As part of the management studies this case was prepared to identify the Suntory Highball Revolution.

1. MGT489
Section: 03
Case: The Suntory Highball Revolution
Prepared by
Azas Shahrier 0930088030
Meraz Bin Mizan 1020950030
Shaheen Al Rafi 1110047030
Ali Rayhan Sharker 1110059030
Rahat Hassan Chowdhury 1120966030
Prepared for
Dr. Jashim Uddin Ahmed
Associate Professor
School of Business
North South University

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Case Overview:
In Japan, especially on late 80’s whisky industries were going down for impact of the
economic bubble and over 20 years sales have been decreasing. Whisky industry
leader Suntory has taken it upon itself to restore whiskey's image and spark it on
around the Japan. The main challenge for Suntory has been to make an old product
seem new as well as appeal to a mass range of consumers although Japanese people
have different perception about the alcoholic products. After trying several attempts
to revive the market without any success, Suntory seemed to be out of options. After a
while, the company realized to overcome this problem, as Japanese are aware about
whisky so that they need different strategies to enhance whisky image all over the
Japan and increase their sales too. So, they re-introduced a drink during the bubble
economy, the whisky highballs cocktail and with some unique strategies,
1. To promote this drink on the mass they choose two different strategies for
youth and old generation.
2. Their advertisements were to attract Japanese health conscious people.
3. Their pricing strategy was low to capture the Japanese market.
4. Japanese are believed on new things, so they re- designed the drink and
offered it as a new to the market.
Suntory has re-shaped its strategies and with the help of their 'new' drink - the
whiskey highball – it became successful and popular drink of Japan. Riding the
highball wave Suntory seems set to continue its reign as Japan's whiskey leader, but if
history is any guide it could be a complex and hard battle.
About Highball & its Local and Overseas business analysis
Suntory is an enterprise with a large network of group of companies ranging from
alcohol beverage to health supplements. The target of the company was to make
Suntory a high-end whisky and also to acquire recognition of being as a Japanese
whisky company rather than Scottish Whisky Company.
When the company Suntory was not successful at home then they targeted foreign
market. Suntory worked hard to create a whisky culture in China. On September 14th

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2010 Suntory held a dinner in Paris with 60 business leaders and well-known
Frenchmen in order to entertain them with the taste of Suntory wine to gain word of
mouth marketing from them.
Moreover, their annual sale totaled 180000 cases both inside and outside Japan, which
made them the world’s eighth bestselling single malt. In 2010, Suntory was hoping to
sell 8000 cases of Hibiki and 31000 cases of Yamazaki in overseas market which pale
in comparison to 46.5 million cases total of all whisky sale in United State in 2009.
This showed that there were lots of potential in overseas market. In addition to that, in
2003, all three of the Suntory high-end whisky won award in various competition.
Every year, Whisky Magazine holds its “Icon Whisky Awards” honoring companies
and distillers from around the globe. Suntory won the Distiller of the year award for
2010, which was the first for any Japanese corporation.
On the other hand, Suntory’s home success could not match with their overseas
success. This is because their younger generation was not taking much alcohol while
the baby-boom generation was hard hit by the economical problem. In the year 2006,
Suntory’s sales were lowest of all time. Besides, the whole industry had been plagued
with the image of whisky being an alcohol and only drunk by older generation.
Moreover, Suntory had to deal with the fact that the Japanese economy had been
struggling for more that 20 years and people had less money to spend. Thus people of
Japan could not spend money on expensive spirits such as whisky.
Strategy for Highball by Suntory
The whisky highball, is a drink made of whisky and club soda. After 20 to 30 years of
it’s lying dormant, Suntory brought the whisky highball back from the dead.
Country’s leading distiller has been revolutionizing drinking culture with the aid of a
pint glass and a more than generous slug of soda. The result was an instant increase in
the number of people ordering cheap and cheerful highballs, and while just 15,000
bars were serving the drink at the end of last year, that figure has rocketed to an
estimated 40,000 establishments, according to Suntory.

