Is the gin category in danger of losing its way?

Despite vague definitions, questionable juniper involvement and an over-saturated category, there’s been a surge in new premium gin brands. But how many will survive?

Will the creative freedom associated with gin be its downfall?

“I think it’s always been attractive to make your own hooch,” declares Ricky Christie, the brains behind the new Scottish single malt gin Gilt, which has just won its first UK supermarket listing in Sainsbury’s.

At April’s Wine & Spirits Wholesalers of America show in Orlando, he was struck by “the huge buzz around craft distilling. I think it was harking back to the old moonshine days with people selling this ‘naughty, but nice’, illicit side of spirits”.

Over in Chicago, Paul Hletko of Few Spirits describes gin as “one of the more fun spirits to make because there’s so much freedom to be creative and do different stuff. The other nice thing from the business point of view, is that you can produce it quickly. We’ve probably tried 50 different gin recipes – some good, some not so good. In the same time we’ve also tried 50 whisky recipes, but I’ve no idea which are any good yet.”

In the US, gin “certainly has the reputation as the classic British spirit, but microdistillers are having an impact and people are beginning to understand that gin isn’t exclusively out of the city of London”, says Hletko. “A lot of us small distillers are trying to carve out our own style of gin and create something different.” Like many, he sees no point in simply replicating London dry gins which the Brits have down to a T.

“The American style is going to be less juniper and a lot more citrus-forward. We make three gins and our mainstream one has a very soft, gentle, grain-forward style.”

The other driver for a different style may be the quality of tonic water in the States which tends to be less bitter, and sweetened with fructose or corn syrup. When mixed with a gin packed with juniper, the resulting G&T has not always been a happy experience. “I would say half the people who come through the door have a bad prejudice against gin,” says Scott Harris of the Catoctin Creek distillery in Virginia. “It’s a very polarising spirit, and we come across a lot of non-drinkers who have this negative image from college, and this idea of ‘Oh, it’s just pine needles’.”

The boom in micro-distilling may be bigger than that of micro-brewing 30 years ago

Today’s American gins may have less of that juniper/ pine essence note, but definitions remain vague despite a warning by Ryan Magarian in 2009. The bar consultant and co-founder of Aviation gin expressed fears that “unless a clear designation is created for these gins, the entire category might find itself not only diluted, but more dangerously unrecognisable 10 years from now”.

Not that Hletko sounds overly concerned. “Our biggest problem is supply. We just can’t make it fast enough.” He believes the boom in micro-distilling will be even more dramatic than micro-brewing was 20-30 years ago. “I see it happening much faster in spirits than it did in beer. Last year craft spirits already had 0.5% of the total market sales. I find that to be a truly mindbogglingly large number.”

Though he doesn’t produce a vodka, most of his rivals do “because that’s where the business is, especially for those who are technically rectifiers, and buy in neutral grain spirit”. Yet as our report on the US market makes clear, vodka is increasingly reliant on its endless flavoured variants – some more serious than others. “I’d definitely say gin is perceived as a more sophisticated white spirit,” says Hletko.

“I think vodka has tarnished its own image,” adds Martin Dawson, who created Broker’s gin with his brother, Andy, 15 years ago. “Many barmen don’t like working with vodka. They have embraced the fact the range of gins has increased, and this has persuaded some to leave vodka behind.”

He quotes a Seattle bartender who recently told him the gin-based Negroni is now the number one cocktail in the city. In contrast to the new breed of exotic rivals, Brokers has stuck to its 10 classic ‘London Dry’ botanicals. “There’s nothing quirky or oddball about our gin,” says Dawson. “It’s tradition writlarge.”

By contrast he questions whether all the new entrants to the category, each desperate to establish their own USP, are actually even gins and not liqueurs.

Or flavoured vodkas, which is how Henrik Hammer of Geranium gin would classify them. “If you say about 500 new gins have been launched in the last five years, a third of them I wouldn’t consider as gin, because the predominant flavour would be thyme, saffron or something else.” Yet the alternative of sticking to a traditional recipe with the same old botanicals, and relying on packaging to establish a point of difference is equally flawed. “People are not stupid. Why should they pay more for a boutique gin that tastes the same as Gordon’s, Tanqueray or Beefeater?”

Hendrick’s is credited for kickstarting a revolution for new gin brands

Like Hammer, Alison Hunter, Hendrick’s global marketing director, believes: “There will be a shake down in the category and gins that don’t have a firm base will probably fall by the wayside.” Many of the newcomers were inspired by Hendrick’s and would love to emulate its success which she puts down to a winning combination of timing, packaging and the quality of the liquid.“Being first mover and creating the super-premium category has been great for us.”

Since launching in 1999, the brand has been carefully seeded in the right bars in targeted cities – the latest being the Columbian capital Bogota. Hunter sees potential in Spanish-speaking South America that to some extent takes its cues from that massive gin market – Spain.

Karen Stewart, marketing manager for Darnley’s View gin, credits Hendrick’s with “starting the revolution for newer brands. The range now available in specialist stores and dedicated gin bars is fuelling interest in premium, small-batch gin, with mixologists creating some great cocktails to keep things fresh”. Sales of her brand, recently joined by Darnley’s Spiced, are up 45% on last year.

Joanne Moore, master distiller at J&G Greenall, reckons: “Spain could teach the whole world about being theatrical with gin & tonic.” The creativity of Spanish barmen and the diversity of gins you will find behind most downtown bars helps explain why premium gin grew 3.5% in 2012 (IWSR) despite the country’s economic woes.

Competing for its share is Bloom, which Greenall’s launched in 2009. “It’s in most of the top bars in London and it’s cascading through the rest of the UK, Spain and Scandinavia.” Moore wonders how the market will absorb all the new, premium brands. “We’re all fighting for the same space. It’s great there’s more choice, but I truly think it’s not sustainable. Only the stronger brands will survive.”

Hopefully among them will be the Swedish gin Hernö, launched by Jon Hillgren in December. As the country’s only dedicated gin distillery and the most northerly in the world on the same latitude as Alaska and Siberia, Hernö has a strong USP. And if Sweden is not known internationally for its gin, the same was true of vodka before Absolut came along. With the state monopoly on distilling only lifted in 2000, distillers like Hillgren have had to learn fast.

Just how far they have come can be seen in our 2013 Gin Masters where Hernö scooped no less than two Masters and two Golds.