University of Houston Conrad N. Chris Taylor, director of the beverage management program at the Hilton College of Global Hospitality Leadership, was surprised to see White Claw sales skyrocket in the summer of 2019.
As a new entry in the relatively unknown hard seltzer category, it was completely unexpected and had nothing to do with the company’s own marketing strategy. White Claw’s rapid success was due, almost entirely, to a social media influencer.
“He came up with a slogan, ‘There’s no law when you’re drinking paws,’ and it took off from there,” said Taylor, an associate professor at Hilton College. “The last thing a company wants is their alcoholic product that’s linked to breaking the law, but it ends up selling everywhere.”
With millions of followers, the influencer flooded the social air with the slogan, even putting it on a T-shirt. This created excitement for a product that wasn’t on the beverage industry’s radar at all. Demand went through the roof and soon White Claw was selling out everywhere.
Taylor had never seen anything like this. There was no one else for that matter. He, along with Hilton College researchers Courtney Norris and Scott Taylor Jr., set out to discover and explain this new phenomenon, which they dubbed “rogue marketing”.
According to researchers, rogue marketing occurs when an unaffiliated person creates an informal message about a brand on social media and goes viral. Although the post is not funded or endorsed by the company that owns the brand, Viral Status offers free and unexpected advertising.
In a study published in the International Journal of Wine Business Research, the team surveyed 210 people who couldn’t tell a significant difference whether the message they were seeing came from a company or an influencer. This means companies need to account for fake marketing in their business strategies, according to the researchers.
“I think this is something companies really have to consider in their marketing plans now,” Taylor said. “They have to talk about how to monitor it and combat it if necessary.”
From 2018 to 2019, the low-alcohol, low-calorie hard seltzer saw a nearly 200% increase in sales to nearly half a billion dollars. At the time, the main reason for their popularity was ready-to-drink cocktails that offered more convenience and gave consumers the freedom to enjoy cocktails without being confined to a bar.
Then the influencer dropped their slogan and grew sales by 1000% in just a few months. Something was driving sales outside the company, and while it wasn’t the way the company wanted to go, growth and profits were staggering.
“It was this little product that nobody thought about until it was rogue marketing,” said Chris Taylor. “And they are still here today. Every manufacturer from Shiner to Anheuser Bush has five different brands of hard seltzer. It is so flooded with the market now.”
Fake marketing is also affecting the luxury car industry. Influencers on platforms like YouTube and Instagram are making attractive cars a part of their brand and this is causing problems for companies that are not targeting that audience.
“Ferrari is having a really tough time because they have a lot of rules when someone buys a car, like you can’t paint it,” Taylor said. “But these YouTubers and Instagrammers are wrapping up cars, putting inappropriate markings on them, and it’s really changing how people view these brands.”
Taylor says that a company’s name and brand equity, built over the years through a carefully cultivated message, is everything. When a brand is damaged by external forces beyond its control, it can do irreparable damage to a company’s long-term lows despite short-term profits.
While the Hilton College team was the first to identify and research the rogue marketing phenomenon, they believe it is just a framework for future studies to truly understand its positive and negative effects.
“We just scratched the surface with this exploratory study,” Taylor said. “But with the explosion of social media influencers, this is a truly worldwide trend that I believe is here to stay.”