Tuesday, February 12, 2019
Diageo is “very focused on getting the energy back into Captain Morgan” after the rum brand’s half-year sales declined. In the group’s results, net sales of Captain Morgan fell by 4% making it the only one of Diageo’s ‘global giants’ to decline during the final six months of 2018. More broadly, rum was Diageo’s only spirits category to decline in the period, falling by 3%. This was largely attributed to Captain Morgan’s performance in the US, which decreased 9% and “lost share in a declining category”.
Speaking at a Diageo roundtable last week, CEO Ivan Menezes said “rum has been tough for us”. He said: “The spirits sector is so dynamic in the US. “Even vodka brands that are on trend are doing really well. Rum is a more muted category. It’s been tougher. Captain Morgan, as a result, is not performing well. “We’re very focused on getting the energy back into Captain Morgan so there’s a lot of work going on that.
This is not a surprise to me, Rum is only growing in the areas of premium and ultra-premium expressions. The consumers in the United States are looking for a better spirit, not something they can bury in a mixer and barely be able to tastes it. Finding the sales of lower end spirits are slipping is not a surprise to me. Many of the makes of the mass “mixing expressions” are working to bring premium ones to the market in order to produce sales gains.
Consumers of “brown spirits” are not the ones that generally mix it with colas or other sugared mixes that bury the flavor of the spirit. Rum drinkers are following in the path of quality that they are willing to pay extra for that can stand alone with a little water or ice if anything at all.