103 | The Revolution Reshaping the Drinks Ecosystem with Filiberto Amati (E.g. Diageo, Pernod-Ricard, Campari, Brown-Forman, etc.)

Show Notes

Episode Deep-Dive Analysis Available at maffeodrinks.com 

Filiberto Amati, Founder of Amati & Associates and Head of Partnerships at MAFFEO DRINKS, is a veteran of major spirits companies, including Campari and Di Saronno.

He dissects the seismic "shrink for growth" transformation, reshaping the global spirits industry.

Drawing from his deep FMCG expertise, Filiberto explains how spirits companies are finally adopting consolidation strategies that transformed consumer goods giants two decades ago—moving from "economies of scale" obsessions to a strategic "economies of scope" focus.

As Campari divests Cinzano, Brown-Forman sells Finlandia, and Diageo sells Pampero Rum, Filiberto reveals how this isn't random portfolio shuffling but a calculated response to activist investor pressure and economic uncertainty.

The conversation explores if mega-mergers are likely in the fragmented spirits industry, how mid-tier players like Gruppo Montenegro and Caffo are capitalizing on cast-off assets to build global scale, and why this inflection point will reshape competitive dynamics for the next 10-15 years.

Disclaimer: All analysis is based on publicly available information.

Timestamps:

00:00 Introduction and FMCG Context

02:15 Shrink for Growth Phenomenon Explained

06:30 Economies of Scale vs Scope

12:45 Industry Fragmentation Reality

18:20 Listed vs Private Company Dynamics

23:10 Mid-Tier Consolidation Opportunities

28:15 Future Industry Structure Predictions

Interested in Group Subscriptions, Keynote Presentations or Advisory? You can get in touch at [e-mail] or find out more at maffeodrinks.com 

Creators and Guests

Host

Chris Maffeo

Drinks Leadership Advisor | Bridging Bottom-Up Reality & Top-Down Expectations

Guest

Filiberto Amati

Founder | Amati & Associates

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This is maffeo drinks.
The direction where the these

companies are going to go, it's
going to reshape how the

industry looks for the next 1015
years.

Filiberto Amati is an old
friend.

For soul.
And a business partner he's an

associate of Maffeo Drinks and
he's the founder of a Amati &

Associates advisory working
especially with FMCG brands, but

not only he's a veteran of
Campari and Di Saronno.

In this episode we go through
the latest analysis that

Filiberto has been carrying out
based on press releases, media

articles and other stuff that is
publicly available.

We focus on what he calls shrink
for growth, the approach that

big companies are having in
divesting brands and refocusing

on what they believe to be the
core of their strategy.

So we have seen lately Campari
selling Cinzano to Gruppo Caffo

back in the days.
We've seen Brown Forman selling

Finlandia and at the same time
buying Gin Mare and Diplomatico.

We've seen Diageo selling
Pampero Rum to Gruppo

Montenegro.
So a lot of smaller and mid tier

players are growing and they're
growing faster through M&A.

The question is, are they going
to be consolidating?

All these sales and acquisitions
are changing the landscape also

from a distribution perspective
because middle sized companies

are actually getting a better
footprint into countries where

they didn't have a footprint.
So in this episode, we talk

about what's happening with
middle size company versus big

size companies, with listed
companies versus privately owned

companies.
If you look at the spirit

industry, mega mergers are
unlikely because of the conflict

of portfolio level.
Too many whiskey, too many

outcasts, too many.
We try to understand why these

things are happening and why
it's so different from what it

used to be in the 90s and 2000,
where we used to talk about only

economies of scale, now we talk
more about economies of scope.

Also to be noted is that the
situation is very fluid.

If you look at the trade news,
even between when we recorded

with Filiberto and when we
published this episode, things

that happened.
Gagio CEO has stepped down.

So whether you are a small brand
owner, the company professional,

you want to understand more
about what's happening in the

world, or spirits, this episode
is for you.

Let's dive in now.
Toffee, Roberto, welcome to the

Mafia Drinks podcast.
Hi, Grace.

Let me ask you about one of the
hot topics.

So some of your latest posts on
LinkedIn going viral.

