Diageo Bets on Growth of Guinness Zero
Diageo plans to introduce its alcohol-free Guinness Zero in every UK pub serving the traditional Guinness on tap. The company aims to boost investor confidence by capitalizing on the rising demand for non-alcoholic beverages.
Company Strategy and Market Position
The FTSE 100 giant will update investors this week following the departure of CEO Debra Crew in July. Diageo is working to reverse declining demand as a growing number of consumers choose to reduce or eliminate alcohol consumption.
- Diageo owns brands like Johnnie Walker whisky and Smirnoff vodka.
- The company is committed to expanding sales through the no and low alcohol trend.
- Interim CEO Nik Jhangiani emphasizes the potential to benefit from moderate drinking habits.
- Despite this, Diageo's shares have fallen by nearly one-third this year.
Guinness Zero's Success
Launched in pubs in 2022, Guinness Zero has quickly become the UK’s best-selling alcohol-free beer, playing a crucial role in Diageo’s turnaround strategy.
"The drink now accounts for 14 per cent of all the beer brewed at the brand's historic St James's Gate Brewery in Dublin."
Its popularity has led Diageo to plan the relocation of some non-beer brands from the brewery to accommodate production.
Media Spotlight
The brand is receiving additional attention following the release of the Netflix drama House Of Guinness, featuring Louis Partridge, which debuted a month ago.
"Dark stuff: Louis Partridge stars in hit Netflix series House Of Guinness."
Summary
Diageo is leveraging the popularity of Guinness Zero and the no-alcohol trend to revive its market position amid a challenging year for its shares.