Markets

Diageo's Takedown of BrosIcingBros.com Is About Price Regulation, Not "Misuse" of Smirnoff Brand

By Jim Edwards

Updated on: June 18, 2010 / 12:45 PM EDT / MoneyWatch

Don't believe Diageo (DEO)'s explanation for its move against the now-dead BrosIcingBros.com, a website that popularized a bizarre binge-drinking game involving Smirnoff Ice. This isn't about the "misuse" of the Smirnoff brand. It's about staving off government price controls on the sale of alcohol.

Diageo said this about shutting down the site:

Diageo has taken measures to stop this misuse of its Smirnoff Ice brand and marks, and to make it clear that 'icing' does not comply with our marketing code, and was not created or promoted by Diageo, Smirnoff Ice, or anyone associated with Diageo.

It was a contrast to its previous statement, which appeared to give a backhanded endorsement to the game:

Icing is consumer-generated, and some people think it is fun -- We never want under-age 'icing' and we always want responsible drinking.

You need to know two more facts about the alcohol marketing climate to fully understand what's going on.

Diageo is headquartered in London.
That's crucial because the U.K. government is raising taxes on alcohol and is considering establishing a minimum price for booze to curb binge drinking.

America has a youth binge-drinking problem of its own, of course, but it's not as serious as Europe's and doesn't make as many headlines. That explains Diageo's initial nonchalance toward the game, which has been making the rounds since April.

It's a good bet that when Diageo in London realized its American arm was being criticized for not distancing itself from the game that someone at HQ flipped out and in effect said, Move on this now because we don't want our U.S. operations to get regulated the way they are in the U.K.

Related:

Bros Icing Bros: The New Binge Drinking Game That Smirnoff Has Nothing to Say About