1. What was the main motive for Pernod Ricard’s acquisition of V&S (including Absolut Vodka) in 2008?

2. Which alternative marketing strategies should the Absolut Company have to increase its market share for:
(a) Absolut Vodka in the USA?
(b) Absolut Vodka in Europe (including Eastern Europe)?
(c) Absolut Vodka in other parts of the world?

3. In which region (country) would you recommend Absolut Vodka to allocate more marketing resources?

4. Did Absolut Vodka have the right competences for achieving international success for its Absolut Cut?

5. Should Absolut Vodka relaunch a mixer product in the global FAB market? 

Absolut Spirits Company is the international wing of the state owned Vin & Sprit AB (V&S) in Sweden. The first bottles of Absolut Vodka were first sold in USA in 1979. Since then Absolut Vodka has reached a market share of about 10 per cent of the US vodka market. From 1979 to 1995, the worldwide sales volume of Absolut Vodka rose from 90,000 litres to 41.5 million litres. About 70 per cent of this amount was exported to USA. In 1994, the Absolut Company changed its distributor from Carillon to Seagram in USA and a number of other countries. 

Worldwide, Absolut Vodka is the third largest international premium spirit and is available in 126 markets. Among premium vodka, Absolut Vodka is No. 2 worldwide, after Smirnoff. In 2004, Absolut entered the international FAB (flavoured alcoholic beverages) market by starting up sales of its Absolut Cut in Canada as a test market. Here, the 7 per cent abv (alcohol by volume) vodka drink is aimed at the more mature drinker – rather than the younger generation traditionally targeted by ready-to-drink (RTDs) – offering the ease of a pre-mix, but with a less sugary taste.

In 2008, Pernod Ricard purchased V&S Group, including the Absolut Vodka brand, from the Swedish government. Absolut Vodka accounts for about 40 per cent of Vin & Sprit’s sales by volume. The rest comes from alcoholic beverages including Plymouth Gin, which is distilled in the English city of the same name, and Cruzan rum, which has been made since 1760 on the Caribbean island of St. Croix. The company also owns the Level, Fris and Luksusowa vodka brands.
In the United States, Absolut was distributed by Future Brands, a joint venture between Fortune and Vin & Sprit. This US agreement between V&S and Fortune Brands was in place until the start of 2012 when Pernod Richard took over.