SB Picks: Top liqueurs trends
The liqueurs category is stagnant, meandering along at a flat rate with no short term sign of major growth, but The Spirits Business has identified four liqueurs trends that will spark interest in the future.
Despite an overall 0.8% (Euromonitor International) uplift in volume in 2011 following years of decline, liqueurs is one of those categories that generally makes few headlines.
Perhaps one reason for its marginal growth in the past year is a resurgence in traditional cocktails and a rise in the number of high-end bars in cosmopolitan cities around the world serving them, but really the category as a whole has failed to excite even the most geeky of liqueurs anoraks.
“There is some momentum, but the key thing is that there is nothing extraordinary happening here,” says Spiros Malandrakis, alcoholic drinks analyst at Euromonitor International. “Although the growth figures are slowly moving in the right direction, it remains to be seen if the category can really catch up.”
But break the saturated category down into sub-sections and you’ll find glimmers of innovation, diversification and rebranding that look likely to shake up the dusty liqueurs market as we know it.
After all, for such a fragmented category it wouldn’t be fair to adopt a one-size-fits-all approach, which is why we’ve identified four liqueurs trends that are likely to make liqueurs the topic of conversation, and hopefully spark a little growth, within the foreseeable future…
Culture Club: Cream Liqueurs
Yes, it’s a category dominated by Baileys, which through its various flavoured extensions of late – expect yet another in a few months – returned to growth last year with a 3% increase in volume to 6.8m nine-litre cases.
It’s also no surprise that Pernod Ricard’s Kahlúa and Distell’s Amarula are among the top 10 cream liqueurs in terms of volume, making gains of 1% and 8% respectively. But as a sub-category overall, cream liqueurs have remained flat, with volume increasing by 0.8% in 2011.
Even Diageo’s highly-anticipated launch of the Pharrell Williams-backed Qream With a Q in the US last year failed to ignite much excitement. For many, the true innovation set to turn cream liqueurs on its head is the launch of Bols’ Natural Yoghurt Liqueur.
“We see a tendency towards healthier and lighter drinks, and creamy drinks based on yoghurt fit perfectly into this trend,” said Maartje Hendrickx, marketing manager for Creamy Creation, developer of emulsified beverages.
“Especially younger women want to enjoy a delicious, fresh cocktail but don’t want to have the calorie intake. With cocktails or RTDs based on fresh yoghurt, a whole new world is opening.”
Bols claims the Chinese had originally asked for a milk-based spirit, but the idea soon evolved into a natural yoghurt liqueur, presented in a coated white bottle to protect the drink from UV light, that could be used in cocktails.
“It took a long time to get the blend exactly right so it doesn’t curdle or go flakey when you mix it,” Guenael Fily, Bols commercial director, tells The Spirits Business.
Developed specifically for the Chinese market, where health and wellbeing is a major trend, Bols Yoghurt could potentially rejuvenate the cream liqueur category, forcing other producers to sit up and take note of the possibilities – particularly if alcoholic yoghurt takes off in the equally health conscious market of the US.
Already launched in Russia, Ireland and Bulgaria, as well as China, Bols Yoghurt could also potentially reap the benefits of the Japanese market, which according to the IWSR saw a 1.8% uplift in liqueurs volumes in 2011, and is the second largest market for the category overall.
Flower Power: Fruit/Herbal liqueurs
By now it would seem every possible flavour on Earth has been bottled into a liqueur, and when it comes to fruit this couldn’t be truer.
But while they’ll never be brand leaders in terms of volume, a niche remains in the botanicals sphere, where herbal flavours like basil and jasmine are increasingly demanded by bartenders. Mixologists in the world’s major developed cities are continuously searching for new flavours, which is where producers such as Marie Brizard come in.
The French group is geared up to concentrate heavily on its new Essence range that was launched last year at Vinexpo and consists of flavours like cinnamon, spicy mix, tea, jasmine, violet and rosemary.
“Our Essence line is a totally new approach, putting the liquor at the heart of mixology and new, trendy cocktails based on nature,” says Aurelie Lorie, marketing director at Marie Brizard. Arturo Illan, marketing director of Licor 43, agrees with this approach.
“We believe the world always wants to try something new and can be provided for by a category which offers a wide range of flavours, textures and combinations.”
Although it would seem that fruit liqueur innovation has had its day, the category is continuing to return positive results, growing at a rate of 3% (IWSR) in the last year.
