Campari is celebrating Aperol Spritz being the most mentioned cocktail online in 2020, plus its Australian sales jumping 20% in the past 12 months.

Italy, the home of Aperol, accounts for 31% of the brand’s total sales and has been badly affected by lockdown restrictions. As a result, Aperol’s performance was described as “flattish” in the company’s 2020 results, which were released this week.

CEO Bob Kunze-Concewitz said Aperol “would have grown double digits” globally if it wasn’t for the pandemic. However, the brand is continuing to grow by double-digits in key off-premise markets, particularly Germany, which was up 31%; the US, which was up 66.5%; plus continued double-digit in Russia, Switzerland and UK.

“With regards to Aperol, I’m pleased to say that we’ve been able to actually attract new consumers into the franchise,” Kunze-Concewitz noted in an analyst call. “I mean the data is showing that because what we’ve done is offered ready kits in both the off premise as well as in the on premise. It made it as easy as possible for consumers and that’s paid off.”

Australia’s off-premise boom

Campari reported net sales of €1,772.0 million, down 4.1% in 2020, largely due to the impact of renewed lockdowns in the fourth quarter.

Kunze-Concewitz said there was continued sustained growth in the off-premise skewed markets such as the US, Canada,
Australia and Northern Europe, which helped mitigate weakness in on-premise led markets, mainly Italy, as well as the
Global Travel Retail channel.

Sales in Asia Pacific make up 7.4% of total group sales and were up 4.6% in 2020, which Kunze-Concewitz described as a “tale of two stories”.

“On the one hand Australia doing extremely well, growing 20.2%, a very positive performance in this off-premise skewed market. And importantly, the mix was also very good with Wild Turkey ready-to-drink, Wild Turkey Bourbon, American Honey as well as our European imports doing extremely, extremely well.

“Sell-out trends in the off-premise remained strong. We were up 22.6%. And we’re continuing to see good momentum in that market.”

Australia registered on-going positive trends in the peak fourth quarter, up 18.7%.

“The rest of the region was actually impacted not only by the restrictions of the pandemic, but also by destocking ahead of route to market changes,” Kunze-Concewitz said. “This impacted Japan during the year. But towards the end of the year China, there we will be changing our distribution network on the first of March this year as well as New Zealand.”

Campari core brands remain strong

Campari said that its financial results in 2020 were “resilient” given the very challenging context of COVID-19, with sustained growth across key off-premise brand-market combinations mitigating weakness in on-premise.

That strength was boosted by resilient home consumption trends.

Wild Turkey grew by 4.9% after an acceleration in the fourth quarter driven by the core markets of the United States and Australia. Off-premise sell-out data in the United States remained strong, with the Wild Turkey franchise up double-digit in 2020.

Espolòn was a big mover for Campari, up 29.9%.

Kunze-Concewitz said: “With regards to Espolòn, I think we’re very, very close to upgrading the brand into another cluster. It’s a great brand. It’s resonating across all consumer segments in whichever country we go into at this moment in time we’re trying to reserve as much volume possible for the US which is our number 1 priority. That might slow down some international rollouts.

“But there is no question that this is going to become quite a meaningful brand for us. And that we believe there’s an opportunity for tequila outside of the US which doesn’t necessarily have to grow through the Margarita. Actually what we’re really pushing internationally is the Paloma, which is Espolòn Blanco with fruit juice, and that’s resonating very, very strongly.”

The outlook for 2021

“Looking at 2021, although our brands continue to be very healthy with strong consumer pull, our outlook remains
cautious mainly due to the uncertain timing related to the on-going restrictions and the vaccine roll-out affecting the on-premise channel across all geographies and Global Travel Retail,” Kunze-Concewitz said.

“Meanwhile, we will continue to leverage the digital and on-line investments, along with a dynamic omni-channel approach, to rapidly adapt to the ‘new normal’ environment, particularly with regards to e-commerce.

“We expect the home consumption to remain sustained, particularly in the key offpremise markets, including the United States, where, with destocking activities completed, the shipments are expected to progressively align with consumption trends. In the long run, as the out-of-home social experience and conviviality will remain essential to consumers’ lifestyles, thanks to our strong brands’ health we remain confident of a favourable development of our business.”

The Aperol Spritz opportunity in Australia