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Diageo exec: ‘In spirits, you need to move fast’
“The battle of the future isn’t between big and small; it’s between those who are fast and those who are slow,” according to Diageo’s president of Europe, Turkey and India.
For John Kennedy, speed is the key to success in spirits
Speaking to The Spirits Business last month, John Kennedy addressed the issue of whether the influx of independent super-premium brands has the potential to significantly erode the market share of large players.
But according to Kennedy, the speed of which companies react to trends is more important than their size.
He explained: “The markets are changing so fast that if you’re on it you’ll win, but if you’re too slow to react – no matter how big or strong you are – you’ll be beaten.”
Kennedy used Gordon’s Premium Pink as an example. Launched in 2017, the iteration is flavoured with raspberry, strawberry and redcurrant. According to Kennedy, the gin is “one of the biggest spirits launches in Europe in many years”.
He added: “Pink gin was a trend that we spotted in southern Spain and realised it could spread to the rest of Europe. So we said: why don’t we get our answer to it and why don’t we get it out to 54 countries in the next six months?
Gordon’s Premium Pink is “one of the biggest spirits launches in Europe in many years”
“We have to move fast – if you don’t you’re going to be beaten, no matter what competitive advantage you have.”
A careful approach to innovation has allowed Diageo to deliver a “good, consistent, sustainable performance” globally over the last few years, according to Kennedy.
In its first-half results for 2018/19, Diageo reported an organic net sales increase of 7.5% to £6.9 billion, bolstered by Tequila and gin.
At an investors’ conference earlier this week, Diageo CEO Ivan Menezes reiterated the firm’s guidance of delivering organic net sales growth “towards the upper end of our mid-single digit range”, and organic operating profit “ahead of net sales” at 5-7%.
To read Kennedy’s full interview, see the May 2019 issue of The Spirits Business, out now.