NO-LO SPIRITS. WHAT AN UNBELIEVABLY SILLY IDEA!

BY DAVID GLUCKMAN

Ihave been working in the alcoholic drinks business since 1969. I was a brand development consultant to IDV - which through mergers became Diageo - my portfolio of brands includes Baileys Irish Cream, Sheridan’s, Coole Swan, Le Piat d’Or, The Singleton, Aqua Libra, Purdey’s, Smirnoff Black, Cîroc and Tanqueray Ten.

In 2017, I published “That s*it will never sell!”, (The title derives from a remark made by an American pundit when he first came face-to-face with a bottle of Baileys. Fortunately for the Irish company, his prediction was way off the mark!) The recent area of development that has attracted my attention has been the explosion in the development of ‘No-Lo’ alcohol beers, wines and spirits. The market has been estimated at $11 billion and rising, and while he can see sense in the growth of 0% beers, where the technology has developed in leaps and bounds, he is mystified by the 0% spirit brands he has encountered over the past few years.

“I was invited to a meeting at Diageo a few years’ back and was told that the subject would be 0% spirits. In order to get up close and personal to the category, I ordered a couple of bottles of Seedlip (two flavours) on Amazon. I tried it myself in a variety of ways and invited some friends to join me.

I was stunned. The bottles cost me £28, about 2.5 times the price of a bottle of gin or vodka, and however we tried it (mixed or straight), the product just didn’t deliver.

We read all the stuff on how each botanical was individually distilled, and about the rural ancestry of the recipe. But on its own it tasted like a kind of ‘reticent vinegar’ and mixed it was swamped by the tonic or lemonade we added. This ‘Lo-No’ was a universal ‘no-no’ amongst my group.

But notwithstanding my comments and an article on the subject in The Buyer magazine, the ‘No-Lo’ market marched relentlessly forward and soon the big players were climbing onto the bandwagon.

I decided to give it another go back in December last year. I bought a bottle of Gordon’s 0% which had been recommended by a friend. I paid £12 for a 70cl bottle, WHICH WAS ONLY £1 LESS THAN FOR A FULL-STRENGTH BOTTLE OF GORDON’S.

I was paying £12 for what was effectively a bottle of gin-flavoured water!

As the ads for Fever-Tree tonic say ’If three-quarters of your drink is the mixer…’, why am I paying £12 for a bit of gin flavouring?

OK. If you’re so smart, what would you do?

Throughout my working life my remit has been to come up with a better idea. There is clearly an emerging consumer need to cut back on alcohol intake and there are products appearing all over the place. Can someone do it better?

I thought I could.

Looking at existing products, I think the 0% beers work fine. They can make up for the absence of alcohol by upping the bitterness. And anyway, the gap between 5% and 0% isn’t that great.

I’ve tried a load of 0% wines and none of them have ever persuaded me to finish a glass, let alone buy another bottle.

And the spirits get more and more ridiculous. And their prices seem to rise. Gordon’s 0% is one of the friendlier options!

Here are two ideas which I believe are easily achievable and a much better price option for today’s down-trodden consumer

The soft drink approach or Gin-flavoured tonic

My first thought was why don’t the soft drink people get involved. If Schweppes or Fever-Tree employed the services of a hot-shot gin distiller and a flavour house, they could offer London Dry Tonic, Sour-Mash Cola and a host of other possibilities at say 40% above the price of ordinary soft drinks. That would significantly reduce the price of the ‘mixed’ drink and eliminate the need for a mixer altogether.

The soft drinks producers would have a more profitable brand and the consumer also wins. I’m not so sure about the 0% spirits folk, but that’s show business!

The Angostura option

If I’m out with friends and don’t want to drink, I often sip tonic laced with a few drops of Angostura bitters. Most times pubs don’t even charge for the Angostura. It’s 44% ABV and three drops will totally transform a plain tonic, cola or lemonade. And keep me under the limit.

How about gin-flavoured Angostura, Bourbon flavour or Tequila? Three drops added to a cola or orange juice and you get a sophisticated mixed drink at an unsophisticated price.

Both options are easily achievable technically and will make a huge amount of sense to consumers.

Perspectives

Given my background as a developer, I have always looked at the brands I create from a consumer perspective. What kind of offer could I make to the ordinary drinker when I produce a new gin or vodka, for example?

But I rarely look at these developments from a retailer perspective. What is the view of this ‘No-Lo’ phenomenon amongst the retail community?

With the help of Susan Young, the editor, we decided to test the water with three prominent figures in the Scottish retailing community: Fraser McIlwraith of Dark Art Spirits and owner of the bar Vodka Wodka, Josh Barr, owner of The Locale and West Side bars, and Stuart McPhee of Siberia Aberdeen.

Here are the main points that emerged from our discussion :

They all acknowledged that the ‘No-Lo’ trend was happening in Scotland and that its greatest success was in the beer category. ‘No-Lo’ beers reduced the social stigma attached to ordering soft drinks like lemonade or cola and served to offer the opportunity to become ‘inclusive’ to abstaining customers. If you were in a group ordering Budweiser or Heineken and you called for a Lucky Saint, the gesture would pass without comment.

There was no mention of ‘No-Lo’ wines but some said they had stocked Seedlip and similar products but they weren’t exactly setting the world on fire. Another interesting trend was the development of ‘do-it-yourself’ non-alcoholic cocktails like the ‘Nojito’. This may provide opportunities for mixologists looking for employment. These cocktails also offer a decent margin to the bar. Pricing of 0% spirit mixes or cocktails tended to be on a par with, or slightly below, their alcoholic counterparts. In the case of the latter, this could be justified by their labour-intensive character.

My soft drink approach and ‘Angostura option’ probably need more work before they can get proper engagement from retailers. But I’d be interested to get a reaction from a wider group.

Susan Young says, “David’s piece is an opening salvo in a category that will get increased attention in the years to come. I don’t think it’s going to be a shortterm event.

It would be interesting to get comments from a wider group of people in the Scottish retail sector. What are your experiences and how do you feel about David’s two product suggestions?

To stimulate discussion, we’d like to get as much feedback as possible on this subject. Write to us and we’ll publish a follow-up to this piece in a few weeks’ time.

And the 2 best letters will receive a free copy of David’s terrific book “That s*it will never sell!” which retails at £25 a copy. You can preview it on www. thatshitwillneversell.com and order it on Amazon.

© David Gluckman 24.04.2023

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