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Promotion

Past promotion policy

The distinct GUINNESS brand identity has evolved over time, but it is still linked to the company’s first ever packaging and advertising. In the beginning, bottles of GUINNESS were labelled with bottler’s own designs. As trade grew, the first official label was used. In 1862, a buff-colored oval label was trademarked and supplied to the bottlers. It is still famous today.

Screen Shot 2015-11-14 at 20.09.41

Three core elements of this label are still used in the brand identity
  1. the HARP device – It is based on a famous 14th century Irish harp called the “O’Neill” or “Brian Boru” harp. This device was trademarked in 1876.  The harp still exists at Trinity College, Dublin. Here is the evolution of the harp:
    Screen Shot 2015-11-14 at 12.19.22
  2. the Arthur Guinness SIGNATURE – This is based on the very signature from Arthur’s signing of the lease at St. James’ Gate Brewery in 1759. The colour and quality of the mark has changed over the years as seen below:
    Screen Shot 2015-11-14 at 12.19.30
  3. the GUINNESS WORD – This is the name of the product and the family that ran the business. It has appeared on wooden-casks, horse-drawn drays, barges, ships, the Brewery’s gates, posters, tv commercials, merchandise and all forms of packaging and promotional material. It has had a variety of letter styling as shown below, but an official typeface ‘Hobbs’, developed by Bruce Hobbs, was introduced in the 1960s. It was replaced by ‘Design Group Hobbs’ in 1991 and by ‘Unified Hobbsian’ in 1997. In 2005, the font was converted to a wordmark:

Screen Shot 2015-11-14 at 12.19.46

Subtle style changes have been made over the years, but the three features always remain.

Advertising

The first advertising for GUINNESS was the famous Gilroy and Animals Campaign done by S.H.Benson’s advertising agency in 1928. Gilroy, an esteemed artist of the century, was recruited by the agency to illustrate for the campaign. He was involved with the “Guinness for Strength” and the “My Goodness, MY GUINNESS” campaigns that ran for nearly 30 years side by side. The former showed people drinking GUINNESS being able to perform feats of strength. The concept was that “Guinness is Good For You”. Some of the other icon phrases used for this were “Lovely Day for a Guinness”, “Guinness Makes You Strong,” and most famously, “Guinness is Good For You”

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The“My Goodness, MY GUINNESS” campaign showed various zoo-animals interacting in funny ways with GUINNESS. At Christmas, the phrase changed to “My Goodness, My Christmas, It’s Guinness!”.

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Words like timeless, world famous, unique, strong, creative, fun, enjoyable and iconic have been used to describe the advertising behind GUINNESS. The goal was to position the beer in line with these characteristics and qualities. TV ads were eventually added to the promotion of the product. Guinness have won many awards for their advertising campaigns.

Campaigns

Some of the most notable campaigns are listed here:

  1. Anticipation” (1994-1995) in Ireland featured Irish actor Joe McKinney dancing to “Guaglione” by Perez Prado. It put the song to number one in the charts for several weeks.
  2. “Good things come to those who wait” was a slogan used to promote GUINNESS Draught in the UK.
    • Surfer” (1999) – won for all time best TV commercial in the UK poll by The Sunday Times and Channel 4 in 2000.
    • Bet on Black” (2000) – features a snail race  
    • noitulovE(Evolution backwards) (2006) – was the most awarded commercial world wide in 2006
  3. To Arthur” (2009) was released for Arthur Guinness Day, the worldwide celebration of 250 years of GUINNESS.
  4. The “Made of More” brand line has been used in advertising in the UK and elsewhere since 2013. Many campaigns have been developed under this new brand positioning.
    • Wheelchair Basketball” (2013) – made by BBDO’s New York office 
    • In Pursuit of More”(2014) – emphasises the history, introduces the employees, and reveals the brewing process.
    • Empty Chair” (2014) was released on the Fourth of July 
    • Sapeurs” (2014) was the newest “Made of More” ad from Guinness.
    • Made of Black” Guinness Africa (2014) – aired on MTV Base Africa (it builds on the brand line “Made of More”) It features a Kanye West song called ‘Black Skinhead’
  5. Barnes Sisters” (2014) – film advert featuring biathletes Tracy Barnes and Lanny Barnes was awarded a gold Clio award in 2015 – honouring excellence in sports marketing and advertising.
  6. Berbeda Batik tapi tetap Satu” for Guinness Indonesia (2015) –  made as an attempt to appeal to younger drinkers, 21-30 year old urban males and average light drinkers. A local street art legend is featured and a Facebook app allows customers to create their own batik styles.
  7. #TasteofBlack” for Korea (2015) –  an attempt to expand the brand in Korea and encourage new customers. The campaign is meant to show that the brand is inviting and overcome the perception of an overly strong taste. A hashtag #TASTEofBLACK is used to asks people to share their experience on social media. The advert stresses product features like: smooth, deep, creamy, bold, rich and amazing. It is targeted at men and women.

