Written by: kyliedicksondeakin
Image: (Cusco Nightlife)
Heineken, a premium international lager brand is set to open their first Heineken House in the Australian market. The new addition Heineken House is part of a growing list, with the branded bars already housed in major airports such as Hong Kong and Dubai. A part of the new City View Precinct within International Departures at Sydney Airport, Heineken will be joined by other premium brands such as The Bistro by Wolfgang, Benny Burger by Shannon Bennett, Kitchen by Mike and Joe & The Juice (Sydney Airport 2016a).
The Importance of ‘Place’ in the Marketing Mix
Place or Placement is an integral part of the marketing mix.
‘Place’ is concerned with how we get our service or goods to where consumers want to buy them (Iacobucci 2013, p. 127). Depending on the brand, getting it’s product or service from the Manufacturer to the Consumer can often involve a number of stages, or otherwise know as Distribution Channels or Supply Chains.
These channels can include Manufacturers , Wholesalers and Retailers, and the company will elect whether certain stages should be outsourced to gain time or cost efficiencies (Iacobucci 2013, p. 129). The flow of distribution channels is known as logistics (Iacobucci 2013, p. 127)
In the case of Heineken, we are focused on the distribution channel options for getting the lager from the brewery to the consumers’ glass.
Intensive vs. Selective
When selecting a brands distribution channels, the distribution intensity is the first consideration. Most consumer-packaged goods (CPGs), such as alcohol, are distributed intensively (Iacobucci 2013, p. 130). There are four main reasons for this:
- Consumers aren’t likely to travel distances for a low cost item and they are usually unplanned impulse buys, therefore they need to be available widely.
- Given most CPGs are inexpensive, suppliers need to sell a lot to make profit.
- The goods are relatively small, so they can be transported to various locations.
- The products are simple, and are able to sell themselves, so no sales force is required.
(Iacobucci 2013, p. 130)
While Heineken beverages are available extensively (bottle shops, supermarket liquor chains, restaurants, bars etc.), the decision to have a branded bar within an Airport would be considered quite a selective distribution channel.
Why select an international airport as a distribution channel?
Image: (Sydney Airport 2016b)
The decision to have branded Heineken Houses at international airports is a strategic one. “We chose airports because that international environment perfectly fits the positioning of Heineken as the most global beer brand” says Erik van de Ven, Heineken’s manager for duty-free and travel retail (The Wall Street Journal 2007 para. 11).
In regards to the Sydney Opening, Andrew Campbell, managing director, Heineken Lion Australia, said “For Heineken, being present in Sydney International Airport is a perfect opportunity to showcase the brand to 12 million international passengers every year, reinforcing the position as the world’s most international premium lager ” (The Shout 2016 para. 2).
Being within the Sydney International Airport, as part of the City View Precinct surrounded by a range of other premium brands, will send many brand association messages to consumers.
International airports are also complementary with Heineken’s tag line of “Open Your World’ and also offers an opportunity to differentiate themselves from other premium lager brands.
Retailing and Consumers
Retail as a distribution channel is no doubt highly visual to consumers, and gives brands a real opportunity to positively affect consumers’ thoughts, associations and feelings towards that brand.
Consumers are seeking hedonic experiences when consuming, and are looking for pleasant and emotional experiences (OnurlubaŞ 2015), the Heineken House is providing consumers with the extra ‘experience value’ they are seeking. The bar gives the opportunity for peer consumption, unique experiences and the status appeal associated with consuming a premium brand in a unique environment.
What are your thoughts on an airport as a retail distribution channel? If you are not usually a consumer of Heineken beverages, would you be interested in visiting a Heineken House? What brand associations do you think consumers will make from the new place of Heineken?
Cusco Nightlife, Heineken, retrieved 28 April 2016, <http://www.cusconightlife.com/heineken/%3E.
Iacobucci, D 2013, MM4, Mason, Ohio : South-Western ; Andover : Cengage Learning [distributor],  Student edition with package.
OnurlubaŞ, Eetet 2015, ‘DETERMINING THE FACTORS THAT AFFECT HEDONIC CONSUMPTION’, HEDONİK TÜKETİMİ ETKİLEYEN FAKTÖRLERİN BELİRLENMESİ., vol. 10, no. 15, pp. 681-96.
Sydney Airport 2016a, Sydney Airport announces upcoming food and dining line-up at T1, retrieved 28 April 2016, <https://http://www.sydneyairport.com.au/corporate/media-centre/media-releases/media-release-detail/2016/media-releases/20160208-sydney-airport-announces-upcoming-food?lst=%7BC313C142-0E4E-4269-A2FB-BDEB95B3BC9E%7D%3E.
Sydney Airport 2016b, T1 Improvements Program, retrieved 28 April 2016, <http://www.sydneyairport.com.au/upgrading-your-journey/projects/improvement-programs/t1-improvements-program%3E.
The Shout 2016, ‘Heineken House’ set to open at Sydney Airport, Andy Young, retrieved 28 April 2016, <http://www.theshout.com.au/2016/02/15/article/Heineken-House-set-to-open-at-Sydney-Airport/MTCKODJNXY.html%3E.
The Wall Street Journal 2007, Heineken Hopes Branding Will Fly at Airport Bars, GEOFFREY A. FOWLER, retrieved 28 April 2016, <http://www.wsj.com/articles/SB117399862141438520%3E.