We strictly adhere to regulations and promote responsibly: Varun Koorichh, Diageo

How was the transition for you from a highly unrestricted category like Pepsi to a category like alcohol with so many restrictions?

The transition was initially frustrating. In this category, there are a lot of limitations – media darkness, so to speak. But when you look at the changing media landscape, traditional advertising, such as 60-second ads, is slowly disappearing. Today, digital channels and influencers drive marketing, and liquor brands, especially in India, are leading the game. We focus more on experiential marketing, PR (public relations) and publicity. Being at the point of sale, both internally and externally, is all about getting people to interact with the product, which feels like a throwback to old-school marketing.

How do you balance the constraints of alcohol advertising while still reaching your audience?

Despite the restrictions on alcohol marketing, we can still use three of the four classic Ps: product, price and place. We focus on experiential marketing and let the products speak for themselves. Alcohol consumers are more engaged than in categories like Pepsi. They pay for quality and want to be associated with brands that resonate with their values. Our marketing reflects this – whether through advocacy or creating meaningful brand experiences.

ALSO READ | “The beautiful future is personalised, sustainable and powered by artificial intelligence”

Alternative advertising has been reviewed. How do you manage this at Diageo?

We do not consider our brand extensions to be replacement advertising. These are legitimate business extensions in adjacent categories. We fully comply with all advertising regulations. In fact, three years after launching the brand extension, we can only spend up to 50% of our revenue on advertising, and we monitor that very closely.

(The Advertising Standards Council of India Code stipulates that the advertising budget for brand extension shall not exceed 200% of sales in the first and second years after product launch, 100% of sales in the third year, and not exceed 50% of sales, thereafter no more than 30% of sales).

How do you meet the growing demand for inclusivity in advertising?

We have moved to purposeful brand positioning. Inclusion is at its core, whether it’s representing differently-abled people, women or the LGBTQIA+ community. For example, we recently launched a campaign for McDowell featuring Kartik Aaryan, where he learned sign language for his friends. We even took over major Indian newspapers and advertised in sign language to spread the message.

What role do influencers and digital play in your marketing strategy?

Influencers and digital platforms are crucial. About 50% of our marketing budget is spent on events and 30% on digital marketing, which includes influencers. For mass brands like McDowell’s and Royal Challenge, we still need to reach a broad audience, so mass media such as TV and film are still important. But digital and influencer marketing help us engage with young consumers in a more meaningful and authentic way.

Can you tell us more about the key brands and their positioning within Diageo’s portfolio of prestigious brands?

Our reputation portfolio includes some of India’s most recognized and trusted brands. We stock the world’s best-selling McDowell’s No. 1 whiskeys, Royal Challenge whiskeys, signature whiskeys and vintage whiskeys. Each brand caters to a different consumer segment, but all focus on quality and tradition. McDowell’s is our flagship brand, known for its rich heritage and mass appeal. The Royal Challenger represents audacity and is closely associated with cricket and sportsmanship. Signature is a leader in sustainability, with its activities centered on nature and craftsmanship. Ancient times represented refined luxury, aimed at upper-class whiskey drinkers. We also recently launched Royal Challenge American Pride (RCAP) to meet the needs of high-end consumers looking for innovation and quality. Each brand plays a key role in meeting the diverse needs of consumers while reinforcing Diageo’s leadership in premium markets.

ALSO READ | Strike a balance between inclusivity and entertainment in your ads

Does McDowell’s premiumization risk cannibalizing your mid-tier portfolio?

Not really. The alcohol market in India is growing rapidly and there is room for everyone. McDowell’s is the world’s best-selling whiskey with a 125-year history. Going premium is a natural move as today’s consumers seek quality, experiment with different options and embrace new-age brands that reflect their identity.

How do you address distribution challenges across states with varying policies?

We comply with each state’s government regulations and adjust our strategies accordingly. Pricing and policies may vary, but consumption continues and we ensure compliance. Diageo is committed to responsible marketing and educates consumers about responsible drinking through programs such as “Drink Better, Not More”.

Sustainability is increasingly important to consumers. What is Diageo doing in this space?

Sustainability is key to our brands, especially Signature, which leads our sustainability efforts. Our activities, such as our iconic mangrove restoration project in Odisha, demonstrate our commitment to protecting nature. We’re always looking for ways to align our brand with sustainable practices, ensuring we don’t just talk the talk but walk the walk.