FEATURE4 June 2020

Drink like a Dane: how Carlsberg applies insight

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A major reorganisation of Carlsberg’s insights function has resulted in a shift in focus as it balances global and local research projects. Jane Bainbridge talks to its insights and analytics director, Jenny Syddall.


With every new image of plastic pollution published, another sector or business feels the uncomfortable gaze of an ever more environmentally conscious public, increasingly aware of the long-term impact of product packaging.

So it was for the beer industry when images of turtles caught up in six-pack plastic rings joined the myriad of depressing ocean-pollution scenes.

For the Carlsberg Group, the answer was to introduce new packaging for its multipacks that used glue instead of plastic rings (also known as yokes) in 2018. It was the first brewer to respond in this way.

This was in keeping with its emphasis on sustainability and ambition for a zero-carbon footprint – its carbon-reduction targets include zero-carbon emissions at its breweries and a 30% reduction in its ‘beer in hand’ carbon footprint, by 2030.

The company’s “good social conscience” is cited by Jenny Syddall, insights and analytics director at Carlsberg, and chimes with its attitude toward insight. “There’s a culture of being open to new ideas,” she says.

“Our sustainability programme, Together Towards Zero, has targets for 2022 and 2030 in carbon, water, responsible drinking, and health and safety. We are also looking for better solutions across our packaging portfolio, which included the snap pack and a longer-term project of developing the world’s first paper beer bottle.”

From a market research perspective, Syddall adds: “People are always open to learning, and that makes it much easier to embed insights – and we’re not afraid to change course if we think there’s a need.”

A very clear demonstration of this came at the start of the year, when Carlsberg restructured its insights team. The aim was to ensure that it was giving the business the most appropriate support. “We had this period of reflection, when the business felt we needed to take more of a lead in joining up the dots across functions and being a stronger voice within the business,” says Syddall.

The result was a new structure split into five key areas: demand spaces; global brand insights; category and shopper; growth and foresight; and performance and KPI reporting.

The demand spaces’ focus is particularly interesting. Syddall describes it as Carlsberg’s “motivation and occasion-based segmentation”, and it is vital to the business’s portfolio planning and brand work.

“We’re trying to cluster drinking moments where people have similar motivations for their drink choice,” she says. “Consumers’ repertoire of drinks tends to be very broad. You think of different drinks and brands depending on the moment; we wanted to unpick the needs and the context of all those individual drinking moments.

“When we created our demand-space segmentation, we were looking across all beverages – alcoholic and non-alcoholic. It allows us to understand where we should position our brands and where the growth is in terms of segments and categories.”

New ways of drinking

The melding of alcoholic and non-alcoholic drinking occasions has taken a new direction since the recent surge in low-alcohol and alcohol-free beers. Where once they were only drunk as a form of abstinence, they are now often actively chosen by those looking for healthier options.

In Mintel’s recent report on the UK beer market – which it expects to grow by 16.4% over the next five years, to reach £22bn by 2024 – it cited the low-/non-alcoholic beer trend as helping keep beer on the menu for consumers prioritising health.

Syddall agrees: “You’ve got huge growth coming from the alcohol-free sector, especially among younger age groups, and that’s opening up new products and flavours. The way young people are socialising is changing; they’re increasingly meeting in places such as running clubs, coffee shops or juice bars – but regular drinks with alcohol aren’t always a good fit for those occasions.

“Also, for alcohol-free, those drinkers in the past were looking for a straight replacement for their current brand, and it was often a trade-off, in that they would have preferred to drink their normal product, but perhaps were driving or pregnant. And, if we’re very honest, the products weren’t that great, so it was quite a negative experience. Now, it’s an increasingly positive choice.”

Syddall points to the rise in craft beer – it has a partnership with Brooklyn Brewery – meaning people are often now weighing up whether to have beer or wine. It also has ‘radlers’ – half beer and half juice – to appeal at different moments.

From an insight and data perspective, alcohol-free brews (AFB) have been a big focus, she says. “I’ve just spent the past 18 months working really closely with our AFB team to understand trends – how is the drinker of today different from the drinker of yesterday? How are they going to change in the future? It’s unpicking it; we’re learning a lot about soft drinks because, increasingly, we see our products playing in that space. But it’s often quite hard to find an alcohol-free product in a bar, for example.

“Traditionally, beer has been delivered in steel kegs, but the difficulty with them is the shelf life is limited, so bar owners typically focus on high-volume products.”

Data streams

Carlsberg has developed a system called DraughtMaster, which keeps the beer fresher for longer, making it easier for bars to stock AFBs.

“The brew lasts longer, so that allows bar owners to provide more variety on tap. We’re also working with the trade to understand the problems they have and to try to overcome those,” says Syddall.

As well as product longevity, another advantage of DraughtMaster kegs is that they incorporate smart technology, so Carlsberg can collect data such as when the product is served.

“That’s a real enabler in terms of our customers’ understanding – when they should be switching barrels, what sort of products they should promote at different times of the day,” says Syddall.

With so many data streams across the business, she says that the company is “trying to join the dots across the data and navigate our way through it”. It has a data hub in Portugal staffed with data scientists and engineers, and Syddall describes her team as the end user of the data.