Themes

Like some of their beer competitors, GUINNESS is a sponsor of sport. They have sponsored various teams and tournaments over three decades. It is now the official beer of RBS 6 Nations and of Premiership Rugby. The beer is sold at the Home Nations stadia.

Guinness_Pro12_LogoGuinness was also became the official sponsor for Rugby’s Pro12 league for the 2014-15 season.

New film adverts ran before and during the 2015 Rugby World Cup, that won the company a silver Clio Sports Award this year:

It involved a series of commercials showing historical footage of games past with narratives voiced-over about how people involved in rugby overcame the odds and triumphed.

The The Rugby World Cup poster campaign that GUINNESS ran alongside these commercials was unique and creative with Rugby themes forming the shape of a pint of GUINNESS. Post tournament analysis shows that people thought Guinness was the official sponsor of the games when really it was Heineken.

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Competition

The three primary competitors of Diageo are Anheuser-Busch InBev (BUD), Molson Coors (TAP), and SABMiller (SBMRY). Two of these giants announced their consolidation this October. In 2014, the American brewing company AB InBev was in control of 30% of the market. They produce, import and distribute Budweiser, Stella Artois, Beck’s, Corona, Leffe and Hoegaarden. The company also produces domestic brands such as Bud Light, Busch, Michelob and Shock Top and many others.

Even though Diageo is the world’s largest producer of spirits and a major player for beer and wine, beer is not their number one commodity. This helps the competitions and could hurt GUINNESS® since many of the competing multinational conglomerates specialize more on beer products. A shared strength with Diageo is that their size and revenue allows them to survive price hikes on resources (i.e. fossil fuels and water) needed for production and distribution and on essential brewing ingredients like barley.

The secondary and somewhat unexpected competitors of Diageo are independent brewers. In the 1980s, 200 independent breweries existed in the U.S. In 2014 that number rose to 1,600 and more are coming to life. In 2014 craft brewers made up 10% of the beer market in the U.S. Ten years ago they only had 3% of the market. New global attitudes and desires for locally produced goods and innovative tastes gives strength to the craft brewers.

One pitfall for these smaller companies is that they may suffer when there are shortages of the production ingredients. Low acreage and bad weather can force the price of craft brews up. There is an impending shortage of barley. In 1942, barley acreage was 17 million and in 2014 it was only just over three million acres. Prices to buy barley will skyrocket and small breweries may not be able to survive. Bad weather in Canada, the second largest exporter of malting barley, has added to the shortage. Icy weather freezes and destroys crops.

The Marketing activities of the competition

For the purposes of length, I will focus on the activities of the largest beer producer, AB InBev. They invest most of their marketing money on their more popular brands which they call their “Focus Brands”. These brands are broken down into three categories:

