E-Malt. E-Malt.com News article: World: Guinness sales rebound around St Patrick’s day but struggle for the rest of the year

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E-Malt.com News article: World: Guinness sales rebound around St Patrick’s day but struggle for the rest of the year
Brewery news

The luck of the Irish shines on Guinness this time of year, The Wall Street Journal reported on March 15.

More than 13 million pints of the midnight stout are drunk worldwide on St Patrick’s Day, nearly four times as much as an average day, according to its owner, Diageo. The increase in sales is especially pronounced in the US where Irish beer brands led by Guinness combine for US$28.2 million in retail sales in March, more than double any other month and 16 per cent of annual US sales, according to Nielsen.

The spike is a blessing and a curse for Guinness. St Patrick’s Day — March 17 — turns up a surge of drinkers, but the brand struggles to maintain it during the rest of the year. In the US, which accounts for about 16 per cent of Guinness’s global volume, the brand’s volume declined 6 per cent to 107 million litres in 2013, according to Euromonitor.

Guinness USA is trying to reverse that decline by stretching sales beyond St Patrick’s Day. To encourage Americans to drink Guinness in warmer months, the brand signed a five-year, eight-figure renewal of its deal to sponsor a northern summer soccer tour — the Guinness International Champions Cup. The tournament last summer drew more than 109,000 spectators to Michigan Stadium for a game between Manchester United and Real Madrid.

The brand also is adding beers beyond its staple Guinness Draught in hopes of attracting more drinkers. Last fall it launched Guinness Blonde, an American lager. Executives hope the lighter beer appeals to Americans in the spring and summer, when they often trade Guinness and other stouts for more refreshing pilsners and lagers.

The brand is looking to ride on the coat-tails of craft beer, which has seen volumes double over the past five years. Many of those craft brewers have launched stouts of their own that have cut into Guinness’s sales. Now the brand plans to push back. It will launch a “brewer’s project” in the US, “dust off old recipes” and come “out with more and more beers”, said Emma Giles, Guinness USA brand director.

“It’s a very competitive market out there and … we’re focused on trying to innovate,” Ms Giles said.

Guinness’s challenges aren’t limited to the US. The brand also has a problem in Britain and Ireland, where fewer people visit pubs. That has contributed to Guinness’s volumes falling by 80 million litres worldwide over the past decade, said Jeremy Cunnington, alcohol beverage analyst with Euromonitor.

Much of Guinness’s sales now come from Africa, which accounts for 32 per cent of business. The company started brewing there in 1963 and is now brewing beer in 20 countries. “In Western markets, the challenge they’ve got for the brand is that it has this spike (around St Patrick’s Day) and is reliant on one time of year,” Mr Cunnington said. “But that’s becoming less important as it becomes a far more international brand.”

If Guinness is blessed with the luck of the Irish, annual sales will start to look more like Irish whiskey than Irish beer. Irish whiskey enjoys much more balanced sales in the US, where March accounts for about 10 per cent of retail sales, about 3 per cent more than the average month, according to Nielsen.

Much of that is due to Pernod-Ricard’s Jameson Irish whiskey, a brand that has been enjoying double-digit growth in the US. Global sales approached five million cases last year, up nearly 25 per cent from 2007.

18 March, 2015

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