Diageo stands f irm on volume

17 September, 2010

Diageo is not planning to join other spirits companies in sacrificing volume sales to protect its margins.

Grocery channel director Andy Adams told OLN: “In grocery, promotion is driving growth in pretty much every category. That is a feature of the recession. Shoppers like promotions – if you didn’t promote, less people would want to buy your brands. If we want to be truly shopper-focused we need to offer that.”?Pernod has sacrificed 41% of value sales on Absolut vodka in the UK over the past year as it stepped away from deep discounts. It said the strategy had allowed it to reposition the brand and invest in marketing.

Diageo GB is set to spend £47 million promoting its portfolio this Christmas, covering everything except price activity. It is more than the company has ever spent on its Christmas campaign before.

A £4 million winter campaign will advertise all Diageo’s core brands on TV, outdoors and in shops. The push follows a successful cross-brand summer promotion where it teamed up with Coca-Cola Enterprises.

Sales director David Smith said: “I want retailers to totally transform their focus on spirits this Christmas. I absolutely guarantee that if that is what we inspire them to do, they will make more money.”?The company is launching a Hazelnut Baileys variant into supermarkets.

The brand will be backed by a £4.5 million through-the-line spend in the run-up to Christmas, including new TV ads, digital campaigns and display innovations including mini counter-top or in-fridge displays for 5cl bottles and red bows on all 35cl and 70cl bottles of Baileys Original in smaller shops.

Other activities include backing for Diageo’s pre-mix range, pre-filled cross-brand display units and new gift packs.

There is also a new global strand in Smirnoff’s Be There campaign. The Smirnoff Nightlife Exchange Project will be fronted by DJ Zane Lowe in the UK.

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