Global brands
    • Budweiser – is positioned as “The King of Beers” and the great American Lager and has won awards and brand loyalty for their iconic advertisements. Other slogans have been “This Bud’s for you” and “Best buds”. Their mascot is the Clydesdale Horse which feature on the branding.It is also the official beer sponsor for the Super Bowl. Budweiser has moved two place up to 33rd on the BRANDZTM top 100 most valuable global brands of 2015. Brand value is estimated at 26,657m US dollars, a 9% increase in value from 2014. It is the only beer listed. http://www.millwardbrown.com/BrandZ/2015/Global/2015_BrandZ_Top100_Chart.pdf
    • Corona – is positioned as a fun and relaxing beer. It is the leading brand in Mexico, the fourth most valuable brand worldwide and stands for “Mexican Pride”.
    • Stella Artois – has Belgian roots and focuses on heritage and the ritual much like GUINNESS. The positioning is one of tasteful sophistication. It has a nine-step pouring ritual and talks flavour too.
International brands
    • Beck’s – is the number one German beer and found in more than 80 countries. The positioning for this brew is that of uncompromising quality. They have not changed the recipe and have only had 6 brew masters in its 125 year history. The branding of the site currently features urban inspired street art graphics to promote their current campaign called Beck’s Urban Canvas. Beck’s has commissioned murals and installations from artists and creators around the world to be made and displayed in some creative communities of Miami.
    • Hoegaarden – This authentic Belgian white/wheat beer is positioned as “totally different – by nature”. Its unique brewing process is very complex and the outcome is a refreshing cloudy-white brew. The website also focuses on it’s heritage and the complexity of the recipe.
    • Leffe – This brew is an abbey beer originally produced by monks and known for its full-bodied and rich flavour. It is positioned as the brew that “makes the extraordinary, just perfect” and a social beer to bring people together for special moments. The community of monks was known by its hospitality. Left’s website looks similar in colour scheme to GUINNESS with Buff and Dark Colours. It is also similar in that it tells the story of the beers heritage and focusses on the quality and unique aspects of each beer.
Local champions
    • Bud light – This is the best selling beer in the US. It is positioned for its drinkability and refreshing flavour. Bud light is the official beer sponsor of the NFL. They are running a campaign cleverly called #MyTeamCan. Bud Light is now available in cans designed with the colours and mascots of NFL teams. People are encouraged to share photos of their preferred can/team via Twitter and Facebook using the custom hashtag.
    • Michelob Ultra – falls into the superior light beer category. It is positioned as the beer for people with active, healthy lifestyles. #LIVEULTRA in all caps is a custom hashtag and Michelop sponsors running and cycling races, golf tours and tennis tours.  It is the official beer sponsor of the PGA tour.
    • Skol – Sociable, innovative, always among friends are the words used to describe this beer in the marketing strategy. It is the most popular beer in Brazil. The website features world music and has a friendly, cheerful colour.
    • There are many more Local Champion beers in AB InBev’s portfolio including Brahma, Antarctica, Qualms, Jupiter, Victoria, Modelo Especial, Klinskoye, Sibirskaya Korona (Siberian Crown), Chernigivske, Harbin, Sedrin, and Cass

All of these competitors have their own website outside of the main AB InBev site most of which are modern, clean and easy to navigate. They each have ID checks in order to browse. The visitor must be of legal drinking age to enter the sites.

The secondary competition, craft beers, take a much different approach to marketing than the global giants. people do not accept push-style, mainstream marketing here. Customers want to think finding the beer was just as special as each unique and innovative brew. Authenticity is important for craft beer and the marketing must align with that. Therefore, they focus more on creativity than on high-cost, super-bowl style advertisement.

One successful craft brand is BrewDog, founded by James Watt and Martin Dickie in Scotland in 2007. It is known for brewing the world’s strongest beer and using odd approaches to the production, like brewing at the bottom of the ocean. In Summer 2015, BrewDog parachuted beers over London from a helicopter. The company also has a TV show called Brew Dogs, in which the two founders go on beer-related excursions. Smaller companies have to think differently and concentrate on the customer relationship while making an impact in creative ways. Both BrewDog and the Californian craft beer company called Stone Brewing Co. have punk style appeal and position themselves as the outsider or rebel of the market. Camden Town Brewery and Brooklyn Brewery also have similar logo styles and approaches. They want to fit in with rather than push out other brews.

Pricing Policies

Diageo has a premium pricing strategy for the high quality Guinness products. GUINNESS is the world’s leading stout giving it a strong, category-defining position. Foreign Extra Stout accounts for 41% of GUINNESS sales and is positioned at a premium to mainstream beer. In Nigeria, GUINNESS is between 40% – 60% premium to mainstream beer.

Diageo practices corporate social responsibility with its responsible drinking campaign and other initiatives, which justifies higher prices for the product. The package design with black as its dominant color is akin to being a premium product. Black is often associated with authority and sophistication in design. The aspirational design and iconic advertising both help to increase consumer purchase intent and preference thereby justifying the premium pricing positioning.

