A tale of Dos Equis and romancing the brand

Jan. 10, 2014
Romancing the Brand cover
Reprinted by permission from the publisher, Jossey-Bass, a Wiley brand, from Romancing the Brand by Tim Halloran, Copyright (c) 2014 by Tim Halloran.

Often finding unique, differentiating product attributes and functional benefits may not be obvious. Most brands don’t have the luxury of starting from scratch. As a marketer, you have to work with what you have—challenging, but not impossible, and with diligence and persistence, the results can be fantastic.

What if, for example, a brand is in a category in which many of the product attributes and functional benefits are similar among competitors? What if the category has more than 20,000 brands worldwide associated with it? This is what the team at Dos Equis encountered in 2007 as they took stock of their brand: a small Mexican beer that was bordering on the edge of obscurity.

Dos Equis was originally brewed by Cuauhtemoc-Moctezuma Brewery and was licensed to Heineken to market and distribute. It had little awareness or identity beyond Mexico, and was distributed in just a few southwestern U.S. states. But during a routine brand analysis in 2007, the Dos Equis brand team started noticing something interesting. According to Willem Jan van der Hoeven, the Dos Equis brand director at the time, “We had noticed that Dos Equis, as a Mexican brand, had started making inroads in, of all places, Austin, Texas. We started to realize that University of Texas students were discovering the brand during their spring break in Mexico and when they returned to Texas, one state where we had distribution, they were drinking it quite frequently.”

Van der Hoeven believed that Dos Equis might have untapped opportunity in the U.S. Another Mexican beer, Corona, had become a major player in the U.S. beer category: could there be room for a second mass marketed Mexican beer? After all, UT students had gone to Mexico, found this brand, and realized it was available in Texas. His hypothesis, confirmed by Austin sales, was that these students wanted to bring back a bit of the Mexican culture that they had experienced during spring break, found the brand available in Texas when they returned, and began to adopt it. Spring break is a college ritual that leaves an indelible mark on many students. If Dos Equis was becoming part of that experience—at least for the students that were spending spring break in Mexico—the brand might be positioned as a reminder of spring break. This was already starting to happen; Van der Hoeven and his team, which included Havas Worldwide Agency partners, Kersten Rivas and Katy Milmoe, thought they might be able to accelerate a relationship with Dos Equis and these 20-somethings.

They set out to understand what the existing reputation of Dos Equis was among both those who had experienced the brand in Mexico over spring break and those who had not. They did both formal and informal research, sometimes sitting down with consumers in bars and found that most people, at least those who hadn’t discovered it on spring break, had little association with Dos Equis. According to account director Milmoe, their perception of the brand was that it was “something akin to a beer that I get in Mexican restaurants when they don’t have the brand I want.”

The brand that they wanted was Corona. In their minds, Corona was undoubtedly Mexico. It owned both the country and the culture. In a classic positioning sense, Corona had “won” Mexico. As Milmoe said, “Corona had a feel. It was beaches, relaxation, vacations, and sun. But we thought to ourselves, is there anything else about Mexico that might link better to Dos Equis? As it turns out, there was.”

In trying to understand the potential corridors in which to position the brand, the team first looked specifically at Dos Equis intrinsics, those attributes that were part of the product. One of those was the brand’s history. Dos Equis was originally developed by a German brew master who had moved to Mexico and established a brewery. So, in actuality, it was a beer recipe brought over from Europe that just happened to be set in Mexico. It was first developed at the tail end of the 1890s and launched to celebrate the arrival of the 20th century. In fact, that is how it got the name “Dos Equis” (“Two Xs” – twenty in Roman numerals). Although considered a lighter lager, it had a heavier and more unique taste than typical U.S. light beers such as Coors Light or Bud Light. If anything, its German roots combined with its Mexican heritage created something of a hybrid beer.

Among those few who were familiar with Dos Equis (those college spring breakers), many saw it quite differently from Corona. In those early conversations with consumers, the unique name, the imposing XX, shiny gold label, the German brew master, and slightly different taste created an air of mystery around the brand. The idea of mystery intrigued the team: it linked to a Mexico that many didn’t immediately associate with beer. Adds Milmoe, “We did some exploration of what Mexico meant and yes, the sun and fun Corona imagery was very strong. But there was something else about Mexico that started to fascinate us. The night time Mexico that was mysterious, unknown, and off the beaten path. Dos Equis represented that Mexico. We were more than beaches and burritos.”

It was an intriguing starting point, but stopping there wouldn’t yield much of a connection. What consumer need could the brand’s product attributes, which included its mysterious origins, unique taste, and Mexican heritage meet? How could it be narrowed down to one core idea? More importantly, how could that idea result in a compelling reason for a consumer to pick it up instead of the thousands of other beer choices available? The team had significantly more work to do. They would need to understand the consumer much more intimately. They would have to build upon these insights to develop not just a functional reason for a consumer to enter into a relationship with the brand, but find an emotional connection that would lead the consumer to actively seek out Dos Equis. The insights that they ultimately found, and the remarkable emotional connection that would result, would take this small, mostly unknown beer into the stratosphere.

Topics: Consumer Behavior , Marketing

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