UK: Pernod Ricard details UK strategy makeover
Pernod Ricard is the second-largest premium spirits company in the UK
The UK arm of Pernod Ricard is looking to re-focus its strategy, as it aims to cement its position as the second-largest premium spirits company in the country.
The division has unveiled plans to up the focus on its Chivas and Jameson spirits brands, alongside its Campo Viejo wine brand, to help “differentiate the company from its competitors”. The on-trade will benefit from a renewed focus as part of the new strategy, although off-trade activity will also increase.
Speaking to just-drinks today (6 November), Pernod Ricard UK's MD, Denis O'Flynn, provided further details of the move. “We asked ourselves, how do we expand on our premiumisation strategy?” said O'Flynn. “We concluded that the strategy needed to be refined and modified, so our aim now is to help shape the country's drinking experiences.
“In the past, we as an industry strayed a bit too close to volume matters,” he continued. “Today, I'm keen to look at the overall drinking experience. Alcohol is only one element of that experience.”
The Chivas, Jameson and Campo Viejo brands have been singled out as “star brands” that will be the focus for 40% of the units A&P stand in the next five years. Meanwhile, flavoured rum brand Malibu – the unit's largest margin provider – will be positioned as the priority brand for the unit.
O'Flynn noted that the division is the second largest premium spirits company in the UK, with premium being defined as 1.2-times the market average index of GBP13 per bottle. Last year, Pernod UK sold 750,000 cases, just ahead of William Grant & Sons' First Drinks unit, which sold 730,000 cases of premium spirits. Maxxium - jointly owned by Beam Inc and Edrington - sold 670,000 cases. The market leader is the Bacardi and Brown-Forman JV, which sold 1.5m cases of premium spirits in the UK last year.
“By 2017, we want to be the clear number two in premium spirits in the UK, and to maintain our leadership status in premium wines,” O'Flynn said.
Future activity will include the promotion of beer cocktails featuring Chivas-blended Scotch and the highlighting of matching a whisky with a beer in the on-trade, and the roll-out of a Havana Club mojito kit in the off-trade.
Late last month, Pernod posted a 9% fall in group net sales in its fiscal first quarter, although sales in Western Europe rose by 2%.
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