Bacardi Limited, the largest privately held spirits company in the world, recently acquired Patron Spirits. (Bacardi Limited). Currently, Patron can be purchased in over 100 countries. With the acquisition by Bacardi Limited, Patron can rely on the parent company's logistics expertise and relationship with global distributors. Patrón leverages the resources and expertise of Barcardi Limited to enter foreign markets and establish a strong market share. In 2019, Patrón was the leader in tequila sales worldwide, outranking Don Julio. Tequila brands are facing a production problem because demand has outpaced the blue agave supply. In 2020, the tequila industry experienced over 46% growth. (Forbes). Surprisingly, tequila sales increased during COVID despite the closure of restaurants, bars, and clubs.
Patrón, like many tequila brands in the market, produce tequila blanco, reposado, and añejo. Customers have the ability to select the tequila that best suits their taste preferences. Although Patrón has a vast product portfolio, they can standardize the product internationally. Patrón does not change its distillation process or tequila recipe/taste to adapt to new markets. Fortunately for Patrón, their products are standardized globally, meaning that tequila tastes the same in any market. Patrón is investing in its expansion into the United Kingdom, Australia, and Canada, all projected to grow in tequila sales. (The Spirits Business). In markets with projected growth for tequila sales, Patrón is seeking to achieve first-mover advantages. Recently, Patrón has been investing in expanding its Mezcal product portfolio to keep up with the growing demand experienced in 2020.
Celebrity Brands Challenging Traditional Brands
A recent trend in the tequila industry has been introducing celebrity-backed brands like Teremana by Dwayne “The Rock” Johnson, Lobos 1707 by Lebron James, Casa Amigos by George Clooney, and 818 Tequila by Kendall Jenner. Celebrities rely on their personal brand, social media followers, and fan base to drive tequila sales. Teremana relies on strong social media advertising to increase brand awareness and sales. By 2021, it is projected that Teremana will sell over 1 million cases of tequila, joining the traditional brands like Patrón, Don Julio, Sauza, Hornitos, Jose Cuervo, and El Jimador. (The Spirits Business). Brands like Teremana are also seeking to expand internationally to capture the growing demand for tequila. Celebrity-backed tequila's benefit from the brand association. Teremana, and other celebrity tequila's, provide customers with strong intrinsic value. Customers enjoy the product more because it is associated with a globally known celebrity.
Patron & Technology
Patron uses a unique strategy to advertise for their brand. They understand how important technology is nowadays. As a result, they have adopted a mobile-first philosophy. Their justification for this philosophy is that they believe most of their consumers first interact with their brand through their mobile devices (Lopez, 2017).
In line with this philosophy they have continued to seek ways to utilize technology to engage with their fans. They have incorporated aspects of VR to allow their consumers to get a first-hand 360-degree view of their distillery’s. This investment into VR helped them convey the quality of their product to their consumers. They have also developed a Patron skill for Alexa so that consumers can ask Alexa how to make certain drinks or provide drink recommendations like a bartender. This Alexa skill served an educational purpose for Patron, to show their consumers all the ways their product can be used.
Patron is essentially continuing to find new ways to push the envelope with technology. They already possess a strong market share but that is not enough for them. They want to continue to innovate and find new ways to reach and educate their consumers by way of technology (Lopez, 2017).
In conclusion, what makes Patron a leading global brand is that they have a standardized product and they have a modern advertising strategy that focuses on technology. By standardizing their product they are able to reach many markets and gain first-mover advantages. With their mobile-first advertising strategy, they are able to find innovative ways to reach and educate their consumers.
Lopez, Maribel. “Three Creative Ways To Drive Brand Marketing From Patrón.” Forbes, Forbes Magazine, 3 Feb. 2017, www.forbes.com/sites/maribellopez/2017/02/03/three-creative-ways-to-drive-brand-marketing-from-patron/?sh=439171e2cefc.