Diageo: Repositioning the World's Biggest Drinks Company for a Generation That Is Drinking Less
Diageo owns Johnnie Walker, Guinness, Tanqueray, and dozens of the world's most recognised drinks brands. Its core customer is drinking less. What does repositioning look like when the market itself is contracting?
Ross Hastings and Kieran Antill
Co-Founders, Ne-Lo
Diageo is not facing a brand problem. It is facing a behaviour change. When your customers stop doing the thing your entire business is built around, repositioning has to go deeper than the marketing.
This is episode nine of Making Moves, a weekly mini-podcast where Ne-Lo co-founders Ross Hastings and Kieran Antill pick a company making an interesting strategic move and interrogate it. Unscripted, unedited, under 15 minutes. The Diageo episode was recorded on 19 June 2026.
This week: Diageo.
The sober curious movement
Alcohol consumption is declining in most developed markets, particularly among younger adults. The sober curious movement, the rise of non-alcoholic alternatives, and a broader cultural shift toward wellness have combined to create a structural headwind for the drinks industry.
Diageo is the world's largest premium drinks company. It owns more category-defining brands than any other business in its space. And its core market is shrinking.
This is not a repositioning problem in the traditional sense. Diageo's brands have not drifted from their positions. The positions are clear, well-established, and still meaningful to the people who drink. The challenge is that the number of people who drink, and how often they drink, is declining.
The portfolio response
Diageo's strategic response has been primarily through the portfolio. Investments in non-alcoholic and low-alcohol alternatives. Partnerships with brands in the adjacent wellness and premium beverage space. The explicit acknowledgment that the future of the drinks market is not purely alcoholic.
This is a sensible hedge. The Guinness brand, for example, has extended into Guinness 0.0 with genuine commercial success. The taste profile is close enough to the original that it serves the same social occasions without the alcohol. That is a product repositioning that does not require the brand to change what it stands for.
The harder question
The more difficult strategic question for Diageo is whether the premium drinks category itself is repositioning in the market's mind.
For decades, a bottle of Johnnie Walker Blue Label was a signal. It said something about the person giving or receiving it. As drinking becomes less socially universal, that signal weakens. The gifting occasion, the celebration ritual, the status marker. All of these are tied to cultural behaviours that are evolving.
Diageo can make excellent non-alcoholic products. But it cannot easily transfer the cultural meaning of its alcoholic brands into those products. The meaning is tied to the experience. And the experience is changing.
The moderation positioning
Diageo has also leaned into moderation as a brand value. Responsible drinking messaging has evolved from a compliance exercise into something closer to a genuine brand position. The argument is that Diageo brands are for drinking well, not drinking more.
This is a positioning move that acknowledges the cultural shift without abandoning the core product. It also differentiates against cheaper competitors who compete on volume rather than quality. A premium brand aligned with moderation has more credibility than one that implicitly encourages excess.
What to watch
The test for Diageo is whether its non-alcoholic and low-alcohol portfolio can generate genuine growth that offsets the decline in the core category, or whether it remains a hedge on a trend that may or may not accelerate.
The company has the brands, the distribution, and the resources to make this transition successfully. The question is timing. If the decline in alcohol consumption accelerates faster than the alternatives can grow, the portfolio strategy comes under pressure. If it plays out gradually, Diageo has time to build the new businesses while defending the old ones.
Making Moves is a weekly mini-podcast from Ne-Lo, Australia's repositioning consultancy. New episodes every Friday.
