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Ad restrictions could damage Scotch tourism

A proposed crackdown on alcohol advertising in Scotland has been met with outrage by spirits brands in the country, who say it will not meet its aims, and will damage the nation’s drinks and tourism industry.

Scotland tourism
In 2019, there were 2.2 million visits to Scotch whisky distilleries

Scotland’s spirits sector is facing major restrictions on alcohol advertising, a move that could harm the country’s economy and the distilling industry. In November 2022, the Scottish government opened a consultation on whether it should impose further restrictions on alcohol marketing to reduce its appeal to young people.

Among the measures are prohibiting alcohol advertising in outdoor public spaces, phasing out alcohol sponsorship, and reducing in‐store promotion of alcohol, as well as ending drinks companies’ sponsorship of sporting and live events.

It comes at a time when the drinks industry is dealing with soaring energy and freight costs, and price hikes for materials such as glass. Furthermore, Scotland will introduce a deposit return scheme (DRS) on 16 August 2023, whereby drinks producers will have to refund consumers 20p when a single‐use container is returned for recycling. Some in the industry have labelled the DRS proposal as “controversial” and “unworkable”.

More than 100 drinks companies, including Chivas Brothers, Diageo and Whyte & Mackay, have signed an open letter to Scottish ministers urging them to abandon the alcohol advertising plan.

They said in the letter: “Restricting the ability to promote and market products responsibly will remove a vital route to market and go against the Scottish government’s vision to double the turnover of the food and drink sector by 2030. A further unintended consequence would be the blocking of a key source of vital funds to Scotland’s sports and arts and culture sectors.”

Many members of the trade are concerned about the plans, including Diageo and trade body the Scotch Whisky Association (SWA). The SWA said in a statement: “It is important that the Scottish government consults all relevant stakeholders – including the alcohol industry – to obtain a broad perspective and understanding of the impact and to identify any unintended consequences.

“The Scotch whisky industry has a robust marketing code in place, which regulates how brands are advertised globally. We want to share the lessons of regulations already in place so that there are no unintended consequences, including a reduction in the vital support the industry provides to communities across Scotland.”

A Diageo spokesperson said: “We are deeply concerned by the proposals to heavily restrict advertising and sponsorship across Scotland. They will do little to support those in need of help, while significantly impacting vital sectors, such as hospitality, tourism and sports. Along with the rest of the industry we will be responding to the consultation.”

Kieran Healey‐Ryder, chair of the Scottish Alcohol Industry Partnership, added: “To introduce a constraint to the spirits industry and restrict our ability to celebrate what we make will impact our ability to make a positive contribution to the economy, and invest in our communities.”

Johnnie Walker tourist attraction
Diageo has invested millions in Scotch whisky tourism, including its new Johnnie Walker experience

Massive investment in tourism

Distillers have made multi‐million‐pound investments to enhance their tourism offerings, including Diageo’s £185 million (US$255m) investment in Scotch whisky tourism in Scotland – the largest single investment programme in the industry. In September 2021 the firm opened its eight‐ floor Johnnie Walker Princes Street visitor experience in Edinburgh, and upgraded four of its Scotch whisky visitor centres.

Distilleries could be made to cover up their brand names on the side of buildings, and tourist attractions would have to conceal window displays.

The move could have a damaging impact on the wider Scottish economy as it would also prohibit the sale of alcohol‐branded merchandise, something distillers rely on for additional revenue.

The Scottish government has suggested that prohibiting the sale or distribution of alcohol branding merchandise, including T‐shirts, jackets and baseball caps, as well as branded glasses and mugs, could be considered to reduce the visibility of alcohol brands.

Edinburgh‐based whisky consultant and broker Blair Bowman said the “ignorance” by the Scottish government was “astounding”. “For the government to claim that it’s all just the same thing if you remove branding is completely false and couldn’t be further from the truth,” he said on Twitter.

He added the report has reduced centuries of skill and craft to create Scotch whisky, a “globally iconic spirit”, to “just a gimmick”.

Bowman noted that in 2018, Scotland welcomed more than two million visitors to whisky distilleries, who spent £68.3m on products and merchandise, adding this move would damage Scotland’s tourism industry.

From a retail perspective, the proposal could ban aisle‐end displays of alcohol, restrict the use of mixed alcohol and non‐ alcohol aisles, and cover alcohol that sits behind tills, in the same way as tobacco is treated. It could also restrict window displays of alcohol in stores.

Jason Hockman, general manager, direct‐to‐consumer at spirits retailer Master of Malt, said: “We’re a whisky retailer and independent bottler based in Scotland and England, so Scotch whisky is something that is very close to our hearts. We feel the consultation documents show a lack of understanding of the nature and culture of Scotch whisky and its place in public life, as well as a lack of comprehension of the history and diversity of the Scotch whisky category.”

Tougher rules

The Advertising Standards Authority regulates advertising in the UK. The organisation introduced tougher rules on alcohol advertising in 2006, including a ban on featuring adults under the age of 25 in alcohol ads.

Matt Lambert, CEO of the Portman Group, the self‐regulatory body for alcohol labelling, packaging and promotion in the UK, believes the proposals are “disproportionate” as the “vast majority of Scots drink moderately”. He cited that 77% of Scottish adults do not exceed the chief medical officer’s recommended lower‐risk guideline of 14 units per week.

He does not believe the proposals will discourage people from drinking to excess or have an impact on minors drinking alcohol.

Data from the Scottish Health Survey in November 2022 showed there has been a 58% drop in weekly drinking among 13‐ to 15-year‐olds since 2004. This has been brought down by the actions of the industry, Lambert explained, pointing to campaigns run by the Scottish Alcohol Industry.

Drinks firms, including Diageo and Pernod Ricard, also combat alcohol misuse and promote responsible drinking through education and enforcement campaigns.

However, first minister Nicola Sturgeon’s resignation announcement in February has left the nation’s drinks industry uncertain about the future of alcohol advertising.

With the consultation due to end on 9 March, and the ongoing financial pressure on the industry, many are hoping that any moves to restrict alcohol marketing will be delayed, and ultimately abandoned.

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