How Aperol Made a Splash in the Campari Portfolio
Under Campari's stewardship, Aperol's revenue has grown by more than 20x and there still may be room left to run
Whenever I happen to be outside, on a warm and sunny day, my go-to lunchtime aperitif is an Aperol Spritz. I have particularly fond memories of a trip in 2022 when I visited Amsterdam with a few friends. Perched outside an off-the-beaten-path cafe, in the sweltering 30+ degree heat, we dined on brunch, Aperol Spritz, and cheap European cigarettes until sunset.
Aperol, with its vibrant flavour and inviting orange hue, is a classic in many parts of the world. However, it wasn’t always this popular. The beverage has seen phenomenal growth in the last two decades; averaging more than 20% annual sales growth. In the most recent financial year (2023), Aperol saw 23% organic growth and recorded ~€700 million in sales. The recipe is over 100 years old and has never changed, so why is it so popular today?
Italian connection
Founded in 1919 by two brothers in Italy, Aperol was later nurtured and successfully commercialized by the Campari Group (CPR, listed on the Milan Stock Exchange). Campari, the famous red liqueur, is the main ingredient in a Negroni, as well as several other iconic drinks. As a collective, the Campari Group has a long and successful history of acquisitions.
In 2003, eyeing something special about their orange-tinted cousin, Campari paid €150 million for Aperol, whose revenue was ~€30 million at the time. Back then, Campari’s flagship brands were Campari (15% of sales) and SKYY Vodka (12% of sales, acquired in 2002). By 2011, Aperol briefly became the group’s largest brand; later cementing its place more permanently. Today, it accounts for almost a quarter of group sales. Perhaps the Campari Group ought to consider a name change.
But this growth hasn’t come at the expense of other brands; more of which were acquired along the way. Both Campari (€117 million → €321 million) and the rest of their portfolio (€566 million → €1.9 billion) have witnessed respectable growth in tandem.
When Campari acquired Aperol, the group wasn't yet a global business. At that time, nearly 50% of its sales came from Italy, 19% from the rest of Europe, and 31% from the Americas. The portfolio was also heavily concentrated in higher alcohol content beverages such as Campari (20.5% to 28.5% depending on where sold), SKYY Vodka (40%), and Tequila 1800 (38%).
Across Europe, a shift in behaviour towards lighter alcoholic beverages had been brewing. Campari faced a challenge that was largely outwith their immediate control. One made more difficult in 2008 as a reduction in discretionary spending hit Europeans in the aftermath of the financial crisis. Aperol was an ace in the hole. It was a lighter beverage (11% alcohol) with natural ingredients that could be enjoyed without food and didn’t dent the purse strings quite as much as spirits.
The aperitif playbook
The Aperol Spritz (a cocktail that is three parts Cinzano Prosecco, two parts Aperol, and one part soda) would be the vehicle through which Campari marketed and popularised the Aperol brand. Campari invested heavily in the Aperol brand both domestically and internationally; focusing on bars, cafes, and other locations where dining is often more informal and less expensive than in restaurants.
Flip through the past few decades of Campari annual presentations and you’ll get a sense of the plethora of vibrant and fun ways the group have continued to market the brand. Trade events, sponsorships, quirky point of sale, tours, bars, parties… Aperol has demonstrated incredible dexterity in marketing over the decades, particularly as it relates to selling the beverage as an experience.
More recently, the "It Starts With Aperol Spritz" campaign, was launched circa 2017 to emphasise the simplicity and appeal of the Aperol Spritz recipe.
It was a playbook that Campari had executed before. Gaspare Campari was the creator of Campari and founder of the Campari Group. Born in 1828 he would later open a bar, Caffè Campari, serving his namesake creation to customers. The story goes that sometime in the 1860s a customer returned the beverage complaining that it would be better serviced over ice with fizz. And so, Gaspare created a cocktail that is now known as the Americano; composed of Campari, sweet vermouth and club soda.
A little later in the timeline, the Americano would become the father of the Negroni; another classic cocktail which popularised the use of Campari; a fortified version of the Americano. In a similar fashion to the discovery of the Americano, the story goes (I am not sure how true these stories are, but hey) that Mr Camillo Negroni, wishing to strengthen his beloved Americano, requested that the soda water be replaced with gin. Like Aperol’s Spritz, the resurgence in popularity of the Negroni this century in turn boosted the sales of Campari.
There is a fascinating relationship that takes place in the alcohol industry. Alcoholic beverages with strong brands that are intrinsically tied to classic cocktails, extend their longevity and status through that cocktail. Ask any pretentious Negroni lover (I happen to think a little pretension never hurt anyone) and they will tell you “It can’t just be any bitters. It has to be Campari”. There will be copycats1, but they will never be the “real thing”.
From hometown to the world stage
Throughout Campari’s ownership, Aperol has shown strong and steady growth in core markets while simultaneously reporting, at times, triple-digit growth across second frontier markets; new regions where they rolled out the Spritz playbook.
The geographic dispersion of Aperol’s sales broadened as it found success internationally. Still a popular staple in Italy, Aperol now derives a larger share of its revenue across Western Europe as well as in the USA. This trend perforated across the entire group as they looked to de-risk themselves from Italy and capitalise on a global scale.
Once accounting for 50% of sales (2005), Italy remains an integral part of the identity of Campari and many of its brands. But it’s no longer the dominant market; a trend which has been in motion since the turn of the century.
Aperol’s got legs
Campari Group has historically been a steady, mid-single-digit revenue growth, type of company. The two years post-pandemic lockdown saw the business accelerate to grow revenue by 22.6% and 24.16% in 2021 and 2022, respectively, before tapering off to 8.2% growth in 2023. Margins, despite the frequency of acquisitions over the years, have remained fairly steady. On a trailing basis, Campari boasts gross margins of ~58%, operating margins of ~20%, and net income margins of ~11%. Like most companies, Campari managed their way through the inflationary environment of the last few years by passing that on to customers.