The driving force has in fact come from the emerging markets of Eastern Europe, where many domestic brands have seen volume rocket. Polish brand Lubelska was named The Spirits Business Liqueur Brand Champion in June after an impressive 33% sales increase, fueled largely by its popular new Lemon flavour which doubled the brand’s volume to 1.5m cases in 2010.
Malandrakis poses an interesting question here: what if successful domestic liqueurs were bought by drinks giants that could roll them out globally?
“Eastern Europe has lots of fruit liqueurs that go back decades or even centuries,” he explains. “There’s a major opportunity there, considering this current interest in brand heritage.
“Jagermeister was a domestic spirit, but now it’s a huge on-trade drink. There’s a big question mark over whether someone can take fruit liqueurs with a history and make them relevant to today’s environment.”
Liqueurs in disguise: Brand spin-offs
In 2010 there were 82 flavoured rum and vodka launches. Not all of them may have a low enough abv to be classed as liqueurs, but it’s an indicator of how many spirits categories are seeing flavoured extensions as a rite of passage.
You would have to be blind not to have noticed the rush of big-name Irish, Canadian and American whiskeys and bourbons with a hint of cherry/honey/cinnamon/insert-flavour-here now on the market – it was the fastest-growing category in the US in the first quarter of 2012.
Most releases, including Jack Daniel’s Tennessee Honey and Bushmills Irish Honey, are classed as liqueurs, both with a 35% abv. Similarly, new Chocolate Fusión (30% abv) and XO Café Dark Cocoa (35% abv) releases this year from Tequila giants Olmeca and Patrón respectively are demanding to be called liqueurs.
“It’s not a cocoa-flavoured Tequila, it’s a coffee-cocoa liqueur with a Tequila base,” argues Greg Cohen, corporate communications director for Patrón. “It may sound like splitting hairs, but there’s a big difference.”
Both companies, along with their whisky counterparts, see their divergence into liqueurs as a route to attracting new, young consumers who have “been afraid” of Tequila in the past, but Cohen warns against all spirit categories diving straight into liqueurs to achieve a similar goal.
“There’s certainly a market for liqueur extensions, and certain spirits lend themselves to it, but whether it works depends on the brand. Those that lend themselves to adding new flavours – it’s a natural evolution and it creates excitement for the brand, but it can’t be forced.”
While Patrón is happy to sit on its three extensions – Citronge, XO Café and Dark Cocoa – Olmeca is actively researching new flavours to add to its Fusión range, which also features Hibiscus. Vice president Olivier Fages says to expect “very interesting” flavours in the coming months, with the Mediterranean and South Africa its target markets.
“We plan to launch one new flavour every year, but we don’t want to extend the range too much. After four flavours we’ll take one away to get some dynamism in the range. But Dark Chocolate will remain a core product due to its success.”
A lost generation: Traditional liqueurs
The after-dinner tradition of supping on a liqueur and a cigar is long dead. Those brands established in the long-forgotten culture of being wheeled out on a dusty tray have found that, to survive, they’ve had to regenerate.
Packaging is the obvious starting point. Tia Maria recently unveiled its shiny new bottle at the Lovebox festival in London, which according to the brand is “more eye-catching and communicates our 18th century heritage”.
The liqueur relaunched in the UK, Argentina, the Netherlands and Canada with a selection of new serves to target a younger audience. But while Tia Maria sees focusing on its brand heritage as a route forward, 119-year-old whisky liqueur brand Drambuie has decided to leave its history out of its new communication.
“We’re incredibly proud of our history, but one of our biggest challenges is helping new drinkers understand what Drambuie is, so we’re not really playing to it right now,” says Drambuie marketing director Miranda Rennie, who admits the brand is fighting to gain new interest from consumers.
“We still have an audience that drank Drambuie in the ’80s and ’90s, but if I’m brutally honest it’s not about retaining interest, it’s about gaining interest. We have to be honest about what we’re facing here. We’ve missed a generation who don’t know what Drambuie is, so we need to work hard to engage, innovate and show them how to drink it.”
Drambuie hopes to turn its flat growth rate around with the launch of its surrealist Taste of the Extraordinary campaign, and work in its new markets of Latin America, India and the Far East.
Innovation and regeneration are not new concepts for liqueurs brands with a long history – Grand Marnier has been releasing extensions for years while maintaining a firmly wedged place on the back bar, and Cointreau equally has remained current through new drink serves and collaborations with cultural icons like burlesque star Dita von Teese.
But, as the category becomes even more saturated, especially with the recent influx of whisky and Tequila liqueurs, traditional brands face a continuous challenge ahead to attract today’s consumer.