The Big Interview: Matteo Fantacchiotti

In one of his first interviews given to the trade, Matteo Fantacchiotti talks about coming home to Italy to take up the post of Campari Group CEO. By Tom Bruce-Gardyne.

AFTER THREE years running Campari Asia Pacific, Matteo Fantacchiotti returned home to take up the role of group CEO in April. In one of his first interviews in the job, he tells db: “Now that I live in Europe, I can really see that, as soon as there’s a ray of sunshine, all the bars and terraces are becoming orange. This is not due to the sun. This is Aperol.”

It would be hard to overstate the importance of the Aperol brand to Campari Group, which acquired the neon-coloured botanical liqueur in 2003, when its revenues were less than €50 million a year, most of them in the Veneto.

Thanks to the phenomenal growth of the Aperol Spritz serve, the brand accounted for 24% of Campari’s global sales of €2.9 billion in its last full-year figures (FY23).

In April, Fantacchiotti took over as CEO from Bob Kunze-Concewitz, who is given much of the credit for creating this extraordinary orange wave; so much so, that the board and shareholders awarded him an eye-popping €30m ‘thank you’ for his “remarkable leadership and exceptional service” after 17 years at the helm. His successor believes Aperol still has “a big runway for growth”.

“We look at Aperol in terms of consumption per capita versus beer,” says Fantacchiotti. “In Italy, it’s still only 1.2% of beer. So, for us, we say the sky’s the limit.” The equivalent percentage in the UK is just 0.06%, while in Asia Pacific it would be almost impossible to quantify outside Australia. Having once worked for Carlsberg, he believes Aperol’s ability to recruit from international beer brands is a big opportunity in the region.

As is Aperol’s colour, which for some reason seems to be an irresistible trigger for any member of Gen Z with an Instagram account. “You know that in Asia people don’t eat or drink anything before they’ve taken a picture and shared it,” Fantacchiotti says.

In Europe, you may wonder if the brand was simply there at the right time to catch the Prosecco boom, but he shakes his head: “Actually, if you talk to the Prosecco industry, they would tell you they feel blessed about Aperol, because it’s been driving so much growth in recent years.”

Serious Prosecco

If it so desired, could Campari build a serious Prosecco brand, something to rival a big Champagne?

“It’s a very interesting thought,” Fantacchiotti replies – and the company, to be fair, does already have two wines in its vermouth and sparkling products Cinzano and Riccadonna, respectively. “Because I’m quite optimistic and a bit of a dreamer, I think it’s possible,” he says, after a long pause. “But honestly, I would not prioritise it for my tenure. I think we have bigger categories to play with.”

Not least Cognac, where Campari is now playing in the premier league, having just finalised the acquisition of Courvoisier – from Suntory Global Spirits (formerly Beam Suntory) in May. At US$1.2bn, it is the biggest deal in the company’s history and one that begs a simple question: if the Italian-based multinational believes now is the time to plunge into Cognac, was Suntory’s board wrong to pull out?

“I wouldn’t comment on them, although I have very clear views about why they did it,” says Fantacchiotti, who explains that the deal fits Campari’s strategy of acquiring premium brands to strengthen its position in the US and Asia. “A lot of people are saying Cognac’s not doing well, which is true, but we know these big categories are cyclical, and we think Cognac will bounce back,” he says.

Another reason for the acquisition was this: “We like dusty, unloved brands with fantastic heritage, where we can really dig into the story of the brand. That’s a job we can do for Courvoisier.”

Despite the widely reported travails of the big four Cognacs in the US, where Hennessy’s bid to buy market share through discounting has caused real pain for its rivals, Fantacchiotti doesn’t sound unduly worried. He believes there is a natural correction going on after a period of “excessive pricing and de-stocking”, and adds: “We also say – it’s better to enter the category at the bottom, because you can grow it again.”

The Courvoisier deal includes impressive aged stocks, which will give Campari scope to develop VSOP-and-above Cognacs in China. At present, EU brandy (including Cognac) is facing an anti-dumping probe by the the country’s authorities, possibly in retaliation for last year’s EU inquiry into Chinese subsidies for electric cars. So far, Courvoisier is not huge in the region; but interestingly, in January analysts at Citibank cited the company’s “limited exposure to an increasingly uncertain China” as one reason to buy shares in Campari.

