SPIRITS AND LIQUORS Trend Report | Q3 & Q4 2009
INTRODUCTION Overall, launch numbers for Spirits & Liquors were up by 131% during the six months to December 2009, boosted by the lucrative Christmas period. Year-on-year figures increased by 39%. All sub-categories saw growth this period, the three prime movers being Tequila (up 369%), Whisky (up 260%) and Vodka (up 225%). Europe remained the most active region this period, accounting for over 60% of all new product launches.
IN THIS REPORT Executive summary...
3
Natural developments...
16
Competitive context...
4
Environmental issues...
19
Regional analysis...
6
Flavors... 21
Europe... 8 Latin America... 9
Innovative packaging... *Forecast...
22
24
North Ameria... 10
Who we are... 25
Premium quality...
Works cited... 26
11
Seasonality... 13
EXECUTIVE SUMMARY Premium quality The higher incidence of at-home use of premium spirits reflects the fact that they cost considerably less when purchased at a store than in a bar or restaurant. Seasonality According to one of the big suppliers, November/December accounts for close to a third of total off-trade spirit sales by volume and around half by value. Natural development In the Spirits & Liquors market, organic credentials tend to be viewed as a premium benefit. Environmental issues Green products are popular with two segments that tend to drink more than others: the affluent and young adults. Flavors Liquors, white rum and vodka featured the highest proportion of flavored varieties. Innovative packaging An interesting bottle or pack are factors that influenced 25% or more of consumers to try a new type or brand of distilled spirit. The new bottle of Tres Generaciones 速 , a super premium tequila, tells the story of hard work, passion and pioneering spirit in a modern way. Each bottle is topped with an elegant wood cork bottle stopper. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 100% organic neutral grain spirit mixed with roots, herbs, spices, citrus and pure cane sugar: the first small-batch run of Art In The Age ROOT has been released in highly limited quantities to establishments in Philadelphia and surrounding areas.
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COMPETITIVE CONTEXT During the six months to December 2009, Wine and Beer were the most active of the Alcoholic Beverages sub-categories, both accounting for just over a quarter of all launches. Liquors was the most active of the sub-categories covered in this Category Insight, constituting a 10% share of new products, whilst Gin was the smallest overall, with just 1%.
Issues affecting the market:
INTERNAL COMPETITION
GOOD NEWS FOR TEQUILA
HEALTH CONCERNS
Vodka has overtaken Scotch as the world’s favorite tipple with sales of £22 billion in 2008. The vodka market is dominated by Diageo, which sold 25.2 million cases, with its closest competitor
Tequila is popular with Hispanics, who are among the fastest-growing segments of the U.S. population. That growth, combined with the fact that Mexican food is among the most popular cuisines in the
Spirits are well placed to help consumers overcome confusion relating to recommended intake of units, as a single measure equates to one unit, an easy to remember figure.
Absolut selling 10.7 million.
U.S., is driving very strong performance.
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COMPETITIVE CONTEXT SUB-CATEGORY COMPARISON NUMBER OF VARIANTS (%)
Whisky
80%
Vodka Tequila Other Spirits
60%
Liquors Gin Wines Flavored
40%
Dark Rum Cider Brandy
20%
Beer
0% Q1/Q2 2008
Q3/Q4 2008
Q1/Q2 2009
Q3/Q4 2009
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REGIONAL ANALYSIS Europe Europe continues to dominate, accounting for a 61% share of the market, up 3% this period. Latin America Latin America’s share of the market fell from one quarter in the previous period to 17% this time. North America Activity here saw renewed growth, up 4% this period and constituting a 13% share of the market. Asia Pacific Asia Pacific accounted for an 8% share of the market, an increase of 2% compared to the previous six months. Middle East & Africa The Middle East & Africa maintained a consistent 2% share of the market this period. TRENDS Liquors was the leading sub-category in both Europe and Latin America, whilst Vodka dominated in North America. Latin America saw the highest proportion of unflavored/plain launches, with cream a popular flavor driven by the prevalence of liquors in this region.
Created in Poland, the birthplace of vodka, Belvedere Vodka is made in accordance with over 600 years of vodka making tradition and heritage. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ A mixto Tequila, Olmeca is made from hand selected blue agave, the piĂąas are slow cooked in brick ovens as part of the 500-year-artisanal Tahona method.
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REGIONAL ANALYSIS NUMBER OF VARIANTS (%)
North America Middle East & Africa
60%
Latin America Europe
40%
Asia Pacific
20%
0%
Q1/Q2 2008
Q3/Q4 2008
Q1/Q2 2009
Q3/Q4 2009
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REGIONAL ANALYSIS: EUROPE Spain was the most active European country accounting for 18% of launches, followed by France with 16% and Germany with 15%. Premium topped the claims this period, seen in 23% of new launches, followed by limited edition (11%) and seasonal (4%) Almost three quarters (74%) of all premium products launched during the six months to December 2009 were found in this region.
Eristoff’s bell-shaped bottle is embossed with the imperial crown and around the base are the words “Original Recipe of Prince Eristoff of 1806”. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ In North-east Scotland, every drop of spirit produced at The Glenlivet distillery is stored in a cask for a minimum of 12 years before it’s bottled and sold. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ The unofficial drink of Southern France, Pastis 51 is diluted with 5 parts water and turns cloudy.
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