Overall, Diageo’s Ireland’s sales volumes declined one per cent in 2010 while organic sales values declined by five per cent leading to a sales decrease of 11 per cent on a reported basis as unemployment and personal tax increases continued to restrict consumer spend, particularly in the on-trade.
“High levels of unemployment and personal tax increases in Ireland continued to restrict consumer spending, particularly in the on trade,” reported Diageo, “Guinness remained the best-selling beer in Ireland but net sales declined due to lower sales in the on-trade, while the volume of Diageo’s packaged beer increased in the growing off-trade. Marketing spend on the brand increased, reflecting the growing momentum of ‘Arthur’s Day’ and the Irish rugby sponsorship. Net sales of spirits grew two per cent and Diageo gained share led by the continued success of Captain Morgan with investment behind on-trade sampling and promotional activity.”
Bud Ice Cold Draught also witnessed heavy spend here as the brand increased its footprint to over 2,700 outlets accompanied by the innovatory Ice Cold Index promotion, the brand’s first major push into the digital marketing arena.
As for 2011 here, Nielsen figures indicate that the Long Alcoholic Drinks (LAD) sector contracted by 5.4 per cent during the first six months of the year, resulting in a drop of 15 per cent since 2007.
As drinks sales here continued to slide, Diageo itself posted a five per cent organic net sales growth globally, reporting Operating Profits up one per cent or £21 million to £2.595 billion. The July and August 2011 figures appear to have held at the levels of the previous six months in terms of business, stated Diageo.
Globally, the Guinness brand generates over €1.3 billion on the domestic and export markets and while organic volume was down five per cent in Europe with organic sales down four per cent during the year, globally, Guinness sales were up two per cent in organic volume and three per cent in organic net sales – good news therefore for St James’s Gate, Europe’s second-largest brewery, which produces 35 per cent of Diageo’s global beer demand, brewing one billion pints a year of which 70 per cent is exported to over 150 markets worldwide.
The other international Irish brand, Baileys, grew organic volumes by three per cent and by one per cent in organic value although this fell two per cent in Europe itself.