What does 2014 have in store for spirits?By SB Staff Writer
After those dark clouds of recession, the future looks relatively bright for premium international spirits, as Becky Paskin and Tom Bruce-Gardyne report.
If you have the right premium credentials, and access to the big, emerging markets, you are more than halfway there if you want to build a successful spirits brand – whatever category you happen to be in. The consumers’ desire to trade up from local spirits to international brands as a way of confirming wealth and status holds true from the Philippines to Peru.
All spirits are attempting to move up-market, some more successfully than others. Rum for example, may have been slow to join the premium party, but brand owners are now making serious efforts to make an impact at the top end. Bacardi, Appleton and Brugal – to name but three, have all launched new sipping rums.
Growth in Scotch whisky may have slowed, but no-one is yet questioning the scale of recent investment in new distilleries. The truth is, there are enough emerging markets out there, some virtually untapped, to mop up the extra production for the foreseeable future. While among single malts the biggest constraint is having enough aged whisky to meet burgeoning demand.
On the other hand, huge whisky markets like Spain continue to shrink and the Chinese clampdown on luxury brands has hit some brands very hard.
There is also intense competition from all those other whiskies. There has been a resurgence in American whiskey in the States since 2000, and it still feels quite a “new category” in much of the world. As does Irish whiskey, whose 20% growth looks set to continue for some time.
In overall volume it is small beer compared to vodka which continues to attract endless innovation, particularly in the States.
Even a tiny share of this vast market is worth pursuing whether you are the latest craft distiller in town, or the newest flavour of an established brand. That said, there is a serious shakedown in flavoured vodkas expected any day. The same is predicted for gin with simply not enough space on the world’s retail shelves and back bars for the thousands of new brands hitting the market.
So as the year draws to a close, we consider what surprises the next dozen have in store and take a look at which brands hold the most promise.
As listed on The Spirits Business website over the past few weeks, here are our picks of the spirits brands to watch in the year ahead.