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Diageo Korea bets on non-whiskey drinks
Publication Date : 04-09-2013
Diageo Korea, the nation’s biggest whiskey seller, said Tuesday that it aimed to increase its proportion of non-whiskey products to 50 per cent.
CEO Cho Kil-soo said at a news conference that his company would increase its focus on vodka and imported beer, adding that wine would not be prioritised as much. Cho took office as the managing director of Diageo North Asia on July 1.
“Umbrellas sell on rainy days and ice cream sells on sunny days,” the Korean chief said.
CEO Cho Kil-soo speaks at a news conference on Tuesday. (Diageo Korea)
“A railroad builder cannot just stick to trains as mass transportation when everyone takes airplanes. He has to set aside trains for other things like logistics, rather than carrying people.”
Whiskey accounts for about 70 per cent of sales of the Korean operation. The company now plans to boost the non-whiskey business to have an equal ratio of whisky and non-whisky sales.
The shift comes largely as a result of the “fast-changing trends of the liquor market,” he said.
Reflecting the waning local whiskey market, sales of Windsor, Diageo’s best-selling whiskey here, fell about 20.5 per cent in the first half. Rival whiskey maker Pernod Ricard also saw sales of its Imperial brand fall by 20.6 per cent.
Cho, however, said that Diageo Korea would not cut back on whiskey such as Johnnie Walker and Windsor, but increase its range of other products. Windsor’s new rebranding will be announced in early October, he hinted.
The company is currently not considering launching new brands, as its liquors in the local market--Windsor, Johnnie Walker, Smirnoff, Guinness and Ciroc--are still considered “relatively new” to customers.
On the same day, Diageo Korea launched a charity foundation called “Heart to Heart Foundation” as its main social contribution channel. The foundation supports “Plan W,” Diageo’s social contribution programme in the Asia-Pacific, which advocates the economic and social independence of single mothers or single pregnant women.
The foundation plans to donate 5 billion won (US$4.5 million) to the Ministry of Gender Equality and Family.