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New Way of Drinking: Suntory tried to push a new way of drinking whisky, the Half
Rock, which is half whisky and half water or soda on the rocks. They were hoping
that the younger generation would think that this way of drinking whisky would come
across as more fashionable and stylish and finally break them out of their cold spell.
Suntory tried to allow younger people more chances to drink whisky by running
promotions offering a free shot of whisky. The drink is reportedly very popular with
women drinkers as it is lighter and less harsh than straight whisky or when it is served
with water, with many consumers commenting that a highball slips down as easily as
a beer. And served with ice, highballs were also a hit during Japan's long, hot
summer.
Craze on Young Generation: Younger drinkers found old-style whisky bars
intimidating, so Suntory developed a new generation of highball bars and getting its
cheaper whiskies into other bars where they could be sold as an alternative to beer.
The highball has ignited sales amongst a new younger generation of Japanese drinkers
being a mix of whisky, soda and ice, but with a Japanese twist.
The Bridge: Suntory worked both on young and older generations. With the younger
generation they were focusing on conveying a feeling of afresh, new style of drink
that would hopefully lead to them trying some of the more expensive whiskies. For
the older generation, Suntory was hoping to reintroduce a product that would allow
them to bask in the nostalgia of the “good old days.”
Pricing: One aspect of the highball that is favored by all is the price. On that
economic slump consumers going to bars and young people were able to order
highballs for less money than a beer of the same size. On the other side of the
transaction, the bar owners like the whisky highballs because the cost of providing
one is about 51–100yen lower than providing the same amount of beer. This gives
them a bigger profit margin
Word of Mouth: In 2010 Suntory held a dinner in Paris at the Japanese ambassador’s
house with about 60 business leaders and other well-known Frenchmen. The event
was designed to give influential individuals taste of Suntory whiskies in hopes of
building their reputation by word of mouth. Later on Suntory arranged more events
like this in other Western countries.

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Ready to Drink: Suntory also introduced highball in canned forms. The cans are
aimed at consumers who wish to pick one up at the convenience store on the way
home and have it that evening with dinner. Suntory believes that the reason for the
success of the highball-style drinks is due to the trend for more people to go home to
eat during the economic downturn, and the fact that the drinks seem to go very well
with many foods.
Brand Ambassador: Suntory has been very active in making actress Koyuki the face
of the highball revolution. Using such a notable actress has allowed them to penetrate
into the younger generation’s awareness and raise the recognition of the brand.
Suntory has used their mainstay whisky, Kabuki, in all of the commercials featuring
Koyuki. In these commercials she guides the viewer through a “seminar” on
Suntory’s recommended way of creating the perfect highball.
Promotion: Suntory created a special advertisement on Father’s day. In one
particular promotion it suggests the best present a father can get is time spent with his
children; the commercial then suggests that you invite your father over for a highball
every now and then. These commercials have helped to raise recognition of highballs
to a new level.
Appeal of Highball: Suntory says that the smell of whisky has been proved to help
the consumer relax when drinking it. Another reason the highball is so attractive is its
taste. The younger generation is having a tough time getting used to the bitterness and
sharpness of beer. Suntory also said, polyphones are included with highball, which
have a variety of health benefits ranging from being an antioxidant to helping fight
tooth decay.
Major Findings Problems about the Highball
The Japanese have long been committed whisky drinkers, and until recently that
meant holing up in a small, dark den designed for serious drinking. But the country's
leading distiller has been revolutionizing drinking culture with the aid of a pint glass
and a more than generous slug of soda.

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The whisky highballs introduced by Suntory, the privately owned Japanese drinks
conglomerate that has the lion's share of the country's whisky market, seem to have
worked. Sales have been up more than 10% a year over the past three years.
The group's Yamazaki distillery on the outskirts of Japan's imperial city, Kyoto, is the
home of Japanese whisky and this year is celebrating its 90th anniversary. It is often
forgotten outside Japan that as well as importing large quantities of scotch, the
Japanese make their own malts. Indeed, more than 80% of the domestic market is
accounted for by whisky produced in Japan. As in the UK, whisky drinkers were by
tradition male and relatively old, but targeting younger drinkers with the highball has
changed all that.
"Domestic consumption was declining up until three years ago," said Hiroyoshi
Miyamoto, the former general manager at Yamazaki and now Suntory's global brand
ambassador, "but it all turned around in 2009 when we introduced the highball. That
changed the attitude of Japanese consumers." Miyamoto said younger drinkers found
old-style whisky bars intimidating, so Suntory was developing a new generation of
highball bars and getting its cheaper whiskies into other bars where they could be sold
as an alternative to beer.
The capital, Tokyo, has plenty of the old and the new. The ultimate secret city, it has
an estimated 300,000 bars, many hidden in basements or office blocks. Campbell
Toun Loch, a subterranean bar in the Ginza district which despite the eccentric
spelling does indeed prove to be full of whisky, seats just eight. It is no bigger than a
large cupboard, but contains hundreds of bottles of whisky, three deep on the counter.
When you order, the barman plonks the bottle down in front of you as if he expects it
to be polished off. This is a bar for the connoisseur.
In some of the more formal bars, there are rocking chairs and oak paneling. The
atmosphere resembles that of a gentlemen's club. Bartenders in ties and waistcoats
theatrically chip away to make the perfect ice ball, over which the spirit is lovingly
poured. This is whisky drinking as performance art.
At the other end of the scale is Margin, a noisy, bustling bar in the heart of Ginza
district, full of salary men who have just finished work and are desperate to let off
steam. Whereas Campbell Town Loch caters for the solitary, late-night drinker,

