Sunday, October 21, 2007
Diageo Wants to Quadruple Johnnie Walker Sales
Can Johnnie Walker outsell Absolut in the next three years? Is it possible for the world's best selling Scotch to overtake the world's best selling vodka? Can the whisky even surpass the sales of Captain Morgan Rum?
That is the goal that Diageo laid out for wholesalers at a recent meeting. All they need to do is quadruple sales by 2010.
Diageo is expected to fuel the growth by continuing to boost marketing spending, which was up 20 percent in 2006. The company is also bringing on line the first new major distillery in Scotland in 30 years to be sure it has enough liquid down the road to keeping filling Johnnie Walker bottles.
Sales of the range of Johnnie Walker products were up 9 percent in the U.S. last year. While the company will continue to count on growth in the U.S., emerging premium spirits markets like China, Russia, Brazil and India will be critical to meeting the massive sales bogey. There are just not enough new brown liquor drinkers in traditional western markets to fuel the growth path.
Diageo has managed the Johnnie Walker franchise in recent years to create multiple levels of brand experiences for customers. From the Red Label entry point to the prestige Blue offering, with other bottlings in between, Johnnie Walker is one of the broader whisky offerings on the planet. Each label is distinct in flavor and the price points match well with various competitive brands. Diageo's marketing efforts spread across advertising and sponsorships also expose the brand to core customer groups. The work that has been done during the last 10-15 years gives Johnnie Walker brand managers at least a fighting chance to come close to the stated objective.
To back the effort Diageo is building a $82 million distillery in Roseisle, which it expects to open in 2009. The new environmentally friendly plant will reclaim water and conserve energy. That distillery will produce spirits for Diageo's blended whisky. The first whisky should be ready by 2012.