Retailers are missing the mark online: Pernod boss

04 September, 2014

Retailers need to do more to embrace online shopping and recognise that the market is changing, Pernod Ricard UK managing director Denis O’Flynn has warned.

“The off-trade is at a crossroads,” he told OLN. “The traditional way of shopping is changing.

“Retailers are going to have to look at that, and if I look at some retailers’ websites they are more, or less, attractive depending on the level of development.

“At the moment there is an opportunity for any one of the major players to step up to that mark.

“We have all been a bit remiss. We have recognised the opportunity, but have we done anything about it?”

Digital media is a major focus for Pernod Ricard and more and more of its media spend will go into that arena and other, non- traditional marketing such as experiential events.

O’Flynn said: “The UK consumer is very digitally savvy and is moving rapidly into the online arena.

“If you look at younger consumers, the way they consume media, products and everything else is quite different, and we have got to be aware of that [when we look at] ways of communicating with them.”

O’Flynn was speaking at Pernod Ricard’s 2013/14 results announcement, where he reported that PRUK’s brands outperformed the market, with wine sales up 11% in the off-trade compared to 1% growth overall, and spirits up 8% against category growth of 5%.

He claimed the wine growth in particular was a “very positive story” because the group has the highest average price point of the major players in the UK at £6.62, but is still growing more strongly than they are.

“If you can be growing 11% at a price premium that’s a great place to be,” he said.

Overall Pernod Ricard has reported flat global sales in a year when it saw a dramatic collapse in China, where revenue fell by 23%.

Europe, which has been a troublesome region for global spirits players in recent times, was among its best-performing regions with sales up by 2% in the year to June 30.

Chief executive officer Pierre Pringuet said the global picture had proved “more difficult than anticipated”.

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