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Pernod prepared to lose UK wine market share
Pernod Ricard is prepared to lose market share in the UK wine sector if it helps keep the group profitable.
Jean-Manuel Spriet, UK CEO for Pernod Ricard, told the drinks business that losing market share is a price the group is willing to pay in order to remain in the black as consumers increasingly trade-down or look for discounts.
“Nobody can survive under the current conditions in the UK wine market,” Spriet said after a press briefing in London to present Pernod Ricard’s half-year results yesterday.
“The current trend of aggressive discounting like offering multiple purchases at £10 cannot continue and we need to evolve the promotional mechanic.
“There will be room for creativity in the market and we will no doubt see winners and losers.
“We are a responsible company and we are prepared to lose market share if it means protecting our profits, but the wine industry as a whole needs to find a solution.”
While the UK market might be proving difficult for Pernod Ricard, which owns the Jacob’s Creek brand, Spriet said the group remains comfortable with its global prospects due to opportunities presenting themselves in other markets.
“We are focusing on other markets in parallel with the UK and there are definitely opportunities in the US, which is structurally a much more stable market, as well as in China and in Canada.”
Meanwhile Gilles Bogart, managing director of finance at Pernod Ricard UK, confirmed that none of Pernod Ricard’s top 15 brands, which include Beefeater gin, The Glenlivet, Ballantine’s and G.H.Mumm, will be sold as part of the company’s drive to reduce its debts by €1 billion.
Vanessa Wright, communications director at Chivas Brothers, also told db that recent rumours regarding the company’s plans to sell the Plymouth Gin brand are unfounded.
“We certainly have no plans to sell Plymouth and have actually got a lot planned for the brand this year,” she said.
“It fits in very well with our gin portfolio and is one of the brands we have high hopes of developing over the next few years.”
Alan Lodge, 24.02.2010