Huge commenting and sharing on
the shrink for growth, what's

happening at the moment in the
spirits world and the wider

drinks ecosystem.
Let me step back because

actually this is something that
is happening in first moment

consumer goods for a while.
So if you look at M&A in

general, we had in the late 90s,
early 2000 a wave of big MMA

consolidation, PNG buying
Gillette, Nestle buying Purina

and so on and so forth where we
really created the mega super

huge groups.
The reason behind was that

economies of scale were thought
to be the northern light of

growth, OK.
Then there was a wave more

recently where a lot of brands
realized that scale, the fact

that you are huge in laundry
detergents doesn't mean you can

really be good at doing
batteries, for example, OK.

And so you had a lot of the
mergers and that's how Craft

demerge, Mondelez and Craft
Foods.

More recently, Kellogg's
separated in Kellanova and WK

Kellogg's, which ended up one
bought by Mars, the other by

Ferrero.
They understood efficiency and

economies of scope were more
important.

What do?
You mean by?

Ideation sees an economy of the
scope.

Economies of scope, they say
it's sparkless to become a

beverage expert.
You're going to become an expert

of a specific occasion or
specific sectors, putting

together necessarily breakfast
cereals with chocolate for

Christmas.
It's not ideal because it's two

different it's categories which
are not really close to each

other.
They don't build on each other.

By trying to create synergies,
you eliminate nuances that they

need.
That's why Miss Le is carving

out Miss Le water from the
sleigh because the two don't

actually help each other.
Being under the same umbrella.

OK.
Because selling some Pelegrino

and Aqua Panda, it's not the
same as selling chocolate

snacks, trying to build
synergies between the two of

them which are not adjacent.
You're actually making choices

that don't help Nestle Waters
and don't give scale to the

chocolate business you have.
Perfect.

OK.
That's what I mean.

Adjacencies.
Unilever is spinning off the ice

cream division.
Ice cream is a specific route to

market where you make deals like
you are in spirits and you have

the fridges and then you have
the products in the off premise.

There is this change.
Now it's about specialization.

Rather than growing in all
different directions, we are now

in an economic cycle whereby you
need to focus.

You're not going to have without
clarity, without the right

resources, without the right
investments, you're not going to

be able to grow brands in your
portfolio just because of

portfolio deals.
Now we are shrinking for growth.

I am going to get rid of
products that in My Portfolio,

brands in My Portfolio don't
make sense and focus on the

brands that make the most sense.
By selling those, I have more

resources and I can focus on
what drives growth and scale.

Brown Forman's gets rid of
Philander.

Campari gets rid of Chinzano.
Nori Card is rumored to be

dumping Mama for example, so
they don't need them.

Diageo is rumored to be looking
into buyers for Guinness, which

is a bit the exception to the
rule of the portfolio.

And this comes at the same time
where last year Diageo created

Diageo luxury groups.
They had the prestige versus

mainstream.
Now they created a separate

entity to manage super premium
brands because they come to the

realization that those brands
have dynamic that are completely

different from investors.
Understand it's fine for that to

happen and at the same time true
Mord, it's not official, but the

Nautica which is based on the
House of Whiskeys, House of

Vodkas and so on, it's less
centralized organization is

trying to build a more
centralized binomial

organization where we have a
luxury groups on one side and

mainstream on the other.
As the drinks industry come late

to the game versus the other
FMCG.

No, no.
My understanding is that the big

driver of for growth is activist
investors.

For example, right now activist
investors are putting pressure

on Kraft Heinz to split into two
different companies, Kraft and

Heinz.
OK, like the carve out of Nestle

water, like the carve out of
Magnum ice cream, which is now

several components from Unilever
in the spirits industry.

The trick is that the industry
has several big players but is

not as consolidated as the other
industries.

So in, in, in laundry
intelligence, the top three

players have probably 80% of
market share of cumulative

market share.
In the ice cream business, the

top five players have probably
80% of cumulative market share

in the soft drinks.
You know, three companies do

what, 90% of the volumes in the
spirits?

