Premium brands drive Beam Suntory sales growth
Beam Suntory president and CEO Albert Baladi has cited “the significant impact” of the company’s premiumisation strategy as a driving force behind the increase in sales.
With a portfolio including Jim Beam, Courvoisier Cognac and Sipsmith gin, the spirits producer, owned by Suntory Holdings, has reported a net sales increase of 13%, a 25% increase on the pre-pandemic 2019 level.
In Japan, Beam Suntory recorded high-single-digit sales growth, while in the US, UK, Spain, India, Australia and Emerging Asia double-digit gains were made. Overall, by region, sales were up by 10% in Asia and 13% in North America.
Super premium brands, such as Laphroaig and Yamazaki, performed strongly. Indian-produced Oaksmith International Blended Whiskey saw massive growth, with sales nearly tripling. The sales of the premium pre-mixed cocktail brand On the Rocks doubled as the company capitalised on the surging demand for RTDs.
Baladi warned that there were challenges ahead, but remained optimistic: “We expect that the external environment will be even more challenging in the second half of the year and into 2023, and we are well positioned to deliver against both our short and long-term ambitions through the strategies we have in place, and investments we’re making in our future.”
The CEO then went on to say: “Our results demonstrate the strength of our operating model, investments in the future, and the unique East-meets-West culture that we have created, which gives us a competitive advantage.”
Indeed, the company is preparing for a West-to-East shift of sorts (that is from the Midwest to the Eastern Seaboard), moving its headquarters from Chicago to New York this coming September to start what Baladi has deemed the “next chapter of growth”. The relocation to Madison Avenue signifies a move towards the luxury end of the market, helping Beam Suntory to “accelerate [its] premiumisation strategy,” in Baladi’s words.