Very bold and intentionally bold in our early years when we had no budget whatsoever. The challenge was how can we get our name out there with no money at all? We had to do things that were intentionally provocative, that were on the edge and sometimes we can adjust that edge as well. That enabled us to get our name or message or business out there with no budget at all. We've driven a tank through the streets of London. We've thrown taxidermy cats out of a helicopter over the bank of England. We've put Vladimir Putin in the front of a beer label. We've done a lot of things, low budget, high impact, but we've tried to make it that everything we do ties back and is underpinned by what we're passionate about. There has to be a connection there. It does this reinforce what we believe in what we're trying to do as a company because otherwise it's just hollow and it's fake and it's false. How does this reinforce the core beliefs that drive this business, which is trying to build an alternative business and a huge passion for a fantastic beer? One of the more extreme things, I sort of led a main thing. What else am I saying? I think it's me for acting. I've seen it all because I'm obviously a marketer and running a marketing company and seeking inspiration from lots of different brands and seeing what they're doing and the impact it's having, especially on social media, which is my battle ground. The thing I read about more recently was that you put in a complaint about your own beer, which triggered press. We did. This was all the way back in 2008 and we had a few running battles with a few bigger players. One of them was the Portman Group. The Portman Group was an industry, still as an industry regulator. For me, it was a thinly veiled cartel funded by the big drinks businesses who have got a vested interest in making sure that small businesses are not successful. There was a few dual ins at the pub that were so silly and frivolous that we wanted to make a statement. We complained about one of our own beers to make a meta statement about how silly the process is and how essentially corrupt it was as an organization funded by the big beer companies, big drinks businesses who have got a vested interest in making sure the small ones are not successful. How does that work? You make a beer that is really high in AVB. Was that the correct term? It was, yes. We made a beer called Tokyo 18%. If you looked at the newspaper headlines in the UK when we launched that beer, you would have thought that I was single-handedly responsible for the downfall of Western civilization by making an 18% beer. We had it in the sun binge drinking, blame this man, with a cut out of my head in a bottle of Tokyo that took a bit of explaining to my very religious grandmother. That's another story. Everything we did with that beer was, we just made a thousand bottles. It was very expensive. It was for connoisseurs. It was for aficionados. We want to elevate the status of beer. I think the more someone can understand and appreciate something, the less likely they are to abuse it. We make expensive products for people who love fantastic beer. It was to make a statement of, you've got all these big companies doing very cheap alcohol that's likely to be abused, trying to ban products of this company that's looking to elevate the status, increase education, no weariness to a down beer and lead people to appreciate and enjoy beer and that were elevated. When you see yourself in the sun with a cardboard cut out of your face, is that swings in roundabouts? Is that good from a marketing perspective? Is that a good outcome? Because you were trying to get a headline. You complained about your own beer. You were trying to get headlines. Is that job done? I think in that one to a certain extent, it was a job done. To show you how odd things were back then. This was 2009-2010 when we were starting to get momentum and the beer scene was starting to change. The big companies had it their own way for way too long and things were starting to change. There was a word ceremony in Scotland in 2010 put together by the BII, the British and Keepers Institute. We got heads up before the word ceremony. You're going to win the award for Scottish Bard Oparetor of the Year. You better come to the word ceremony. We went there. We booked a table. They were just about to announce it. I was halfway up to the stage to get the award and they announced a different company. I was like, okay. But then the other company didn't want to take the award because our name was engraved in the show for you. He was like, well, we don't want it. The next day I spoke to the person that organized the award ceremony. I was like, what happened? You told us we were going to win. He was like, well, Diadio, one of the world's biggest drinks companies, they were the main sponsor. They told me five minutes before we were going to give it to you. If they gave it to you guys, they were going to pull off future sponsorship. You joking? We felt we didn't have an option. We put this online. It blew up. It was trending and Twitter globally. That day, Diadio issued us a formal apology about the whole thing. That apology was in killer broadcast news. It just showed back then how the dynamic in the beer industry was changing and how the big beer companies and big drinks companies were acting towards that change of which the partner was one manifestation of it. Did you take that personally? I took that as a sign that we're doing the right thing. I think unless other businesses are copying you or trying to knock you, then you're not doing well enough. Unless you're doing something that's worthy of people copying it, and a lot of people moan on being copied, unless you're being copied, you need to up your game and you need to do better. Unless your competitors are