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Premiumization and emerging wines and spirits markets prove lucrative despite tough economic conditions
Despite tough economic conditions, there is still demand for pricy, luxurious brands and sophisticated packaging in the wines and spirits market. When disposable incomes are shrinking, consumers in spirits sector, in mature markets, rather buy less of pricier brands, than more of cheaper labels. Demand for upmarket spirits is also created by growing of middle-classes in emerging and developing markets.
Pernod Ricard, once a local alcoholic beverages producer, has rapidly expanded over the past decade, through organic growth, strategic acquisitions and powerful marketing, to become one of the world leaders in the wine and spirits industry.
The group’s ambition is to become the global number one, by employing a sustainable growth model based on ‘premiumization’ of its portfolio of international brands (such as ABSOLUT, Chivas Regal, Ballantine’s, Jameson, Kahlúa, Havana Club, Ricard, Malibu and Beefeater, amongst others), innovation and geographical expansion.
To find out more about premiumization, weekend millionaires and Pernod Ricard’s strategy to become the number one globally, read our case study: “Pernod Ricard: Premiumization and decentralization fuelling growth in mixed macroeconomic environment”.