Pubs are closing, drinking at home is on the rise, and the brand is struggling. These threaten to be black days for Guinness, when even St James's Gate, its home since 1759, could be sacrificed, writes Laura Slattery.
But while Irish drinkers might be horrified to see their stout being tinkered with - Guinness Mid-Strength, Red Guinness - the fact is that in the drink's growing markets, its "Irishness" is secondary.
The future of St James's Gate currently hangs in the balance, as Guinness's parent company, Diageo, has confirmed it is reviewing its operations in Ireland. The Dublin brewhouse is 25 years old - near the end of the life cycle of a brewery. Diageo either needs to invest several hundred million euro or shut down production.
Selling the historic 64-acre site will mean the brand will lose some of its Irishness, but that might not matter too much to Diageo. Guinness sales are growing faster in Africa than anywhere else. And not too many Nigerians will care if the beer they drink comes from Arthur Guinness's old stomping ground, some logistically more practical site off the M50, or indeed any one of the 49 other markets where Guinness is brewed.
Brian Duffy, chairman of Diageo Ireland and global brand director for Guinness, says there is no question of the company moving out of Ireland completely. "St James's Gate is an important factor in the DNA of the brand," he says.
The review, which is expected to be completed in January 2008, is "a complex process", according to Duffy. Diageo needs to plan ahead several years so that it has the capacity to brew enough beer to meet overseas demand. Some 60 per cent of the eight million kegs it brews each year is exported.
The value of the land at St James's Gate, not all of which is actually used by Guinness, won't be a deciding factor. "It is less on our minds than people think," says Duffy.
Nevertheless, the site would prove to be a useful cash cow for Diageo should it go shopping for other beer companies, something that Duffy insists is part of Diageo chief executive Paul Walsh's strategy for the public limited company. Persistent speculation that the company is planning to offload Guinness completely and focus on spirits and liqueurs - thus sidestepping the St James's Gate issue - are just that, he says. "Sometimes when a rumour is around for so long, it becomes clear that it's just wrong." Diageo wants to get "bigger in beer", he says. Selling off the most iconic beer brand in the world would hardly be the way to go about it.
In the meantime, Guinness continues to launch new special brews. In Ireland, it is attempting to do its social responsibility image a favour by giving a trial to a mid-strength version with an alcohol content of 2.8 per cent instead of the usual 4.2 per cent.
Mid-strength beers are popular in Australia, according to Duffy, who believes they have great potential here. Guinness Red, in which the barley is lightly roasted to give it a rich red colour instead of black, is being tested in Britain, although it is not yet on the menu for Ireland.
Guinness is also attempting to play catch-up with stay-at-home drinkers. Known in the drinks industry as the "off-trade" market, this is a segment that has grown from 15 per cent of the beer market a decade ago to 50 per cent now. Guinness's most recent television advertising campaign has been aimed at breaking down a resistance among many stout drinkers who enjoy the pub ritual but not the idea of opening a can at home.
HARDCORE GUINNESS DRINKERS, most of whom are men, have also reacted scathingly to various new versions of their beloved brew over the decades, most notably rejecting Guinness Light, a low-calorie beer that was disastrously ahead of its time when it surfaced in the late 1970s. It is for these drinkers that Guinness spends €50 million on quality assurance in Irish pubs every year.
Duffy says that canned Guinness is aimed at both drinkers who wouldn't usually order the stout in a bar and long-standing Guinness customers who want to be able to enjoy their drink despite smoking bans, drink-driving enforcements and local closures keeping them out of the pub. "We're trying to please both," he says.
But Guinness has to be careful not to send mixed messages, according to Stuart Fogarty, director of advertising agency AFA O'Meara.
"I do think that in an attempt to remarket the brand there is the constant danger of alienating people. If you're launching new brews, there is a risk that oul' fellas drinking their pints in Mulligan's will say maybe this drink isn't for me," he says. "The PR aspect to moving out of St James's Gate reinforces that perception."
The speculation that Diageo may simply discard Guinness stems from the fact that most of the brands it owns are spirits. Its biggest sellers are Smirnoff vodka and Johnnie Walker, not Guinness. Diageo, which has its headquarters in London, was formed in the 1990s when Guinness and Grand Metropolitan merged, and the stout's devotees have been quietly grumbling into their pints about the good old days being over ever since.
For a few years, Diageo also owned Burger King - exactly the kind of modern lumping-together of corporate brands that leaves an uneasy feeling in the stomachs of people concerned with the authenticity of a brew. No one has ever waited for the grease on their fries to settle.
WHATEVER DIAGEO DOES next, it will face intensifying competition from other beer brands, and to a lesser extent from the likes of C&C's Bulmers cider. Apart from a rain-related blip this summer, cider has reaped the benefits of warmer weather in Ireland and Britain in recent years, whereas it is colder days that inspire people to reach for the Guinness.
For Fogarty, Guinness's difficulties in the Irish market largely stem from one harsh fact. "The Guinness generation is getting old and is dying off." The company is lauded for the quality of its advertising almost as much as it is for the quality of its brew: from the toucans of the 1930s posters to the dancing man ads, from "Guinness is Good For You" to "Not Everything in Black and White Makes Sense", the word "iconic" is often used.
But the brand has slipped, Fogarty says. "When we talk about the classic Guinness ads, we're talking about the past. Guinness is no longer the green-flag, shamrock-waving brand it was. It's not relevant to drinkers. And when you have a brand that is so ingrained in people's consciousness, in people's psyche, it is very difficult to shift."
If the Guinness brand is slipping, it is doing so from a great height. A survey published earlier this month by brand-monitoring group Superbrands ranked it the eighth biggest brand in Britain.
It's not hard to look on the bright side. While the numbers of pubs closing in Ireland is "alarming", Duffy says, it is not something that will continue unabated. Guinness remains the number one beer here, and is more than twice as popular as its nearest competitor. And musicians from Barbra Streisand to Bloc Party regularly drop Guinness into their stage banter to try to ingratiate themselves with Irish audiences.
GUINNESS'S LOCAL DIFFICULTIES are small beer compared to its healthy global picture. Diageo's annual results, due at the end of August, are expected to show strong sales in most markets around the world.
The brand still has one major annual global marketing godsend to play with, one in which it can mop up first-time drinkers previously under the impression that the black beer was too bitter, too challenging or just much too much for them. If all else fails, there is always St Patrick's Day.