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Diageo has announced the formation of the Diageo Luxury Group, a new division that will unite its high-end spirits and brand experiences under one umbrella.

This move represents a shift in the company’s approach to the rapidly growing luxury spirits market, which has seen a surge in demand, particularly among younger consumers.

The Diageo Luxury Group will oversee a portfolio that includes prestigious brands such as Brora and Port Ellen, alongside brand homes like Johnnie Walker Princes Street and Justerini & Brooks, one of the UK’s oldest fine wine and spirits merchants.

This consolidation allows Diageo to better manage its luxury assets and create a cohesive strategy for innovation and consumer engagement in the premium segment, which is currently the fastest-growing price tier in international spirits.

Julie Bramham, former global brand director of Johnnie Walker, has been appointed managing director of the new group. Under her leadership, the division aims to accelerate growth for brands priced at $100 and above, leveraging long-term consumer trends that favour premiumisation and experiential luxury.

The luxury spirits market, valued at $12.7 billion, has been growing at a compound annual growth rate of 12% in volume and 18% in value since 2020, according to IWSR data.

The new group will focus on key global markets, with particular attention to influential cities and the UK, the home of Scotch whisky. This aligns with Diageo’s broader strategy to enhance its luxury brand positioning while also catering to a growing base of affluent consumers seeking unique experiences.

In addition to managing luxury spirits, the Diageo Luxury Group will enhance its private client business, offering exclusive access to rare and exceptional products. This includes the Casks of Distinction programme, which allows clients to purchase individual casks of rare Scotch whisky, further tapping into the trend of personalised luxury experiences.

The establishment of the Diageo Luxury Group comes as Diageo Great Britain launches the Diageo Luxury Company, which will operate within a broader price point of £30 and above. This initiative aims to build locally relevant luxury brands and memorable consumer experiences, featuring products like Don Julio, Johnnie Walker and Cîroc.

The formation of the new division reflects an industry-wide recognition of the importance of luxury branding in the spirits sector. As consumer preferences evolve, companies are increasingly focusing on creating distinct identities for their premium offerings.

Industry analysts suggest that the success of the Diageo Luxury Group will depend on its ability to navigate the complexities of the luxury market, including maintaining the authenticity and heritage of its brands while innovating to meet modern consumer expectations.

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