Flavoured vodka and whiskey ‘not in competition’

Flavoured whiskey is not stealing market share from vodka, but is instead broadening the entire market for flavoured spirits, two Beam Suntory executives have argued.

Instead of swiping market share from flavoured vodka, flavoured whiskey “complements” the sector

Speaking to The Spirits Business, Jason Dolenga, senior director of US vodka for Beam Suntory, said that as more consumers become interested in the flavoured spirits category, vodka, whiskey and rum are not in competition but instead cater to demand in unison.

“Over the last few years, we’ve seen consumer tastes evolve, and we strive to release premium innovations across all three of these categories that appeal to the growing passion for spirits with unique and complex flavor profiles and will continue to do so in 2015,” he said.

“We see the flavoured variants of vodka, rum and whiskey complementing one another and providing different tasting profiles that appeal to our consumers’ palates.”

His comments come as analysts predict a continued slowdown of flavoured vodka – particularly as demand for “wacky” flavours which once sustained growth wanes – while flavoured whiskey continues to soar.

According to Rabobank’s Spirits Quarterly Q1 2015, flavoured whiskeys, or whiskey-based liqueurs, was the “hottest growth segment in the US spirits market” in the first three quarters of 2014, while volumes of imported flavoured vodka fell by 5% to 1.1m nine-litre cases.

However, Dolenga’s Beam Suntory colleague Vanessa Jenkins, senior director of US Bourbon, concurs that both categories can grow in tandem.

“The rise of flavoured whiskies has helped to bring in new consumers from a range of categories, as well as from outside the category,” she said. “Rather than driving a swipe in market share among spirits, flavoured whiskeys are actually widening the overall market.”

She added that growth in flavoured whiskey will continue to grow in 2015, and Beam Suntory will seek to make “strategic investments” across its flavoured portfolio.

Dolenga also claims that while Pinnacle vodka’s trends of confectionary flavours are “levelling out”, fruit flavours in vodka continue to grow in popularity. However he added that while the brand is “looking at global expansion” in the next few years, Beam Suntory is “in no rush” to do so.

For more on the flavoured spirits category, see the April 2015 issue of The Spirits Business – The Vodka Report – out now.