Distribution

It is easy to assume that GUINNESS is distributed in Ireland the most, but this is not the case. The largest market for GUINNESS is in Great Britain. The second largest is in Nigeria, where 40% of all Guinness is consumed. There are five Guinness-owned breweries in the world and three of them are in African nations. Ireland comes third in the list, Cameroon fourth and the U.S. is in fifth place for distribution.

As mentioned earlier, distribution is part of a three-tier system that many kinds of beers go through. Suppliers, like national breweries or importers, sell the product to wholesalers or distributors, who then sell the beer to retailers, like the pubs and supermarkets. It is a mandate in most places that beer go through this system.

The Market

Who and where is the market?

The market is characterized by three sizes of breweries: large, mid-sized and microbreweries. All sizes brew varities of beer including craft beers. The beer produced can range from 3% to 14% alcohol by volume. The majority of beer sold falls into the middle of this rage, 4-6%. Beer can be categorised as Traditional, Craft or Microbrewed and can be segmented even further in to Light Beers, Premium Beers, Imported Beers, Popular Beers, Crafted Beers, Specialty Beers, Superpremium Beers, Malt Liquors, Malternatives, Ice Beers and Low/Non-Alcoholic Beers.

The most common types of beer consumed today are bitters, ales and stouts. The most  recent attitudes are that beer is interesting and trendy. Popular characteristics the market is turning toward are local breweries, craft beers and innovative tastes. Health conscious consumers and drinkers who suffer from gluten allergies or follow new diet fads are asking for alternatives to wheat, barely and rye-based production.

Consumers mainly purchase beer from pubs, bars and supermarkets. About half of beer in Britain is sold in pubs. Seven out of every ten drinks sold in the pub is a beer. Beer demand is increasing alongside rising incomes in developing countries.

Past IMC appeals

Historical IMC appeals by GUINNESS have concentrated on historical and heritage based themes. Arthur’s Day was somewhat successful, but ultimately dubbed a marketing ploy by many, and eventually cancelled.

Who are our customers?

Consumers are generally looking for a tasty, simple beer at a reasonable price. The customers for GUINNESS have mainly been men, and the stout is still perceived by many as a beer for older people. There is a push to market the product more to women and young adults.

The product is generally loved for its Irish heritage. It has strong ties with the Irish holiday, St Patrick’s Day, which is celebrated world-wide. Loyalty to Arthur Guinness is celebrated in September on “Arthur’s Day”, even after the cancellation of the official event. The product is loved for it’s creamy nature and luxurious colouring. Both nostalgic and modern Ad campaigns have increased brand love and loyalty across the globe.

Share of Market

Sales history industrywide

Other key players in the global beer market include AB Inbev, Heineken, Kirin Holdings, Asahi Group Holdings and SABMiller. In 2013, AB Inbev ranked highest for global sales reaching 43.2 billion U.S. dollars.

The newest merging of two global giants is bound to impact the market for all beer giants as well as craft breweries. AB Inbev is the world’s largest beer company. In October this year, they announced the purchase of their main competitor, SABMiller. This mega-merger has been dubbed MEGABREW in the industry. The new giant will be creating one in every three beers around the world and together earned 30.5% of beer sales in the world in 2014. The UK market is not dominated by this Megabrew. The list below shows the market share distribution in the UK in 2014:

  • Molson Coors 18.4%
  • AB InBev 17.8%
  • Heineken 17.1%
  • Carlsberg 14.8%
  • Diageo 4.8%
  • SAB 3.1%

Sales of craft beers have been on the rise by 14-17% every year for the last five years. Craft breweries make up 5% of beer sales in the UK. The larger traditional breweries are beginning to buy craft breweries too.  For instance, at the start of 2015, SAB purchased the London-based Meantime brand, and AB InBev has spent more than $200m acquiring craft breweries.

Rumors of more mergers and acquisitions are in the air. The smaller of the traditional breweries are starting to think how to keep up with their colossal competitors. Heineken and Molson Coors may join forces. There are also rumours that Guinness could be sold off to another company.

