Cinzano grew 2.2% for H1 this year. What drove this growth?
Cinzano is going through a double trend. We are seeing a good performance on sparkling wine, especially in Russia where we are recovering our business, and more generally we are doing pretty well in the rest of the world.
On vermouth, our major market, Argentina, is suffering because of some economical influences. The brand is doing very well in Europe and in Russia but this doesn’t compensate the loss we are seeing in Argentina. In general though the brand is performing well.
What are the key European markets Cinzano is succeeding in?
If we look at vermouth; Russia, Germany and Italy are important markets. Spain is a key market, especially because of the resurgence of the category and the way vermouth is being drunk in Spain. In the UK the category seems to be a little bit better as well.
If we look at the sparkling wine category, Germany is a very important market - one of the biggest sparkling wine markets in the world. Italy and Russia are also key markets, so the brand has got a very important footprint in the European markets but different trends are at play.
How is Cinzano performing against the wider vermouth category?
Cinzano, because of the negative trend in Argentina, is underperforming. If we look at the data available from IWSR, we are underperforming in this category. But at the same time we see some potential to be in line with the trends of the category in the future.
What we are seeing is the premiumisation of the vermouth category. So when we look at the trends in volume and value they do not match. Value is growing faster than volume because of Spain, Argentina and even in the UK and US.
Vermouth and premium vermouth are seen by mixologists as a very interesting ingredient to create premium cocktails. They are looking at a premium and super premium offer and that segment of the category is very healthy - this is where the Cinzano 1757 is doing well. On the other hand the more mainstream, standard vermouth category is declining in volumes. There are new ways of enjoying an aperitvo, such as an Aperol Spritz. The premium segment is growing and is expected to grow in the future. This is a very important segment for Cinzano.
Are you looking to steal share from competitor vermouths or are you looking for new consumers?
On the more mainstream segment, stealing share from competitor vermouths is the objective. We have to defend our volumes from the low-tier products and to steal share from the market leader.
On the other hand the premium and super premium segment is not really a share game but the aim is to increase the capital.
How do you perceive vermouth consumers? And how are they drinking vermouth?
The way consumers relate to the category is really two-fold. There is a traditional way of enjoying vermouth, with just ice cubes or soda. But in recent years there has be an increase of aperitivo bars coming back, especially in Argentina and Spain, we want to tap into this comeback of an authentic and sophisticated way of drinking.
Then there is another way vermouth is being served, which is in the hands of mixologists and bartenders using vermouth as an ingredient in cocktails, such as a Negroni, Americano and many others are becoming very popular. There is a renaissance of these cocktail trends. We believe there are good times ahead for the category and Cinzano.