trying to knock you down, you're not enough of a threat to your competition. I took that as a sign that we're on the right track. We're doing the right thing. Let's keep going. The other extreme marketing that I saw, which was when I first read it, I thought this was fucking hilarious, is the Elvis estate tried to copyright in Fringeu for calling your USB, which I think is your most popular USB. It is Elvis juice. Elvis juice. Basically, your copyright statement, basically a notice that you've you're violating the copyright. Yes. You responded with some Elvis rhyme. We did. On the LinkedIn post, I thought it said you changed your name to Elvis. Then the BBC commented that didn't happen. What is the truth in this one? What did you change your name to Elvis? Yeah, we did. Just to go back in the story, not Elvis himself, Elvis is a state, sent us a letter saying we couldn't use the name Elvis in a beer. If we did, we had to pay them a license fee for every can, case and bottle of beer that we sold. What myself and Martin did, we changed our names to Elvis and we sent them a letter back saying that they couldn't use our name when they're music and they had to pay us a license fee for every time they played one of Elvis's songs. Got a huge amount of publicity at the time. We were both Elvis for a few weeks. Then we changed our names back. The BBC attacked us on that as they have on many things. However, the BBC misunderstood the Scottish procedure for changing the name. They said we didn't change your name by deed pull. That's not a Scottish thing. Scotland, you need an official declaration to change your name, which we did. What's that just signing off his paper? You sign a official declaration piece of paper and that counts as a name change in Scotland. You don't even have to send it to anybody. Don't have to send it to anyone. We met the Scottish requirements, which is what we said we did. My grandmother was very unhappy and she insisted I change my name back to James. Brudon's marketing has been so bold and it's been so standout. In terms of how hard you've, in terms of the return on every dollar you've spent, it seems to have been a pretty astounding return per dollar spent because you've done these big viral activations. A lot of them are like parodies or they're taking the piss of big corporations. We're sticking it to the man in various ways or going out the incumbents in the industry. Some of them, though, even the example you gave there, they're complaining about your own beer. With the Portland truth. Obviously, the complaint wasn't real because it was you. What is the line between truth when you're doing these stunts and virality and untruth for you? Where do you play? Are you willing to do something that is from a marketing perspective that is not necessarily true like a plane about your own beer if you believe it will help reach the outcome, which is to stick it to the Portland group? Yeah, well, I think with that one, it wasn't necessarily unfilled because afterwards we said we made this complaint. It was us who disclosed the fact that we made the complaint and we disclosed that to just show how ridiculous the system was. If we hadn't said it was us that complained about it, then I would accept that was being a bit dishonest. The fact that we came out and we said, hey, the system fundamentally doesn't work and we wanted to expose that by making this complaint was what we intended to do there. When we first started talking about marketing, one of the things you said was we made a lot of mistakes. Yeah, took things too far. Yeah. What did you take too far in hindsight now? Now that you're a big global brand and everyone is looking back at all the steps when you weren't so big. Yeah. I think the mistakes that we've made in marketing is when we've tried to do something which is on the edge or which is controversial, which needs explaining. So if you look at the thing in its totality, then it is potentially a positive thing. But if you only see a snapshot of it, then your takeaway from that could be negative. So I think a lot of the mistakes that we made from a market perspective and we did some amazing things, but we did make some mistakes was when we got too clever with the concept and the intention behind it, which was genuine got lost. So a famous example of one of the mistakes that we made in marketing. For International Women's Day, we wanted to highlight the gender pay gap. This was a project that was put together by some of the fantastic women we've got in our business. And we made a beer called Pink IPA that we was get sale 21% cheaper to women to highlight the gender pay gap, which was something that we felt passionate about. And then the proceeds from sale of that beer went to charity is which help women in women's pay in the workplace and these kind of things. But then what happened was people just saw Pink IPA and it looked like we were it was the beer itself was a parody of products which market themselves towards women. But then it just looked like another shawdick that market itself to where women and if anyone like dug into it and understood, okay, this is to highlight the gender pay gap and they're doing some good with the money and there's a genuine cause. People just saw the Pink IPA, they saw the image and came to the conclusion that we're just doing the thing that we were going to fight against. And that was a kiki learning it. People just see a snapshot of a thing. So you need to make sure that all of the message that you want to land as in that snapshot. Because a lot of people's not going to dig deeper into what it is. What I got from that was that like you've got to create a marketing campaign where the context is sort of can't be separated. Can't be separated exactly. Because it will be separated if it can be. Exactly. 100%. ♪♪