ad webinar 2013 · ad webinar 2013 alcoholic drinks in 2013: the recovery and the macroeconomic...

AD WEBINAR 2013

ALCOHOLIC DRINKS IN 2013: THE RECOVERY AND THE MACROECONOMIC BALANCING ACT

ALCOHOLIC DRINKS: SETTING THE SCENE

© Euromonitor International

3

Economic recovery, but uncertainty remains

SETTING THE SCENE

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2008 2009 2010 2011 2012 2013

% R

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P G

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Real GDP Growth 2008-2013

World

http://www.euromonitor.com/


4

Economic recovery, but uncertainty remains

SETTING THE SCENE

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2008 2009 2010 2011 2012 2013

% R

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Real GDP Growth 2008-2013

World Developed Markets Emerging and Developing Markets



5

Alcoholic drinks growth follows macroeconomic trends

SETTING THE SCENE

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2008 2009 2010 2011 2012

% t

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Alcoholic Drinks Volume Growth Performance 2008-2012

World Developed Markets Emerging and Developing Markets



6

0%

10%

20%

30%

40%

50%

60%

70%

80%

Volume Value

Emerging Markets Developed Markets

0%

10%

20%

30%

40%

50%

60%

70%

Volume Value

Emerging Markets Developed Markets

Volume versus value

SETTING THE SCENE

% of Global Sales 2012 % of Global Sales 2017



7

Gap in disposable incomes still significant

SETTING THE SCENE

Emerging Markets

Per Capita US $

Disposable Income

Alcoholic Drinks Spend

% Spent on

Alcohol

Russia 8207 531 6%

Brazil 7522 478 6%

Mexico 7005 406 6%

China 3598 130 4%

Developed Markets

Per Capita US $

Disposable Income

Alcoholic Drinks Spend

% Spent on

Alcohol

UK 24981 1309 5%

Japan 30490 1083 4%

Germany 27341 1034 4%

France 27215 1012 4%



8

Emerging Markets Key to Growth

Diversify Presence Potential Volatility

Developed Market Opportunities

Innovation Brand Positioning

Key themes to the balancing act

SETTING THE SCENE


STATE OF THE INDUSTRY: REASONS FOR

OPTIMISM AND CAUTION


10

Walking the line

STATE OF THE INDUSTRY: REASONS FOR OPTIMISM AND CAUTION

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200

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2007 2008 2009 2010 2011 2012

% y

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Alcoholic Drinks Performance 2007-2012

Alcoholic Drinks Volume Total Volume % Growth Total Value % Growth



11

On-trade: a narrow lead


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2007 2008 2009 2010 2011 2012

% y

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On- vs Off-trade Performance 2007-2012

On-trade volume sales Off-trade volume sales

On-trade volume growth Off-trade volume growth



12

The good, the bad and the ugly


Asia Pacific

Australasia

Eastern Europe

Latin America

Middle East and Africa

North America

Western Europe

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Total volume % growth 2012

Alcoholic Drinks Regional Performance 2012


REGIONAL ANALYSIS: THE GOOD, THE BAD

AND THE UGLY


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-4 -2 0 2 4 6 8 10

Asia Pacific

Australasia

Eastern Europe

Latin America


North America

Western Europe

Total volume % growth

Total Alcoholic Drinks Volume Growth by Region

2012

2011

Regional divergences: A bird’s eye view

REGIONAL ANALYSIS: THE GOOD, THE BAD AND THE UGLY



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0

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Beer Spirits Wine

Mil

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Western Europe Performance

2010 2011 2012

Sub zero: Western Europe and Australasia


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Beer Spirits Wine

Australasia Performance

2010 2011 2012



16

Cautionary optimism : North America and Eastern Europe


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Beer Spirits Wine

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North America Performance

2010 2011 2012

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Beer Spirits Wine

Eastern Europe Performance

2010 2011 2012



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Booming emergence: AMEA, Latin America, Asia Pacific


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AMEA

2010 2011 2012

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35000

Latin America

2010 2011 2012

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60000

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80000Asia Pacific

2010 2011 2012


CORPORATE STRATEGIES: OPPORTUNITIES

THROUGH DIVERSIFICATION


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0%10%20%30%40%50%60%70%80%90%

100%

Top 3 Markets Other Markets

Geographic spread of leading alcoholic drinks companies

CORPORATE STRATEGIES: OPPORTUNITIES THROUGH DIVERSIFICATION



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10,000

15,000

2007 2008 2009 2010 2011 2012

% v

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ar

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Captain Morgan Rum’s Performance in Western Europe 2007-2012

Volume Sales, '000 litres % volume share of rum

Mature markets still relevant


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11,000

12,000

13,000

14,000

2007 2008 2009 2010 2011 2012

% v

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Bacardi Rum’s Performance in Mexico 2007-2012

Volume Sales, '000 litres % volume share of rum



21

Diageo’s change of focus


0%

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2007 2012 2012(including

UnitedSpirits)

Vo

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Diageo Mature vs Emerging Market Volume Split

