The Scotch whisky brands to watch in 2014

With market fortunes contrasting around the globe, which are the Scotch whisky brands to watch in 2014?

Scotch whisky remains one of the most prestigious spirit categories in the world

Anecdotal evidence suggests 2013 will have been a mixed year for Scotch with shrinking sales in Southern Europe and a clampdown on conspicuous consumption in China offset by healthy growth in emerging markets from South East Asia to Latin America.

Scotch dominates spirits in travel retail whose growth continues unchecked with the boom in passenger numbers and new airports. Figures for the US are predicted to show healthy growth at the premium end, while India’s vast potential remains tantalisingly out of reach.

Standard blends in mature markets provide the lion’s share of volume, but with the squeeze on margins, there has been less investment in marketing and NPD. Marco di Ciacca, brand manager for Black Bottle, says: “It’s probably the most boring category in terms of innovation, because the regulations knock a lot of NPD on the head.”

This didn’t stop the US launch of Dewar’s Highlander Honey – a flavoured blend in all but name, which raised some hackles in the industry.

Premium blends are doing better, though the squeeze on banqueting and gift giving in China has been bad news. Pernod’s Royal Salute claims 75% of the country’s “prestige whisky” market and was “hit very hard”, says brand director Neil Macdonald.

Pernod’s Q1 results (June to August 2013) show Royal Salute down 21%, while sales of Chivas Regal fell 11%, although this compares to very buoyant growth for the same period last year. Diageo claims its ultra-premium Scotch brands performed well in China, though off a much smaller base than Pernod.

Beyond China, exciting markets include Indonesia and Vietnam where Chivas Regal 18 and Johnnie Walker Gold battle it out at the top end. Meanwhile Thailand has been hit by a big tax hike.

Leading the malt charge

America is described as “still in good growth, albeit slightly less buoyant than in 2012/13” in Pernod’s Q1 results. In 2012 super premium Scotch and above grew 10-11% last year (IWSR), and slower growth rates are forecast with the US on-trade now in decline.

As Americans trade up and out of standard blends, single malts have benefitted with exports up from 1.35 million cases to 1.6m in the year to June according to Glenrothes’ brand ambassador, Ronnie Cox, who says sales of the Speyside malt are “well-up on two or three years ago”.

Selling itself as the “undiscovered Islay malt”, Bunnahabhain has “grown quickly with very little effort”, reports brand manager Michelle Lansdowne. Volumes were up 56% in 2012, and the brand is expected to benefit from being part of the South African drinks giant, Distell, which bought its owner, Burn Stewart, in April.

Glenfiddich is still ahead among malts, and the brand’s marketing manager, Katie Rawll, says 2013 “has been a really good year so far”. In second place, Glenlivet is closing the gap, having trebled sales since Pernod bought the brand in 2001, with The Macallan in third place.Overall the biggest constraint on the buoyant malt category remains the shortage of aged stocks.

Click through the following pages to discover our pick of the three Scotch whisky brands to watch in 2014.

Talisker

If innovation is lacking in standard blends, it’s alive and kicking among single malts. This summer’s European launch of Talisker Storm has accelerated the brand’s already double-digit growth, and it has now been rolled out into the States. Early days, but the omens look good for next year.

Black Bottle

This once well-loved west coast whisky was given a comprehensive makeover this year. The blend was re-balanced to smooth out the raw, smoky edges and then filled into its original black glass bottle. The plan for the next 12 months is to target key cities including London, New York and Moscow.

Aberlour

Pernod’s Chivas Brothers is keen to build on the success of its number two malt, which is the top seller in France. Right now a raft of new SKUs are being rolled out, which brings the number to seven in the UK. With an increased marketing spend, 2014 should be an exciting year for Aberlour.