Carlsberg bolsters marketing investments to drive growth in premium brands

By Joseph Ekeng

In a bid to amplify its market presence and stimulate brand growth, Carlsberg has unveiled plans to intensify its marketing expenditure, adopting a “selective” approach to ensure optimal returns. The renowned beverage conglomerate, with a portfolio featuring iconic names like Estrella, San Miguel and Somersby cider, in addition to its eponymous flagship brand, reported a notable 7.2% rise in marketing investments during the initial half of the fiscal year.

While the proportion of marketing spend relative to revenue exhibited a minor dip in the last quarter, Ulrica Fearn, Carlsberg’s Chief Financial Officer, reassured investors that this decline is not of substantial consequence. Fearn unequivocally pledged the company’s continued escalation of marketing investments in absolute terms. The forthcoming investments will be meticulously allocated to areas projected to yield the highest returns, a strategy exemplified by the deployment of funds to drive the premium segment of the business.

“We are unequivocally committed to investing in our marketing endeavors, fortifying our brand presence, and elevating our premium offerings,” Fearn articulated confidently, asserting the company’s dedication to an effective and discerning approach,” he said.

The acquisition of the revered Kronenbourg 1664 brand, formerly licensed under Heineken, stands out as a significant milestone for Carlsberg in its pursuit of expanding its premium portfolio. Fearn emphasized the company’s intention to “unleash the long-term growth potential” of this emblematic brand through strategic marketing investments. The success of Kronenbourg is a vital facet of Carlsberg’s overarching strategy to enhance its premium business division.

Cees ‘t Hart, Chief Executive of Carlsberg, conveyed the company’s satisfaction in witnessing its premium portfolio’s strong performance. “Our premium brands are consistently outperforming in various markets, a testament to the robust support we provide to these brands,” ‘t Hart stated confidently.

The first half of the year saw the premium portfolio recording a remarkable 3% increase in volume sales compared to the same period the previous year, outpacing the overall portfolio growth rate of 0.8%.

A standout performer in the portfolio was the Brooklyn Brewery brand, which experienced an astounding 50% surge in volume sales during the initial half of the year. The brand’s largest market, the UK, witnessed a particularly impressive response to its Brooklyn Pilsner product.

The first half of the fiscal year also brought substantial financial growth for Carlsberg, with revenue surging by an impressive 11.2% to reach 37.79 billion Danish Krone (£4.35 billion).

Demonstrating its commendable financial resilience, Carlsberg achieved a commendable 5.2% growth in profits, resulting in a total of 16.88 billion Danish Krone (£1.94 billion) during the same period.

The consistent and robust performance displayed throughout the year prompted Carlsberg to revise its profit projection for the entirety of the fiscal year. The company now anticipates organic operating profit to expand within a range of 4-7%, a substantial upgrade from its previous guidance which projected growth between -2% and 4% for the year 2023.


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