Diageo’s Consumer Connect
Q] Looking at the market trends, do you think a brand has to change its strategies? Q] You have been very vocal about brand building, can you please shed some insights on it? Q] Talking about the strict rules in advertising and the recent policy on surrogate advertising for tobacco and liquor brands, how is Diageo India utilizing innovative marketing strategies to reach its consumers? Q] The alcohol industry has evolved immensely in the recent past. How is Diageo India innovating with its products for consumers? Q] When we compare between the Covid period and now, how does sales look for Diageo India? So, at the lower end, we are seeing some slowdown in country liquor or popular brands to the lower prestige brands. At the top end, however, we are not seeing a slowdown in consumption yet. As I have said before, repertoire drinking is perhaps slowing down. We will have to see how it evolves. I remain optimistic though that because on trade is going open after two, two and a half years, the celebrations will be good and the demand will be robust. We are preparing for a good season, but we are patiently watching, as there is an overall slowdown in consumption generally. We expect some flow to come through to the alcohol industries.
I certainly think brands are going to have to review strategy. Actually, it's a time of uncertainty, as you really don't know where consumer demand is headed. So, if I look at our alcohol industry, during COVID, we saw people experimenting. But now we are seeing the inflationary pressures play out, especially at the lower end where there is a slowdown in trade.
We think that brand building might change. People may want more promotions, as we are seeing in the FMCG sector. In the alcohol industry, at the upper end, we were seeing a lot of repertoire drinking. So, people were drinking multiple spirits because they were experimenting, and now we are seeing a slowdown in that regard. While there's no reduction in consumption of your favourite brand, there may be a reduction in experimentation repertoire. But I do think that brands have to look at more purposeful marketing. We have to look at more purpose in our marketing, and we have to be more meaningful for the consumer. Consumers today are looking at sustainability. So, for example, Godawan, which is a new Indian single malt that we've launched, we are working towards sustainability there. We are looking at conserving the Godawan bird and therefore the brand is much more than just for consumption, it stands for something.
We follow all compliant practices when advertising on any platform. I think we connect with our consumers on the meaningfulness, as I described. Johnny Walker stands for keep walking. So, we do purpose-based advertising, and have actually helped the hospitality industry to raise the bar. That was the programme. People see this and associate these programmes with Diageo, and therefore they like to consume our products. We find that such engagement actually works for our brands.
We are actually innovating and really meeting the evolving consumer standards. Talking about Royal Challenger American Pride, that's a new whiskey that we launched just a few months ago, and this is much easier to drink with mixers. People can have it with a Cola, neat, with ginger ale, etc., and that is really appealing to the younger women consumer. So we are certainly innovating. On the other hand, the craft is becoming very big and people want new experiences. We recently launched Epitome Reserve a few months ago, a rare craft offering. There was one rice grain-based, only 2000 bottles, and another was an Indian Peated single malt. So we are continuing to innovate and renovate to cater to the experiences that the consumers want.
I will not comment on growth because we have already guided the market on double-digit top-line growth. I would say that post-COVID, we are seeing some slowdown in consumption, and I think the inflation is hitting consumers, particularly at the lower end.
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