Campari: Strategy, Innovation and the Spirit of Leadership Workshops

February 10, 2025 at Campari Academy (all week, sessions for regional CEO teams)

Leaders shape their markets and organisation of the future, by addressing change and disruption in a way that is proactive not reactive, shaped in their own vision. This requires bolder thinking, embracing new insights and capabilities, to unlock new opportunities for innovation and growth. It means thinking about brands beyond products, partners beyond channels, occasions beyond drinking, and strategies beyond financial plans.

Future-ready strategy is about making better choices in an uncertain world. This demands deeper contextual understanding, unlocking assets in new ways, innovative approaches beyond product and promotion, and agile execution. It means working from the future back, combining small experiments with bolder shifts, letting go of the old, embracing the new. In this fast, high energy and interactive session, we seek to inspire leaders to think bigger, bolder and smarter.

How will the drinks industry change?

Over the next 5-10 years, the global drinks industry, including companies like Campari, Diageo, Beam Suntory, and Pernod Ricard, will likely experience significant changes. These changes will be driven by shifts in geography, sociodemographic factors, consumer preferences, and broader industry trends. Below are some key areas of change and their potential implications for these companies.

Shift 1: Geographic Market Shifts

 The global beverage market is expected to evolve with both emerging markets gaining importance and developed markets seeing more nuanced changes. Key regions of change include:

Emerging Markets

  • Asia-Pacific: Countries like China, India, Vietnam, and Indonesia will continue to be key growth drivers. The middle class is expanding, and urbanization is increasing, resulting in higher disposable income and changing drinking habits. China and India are especially important for the spirits industry, where premiumization and Western-style drinks are becoming more popular among young, affluent consumers.
    • Impact on Companies: Companies like Suntory (with strong operations in Japan and growing interest in China) and Diageo (with a significant presence in India) will likely see demand for both premium and locally adapted products. Diageo’s focus on Johnnie Walker and Guinness could benefit from increasing urbanization and aspirational consumption.
  • Africa: African countries, particularly Nigeria, Kenya, and South Africa, are witnessing rapid economic growth and urbanization. As the population becomes more youthful and middle class expands, there’s rising demand for both alcohol and non-alcoholic beverages.
    • Impact on Companies: Firms like Diageo and Campari may see an increased demand for local spirits (e.g., gin, rum) and premium alcoholic beverages. Additionally, there may be opportunities in non-alcoholic beverages, such as energy drinks or premium soft drinks, as well.
  • Latin America: Latin American markets like Brazil, Mexico, and Argentina will remain important but may experience slower growth due to political instability and economic factors. However, the rising demand for premium spirits, particularly in the tequila, rum, and whiskey categories, could drive continued expansion in the region.
    • Impact on Companies: Companies such as Diageo (with its premium tequila portfolio like Don Julio) and Campari (with its rum portfolio) will likely see both volume growth and higher-value sales from premiumization trends.

Developed Markets

  • North America & Europe: While these regions remain significant for global players, growth will be driven by more niche markets and product categories, particularly premium, health-conscious, and convenience-driven beverages. Younger generations are shifting away from traditional alcohol consumption and are more focused on low- or no-alcohol drinks.
    • Impact on Companies: Companies like Diageo, Campari, and Ricard will need to continue expanding their premium offerings and innovate in the low- and no-alcohol space to appeal to younger, health-conscious consumers. There will also be a push toward sustainability and better-for-you options, such as low-sugar, organic, or functional beverages.

 Shift 2: Sociodemographic Changes

 Several key sociodemographic shifts will affect consumption patterns:

Aging Populations

  • Europe, Japan, North America: The aging population in mature markets like Japan and parts of Europe (e.g., Italy, Germany, and France) will lead to increased demand for more moderate alcohol consumption and healthier, lower-alcohol alternatives.
    • Impact on Companies: This demographic shift could drive companies to develop more premium but lower-alcohol options, such as lighter wines or spirits with lower ABVs (alcohol by volume), catering to older consumers who are more health-conscious.

