Diageo commits to marketing spend after sales bump

Diageo, owner of the Guinness and Smirnoff brands, says it will continue to invest in marketing to boost revenue after reporting sales growth accelerated in the first three months of the year.

Diageo brands
Diageo brands

The drinks producer says net sales grew 12% in the quarter ended 31 March, an improvement on the 2% registered over the nine months to March.

The company, which also owns the Johnnie Walker and Baileys brands, says a “fragile” recovery in developed markets and “stronger” growth in emerging markets helped increase sales.

Paul Walsh, chief executive of Diageo, says its forecast for low single digit operating profit growth for the full year to June is unchanged. He claims the company’s “successful management” of the “tough” economic environment in the first half and its commitment to increase marketing investment will help the company meet its own expectations for the full year.

In the UK, Diageo has invested heavily in marketing brands such as Guinness, Smirnoff and Gordon’s over the last nine months. It has also developed a number of joint initiatives with Coca-Cola Enterprises to co-promote their spirit and mixer ranges.

Diageo recently appointed Philip Gladman as marketing director for its British business. He replaced Philip Almond, who is now global marketing director for Baileys.

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