Rum taking ‘baby steps’ towards premiumisation

22nd February, 2018 by admin

Rum’s sales may not be soaring, but there is a huge opportunity for brands to position high-class expressions in the luxury segment. Alice Lascelles speaks to those who are making plans to tap into this fledgling market.

*This feature was originally published in the December 2017 issue of The Spirits Business

In some lights, rum looks like a category in the doldrums. In 2015/16 global off-­trade sales were almost flat, according to market research provider Euromonitor, growing just 0.3% by volume. The year before that they fell by 1.2%. It’s a different story, though, if you look at the value figures: in 2015/16 rum grew by 3.6% overall, with luxury rum climbing by 4.4%. Do the maths, and it’s clear that the world’s third­-largest spirits category is finally falling in line with the trend for premiumisation, and making a gradual move upmarket. But what took it so long?

“Historically, rums haven’t had the backing of major spirits groups, and with so many different geographical origins and local brands, it has been rather slower than other categories to premiumise,” says Nick Blacknell, global marketing director for Havana Club. “A mixture of inconsistent regulation around the world and a lack of consumer education have also slowed the progress of rum in establishing itself as a strong alternative to other high­-end dark spirits, such as Cognac and single malt Scotch.”

CONNOISSEURS AND COLLECTORS

But all that’s starting to change. This year, Havana Club unveiled the second edition of Tributo, a limited-­edition sipping rum aimed at dark-spirits connoisseurs and collectors. Limited to 2,500 bottles, and priced at around €250 (US$294), this prestige expression is to be re­issued each year based on a slightly different blend – a model that echoes Diageo’s collectable Special Releases range, which sees limited editions from some of Scotland’s most famous distilleries released in new incarnations each year.

Facundo rum range

Not to be outdone, the world’s number­-one rum, Bacardi, also raided the family cellars not long ago to create the Facundo Collection (pictured below), a limited­-edition range of four ultra­-premium sipping rums priced from £40 to £300 (US$52-US$394). While the Facundo Collection was a one-­off, it served as an indicator of the company’s growing focus on the sipping market, where it’s been increasingly pushing its golden SKU Bacardi 8 Year Old with a variety of bespoke glassware and signature twists on the slow-­stirred Old Fashioned.

“We know a third of premium spirits buyers are already purchasing rum, but of those only 25% purchase premium rum,” Ned Duggan, global vice president of Bacardi Rum, says, quoting a Nielsen study. “So it’s clear that they are willing to pay more but they are not finding the right offering, which represents a big opportunity for the category.”

The digestif moment has been key to “double-­digit growth” for rum’s best-­selling super­ and ultra­-premium rum Ron Zacapa in the past year, says marketing director Montserrat De Rojas. “Zacapa does not act like a rum, it acts more like a luxury dark spirit as it is often consumed in moments where people would enjoy whisky and Cognac, for example, in after-­dinner drinks,” he says. “Our aim is to be recognised as the best­-tasting super­-premium dark spirit in the world.”

Hip sip: sipping rums become popular

Hip sip: sipping rums become popular

In a bid to establish itself as the go­to rum for gourmets, Zacapa recently partnered with the international restaurant group Zuma to create the Zuma Zacapa Live Solera, a ‘cocktail installation’ that creates a unique drink for each restaurant using a solera system based on the Guatemalan rum’s signature ageing process. Since its launch in 2016, it’s been rolled out in nine locations including New York, Hong Kong, Bangkok and Dubai, with the latest opening in Las Vegas only last month. Jamaica’s Appleton Estate rum has historically made much of its plentiful aged stocks, releasing ultra­-aged rums such as Appleton Estate 50 Year Old, which at the time of its launch in 2012, was the oldest commercially available rum ever to hit the market.

The company’s most recent luxury launch, Joy Anniversary Blend, is a blend of rums aged for a minimum of 25 years, but the age statement takes a back seat to the story surrounding the 20th anniversary of the company’s master blender, Joy Spence.

One Response to “Rum taking ‘baby steps’ towards premiumisation”

  1. rumbongo says:

    Not sure if you recall but Angostura put out what was the worlds most expensive rum at £10,000 with Legacy in 2013 and innovation around multiple cask finishes with their 16YR No.1 French Oak Cognac series. I’m glad the category is finally moving towards permutation but i can’t help but think the category only moves forward when the big boys with big pockets decide it’s time.

    Much love to Appleton, Foursquare, Zacappa and Diplomatico – I love those brands too but often I find Angostura never gets the recognition it deserves especially when, in my opinion – have been veterans in leading the charge towards preimumisation years ago – i guess the public just wasn’t ready for it.

    Anyway that’s just my 2 cents. It is an exciting time for rum no doubt.

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