No, In the spirits, the top ten
companies have 1/4 of the total

global volume.
So it's not that the industry is

late.
The industry is not as

consolidated as we think it.
It's due to the diversity and

the fiscal and legal regimes
that make distribution very

local.
You hardly have a player who's

strong everywhere.
The agile is strong in certain

markets.
For example, recently in France

this year build their own
distribution company because

they had their joint venture
with Moe AC Yes, in France,

Pernod and Ricard had their own
separate distribution companies

and they're merging it.
Brown formerly launched in Italy

this year, I mean, and Jack
Daniels was a Jim Murray are big

brands in Italy for a long time.
The industry is not just

consolidated then you see that
because your competitors are

still distributing, yeah.
I mean the, the, the

relationships are very in, in
chest was in in that sense, not

because you are absolutely
together with a distribution

company, then you are in another
market, but then you are

distributed by the same
distributors in a third market

and in distribution and in route
to markets.

It's very similar to the
categories.

There are these big waves.
There's the, the moment

everybody hires brand
ambassadors.

The moment is some companies
fire brand ambassador, but then

another company is hiring them
because they are pushing and

putting all their eggs in the
basket of brand ambassadors.

Same thing with distribution.
Like there's the wave of let's

go indirect because it doesn't
make sense to be direct.

And then at the same time in
other markets, they go direct

because it doesn't make sense
because they want to integrate

themselves.
It's a very interesting

ecosystem to play in because
often there is always this

looking for shortcuts, a
decision that will make life

easier and solve all your
problems.

But if you don't solve the
problems that the at

foundational level, then no
route to market is gonna save

you if you.
Look at the spirit industry.

Mega mergers are unlikely
because of the conflict of

portfolio level.
Too many whiskey is too many

world cuts, too many genes.
OK.

But the shrink for glut, you've
seen that Cafos doing

acquisitions this Anon was going
to probably looking into

acquisitions and has done few
acquisitions in the past stocks

periods which is you know
private equity owned is doing

add-ons which are both portfolio
11 but also distribution level

acquisitions.
So a lot of smaller and mid tier

players are growing and they're
growing faster through M&A.

The question is, are they going
to be consolidating with KAFO by

a same size company next maybe
AUS based company where they can

build synergies in distribution
of the KAFO products in the US

and vice versa the American
products in Italy and Europe.

And so that's that's where there
is going to be mounting pressure

as well of Bernardo and the
Agile because right now you know

it's a group of 5-6 and the
others are distant.

But when the others are merging,
then the group of five and six

is going to be our group of
seven, a group of eight, a group

of nine and group of 10.
At that point, there is going to

be some consolation in the
industry.

It also depends how, how tough
and how long this economic cycle

is.
The uncertainty due to American

tariffs and what's happening in
China, nobody really knows.

But are they things?
They will have enough run away

with the high debt to reduce the
debt and keep growing on their

own.
But can they?

And if they can't, the Bombay is
not listed on the stock market.

You can go to the stock market
and ask for more cash.

Let's dive into this.
Whether they are big or small,

some of them are listed in the
Stock Exchange, some of them

aren't.
Do you see different approaches?

Can we get an insight on listed
companies seems to do this and

non listed companies seems to do
that or we cannot really group

insights like that?
That's an issue, man.

List of companies drop any long
term planner for the next

quarter and we are living in a
cycle where CEO tenure is down,

CMO tenure is down and they're
changing fact because investors

are actively pursuing change.
If the direction of the change

is right, but the speed of
change is not fast enough, they

will do the change.
I mean it's like Campari changed

Co three times in a year.
Remi Guantrou recently made a

change.
I think it's a very interesting

letter that the exiting Co about
the industry that was part of

the problem with the industry
and the expectations of the

industry, which is a traditional
industry.

And then everything about last
year plus 6%.

Thomas, a cry for help from the
industry to itself and the

investors.
Let's be honest, it's going to

be more difficult to drink
alcoholic.

There is this story whether Gen.
Z or not, drinking or drinking

and I don't want to know what
they're claiming they're doing.

But spirits volumes are not
going up.

Beer volumes are not going up.
Wine volumes are not going up.

Non alcoholic is a factor.
So the spirits industry, if you

compare volumes and revenue size
versus beer and soft drinks,

it's a very small animal.
Very small.

So if blavification is a
phenomenon and these guys can't

distribute themselves because
they need the beer companies or

the soft drink companies to
arrive to the end consumers, and

this is except for the US, then
is there a long term viable

spirits industry separated by
beer and wine and soft drinks?

