BROWN SPIRITS: DIAGEO GLOBAL TRAVEL
Diageo transforms Johnnie Walker brand to mark its 200th anniversary
Diageo Global Travel has been busy modifying its permanent Johnnie Walker retail spaces to prepare for the brand’s monumental anniversary. In conversation with Andrew Pentol, the company also reflects on the Game of Thrones partnership and talks up the possibility of similar alliances in the future.
The 18% drop in travel retail owed
to the challenging trading conditions (reduction of inventory levels and lower passenger traffic) in the Middle East and Hong — the latter no doubt due to the anti-government protests. Net sales in the Scotch segment
were up 1% across Asia Pacific, led by a strong performance from Johnnie Walker. Scotch malt gains in China, Australia and South East Asia offset a net sales decline of the Windsor brand in South Korea, along with Johnnie Walker in travel retail and the Middle East. The single malts portfolio
Above: Diageo Global Travel has been busy modifying its permanent Johnnie Walker retail spaces to mark the brand’s 200th anniversary in 2020.
W
hen drinks giant Diageo released its interim results in January for
the half-year ending 31 December, the company was unable to quantify the expected impact of Covid-19. From a DF&TR perspective, the
outbreak has caused a significant reduction in international passenger traffic, especially in Asia. With the recovery of passenger volumes expected to be gradual, Diageo Global Travel can expect weaker performance for the remainder of fiscal 2020. In a recent trading update, Diageo
“The 200th anniversary of Johnnie Walker is an opportunity to look back and think how amazing it is to still be responsible for the brand which has been around for a tremendously long period of time.”
Anna MacDonald, Marketing and Innovation Director, Diageo Global Travel
54 TRBUSINESS
estimates the negative fiscal 2020 impact on the group’s organic net sales and organic operating profit to be in the region of £225 million/$288 million to £325m/$416m and £140m to £220m, respectively. The company says the timing and pace of recovery will determine the impact within these estimated ranges. Despite challenges presented
by Covid-19, Diageo is confident in the growth opportunities across its Greater China and Asia Pacific business. It is continuing to invest in brands across various markets, including travel retail, to ensure it is strongly positioned for the expected recovery in consumer demand. Until the recovery kicks-in, trading
conditions will be anything but easy for Diageo Global Travel. Increased travel retail volatility meant trading was far from easy in the half-year ending 31 December 2019. In its interim six-month results
release, a 4% growth in Asia Pacific net sales and strong performances in Greater China and Australia was partially offset by a decline of -18% in travel retail, Asia and the Middle East.
(Buchanan’s and Johnnie Walker Reserve) grew in the period, but that was offset by Johnnie Walker Black Label and Johnnie Walker Red Label, which softened globally. This was driven by challenging
trading conditions in Mexico, volatility in travel retail and the Middle East, and political and economic disruptions in Peru and Chile.
JW to impress in 200th year No matter how the rest of the calendar year transpires, there is one major landmark for the company to enjoy. This is the 200- year anniversary of the Johnnie Walker brand. Anna MacDonald, Marketing and
Innovation Director, Diageo Global Travel tells TRBusiness: “The 200th anniversary of Johnnie Walker is an opportunity to look back and think how amazing it is to still be responsible for the brand which has been around for a tremendously long time. “Moreover, it’s also an opportunity
to ensure we continue to build the foundation, so the brand has a legacy for the next 200 years and beyond. “There will be a transformation
MARCH 2020
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