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Trends : Diageo cuts its growth forecast and targets off-premise consumption in the UK

Par Vitisphere Le 08 septembre 2008
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Trends : Diageo cuts its growth forecast and targets off-premise consumption in the UK
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n August 28th, the number one seller of wine and spirits, Diageo, cut its sales growth forecast for 2008, insisting that the growing cost of supplies and the currency effect of a strong euro was the main cause of this surge of realistic pessimism. On the other end, booming sales in emerging markets are driving the group's results towards positive global growth. 

Still, Paul Walsh, CEO of Diageo, pointed out that the morose economic environment in the UK is triggering changes in consuming patterns that imply major marketing adjustments for Diageo's products : “We are not seeing the middle classes move away from drink. The middle consumer group is under pressure but what we're seeing there is a migration from the on-premise [pubs and bars] to the off-premise. For the average person of 35 with a young family and household income of less than £40,000 a year [about 50 000 euros ], a night out at the pub these days is expensive. We have to capture that off-premise occasion.” In order to do so, Diageo certainly intends to maintain the budget of its Marketing division at its notourious heights : "I don't mean to sound immodest, Paul Walsh commented, but we're pretty good at it."

[ Source : Times online ]

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