Youth and Millennial Consumption

  • Generation Z and Millennials: These cohorts are more health-conscious, seek authenticity, and are inclined toward unique, sustainable products. They are also more open to trying diverse alcoholic beverages, such as craft cocktails, hard seltzers, or cannabis-infused beverages.
    • Impact on Companies: Companies like Campari and Diageo must cater to a new wave of consumers by investing in trendy spirits (e.g., tequila, craft spirits) and low-alcohol alternatives (e.g., non-alcoholic spirits, seltzers). Diageo’s acquisition of the hard seltzer brand “Pura Still” and Campari’s focus on innovative cocktails suggest these shifts are already being embraced.

Diversity and Inclusion

  • As younger consumers increasingly demand inclusive and diverse representation in advertising and product offerings, brands will need to reflect a more multicultural and socially aware identity.
    • Impact on Companies: Companies will need to prioritize diversity not just in marketing but also in product development and corporate social responsibility. Inclusivity initiatives could become a key part of brand strategy.

Shift 3: Changes in Beverage Categories

 The following trends will significantly impact the types of products in demand:

Premiumization

Consumers are increasingly opting for higher-quality, premium alcoholic drinks, including craft spirits, luxury wines, and aged liquors. This trend is particularly notable in whiskey, gin, and rum categories.

  • Impact on Companies: Companies like Diageo, Campari, and Suntory will benefit from their premium portfolios. Diageo’s investment in premium whiskey brands (e.g., Buchanan’s and Johnnie Walker) and Suntory’s focus on high-end Japanese whiskey position them well to take advantage of this trend.

Health-Conscious and Functional Beverages

Health concerns are shaping beverage choices, with more consumers opting for low- or no-alcohol drinks, functional beverages (e.g., kombucha, CBD-infused drinks), and products with fewer artificial ingredients or lower sugar content.

  • Impact on Companies: Companies like Diageo (with its low-ABV offerings like Guinness 0.0 and Tanqueray 0.0) and Campari (with its innovation in lower-alcohol products) are responding to this trend. Developing non-alcoholic products will be essential for maintaining relevance among younger, health-conscious drinkers.

Sustainability

Sustainability will become an even more critical factor in consumers’ purchasing decisions, with an increasing preference for environmentally conscious products and sustainable packaging.

  • Impact on Companies: Drinks companies will need to ramp up sustainability initiatives across the supply chain, from sourcing raw materials to packaging and transportation. Diageo, for example, has set ambitious goals for net-zero carbon emissions, and Campari has pledged to reduce its environmental footprint, positioning them to capture the growing “conscious consumer” segment.

Convenience and Ready-to-Drink (RTD) Options

RTD cocktails, hard seltzers, and other easy-to-consume alcoholic beverages are gaining traction, particularly among younger consumers and in markets where convenience is highly valued.

  • Impact on Companies: RTD beverages are an area of rapid growth, and companies like Suntory (with their popular Ready-to-Drink beverages in Japan), Diageo (with products like Smirnoff Ice), and Campari will continue to innovate in this space. The trend toward on-the-go, premium RTD drinks (e.g., canned cocktails) will also shape the future.

Cannabis-Infused Beverages

As legalization spreads, cannabis-infused beverages are expected to carve out a significant niche in the alcohol and beverage markets, especially in North America.

  • Impact on Companies: Companies like Diageo (which has already entered the cannabis beverage market in Canada) and others will likely expand their portfolios to include cannabis-infused drinks, tapping into this growing segment as it becomes more mainstream.

Shift 4: Technological Innovation

Advances in technology will also play a role in the drinks sector. AI, automation, and data analytics will improve production efficiency and create new product development opportunities.

  • Impact on Companies: Companies will need to leverage technology to personalize offerings, optimize supply chains, and create smarter marketing strategies. For example, data analytics can help predict shifts in consumer preferences, allowing companies like Diageo and Campari to adapt more quickly.