This graph shows the beer market share of Diageo in the United States in 2012 and 2013, based on shipment value*

statistic_id309244_diageos-beer-market-share-in-the-us-based-on-shipment-value-2013-2014

Market potential

Industry trends are forming at two sides of a spectrum, huge merging beer conglomerates and small craft and micro breweries. The development of new products like GUINNESS’s Blonde American Lager is also a market trend. Companies are trying to fit products to the demands of the culture where they are distributed. Guinness hope to gain popularity with this All-american brew. Developing craft beers is also an area for potential. Beer has become trendy and the market values low volume and better quality over mass production. The market also shows concern for environmental impacts caused by mass-production practices. There has increased support for locally focussed businesses over multinational companies.

Sale History

In the 19th century, trade for the Guinness product grew overseas. By 1929, 2 million pints of Guinness were enjoyed everyday increasing to 5 million pints a day by 1950. In 2008, this statistic doubled to 10 million pints consumed in 150 countries around the world.

Unfortunately, according to The Economist, sales of Guinness are falling. Sales have risen in Ireland for the first time since 2008, but they have plummeted in Britain in 2014. Where sales were gained in Ireland they were lost times 8 in Britain.

decreasing sales

Sales for Guinness in the US have also been on a gradual decline. This decline in beer sales is not exclusive to GUINNESS.  It is also happening for other large producers, Heineken, Budweiser and Carlsberg. The popularity of craft beers is a possible cause of the decline. Revenues in Europe and America are also on the rise and tastes are shifting toward spirits and pricier wines along with them.

There is some question whether focusing GUINNESS marketing on the national holiday St. Patrick’s day is the best strategy for rebuilding the brand. Assessing and answering to current market demands has brought about some progress. ‘The Brewer’s Project’ has helped sales grow again in Britain and Ireland. In Britain sales are up 2%, and in America, the addition of the new Blonde American Lager is improving sales too. Whereas sales in Africa and Asia have still been in decline.

The Product

Development and Quality

GUINNESS is what we know today as a “Stout”. In 1759 Ireland, It was originally brewed as “Porter” and later “Stout Porter” because it was popular with UK train porters. They preferred it for its strong taste. Arthur also brewed Ale when he first opened the brewery, but it was no longer produced by 1799. “Pure Beauty. Pure GUINNESS” is the slogan used to identify all styles of the beer.

The brewery currently produces the following types of GUINNESS:
  • Guinness Original (canned or bottled): The original brew from 200+ years ago
  • Draught Guinness (launched as draught beer in British pubs in 1959 and now in cans and bottles too): this contains nitrogen and carbon dioxide. The creaminess of the head is produced by the nitrogen as very fine bubbles and the method used to dispense the beer.
  • Guinness Red (draught): lighter tasting draught stout – the barley is roasted a little less and the red colour comes out more.
  • Foreign Extra Stout (bottled): most full-flavoured of all. brewed with extra hops. the flavour is bitter and sweet. Contains only the carbon dioxide which gives it a more acidic taste

 

This chart shows how some types of GUINNESS were ranked by number of users in the UK in 2014:statistic_id304081_leading-draught-bitter-brands-of-guinness-in-the-uk-2014-by-number-of-users

The newest development for the product was announced this November 2015. By the end of 2016, GUINNESS are removing one of the ingredients, Isinglass (from fish bladders), to make their products suitable for vegetarians and vegans. This is going to be possible because of a new filtration process to remove yeast particles.

Design and Description

GUINNESS is composed from water, hops, brewers yeast and barley malt. On first glance, the colour of the beer looks black. It is actually a ruby red when held up to the light, and this signature dark colour is a result of a portion of the barley being flaked (which involves steaming, rolling and roasting). The draught requires a signature double pour. It is dispensed through a five-hole disk restrictor plate or with a widget, supplying an uncommon amount of nitrogen. This produces the creamy head as mentioned before. To pour the perfect pint of GUINNESS takes 119.5 seconds.

GUINNESS is described as the Nation’s favourite drink. It is the quintessential Irish brew.