Is there an element of
perception that the spirits in

this is an FMCG?
And I even mentioned that

mistakingly, you know, earlier,
you know, I called it FMCG but

but it's actually a slow moving
consumer goods.

I remember we discussed this
with Alex Suziel back in the

days.
Is that a reason there has been

so much migration into spirits
roles from historically FMCG or

CPG, fast moving consumer goods,
Consumer Packaged Goods into the

spirits world and they have
brought practices from the FMCG

world.
Even beer, the closest thing in

FMCG to spirits.
And it has changed the mindset.

And he made his mindset much
more modern.

Trade driven off trade driven,
promotion driven without

realizing that you may buy a
bottle of whiskey once a year,

that every Joe may buy a bottle
of whiskey maybe once every two

years unless they buy for a
present and then you just

recycle that bottle that you
never open and bring it to the

next dinner.
You're confusing it with beer

occasion.
Which?

Are.
Very much fast moving.

For me, the fast moving, it's
where we get confusion in the

sense that I don't think the
fast moving consumer goods are

actually fast moving at all.
When I was in PNG, when you miss

a promotion it takes you
probably 3 months to get into

the data reading that it didn't
go well.

To counteract that it takes
another three to six months.

So if you are driving a car and
it takes you nine months between

understanding that you miss your
exit and then you need to change

your route and finally being
able to do so, I don't think

it's fast moving at all,
especially when you compare it

with technology.
I know start-ups that in nine

months have changed name, pivot
strategy, CEO companies and

marketing allegation.
So for me that is a non issue.

But I agree there is this idea
that you can build a brand.

This is also very true in food
and beverages from the external

that it takes you just, you
know, a six months hype to build

a brand.
Look what has happened with

Prime Beverage from Doctor
Beast, which is a huge brand.

They launched this in two years.
The initial hype gives you not

all ID.
But then getting distribution

velocity, on premise, velocity
of premise, the right

investments, the right teams,
the right conversations with

trade and trade in general.
It's like, OK, we've got a list

on the on premise, on the off
premise.

Great.
And then you think that this

happens in two weeks?
It takes 2 weeks to be able to

set up a meeting, which probably
is going to be in the next 2-3

months.
You know, a six months.

Negotiation.
And then it's Christmas again,

no new listings.
Suddenly it's February and it's

like, what was that?
You changed the plot, the label,

and the label is not compliance
and you don't have to.

And so on and so forth.
So these processes really take a

lot.
Of so, if I understand

correctly, the issue's twofold.
One thing she's saying is that

my question on is spirits
mistakenly considered FMCG?

Actually, it's the FMCG that is
mistakenly.

Mistakenly considered moving
exactly.

But then I would still push my
approach.

It's easier to find scale if
fast moving consumer goods.

If you do 99% of your volumes in
modern trade, once you have

listed your laundry detergents,
you don't have any other

channels where you can list your
more.

The other channels are going to
come to you.

Whereas with beverages, starting
with the on premise, but it's

only beverages, specialty food
in general as well starting with

the on premise before you build
scale.

It's a trip around the world.
The.

Best if we take Campari as an
example to clarify for myself of

the listeners, when I read the
news about Campari, on one end I

see they buy Corvusier and on
the other end they dismiss

Ginsano.
So in that shrink for growth?

It's a cycle.
Part of the issue that Pernod

Ricard and jail is that they
have done a number of

acquisitions because more growth
comes from newer things that are

technical.
But but they bought how many 7-8

jeans in a decade?
Something like that.

Yeah, and the same compared,
they bought Montelobos, Mezcal,

other minor brands.
The interesting thing was what

you were writing about, the
focus on certain companies that

would do.
Billions.

Of turnover a few millions
revenues, brands are a

distraction.
That's where the economic cycle

always plays a role and
investors always play a role

because when the economic cycle,
it's positive, OK, So your

organic growth, it's coming by
doing nothing, then you pursue

more growth by doing these bets.
And by the way, it's completely

Gracie.
And you know that as soon as

that reverse, then you need to
go back to the basics and focus

your investment for your organic
growth.

And then you're going to not
have enough cash and so you're

going to get rid of some of the
bets that you have done in the

past.
It's like eating you like a pig

to get fat and then get you on a
diet.

