Pernod Ricard Uses AI to Mix Up Marketing and Sales
Source: cio.com
The Bottom Line
Pernod Ricard, the French wine and spirits giant, is betting big on AI to revamp its marketing and sales strategies. Facing the challenge of managing over 200 brands across diverse markets, the company is turning to machine learning to gain a competitive edge.
What Happened
Pernod Ricard rolled out several AI-powered tools, including Maestria 2.0, a brand-matching platform that uses predictive algorithms to forecast consumer behavior and trends. This platform evolved from a workshop-based approach to a data-centric model, developed with the help of consumer insights, marketing, and sales teams, along with market research firm Kantar. Maestria 2.0 aims to pinpoint how Pernod Ricard brands can best enhance specific events or moments, shifting the focus from the drink itself to the "consumption occasion."
Complementing Maestria 2.0 is Matrix AI, a marketing effectiveness engine that optimizes budget allocation and campaign tailoring. According to Brendan Coogan, chief transformation officer, Africa and Middle East, Matrix AI allows for near-real-time decision-making, reducing analysis time from weeks to mere moments. For sales teams, Pernod Ricard uses D-Star, an AI platform providing real-time recommendations on which products to push, stores to prioritize, and visit frequency. The company is also piloting Genie, a generative AI tool for faster content creation and improved marketing ROI.
Why It Matters
Pernod Ricard's adoption of AI addresses the complex challenge of marketing a vast portfolio across numerous platforms. By leveraging data-driven insights, the company aims to move beyond traditional marketing assumptions. Coogan notes that AI can reveal surprising consumer preferences, potentially challenging long-held beliefs about brand positioning and target demographics. This shift towards data-driven decision-making could lead to more effective campaigns and increased market penetration.
The emphasis on "consumption occasions" represents a strategic pivot, focusing on consumer motivations and emotions rather than simply pushing products. This is particularly relevant in markets like Africa and South Africa, where alcohol consumption is rising, and consumers are increasingly opting for premium brands. Maestria 2.0 helps Pernod Ricard identify and capitalize on these trends by aligning premium products with specific consumer tastes. However, this data-driven approach isn't without its challenges. Coogan stresses the importance of accurate and consistent data, warning that flawed information can undermine the effectiveness of these tools.
Our Take
Pernod Ricard's AI initiatives highlight a broader trend of established companies embracing machine learning to stay competitive. The key here isn't just implementing the technology, but also ensuring that employees are brought along for the ride. Coogan rightly emphasizes the need for co-creation and addressing fears about job displacement, framing AI as an enabler rather than a replacement. This approach is crucial for fostering buy-in and maximizing the potential of these new tools.
Still, there's a risk of over-reliance on algorithms. While data can provide valuable insights, it shouldn't completely replace human intuition and creativity. The most successful marketing strategies will likely blend data-driven analysis with a deep understanding of consumer psychology and cultural nuances. Furthermore, ethical considerations surrounding data privacy and algorithmic bias must be addressed to maintain consumer trust.
What's Next?
Pernod Ricard's experience offers valuable lessons for other companies seeking to integrate AI into their marketing and sales operations. The focus on clean data, employee engagement, and strategic alignment are critical success factors. As generative AI tools like Genie continue to evolve, expect to see even more innovative applications in content creation and campaign optimization. The ability to adapt to changing consumer preferences and leverage data-driven insights will be essential for staying ahead in the increasingly competitive beverage market.