Emerging

Mature

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20,000

40,000

60,000

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160,000

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MatureMarketGrowth

EmergingMarketGrowth

Vo

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Source of Diageo Volume Growth 2007-2012

AcquiredEmergingMarketGrowth

OrganicEmergingMarketGrowth

MatureMarketGrowth


INTOXICATING TRENDS AND SOBERING

PITFALLS


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Dark, non-alcoholic and premium

INTOXICATING TRENDS AND SOBERING PITFALLS

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2008 2009 2010 2011 2012

% t

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Beer Category Performance 2008-2012

Dark beer Lager Low/non-alcohol beer Stout



24

Polarisation redux


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2008 2009 2010 2011 2012

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Lager by Price: Performance 2008-2012

Premium Standard Economy



25

From non-grape wine to still light grape wine: the transition


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2008 2009 2010 2011 2012

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Wine Category Performance 2008-2012

Fortified wine and vermouth Non-grape wine Sparkling wine Still light grape wine



26

Red dawn rising


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2008 2009 2010 2011 2012

% t

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Still Light Grape Wine Category Performance

Still Red Wine Still Rosé Wine Still White Wine

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2006 2007 2008 2009 2010 2011

% t

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Red Still Light Grape Wine Performance: WE versus AP

Western Europe volume salesAsia Pacific volume salesWestern Europe volume growth



27

Still light grape wine: quantifying polarisation


Portugal: Red Wine % Retail Volume Sales by Price Band 2007/2012

% volume 2007 2012

Under EUR1.99 29.0 27.0

EUR2 to EUR3.5 29.9 34.0

EUR3.51 to EUR8.5 24.7 24.0

EUR8.51 and above 16.4 15.0

Total 100.0 100.0

China: Red Wine % Retail Volume Sales by Price Band 2007/2012

% volume 2007 2012

Under RMB19.99 27.0 15.0

RMB20 to RMB29.99 30.0 28.0

RMB30 to RMB49.99 30.0 30.0

RMB50 to RMB59.99 9.5 18.5

RMB60 to RMB89.99 2.0 5.0

RMB90 and above 1.5 3.5

TOTAL 100.0 100.0



28

Champagne’s demise and other sparkling wine’s ascent


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2008 2009 2010 2011 2012

% t

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Champagne Versus Other Sparkling Wine

Performance

Champagne Other Sparkling Wine

2012 Champagne vs Other Sparkling Wine Volumes

Champagne

Other sparkling wine

89%

11%



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2008 2009 2010 2011 2012

% t

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Spirits Category Performance

Brandy and Cognac Liqueurs Rum

Tequila (and Mezcal) Whiskies White Spirits

Other Spirits

Spirits: Cognac, whiskies and the others




30

Rtds: A new generation


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2008 2009 2010 2011 2012

% t

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RTDs/ High-strength Premixes Performance 2008-2012

High-strength premixes RTDs

RTDs/High-strength Premixes Regional Volume 2012 Breakdown

Asia Pacific

Australasia

Eastern Europe

Latin America


North America

Western Europe



31

Cider: Crossing the Atlantic


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2008 2009 2010 2011 2012

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Cider/Perry Performance 2008-2012

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Cider/Perry Top 10 Markets

Others

Sweden

Finland

Spain

Ireland

Australia

France

USA

Argentina

South Africa

United Kingdom


FUTURE PROJECTIONS


33

Mapping Out the Future: Alcoholic Drinks Projections for 2012-2017

PROSPECTS, DRIVERS AND RECOMMENDATIONS

>4% total volume CAGR

2-4% total volume CAGR

<2% total volume CAGR



34

Beer: Post-lager


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2012 2013 2014 2015 2016 2017

% t

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Beer Category Performance 2012-2017

Dark beer Lager Low/non-alcohol beer Stout



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2012 2013 2014 2015 2016 2017

% t

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Wine Category Performance 2012-2017

Fortified wine and vermouth Non-grape wine

Sparkling wine Still light grape wine

Wine: Healthy, steady and still advancing




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2011 2012 2013 2014 2015 2016

% t

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Spirits Performance 2012-2017

Brandyand Cognac

Liqueurs

Rum

Tequila(and Mezcal)

Whiskies

WhiteSpirits

OtherSpirits

Cognac leads the future, vodka side-lined




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2012 2013 2014 2015 2016 2017

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Cider/Perry On- vs Off-trade 2007-2012

Off-trade

Cider’s enviable projected trajectory




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2012 2013 2014 2015 2016 2017

To

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RTDs/ High-strength Premixes Category Performance 2012-2017

RTDs/high-strength premixes total volume

RTDs/high-strength premixes total volume growth

What does the future hold for RTDs?



THANK YOU FOR LISTENING

Andy Tiverton-Brown

Head of Alcoholic Drinks & Company Analysis

[email protected]

Spiros Malandrakis

Senior Analyst - Alcoholic Drinks

[email protected]

Jeremy Cunnington

Senior Analyst - Alcoholic Drinks

[email protected]

ad webinar 2013 · ad webinar 2013 alcoholic drinks in 2013: the recovery and the macroeconomic...

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