As U.S. Growth Slows, Diageo Adds Another Super-Premium Pour To Spirits Portfolio

Image above: Foo Fighters' Dave Grohl in teaser ad for Crown Royal whisk, with Super Bowl spot to come.

Diageo continues to double down on super-premium spirits amid a slowdown in overall North America sales.

In the six months ended Dec. 31, organic sales growth of 3% in North America—typically Diageo’s most profitable region—was in stark contrast to financial analysts’ predictions of 6%+.

RBC Capital noted that because of North America’s high-margin status, “even though the group as a whole beat organic sales estimates comfortably, we think that the U.S. miss is the most significant element of these results.”

Looking forward, the world’s largest spirits marketer said this week that it expects sales growth to “continue to normalize through the second half of fiscal ’23 compared to the double-digit growth in the prior period.”



Diageo is in the process of topping off its portfolio with the planned acquisition of the super-premium, Philippine dark-rum brand Don Papa. That follows its purchase last fall of Texas super-premium whisky distiller Balcones Distilling.

In a conference call on Thursday, Diageo CEO and executive director Ivan Menezes said that while growth in the U.S. spirits category is “normalizing” following pandemic-related behavior shifts to higher-priced items, “the market continues to premiumize.”

He cited a survey of American drinkers indicating that 33% had spent $50 or more on a bottle of alcohol in 2022—up from 24% in 2021.

The company says that 10 of the brands it acquired since fiscal year 2017 are in the “super-premium-plus price tier.”

In the first half of fiscal 2023, net sales of Casamigos tequila had net sales 11 times larger than its annual sales when Diageo acquired the brand in 2017.

Founded by actor George Clooney, Casamigos was designated as the top-selling tequila and celebrity backed spirits brand in 2022 by U.S. ecommerce platform Drizly.

Diageo will make its debut at the Super Bowl next month with an ad for Crown Royal whisk—which the company has owned since 2000—a teaser for which, featuring Foo Fighters founder Dave Grohl, can be seen here.


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