Interview, Part 1: Bob Kunze-Concewitz, CEO, Campari Group
October 27, 2021Yesterday, Campari Group posted sales up 27% to €1.6 billion ($1.86b) for the nine months through September, marking the first three quarters of its fiscal year, with adjusted EBIT leaping 54% to €360 million ($418m).Following the results, SND executive editor Daniel Marsteller spoke with Campari Group CEO Bob Kunze-Concewitz to hear the latest on what’s driving growth for the Italy-based company, which ranked as the eighth-largest spirits player worldwide by volume in 2020, according to Impact Databank, at 28.5 million 9-liter cases.
SND: How are overall conditions in the U.S. and your other key markets? What gives you the most reason for optimism about business prospects moving forward, and what gives you cause for concern?
Kunze-Concewitz: We’re very optimistic. We have great momentum behind our brands. We’re the only company where all of our brand clusters and all of our regions are growing by double-digits not only versus last year, but versus 2019. We’re seeing significant growth compared to what we see as the real base, which is pre-pandemic. We’re taking market share in the off-premise, and at the same time we have a very robust return in the on-premise. Historically we’ve been one of the companies that’s been most skewed toward the on-premise, and clearly we’re making the most out of what I call ‘revenge conviviality.’ We’ve also been increasing our investments significantly in A&P, and building important capabilities both in e-commerce as well as digital marketing, and these are paying off.
SND: Which brands in the portfolio are driving growth in the U.S.?
Kunze-Concewitz: Espolon is on fire, despite the fact that we’ve taken price increases. Together with Espolon, because of the Margarita craze and what we call the Grand Margarita, Grand Marnier is growing at rates which the brand hasn’t seen in the past 20 years in the U.S. Our aperitifs Campari and Aperol are doing very well, as are our Bourbons. What we print are the headline numbers, but what you need to understand is that the higher-end whiskies—like Rare Breed, Kentucky Spirit, and Longbranch—are growing at very high double-digits, so the premium end is growing much faster. And last but not least our rum portfolio is doing extremely well. So we’re firing on almost all cylinders in the U.S. with the exception of vodka.
SND: Speaking of which, what’s the latest on Skyy?
Kunze-Concewitz: Clearly the one brand that remains challenging in the U.S. is Skyy, but you know how competitive vodka is. Skyy is doing no worse or better than the majority of vodka brands in the U.S. There is obviously one vodka brand that keeps doing very well, and all the rest are losing share. We relaunched Skyy at the beginning of the summer, and we know that it’s a marathon, not a sprint. We know that consumers love the new pack and the new liquid. It will take time to recruit new consumers into the franchise, but we have the patience and the will to do so.
| Campari America—Key Spirits Brands | |||||
| Brand | Type | Total 2020 Case Volume1 |
2021 YTD Percent Change in Control States2 |
||
|---|---|---|---|---|---|
| Skyy | Vodka | 2,390 | -6.3% | ||
| Wild Turkey | Bourbon | 810 | 10.2% | ||
| Espolòn | Tequila | 768 | 46.0% | ||
| Grand Marnier | Liqueur | 540 | 18.0% | ||
| Wild Turkey American Honey |
Flavored Whiskey | 454 | 8.9% | ||
| Appleton3 | Rum | 250 | 12.6% | ||
| Aperol | Liqueur | 248 | 25.4% | ||
| Campari | Liqueur | 182 | 8.4% | ||
| Cabo Wabo | Tequila | 85 | 8.9% | ||
| Frangelico | Liqueur | 63 | 21.2% | ||
| Russell’s Reserve | Bourbon | 55 | 42.9% | ||
| Total Key Brands | 5,845 | 10.0% | |||
| Other Spirits | 77 | 15.9% | |||
| Total Campari America | 5,922 | 10.1% | |||
| 1 Thousands of 9-liter case depletions 2 Year-to-date through September 3 Includes Wray & Nephew Source: NABCA and IMPACT DATABANK © 2021 |
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Tagged : Campari, Espolón, Grand Marnier, Russell's Reserve, Skyy
