Alcopop boom is over for Diageo

Related tags Smirnoff ice Diageo

Drinks giant Diageo has revealed that the growth boom is well and truly over for alcopops.Its ready-mixed cocktail-style drinks such as Smirnoff Ice...

Drinks giant Diageo has revealed that the growth boom is well and truly over for alcopops.

Its ready-mixed cocktail-style drinks such as Smirnoff Ice and Archers Aqua, are losing sales in the UK.

The global group, which owns the Baileys, Guinness and Johnnie Walker labels as well as Smirnoff, unveiled a 12 per cent fall in UK sales of Smirnoff Ice for the past six months, and a four per cent drop in the ready-to-drink market, worldwide.

Diageo Great Britain said the high duty rate imposed in 2002 had hit the category. Smirnoff Ice actually gained market share in a shrinking sector, from 25.6 per cent to 28.4 per cent of the market.

The drink giant's UK arm still considers the RTD market very important. Don Goulding, head of Diageo GB, said: "The RTD category is large and valuable, now worth £1.2bn in Great Britain, and well-established within comsumers drinks repertoires.

"We believe there is still a significant opportunity and over the next few months, we will be working hard to create new news for the trade and consumers."

Elsewhere, sales of Guinness had also slowed and Diageo is planning a massive marketing drive for the brand, kicking off this week with the latest TV advert. The first screening will be tonight during the interval of the Champions League football coverage (ITV, 8.30pm).

Johnnie Walker and Baileys both grew nine per cent.

Profits for the six months were £200m ahead to £1.29bn.

But chief executive Paul Walsh warned that full year profits would be hit by the falling value of the dollar against the pound.

Related topics Spirits & Cocktails

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