Research Team: Okko Grippando Jerald Mutia Kate Richards Joe Shaw Peter Young - Marketing Research X August 30, 2005 Smirnoff Ice

Smirnoff Ice produced by London-based Diageo PLC, the world’s largest producer of alcoholic drinks Diageo produces over 70 brands and variants of wines, beers, and distilled spirits distributed over 180 territories throughout approximately 70 countries Brands include Guinness Stout, Harp Lager, Sterling Wines, Johnnie Walker Scotch, Tanqueray Gin, and Smirnoff Vodka Total revenue was $15.9B, gross income was $3.1B, net income applicable to common shares at $1.6B Corporate site emphasizes responsible marketing and responsible drinking Company Profile

21-34 year olds Young and edgy Regular consumers and new drinkers Drinkers in training Flavor and taste are important Customer Profile

Mike's Hard Lemonade –The #2 flavored malt beverage with about half of Smirnoff Ice's sales. Aggressively targets men in its marketing and corporate sponsorship Launching Mike's Light as a low carb alternative Markets its independent label status Bacardi Silver –The #3 flavored malt beverage with about a third of Smirnoff Ice's sales. Specifically courts women in its television marketing on networks such as Style and Oxygen. Launching Bacardi Apple Silver as a low carb alternative Leverages the strength of the Bacardi name Competitive Analysis

Produced by Diageo, Plc. Launched in 1999 A lightly carbonated, citrus flavored malt-based cooler 5% alcohol content Product Profile

Surveyshare.com, self administered, 14 question survey Survey of convenience Over 200 respondents from coastal regions First 4 questions categorize respondents into sectors of age, gender, relationship situation, and employment status. The rest of the survey evaluates the participant’s lifestyle, drinking patterns, and opinions of flavored malt beverages and Smirnoff Ice. Survey Methodology

Research Question Understand the lifestyles and drinking preferences of FMB consumers –Location –Surroundings –Friends –Season

63% of respondents had tried Smirnoff Ice and 50% indicated that they would drink it again. Taste appears to be the strongest driver of drinking Smirnoff Ice with 68% naming it the driving reason. Of those who would not drink a flavored malt beverage again 83% cited taste as well. Other reasons for drinking Smirnoff Ice seemed to be split by gender. 15% of men said they liked the convenience of a bottled drink and 24% of women liked the lack of strong alcohol flavor. There was a slight perception of flavored malt beverages being 'a girl's drink' as reported by 15% of men however this does not seem to be a critical issue. Research Results

While half of the respondents had tried a flavored malt beverage and would drink it again it was rarely the drink of choice. - Less than 2% named it as their drink of choice at a bar/club - Less than 4% named it as their drink of choice at home - Only 10% named it as their drink of choice at a barbeque Other the people who named it their drink of choice at a barbeque 63% identified wine as their drink of choice at home and 67% named hard liquor/mixed drinks as their drink of choice at a bar/club Smirnoff Ice tied with Mike's Hard Lemonade as the drink of choice overall however those who identified Smirnoff Ice as the dominant brand tended to skew younger and male. Research Results

Increase current advertising as survey shows MHL rivals SI in brand recognition Advertise through female-specific outlets to increase female market share Market within bars to the population that sees Smirnoff Ice as an outdoor/barbeque drink through specialized marketing. Investigate what aspects of the taste are displeasing to those that have tried but would not drink FMB’s again Employ more precise marketing tactics - Identify top SI consumer age ranges - Identify the actual purchasers of SI - Identify seasonal purchase patterns Recommendations

Questions?