Carlsberg's Bold Commitment: Strategic Marketing Reimagined for Unleashing Maximum Impact

Carlsberg, along with its brands Estrella, San Miguel, Somersby cider, and Carlsberg, has made a commitment to increase its marketing spend. However, it plans to deploy this investment selectively in order to achieve the highest possible returns and drive brand growth. During the first half of its fiscal year, the company saw a 7.2% growth in marketing investments.

Marketing spend as a ratio of revenue decreased in the quarter. According to Ulrica Fearn, Carlsberg's chief financial officer, this decrease was not significant. She assured investors that the company will continue to increase its marketing investment in absolute terms. This investment will be selectively deployed in areas where the company expects the highest returns.

We are committed to investing in our marketing, brands, and premium business in a clear, selective, and highly effective manner," she asserted.

During the first half of the year, the company acquired ownership of the Kronenbourg 1664 brand in the UK, which was previously licensed to Heineken. Fearn expressed the company's intention to maximize the long-term growth potential of this iconic brand through strategic marketing investments.

The Kronenbourg brand is classified as part of Carlsberg's premium portfolio, which the company has been prioritizing for the long-term growth of the business. Today, it informed investors that its premium portfolio is performing well. "We are generally outperforming in the premium segment across markets, thanks to our strong brands and the extensive support behind them," stated CEO Cees 't Hart.

The premium portfolio experienced a 3% increase in volume sales compared to the same period in 2022, surpassing the overall portfolio growth of 0.8%.

The volumes of its Brooklyn Brewery brand increased by 50% during the first half of the year. The UK market, especially the Brooklyn Pilsner product, showed a particularly strong performance for the brand.

In addition to experiencing organic volume growth, the company achieved an 11.2% increase in revenue during the first half of the year, generating 37.79bn Danish Krone (£4.35bn). Furthermore, profits in the period grew by 5.2% to 16.88bn Danish Krone (£1.94bn).

Carlsberg upgraded its profit forecast for the full year due to its strong performance in the year to date. The company now anticipates organic operating profit to increase by 4-7% in the year, up from its previous forecast of -2 to 4% growth in 2023. However, despite these positive changes, Hart cautioned that Carlsberg has observed some adverse effects from unfavorable weather conditions in Europe during July.

“Volumes are volatile when weather is bad,” he stated, saying it had been hard to get a clear picture of consumer sentiment in Western Europe in recent times due to the impact of bad weather.