 The drinks industry over the next 5-10 years will see both challenges and opportunities for global players like Campari, Diageo, Suntory, and Ricard. The key to success will lie in being agile and responsive to evolving consumer demands—whether it’s by tapping into emerging markets, aligning with health and wellness trends, or embracing sustainability and innovation in new product categories. The companies that can effectively navigate these shifts while maintaining brand identity and delivering premium, authentic products will be best positioned for growth in the years to come.

Thinking like a disruptor brand

Here are some disruptors, including in the world of alcoholic drinks, and how they engage consumers, partner with other brands, develop new channels to market, add adjacent services, and introduce new pricing models:

Disruptive drinks brands

  • Seedlip: Known as the world’s first non-alcoholic spirit, Seedlip has created a new category in the spirits market, appealing to health-conscious consumers and those who prefer non-alcoholic options.
  • Bacardi: Bacardi has been experimenting with sustainable packaging, including launching the first glass spirits bottle fueled by hydrogen, which cuts greenhouse gas emissions by over 30%.
  • The Pathfinder: This fermented ‘spirit’ has gained popularity for bridging the gap between alcoholic and non-alcoholic beverages, offering versatility in cocktails.
  • BrewDog: Known for its bold marketing and innovative products, BrewDog has disrupted the craft beer market with unique flavors and limited-edition releases. They engage consumers through experiential marketing, pop-up bars, and exclusive events1.
  • Diageo: The parent company of Johnnie Walker, Diageo has embraced sustainability and innovation with initiatives like the “Society 2030: Spirit of Progress” plan, which focuses on reducing water usage and promoting responsible consumption.
  • Suntory: This Japanese beverage giant has scored highly in areas like e-commerce, AI, and health & wellness, positioning itself well to benefit from industry disruption.
  • EcoSpirits: Focusing on closed-loop packaging, EcoSpirits aims to reduce waste and promote sustainability in the spirits industry.

 Engagement and Partnerships

  • BrewDog: Engages consumers through bold marketing campaigns, pop-up bars, and exclusive events. They also partner with other brands for limited-edition releases and collaborations.
  • Seedlip: Partners with bars and restaurants to offer non-alcoholic cocktail options, promoting the idea of “mindful drinking.”
  • Diageo: Collaborates with tech companies like Thinfilm to develop smart bottles with NFC sensor tags, enhancing product safety and preventing tampering.
  • Suntory: Partners with local farmers and grain suppliers to adopt sustainable practices, promoting responsible consumption and environmental stewardship.
  • EcoSpirits: Works with eco-friendly packaging companies to develop closed-loop systems that reduce waste and promote sustainability.

 New Channels and Services

  • BrewDog: Explores new channels like virtual events and online tastings to reach a wider audience.
  • Seedlip: Develops adjacent services like cocktail-making kits and virtual mixology classes to engage consumers.
  • Diageo: Invests in e-commerce platforms and AI-driven marketing to enhance consumer engagement and streamline operations.
  • Suntory: Expands into health & wellness services, offering products that cater to consumers seeking healthier lifestyle choices.
  • EcoSpirits: Introduces new pricing models that incentivize consumers to return bottles for recycling, promoting a circular economy.

Innovation in business models

  • Premiumisation: Brands like Bacardi are focusing on premium spirits, offering high-quality, artisanal products that cater to consumers seeking luxury experiences.
  • AI and Data Analytics: Companies are leveraging AI to enhance consumer experiences, personalize marketing efforts, and streamline operations.
  • Sustainability Initiatives: Brands are adopting eco-friendly practices, such as using recycled materials, reducing carbon footprints, and promoting responsible consumption.

How Campari Could Embrace These Ideas

  • Non-Alcoholic Spirits: Campari could develop its own line of non-alcoholic spirits to tap into the growing market of health-conscious consumers.
  • Sustainable Packaging: Campari could invest in sustainable packaging solutions, such as biodegradable bottles or reusable packaging, to reduce environmental impact.
  • AI Integration: Campari could use AI to personalize marketing campaigns, improve customer engagement, and optimize supply chain management.
  • Storytelling and Authenticity: Emphasizing authentic storytelling and brand heritage can create a deeper emotional connection with consumers.

How will you lead the future? How will you shape it to your advantage? How will you future proof your business?