It's as simple as that.
It's the foie gras strategy.

What is also interesting is the
fact that within that, what you

were saying before, a management
has changed.

There has been a management for
growth and then there is a

management for shrinking.
In the meantime, you change the

trainer at the gym.
The first trainer told you to

eat a lot of steaks and the
second one tells you to get lean

on the treadmill.
This is also the element of

listed companies versus
privately owned.

If we go to privately owned, is
there less pressure?

We see a lot of changes in
privately owned as well.

There is a bit less changing
pace let's say.

Do they take decisions more for
the long term or at least?

Allegedly who wants them if
they're family companies?

There is always the end game of
building and continuing the

generational pursue.
OK, you are building for the

long term.
They don't care about 1/4 or two

quarters.
They don't have to panic or cut

travel at the end of the quarter
to save money.

Then you have companies like
Bacardi which is family owned

but it's 6th generation.
So many different interests,

it's harder to understand what's
going on.

They're cleaning on the
Financial Times.

They don't need to do any
changes.

They did the instruction 2 years
ago in the United States where

they cut a lot of jobs.
They are over leveraged in terms

of debt.
But on the other hand, you have

then companies like Bernard
Ricard, OK, which is family

owned because the CEO is Ricard.
But they are listed on the stock

market.
And for a long time they try to

build, but sometimes they need
to go back because they

understand that their ability to
finance depending on how happy

is the investors.
And if the investors are happy,

the stock market, the stock
reflects that.

And if the stock doesn't reflect
that, banks are not going to

give them money.
There are a number of realities

to that.
But you know, a family company

traditionally is able to make
bets in the long term.

Look at Kafo Stock Spirits.
It's private, but it's owned by

private equity.
So they're doing a very

effective stocks, you know, add
on strategy by adding brands, by

adding distribution companies.
But we also have sooner or later

these companies, we want a
return on what they've invested

and that return, it's going to
be either an exit through an IPO

or by selling the company.
So usually these guys have very

process intensive and cost
focused.

They're not going to do a step
longer than they should.

I think right now we're seeing
in the direction where these

companies are going to go, it's
going to reshape how the

industry looks for the next 1015
years do.

You think we are at one of
those?

Inflection points.
Very interesting.

So one last one last recap on
final thoughts from your

perspective.
This is.

Going to be very interesting for
the beverage industry in

general, spirits and on spirits,
I expect a lot more transactions

happening and unfortunately
talent looking for jobs in the

next few months because a lot of
this shrinking for growth also

happened with cost cutting for
growth so to speak.

In terms of outlook positive.
I mean, people are going to

still drink probably less, I
didn't less, but they still

enjoy Negronis once in a while.
And I'm not the typical

consumer.
So don't make your foreign gas

based on me.
But definitely there is going to

be a lot happening.
But as long as we keep focusing

on the consumers and generate
unique insight and as you say,

because you're brilliant in
saying that making sure that

when you go to the on premise,
you actually solve the problem

for the on premise, not just add
another bottle, but really solve

the problem, then everything is
going.

To be How can people get in
touch with you?

Feel better?
Through LinkedIn or my podcast,

Growth brands and more on
Spotify and weather Follows, you

all usually can easily find me
as well or amati-associates.com.

Fantastic.
Thanks a lot, Fili Bet it was

very insightful.
It was a master class.

I think it would be precious
episodes for our listeners.

Thank you so much.
Thank you.

That's all for today.
Thanks for listening to my fair

drinks.
I hope you enjoyed the insights

that Filiberto brought to the
table.

I learned so many things that I
didn't know about or I never

thought about in that way.
The biggest take away is this

shrink for growth, the fact that
we are moving from economies of

scale to economies of scope.
What's happening with middle

sized companies, with big
companies, whether these are

listed on the Stock Exchange or
they're privately owned or they

are owned by a fund.
The big thing that Philibert is

saying is that we are probably
experiencing something that it's

going to shape the industry for
the next 10-15 years.

And I think it's probably right.
Again, the disclaimer, all these

information are based on public
publicly available sources,

whether press releases or
industry articles or interviews

and everything that is in the
public knowledge of to everyone.

So I hope you enjoyed.
It if you would.

Think of a couple of persons,
colleagues or friends in the

industry that will benefit from
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