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Margin attracts lively early-evening groups, eating, smoking and knocking back
highballs. Margin even has whisky on draught, a trend Suntory is keen to encourage
despite the high cost of maintaining the pumps.
"We are trying to create a buzz around whisky," said brand manager Keita Minari. "A
popular TV program in Japan picked up on Margin and the new trend for drinking
highballs, and it said people there were drinking whisky more than beer. When you
are having a meal, whisky doesn't stay in your stomach, unlike beer where you get
full very easily."
There are, though, no immediate plans to transplant the whisky-drinking revolution to
Europe, where Suntory's brands – principally the Yamazaki and Hakushu malts – are
premium products. "We have to do these things step by step," said Minari. "Scots are
coming to Japan, seeing the phenomenon of the highball and saying we should do the
same thing in the UK, but it's too early. Our share of the UK market is very small
compared with scotch whisky. At the moment we still have to let people know that
Japan is making whisky."
Japanese whisky exports to the UK and Europe used to be negligible, but when
Yamazaki 12 Years Old won a gold award at the International Spirits Challenge in
2003, Suntory decided to try to take on scotch on its home ground, and now has a
foothold in the market.
Perception about highball whisky in Japan
Japanese people have different types of perception about the alcoholic product.
Different aged people see differently and their perception varies. To overcome this
problem, Suntory has developed different types of strategies to increase the sales and
overall growth of their company. One of the strategies was to work not only on the
young generation but the older generation as well. With the younger generation they
were focusing on conveying a feeling of a fresh, new style of drink that would
hopefully lead to them trying some of the more expensive whiskies. For the older
generation, Suntory was hoping to reintroduce a product that would allow them to
bask in the nostalgia of the “good old days” when the economy was at full speed and

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the highball was a staple drink. They wanted to create a buzz among the mindset of
their target customer and they successfully has done that. They have made “kayuki”
the main endorser of their product which has made instant growth in the sales.
Japanese young generation people were crazy about the endorser and they felt that
they belong to that category, so they started to consume more and more of this whisk,
which eventually mountain the sales.
They also have used several other strategies to increase the sales and change the
perception of the Japanese people because Japan is such a country where it is difficult
to persuade people to drink whisky or alcohol. For the centuries, Japanese people are
very health conscious and they do not take or drink anything, which is bad for health.
So in the first place drinking alcohol seemed to be bad for them but Suntory made
their advertisement and promotional strategies in such a way that they have
successfully persuaded the Japanese people to consume whisky.One aspect of the
highball that is favored by all is the price. In the current economic slump consumers
going to bars and izakayas are able to order highballs for less money than a beer of
the same size. The prospect of economizing thus adds another reason to drink the
highball. On the other side of the transaction, the bar owners like the whisky highballs
because the cost of providing one is about 51–100 yen lower than providing the same
amount of beer. This gives them a bigger profit margin, which is one of the reasons
why the number of establishments serving whisky highballs has increased so quickly.
On the other hand Japanese people are kind of a fad. They just jump into a new thing
and that thing becomes hit for a few time periods. Then the people forget about the
product and sales of that product suddenly decline. Suntory faced one problem: no
one is making the hoped-for leap from the cheap whisky used in highballs to the more
expensive premium products. They continue to struggle to persuade frugal Japanese
consumers to switch over, which is what will be needed to maintain growth in the
long run. In Japan, buying habits are typical of a collectivist-oriented culture, and one
of the collectivist features often represented in Japanese consumer behavior is the fad.
“Pack consumerism” has been instilled by peer pressure since childhood and drives
the desire to conform. So it was difficult for Suntory to hold onto to growth rate
because the frugal Japanese were not buying this high end whisky and thus a large
chunk of money were untapped.

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Recommendation:
Suntory is a well-established alcoholic brand in Japan. They need to maintain their
growth rate so that they can become the market leader in the economy. This is not so
easy task as said. It needs to implement some strategies carefully and there are few
strategies that Suntory can take. To remain a leader in the alcoholic beverage industry
Suntory must continue their aggressive marketing strategies for whisky and continue
to make their products attractive, while offering value to the consumer. They must
also focus on creating a more fluid transition to the premium whisky brands for
consumers whose interests have beenstimulated by the highballs, if they hope to
maintain their current fortunes. For a company setting its sights on the world, they
must start at home and get a firm grip on the domestic market before they can expect
to become one of the world’s leaders in whisky.