Packaging

Packaging has gone through various container changes and redesigns, but the trademark label was first introduced in 1862 and still remains – an oval label with the harp and Arthur Guinness’ signature. The harp was a registered trademark in 1876. As mentioned earlier, the beer started out in stoneware and was eventually packaged in glass bottles in 1834. It is also available on tap or in cans. Draught can come in a can because of the invention of the ‘widget beer’. Bottled draught beer is also possible because of the invention of the ‘rocket widget’. In ### GUINNESS revealed a new American style lager to release to the American market. The new lager’s packaging was more in keeping with branding of typical lagers of major corporate brewers in the U.S. The style is near-monochromatic as opposed to the more colourful and whimsical branding often seen on craft beer brands.

Uses

Guinness products are mainly used as drinks and much of the time during social occasions, but they have some alternative uses too. Guinness is sometimes used as an ingredient in recipes for starters, main courses and desserts. It is also used as an ingredient in cocktails. In 1861, the famous cocktail called the ‘black velvet’ was invented which is a 50/50 mix of GUINNESS and champagne. Recipes can be found throughout the internet. Visit the official site http://www.guinness.com/en-gb/food.html to see their listed recipes and cocktails.

Reputation

Guinness is seen all over the world as a potent national symbol of Ireland. It is known for its full-bodies flavour, dark colour and creamy texture and has a reputation as a “meal in a glass”. This is a misnomer since the beer actually has less alcohol and calories than other beers. It also has a reputation for being an older gentleman’s drink, though GUINNESS has tried to change this reputation in various global ad campaigns.

Strengths

One major strength of this product is that it is the only global stout brand available. Another strength is its ties with the Irish holiday, St. Patrick’s day. 13 million glasses are enjoyed round the world in that one day! A typical day would see 8 million glasses consumed. In general this link to Irish heritage has been a strength. The distinctive and unique flavour, colour and texture can be seen as a strength since there are no other brands that have matched this. Another helper are the scientific studies that say drinking beer in moderation is good for your health, and GUINNESS has a reputation for containing antioxidant compounds.

Weaknesses

As much as the flavour, colour and texture can be a strength, they can be a weakness too. Some people find this beer too heavy and filling and might go for something more crisp and fresh. Some consumers are also turning to craft beers over established brands since for craft beers, quality wins out over quantity. Another weakness is the trend of health conscious populations to shift from beer consumption to wine and spirits. Other scientific studies go the other direction and link beer drinking with increased risk of breast cancer as well as liver damage, other types of cancer and decreased brain function. Another threat is the role of alcohol in differing cultures. Some people choose not to drink alcohol at all.

The Product Sales Features

Exclusive

Sales features exclusive to GUINNESS products is a distinct dark creamy brew, the position as the only global stout available worldwide, it’s Irish heritage, the antioxidant compounds responsible for health benefits, and high iron content.  Health benefits however are never used by GUINNESS or Diageo as selling points. The company never makes medical claims for their drinks and they even run advertisements calling for “responsible drinking”. Positioning the product as healthy would be contradicting to these points.

Nonexclusive differentiating qualities

Beer in general has a wide spectrum of vitamins and minerals. One study showed that the darker the beer, the more flavonoids it contains making GUINNESS better for reducing risk blot clots in the body. GUINNESS is one of the lower alcohol beers. It has an ABV of 4.0, which is less than the watery brews labelled “light”. Coors Light has 4.2, Bud Light has 4.2, and Corona Light  has 4.5. Guinness Draught seems heavy, but it is actually one of the lowest-calorie, non-light beers there is. It has about 125 calories which is 44% less than other stouts.

Competitive position

The competitive position could be that GUINNESS has fewer calories for a full-bodied and full-flavored beer.  It would not be appropriate to officially position the beer for scientific health benefit findings since there is also risk of alcoholism and studies also link drinking beer to cancer.

The Product Research

Technological breakthroughs and improvements planned

The beer ‘widget’ was invented by GUINNESS so that Draught beers can be brought home in a can.

Fish bladder will soon be removed from the recipe to target a new audience of vegetarians and vegans.

Innovation in craft beer production is helping to drive net sales for GUINNESS. A marketing and branding campaign known as “The Brewers Project at St James’s Gate” was created to give new Guinness beers a podium. The new beers are craft porters, a golden ale and a blonde American lager.

The Company

History

GUINNESS® the company was officially born in 1759, when the founder, Arthur Guinness, signed a 9,000-year lease on a disused brewery at St. James’ Gate in Dublin. In 1769, the first export went out to England, 6 and a half barrels by ship. After Arthur’s death in 1803, the business was passed down through the family line. He himself has 21 children, so there would not be a shortage of possible inheritors.