Changes to its data platform are planned; Carlsberg is working with its IT department to not only have easy access to all its data, but to also have better predictive analytic capabilities.

“Within the business, we’re continually getting these new streams of data; so, for example, we’ve got an app called QServe, through which Carlsberg employees – when they are in a bar or restaurant – can rate the quality of the beer and collect a couple of key metrics. It’s a really nice way of understanding our serve quality. It’s a bit like mystery shopping, but we’re using it in a consolidated way, to understand the total trend,” says Syddall.

On- and off-trade

Where, once, understanding the differences between on- and off-trade customers was a large part of any drinks marketer’s job, nowadays there’s not such a gulf in the channels.

“In the past – not just in our organisation, but in the industry as a whole – they were looked at in isolation, but we’re increasingly in an omnichannel world,” says Syddall.

“We have on-trade venues opening in stores, Uber Eats bringing restaurant-style meals into the home – so we look at them in a joined-up way. Our consumers are in both, so we must understand them more holistically.”

From a research perspective, bar staff can be a rich source of information. “If we’re doing research in an on-trade channel, we’ll talk to the bar owners and staff, because they have great insights. Off-trade, we’ve got a lot of data – Nielsen, Kantar, IRI and dunnhumby. The on-trade is more fragmented; that comes with some challenges, but we must get out there and talk to individuals in these environments. Sometimes, the techniques are the same across both on- and off-trade channels – for example, shop-a-longs,” says Syddall.

Challenging preconceptions

With more than 140 brands across 100 markets, insight must be applied across global and local markets. While Syddall, based in Carlsberg’s central office in Copenhagen, is focused on global work, she says there is a “cross-pollination” of ideas. “We’re respecting and learning about the local markets, and – where it’s relevant – we then scale it up.”

The repositioning of Carlsberg in the UK is an example of local markets going it alone. While Syddall wasn’t involved in this project directly, she says it demonstrates the way the business thinks. “The company recognised it needed to revisit our brew in the UK, and the local team went with this really ballsy campaign to support the new brew, challenging the ‘probably the best’ positioning. It said ‘we hold our hands up – we don’t think we are the best’.

“This was based on a need to elevate the experience of our products and challenge people’s preconceptions of the brand. Consumers increasingly want transparent communication and I don’t think it would have been enough to just say, ‘we’ve reinvented our brews’. We wanted something that cut through.

“In the UK, we now talk about it being a pilsner, not just a lager – so we’ve given the brand a bit more meaning. From a central-team perspective, we supported the refresh of Carlsberg’s global positioning and branding, which rolled out quite a different pack design for Carlsberg.”

Managing data

In terms of centralisation, a major issue for the business – with more than 40 insight and analytics people around the world – is sharing human data intelligence. To this end, it is building a knowledge toolkit – the KnowledgeNet platform – which hosts the data from all its markets. This is not just about servicing the insight team, but rather sharing knowledge with the whole business.

“There are six of us in the central team in group commercial in Copenhagen, but we have a big insight community in the markets. We’re keen to work as one team, and share and learn from each other. With KnowledgeNet, you can see before you start a new project what’s been done in the past,” says Syddall.

Amid these various changes for the insight function, its priorities include better understanding of the path to purchase – hence, category and shopper being one of its five prongs. This means multiple research techniques are being applied from ethnographic research, going into bars and observing consumers and how they behave, and accompanied shops.

Pinning down the best route to foresight is another area in which the business wants to improve. “The challenge is that there’s a lot of information, so we need to understand which trends are most relevant and not just a short-term blip. We then need to orientate the whole business around them.”

With its toolkit of research agencies and methodologies, Carlsberg has a broad approach – but what does Syddall want to know that’s currently not being achieved?

“We’re about to kick off some more work on path to purchase. In the past, a consumer’s path to purchase was quite linear, but, increasingly, in this omnichannel world – where we’re seeing all these channel boundaries blurring – it’s more complex. So we’re about to start mapping all the points of interaction, and then we’ll overlay our demand space understanding into that.

The imperative for the insight function remains the same, however, Syddall says: “Our businesses are changing all the time; it’s important in an insight function to put in time to reflect – are we focused on the right stuff, and is there anything we need to dial up or change? The need for research is broad, so we had to explore where will we have the most commercial impact.”

Global rollout of new-look Carlsberg brand

Business reason for the research – to sync the packaging design with an updated brand positioning. The objectives were for the new packaging to support the brand positioning without alienating current drinkers, and to improve shelf impact.

Research approach – a global study across multiple markets. During initial, exploratory qualitative research, respondents carried out a shopping trip to collect spontaneous reactions to the different executions. They were then shown a brand video and, through focus groups, Carlsberg explored how reactions changed once respondents had more context on the brand positioning. It then did quantitative research to compare reactions to two routes versus the current execution. This was a mix of central location tests with 2D-printed trade shelves or online research, depending on the market.

Impact of research and rollout – Carlsberg decoded the importance of behavioural metrics in relation to packaging design and ease of shopping. For example, the end design was more minimalist than the first sketches, reflecting the ‘Danishness’ of the brand character. The final design is now on shelves across its key markets.

This article was first published in the April 2020 issue of Impact.