Yet that is set to change if Fantacchiotti has his way.

Pass it on: Fantacchiotti (left) with predecessor Bob Kunze-Concewitz

As of last year (FY23), Asia Pacific accounted for only 8% of the group’s business, and half of that was in Australia. As the new CEO, Fantacchiotti announced that he wanted to grow this to 15%–20% of the total within five to 10 years. When I quote this back to him, he sounds a little reticent about specific targets; however, he does believe there are huge opportunities for his brands in Asia, particularly in India and China.

“One of the things we need to get there is for the rest of the group to stop growing at double digits,” he says. “Obviously, that’s a joke, but in the last three years we doubled the business in Asia, and by doing so we moved from 7%–8%.”

When Fantacchiotti joined Campari as MD, Asia-Pacific, in 2020, its sole in-market company was in Australia. “Now we have six, in all the places where we believe we can compete effectively,” he says, listing the firm’s new outposts in South Korea, Japan, China, India and New Zealand.

Having laid the foundations, he says: “We now have the ability to execute our marketing model, which is: a love for the experiential, liquid on lips and digital activations. Obviously, it’s totally different if you can do it through your own people, rather than distributors. And we already have places in Asia where our brown spirits – Glen Grant and Wild Turkey – and Aperol are doing really well.”

As to whether the region has an aperitif market yet – aside from Australia –Fantacchiotti seems unfazed and says: “Is there an aperitif market in the US? I don’t know. What I do know is that Aperol is a drink whose taste profile people love. It’s refreshing, it’s sessionable, it’s thirst-quenching and it’s the Italian summer in a glass. When people see someone holding a glass of Aperol Spritz, they immediately say: ‘Oh, I also want that,’ and you can see what we call ‘the orange spill’ happening.”

This most contagious of drinks can spread fast, fuelled by billions of shared images on social media. Naturally, its success has not gone unnoticed by rivals.

“Others are trying to tap into the spritz market with drinks like the limoncello spritz, but we don’t think this is at the expense of Aperol,” Fantacchiotti says.

Instead, it has helped the great mother brand of the business: Campari itself.

“Initially we didn’t push Campari as a spritz; it was mostly as a Negroni or in a classic cocktail like a Boulevardier or MiTo (Milano-Torino),” he explains. “But the spritz is growing, and it’s now 25% of Campari’s volumes in Italy.” Those of us who have been enjoying Campari-andsoda for years are clearly on trend.

“And we’ve just realised we have a beautiful non-alcoholic spritz, which is Crodino,” Fantacchiotti declares, as if emerging from the cobwebs of Campari’s back-bar. With its pocket-sized triangular red bottle, Crodino has been an Italian staple since 1964, but only reached the UK three years ago. “Now, we’re starting to invest in it,” he says. “We’re going to launch more prominently in the UK. We have a new format, a new formula and a bigger bottle.”

Future acquisitions

Campari, the brand, is second to Aperol representing 11% of the group’s net sales, followed by Wild Turkey Bourbon and Espolòn Tequila, both on 8% as of FY23. As for future acquisitions, might there be room for more whisky? The portfolio has a solitary single malt Scotch in Glen Grant, and nothing from Ireland or Japan.

“Everything that can help us in the US and Asia, and is premium, we look at,” Fantacchiotti replies. “But I need to say that Glen Grant in Asia is doing phenomenally well off a small base.”

Having enjoyed 35.7% organic sales growth in last year’s results, Espolòn Tequila is now a “global priority brand”. Fantacchiotti accepts that the category remains heavily dependent on the US and Mexico, but says: “What we believe is that everything that’s really big in the US will at some point come to the rest of the world. We see that Tequila is starting to come, both in Asia and Europe off a small base.

“If there’s a brand that’s the perfect entry-point into premium Tequila,” he continues, “with that perfect combination of equity and price point, with a great liquid and a very easy proposition for consumers to understand, it’s Espolòn.”

To stand out from all the margarita brands, it has embraced the paloma cocktail with its ‘Espaloma’. “We call it spritz-like, thirst-quenching and sessionable,” Fantacchiotti says – in what is a neat summation of Campari at its best.