Diageo recently announced plans to focus much more heavily on marketing Johnnie Walker (JW) in Europe. The iconic blended whiskey is the world’s biggest selling spirits brand, yet, in recent decades has virtually ignored its own back yard in pursuit of profits in Asia, the Americas and Africa.
Why the sudden re-focus closer to home? Well, there is more than one compelling reason for this change in strategy. As Diageo has conquered the emerging markets with its luxury marketing, whiskey/bourbon competitors (especially those from the US) have made serious inroads into the European spirit market. Younger European drinkers, getting tired of vodka, have been attracted by brands such as Jim Beam and Jack Daniel’s because of their pop culture credentials and increased accessibility.
Accessibility is not a quality which the prestigious and traditional whisky/ey category is renowned for – especially Scotch. However, US whiskies and bourbons are re-writing the rules, with Beam’s cherry-flavoured Red Stag and JD with Honey exciting younger consumers who crave a sweet and mellow taste profile, not to mention choice and experimentation. The legal definition of Scotch prevents such flavouring, meaning that we won’t be seeing a JW and Honey anytime soon, but Diageo plans to emphasise the whisky’s flavour and “mixability”.
A second reason for Johnnie Walker’s European return – less talked about in Diageo press releases – is that there are signs of a slowdown in key emerging markets. It is no time for panic, but JW cannot afford to assume that emerging market growth will carry on climbing in double digits forever.
The big question is: will JW be able to catch up with competitors in the European market after so long in the wilderness? The answer is almost certainly yes, but only if Diageo takes the long-term view and commits to a sustained period of marketing spend.
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