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People drinking better not more: an opportunity, not a threat

Our Chief Executive talks about his views on the opportunities presented by increasingly moderate and responsible relationships with alcohol around the world

Feature

“The question is can you have a successful alcohol business while promoting positive drinking experiences? My answer to that is categorically yes - there is no trade-off.”

Ivan Menezes
Ivan Menezes

Chief Executive

Diageo-Bucharest-Tanqueray-Bar

It used to be thought that alcohol was merely a by-product of human civilisation – perhaps from bread-making or other food processes. But recent discoveries of alcohol production, dating back to the dawn of civilisation, suggest otherwise.

New evidence and research points to alcohol being created not just as an accidental offshoot of humanity but as a constant and positive feature in society, central to many celebrations and cultures around the world.

Indeed, when Arthur Guinness signed a lease on his brewery in St James’ Gate he signed it for 9,000 years – so confident was he of alcohol’s place in society for generations to come.

But while the enduring place of drinking within human history is well documented, it’s also true that the relationship we have with alcohol has changed many times. Each generation has its own habits and styles and right now, we are living through another of these generational shifts.

Some extraordinary demographic movements and cultural trends are changing the way people drink today - and also the role alcohol plays in society.

In general, young adults are drinking less, especially in the developed world, and around the world, people are choosing a higher quality of drinks. At Diageo, we are capitalising on this trend by encouraging consumers to trade up to better drinks.

Our goal is to grow our participation in international premium spirits. We are taking advantage of demographic changes and the growth of the adult community, as well as rising disposable incomes around the world and the increasing popularity of spirits in emerging markets.

There are those who would like to claim that more moderate drinking habits will spell the inevitable decline and subsequent demise of the alcohol industry. But 9,000 years of history tells us otherwise.

Drinking demographics are shifting, but by adapting and introducing a new generation to our quality products as they come of age, and innovating to match the tastes of today’s and tomorrow’s drinkers - we can and will flourish.

In fact, these changes and trends are precisely the things that will allow the best performing and responsible alcohol companies like Diageo to succeed.

Diageo-Madrid-Bar

The question is can you have a successful alcohol business while promoting positive drinking experiences? My answer to that is categorically yes - there is no trade-off.

We know that harmful drinking can cause significant problems for society, and damage the reputation of a business and its brands and make it harder to run a business. A drinks business that focuses solely on maximising profit without concern for the role of alcohol in society will soon find itself in trouble.

As an industry, we can be successful by pursuing a growth agenda that is responsible - driven by people drinking better not more - while at the same time educating consumers on moderation and advocating for policies that reduce the misuse of alcohol.

Everyone at Diageo is committed to promoting positive drinking experiences and tackling harmful drinking – and we have ambitious new targets to do even more.

By 2025, we will:

  • Educate 5 million young people, parents and teachers about the dangers of underage drinking.
  • Collect 50 million pledges to never drink and drive through #JoinThePact.
  • Reach 200 million people with moderation messages from our brands.

But we cannot act alone.

I recently took up the role of Chairman of the CEO group at the International Alliance for Responsible Drinking and I know all the CEOs, who represent the major beer, wine and spirits companies, share my commitment to this issue.

We are collectively and individually working with governments and industry to ensure alcohol continues to play a positive role in society. When the drinks industry works with governments, NGOs and consumers, we get the best results.

We have already made a tangible difference. Working with NGOs, IARD members have reached close to 11 million underage people with education programs. We have run over 330 drink driving programmes in 88 countries and reinforced self-regulatory codes on responsible marketing.  

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We’re proud of this work but we’re not complacent and are committed to doing more.

For example, at IARD, we are setting the highest standards of responsibility for the alcohol industry in digital marketing. In September we announced a new commitment to harness our marketing expertise and work in partnership with others to apply new tools, technology and data to our digital marketing and ensure it is responsibly targeting adult consumers.

It’s clear to me that change is not a threat but an opportunity. Change is constant. The way people socialise and drink will continue to evolve and bring new opportunities, as it always has.

At Diageo, we are well positioned to seize these. At the same time, we want to encourage industry and government to work with common purpose to promote positive drinking and ensure a bright future for the industry.

That is how we will adapt and thrive through change and ensure alcohol remains a positive influence in the story of humankind for the next 9,000 years. I suspect Arthur Guinness would raise a glass to that.