  • 1759 Arthur Guinness (founder)
  • 1803 Arthur Guinness II
  • 1850 Sir Benjamin Lee Guinness
  • 1868 Edward Cecil
  • 1927 Rupert Guinness

in 1840 the first shipment of  GUINNESS set sail for New York. It was in 1886 the company became public on the London Stock Exchange. It was the largest brewery in the world during this time (1.2 million barrels produced per year)! With increasing exports, bottling began to happen locally to where the product was being sold and then in 1936 the first overseas brewery was built at Royal Park, London. The 1950s to 70s saw much expansion of GUINNESS being made in breweries around the world (see 50s-70s list below). But the next purpose-built GUINNESS brewery following London erected on Nigerian soil in 1963. That same year the last wooden keg was used. From then on it was only stored and shipped in metal. From the 70s to 80s, GUINNESS again gained wider ground seeing production in more breweries outside of Ireland. (see 70s-80s list below)

1950’s-1970’s expansion
  • Kenya (under contract by East African Breweries, for Kenya, Uganda and Tanzania, then Sudan and Somalia)
  • Trinidad (under contract, by Caribbean Breweries)
  • Sierra Leone (under contract with Sierra Leone Breweries)
  • Cameroon
  • Mauritius
  • Ghana
  • Angola (under contract by Eka Brewery)
  • Liberia (under contract by Monrovia Breweries)
  • Seychelles (under contract by Seychelles Breweries Limited
  • Jamaica (under contract)
  • Canada
  • Australia
  • New Zealand
  • Nigeria
  • Thailand (under contract, by Thai Amarit Breweries)
1970’s-1980’s expansion
  • Cote D’Ivoire (under contract).
  • Guyana
  • St. Kitts (under contract, by St. Kitts Brewery).
  • Singapore (under contract by Asia Pacific Breweries).
  • Haiti
  • Bahamas
  • Indonesia (under contract by PT. Multi Bintang Indonesia).
  • South Africa
  • Tanzania
  • Togo (under contract by Brasseries du Benin)

Size, Growth and Profitability

In 1997, the long tradition of being a family-owned business ended when Guinness PLC & Grand Metropolitan PLC merged to form English conglomerate Diageo PLC. The name comes from the Latin word ‘Dia’ for ‘day’ and the Greek word ‘Geo’ for ‘world’. In 2005, The Royal Park Brewery closed, but by this time GUINNESS was based in Diageo’s London headquarters instead of Dublin. Diageo operates in 21 geographically markets worldwide and leads the industry for premium drinks business. The conglomerate produces 6.5 billion liters of its spirit, beer and wine commodities each year from over 100 locations in more than 30 countries.

They have five geographical reporting segments listed here:
  • North America
  • Western Europe
  • Latin America
  • Asia-Pacific
  • Africa combined with Eastern Europe and Turkey

Diageo is most profitable in its North America segment, which includes U.S. Spirits & Wines, Diageo-Guinness U.S.A. (DGUSA), and Canada.

The full family of brands is listed below:
  • Global Giants: Johnnie Walker, Smirnoff, Captain Morgan, Baileys, Tanqueray, Guinness
  • Local stars: Crown Royal, Yeni Raki, J&B, Buchanan’s, Windsor, Grand Old Parr, Bundaberg Distilling Co., Bell’s, McDowell’s No.1, Ypio’ca, Cacique, Shui Jing Fang
  • Reserve: Johnnie Walker X-R The Legacy Blend, John Walker & Sons Odyssey, John Walker & Sons King George V, Johnnie Walker. Blue Label Trophy, Johnnie Walker Gold Label Reserve, The Singleton of Glen Ord, Ketel One Vodka, Ciroc, Tanqueray No. Ten, Zacapa XO, Tequila DonJulio, Bulleit. Bourbon

The company is listed on the London Stock Exchange (LSE: DGE) and the New York Stock Exchange (NYSE: DEO) The growth and profitability between 1999 and 2015 is shown below for each of these:

  • LSE: DGE – (1999 – 2015)Screen Shot 2015-11-15 at 00.00.39
  • NYSE: DEO – (1999 – 2015)Screen Shot 2015-11-15 at 00.00.14

Scope of the business

GUINNESS produces the world’s favourite stout beer. It also owns Smithwicks Irish Ale, created Harp Lager and makes Kilkenny. The business branches out beyond beer. In 1984 it opened the Hopstore to visitors at St. James’ Gate Brewery. This later became known as the GUINNESS visitor center in 1988 and since 2000 has been known as the GUINNESS STOREHOUSE™. This is the number one tourist attraction in Ireland. It showcases a special tour of brewing techniques, exhibits the company’s history of marketing, and pours visitors (of drinking-age) a free trial pint of the world’s favorite stout. It sees visitors from all over the world included many famous celebrities. The company also sells merchandise, emblazoned with its world-renowned branding.

Competence

This GUINNESS name is still standing after more than 250 years with huge sales world-wide which shows competence and uniqueness in the recipe it provides. These days GUINNESS is going beyond its product sales competence by implementing sustainability and responsibility initiatives that positions the brand as a corporate citizen. GUINNESS strives to support every link in its own production chain and goes beyond by helping to relieve problems of alcohol misuse in society, safeguarding water and the environment, contributing to socio-economic development of the communities in which they operate, providing employee support, integrating standards further down the supply chain, setting up a sound governance structure and code of business conduct and creating a culture that demands integrity all-round in its practices.

Reputation

Overall, GUINNESS has a great reputation. It is the only global stout brand available and is the world’s favourite stout. In 1992 the concept of the Irish pub moved across Europe and by 1998, 2,500 of them were selling GUINNESS Draught worldwide. GUINNESS is also known for the fun and creative marketing campaigns that capture the heart and soul of the brand. The company has won many awards for these campaigns throughout the years. In 1996, the Queen’s Award was given to GUINNESS for Export Achievement for the 3rd time. In 2004 the The GUINNESS STOREHOUSE™ welcomed its 2 millionth visitor since it opened in 2000. In the United Kingdom, an average Buzz score of 6.7 in 2014, ranking GUINNESS highest of leading beer and cider brands.

statistic_id310031_leading-beer-and-cider-brands-ranked-by-buzz-score-in-the-united-kingdom--uk--2014

Strengths

GUINNESS has been around for many years, therefore the business has considerable experience and knowledge for producing and exporting the product. The company also has a history of going beyond the bottom line too.  Arthur Guinness was a human rights advocate and the company has carried on Arthur’s philanthropic nature throughout the generations. This gives the company strength in the current market that requires businesses to practice corporate social responsibility. Since it is a traditional practice to care about the community, the company does not look as though the motivation is reactive to this demand, but more sincere and altruistic. GUINNESS also has strength in its marketing, historically and current. One example where a marketing effort exploded into a bigger thing is which the invention of the Guinness book of World Records. It was originally intended as a marketing giveaway, a compendium of little-known facts, invented to settle obscure debates one might find discussed in pubs in 1954.  It is now a publishing sensation. The merger into Diageo brought GUINNESS into the family with premium brand positioning and a large market in the U.S. and since 2000 North America brews its own GUINNESS Extra Stout. Innovation is another one of the GUINNESS strongpoints. In 1988, GUINNESS provided the first ‘widget’ beer, GUINNESS Draught in a can and won the Queen’s award for technological achievement. Following that, in 1999, Draught in bottles was launched using a new ‘rocket widget’.

Weaknesses

Being owned by a large conglomerate can also be seen as a weakness. Current trends show backlash and boycott from consumers on huge multinational corporations that cause harm to communities (socially and economically). This reputation is sometimes blanketed across all huge corporation without further investigation. For example, when a corporate sponsored holiday dubbed “Arthur’s Day” was organised by Diageo in 2009 to commemorate the 25th anniversary of GUINNESS, it was met with some negative publicity. Some high-profile artists even spoke out against the holiday and Huffington Post called it “Diageo Day”, criticising it as a marketing ploy to raise GUINNESS sales. The journal even called for a boycott of the event. Some other weaknesses for the company include the threat of widespread alcohol abuse damaging the reputation and the threat that fossil fuel and water shortages have on production and cost to consumers.