In 1986, the Distillers Company was bought by the Irish brewery Guinness, which merged 11 years later with Grand Metropolitan to create Diageo. Listed on the London and New York stock exchanges, Diageo is now the world's largest spirits group by revenue, with bold-faced brands including not just Johnnie Walker but Smirnoff vodka, Captain Morgan rum, and Tanqueray gin. Diageo is an alcohol colossus that already generates nearly 40 percent of its sales from emerging markets, and that fraction is set to rise to 50 percent by 2015.
TODAY, DIAGEO is walking toward India and the acquisition of United Spirits, the country's largest alcoholic drinks firm, with 60 percent of the market. In July, it acquired a 25 percent stake in the company, and it aims to own more than half. Indians consume more whiskey than any other country in the world, and the distribution network Diageo would get with the purchase of United Spirits is akin to a raw materials producer gaining access to internal rail networks or shipping ports. Diageo has also acquired Brazil's Ypioca, the third-largest producer of cachaca, the popular sugar-cane-based spirit that adds the kick to caipirinhas from Sao Paulo to San Diego. It also recently had its eyes on Mexico's Jose Cuervo, the world's top-selling tequila-maker.
China is the big prize, though. There alone the middle class has grown to some 350 million people. According to consulting firm Ernst & Young, by 2030 China could see 1 billion people in the middle class -- some 70 percent of its projected population. And they'll be toasting to their success: The market research company Euromonitor International predicts that China alone will contribute 50 percent of the volume growth of the spirits industry in coming years. China is already the world's largest spirits market, followed by Russia and then India, though the South Asian giant will move into the second spot this year, according to industry estimates.
But will Chinese start quaffing scotch? On a per capita basis, whiskey consumption is still relatively low, with baijiu, a heady clear-colored liquor distilled from sorghum, still the preferred blend. But Johnnie Walker is striding ahead. In 2011, Diageo acquired a controlling stake in Sichuan-based Shui Jing Fang, a maker of baijiu, and the company has actively been courting young, urban professional Chinese -- "chuppies" -- with the familiar "Keep Walking" ad campaign. Since 2011, two "Johnnie Walker Houses" have opened, in Shanghai and Beijing, offering tours that mix a dab of Scottish heritage, a dash of whisky education, and a jigger of clubby exclusivity. On sale, of course, is the full array of Johnnie Walker blends, including exclusive limited-run editions of the super-high-end King George V Blue Label, which can run north of $600 per bottle.
Admittedly, Johnnie Walker and Diageo have made a few mistakes as well. A recent ad campaign for Blue Label, featuring a computer-generated Bruce Lee spouting inanities about the good life in a Hong Kong penthouse, drew ire from devoted fans of the martial artist, who was a teetotaler. The company's big investment in Turkey in 2011 -- the $2.1 billion purchase of Mey Icki, a major raki distiller -- came as the Turkish economy started to cool and the government clamped down on alcohol ads. What's more, the World Health Organization is issuing warnings about rising alcoholism in Africa -- Diageo's next big growth market.
Meanwhile, some scotch devotees argue that Johnnie Walker has forgotten its roots. Clearly, it's not soaked in nostalgia for ye olde Scotland. Today, Johnnie Walker is part of a massive conglomerate that has more than 25,000 employees and production centers in Australia, Cameroon, Canada, Ghana, Ireland, Jamaica, Kenya, Nigeria, Uganda, the United States, and the United Kingdom (including Scotland). In late 2012, Diageo bulldozed the last production plant in Kilmarnock, the birthplace of Walker's Old Highland Whisky.
As Kosar and I spoke about the future of Johnnie Walker, he sent me two images. The first was the original Striding Man design, Tom Browne's big advertising hit. The second was today's logo. I saw the difference right away: The Striding Man has had a face-lift, literally. His face no longer exists. He has become a silhouette, a colorless everyman. He could be anyone -- and you could be him.