COMMENT

The growth drivers in whisky

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JENI SPINKS

Head of Commercial Marketing, Edrington-Beam Suntory UK

Following substantial investment and extensive research, the team at Edrington-Beam Suntory UK has identified a series of six drivers of growth within the spirits industry.

In-depth interviews, accompanied shops, and detailed usage and attitude studies enabled the views of consumers, shoppers and industry alike to be studied and understood, to ultimately produce this rigorous set of growth drivers. This research uncovered substantial headroom within the UK spirits market and outlines that growth is likely to take the form of one of the six drivers outlined below.

Discovery

Discovery is a way to continue to bring new drinkers into spirits and presents immense opportunity to drive category growth.

Encouraging discovery for these consumers by offering consumption opportunities that diminish the barriers – such as the belief that the alcohol might taste too harsh – has been critical in enlightening a wider group of people about the potential for whisky in their repertoire.

At the same time, the concerted effort by brands and retailers, alongside bartenders, to demystify whisky will also drive discovery – making the category easier to access for consumers and easier to buy at the bar or in-store and (increasingly) also online.

Whether through positioning mixed drinkers (such as the highball, where adoption is being driven by Edrington-Beam Suntory UK brands – especially by Jim Beam – and has since been embraced elsewhere) or through the medium of recognised, trusted brands such as The Famous Grouse, this is a driver that could add substantially to the value of the whisky category in the coming years.

Adventure

In value terms, this is a vital driver identified by the team at Edrington-Beam Suntory UK – the opportunity to encourage whisky drinkers to trade up and through the category, as well as to “shake up” existing drinkers’ routines and thereby increase the frequency with which whisky is selected over alternative beverages.

To do so, we need brands that will help spirits drinkers to add to their repertoire and encourage trade-up.

With brands such as The Macallan and Highland Park that offer significant range and diversity in their portfolios, we have a real opportunity to activate this existing consumer behaviour while contemporary whisky brands are also encouraging new drinkers to the category.

Combining innovation, education and communication to help our consumers better navigate the whisky category both in the on-
and off-trade will encourage this sense of adventure.

By encouraging existing consumers to explore the category more widely – for example through cocktails in-bar– there is immense value here to be unlocked as consumers may not consume whisky at home but could be introduced to the category.

Refreshment

Whisky has not always been a consideration for consumers looking for refreshment. However, innovation, longer serves and communication that make spirits relevant to refreshment occasions – becoming the “first drink of the night” – will drive further growth.

Serves such as the highball through the summer months – across a wider range of brands and outlets to establish this as a new way of consuming whisky in the UK, as is the case elsewhere – are already driving growth in an occasion where the category under-trades at present. Combining Japanese whisky and the range of premium mixers specifically designed for highball-inspired serves has offered new opportunity in the category.
Sharing

Sharing

The drive amongst consumers to want to feel part of a group and to share a moment through their choice of drinks – creating social bonds – could give whisky another vital role in consumers’ repertoires.

The development of bottle-to-table serves, and of new cocktail serves that offer opportunities for groups to share, all play to this consumer driver, further offering opportunity to unlock the value in the category.

Perfect experience

The quality of experience of drinking spirits is driven by a greater demand from consumers – those looking for both the “perfect serve” and “perfect bar experience”.

In the specialist on-trade, this is about offering something that can’t be replicated at home – for example a dram of a highly-valued spirit when a bottle might be prohibitively expensive while, at the same time, increasing consumer education and knowledge. All in an environment relevant to such a premium experience.

Away from specialist cocktail bars, there is a real barrier to ordering spirits because consumers – particularly younger groups more likely to spend money in-bar – worry that their drink will not be made properly and their investment will be wasted.

Continuing to develop our bartenders and educate consumers is a critical part of delivering the perfect experience driver to customers and realising the potential value of getting this aspect of the whisky experience right.

All the while, we are seeing retailers activating in store through recipe suggestions and education to further create this sense of experience amongst consumers – recent research shows there were 120 million at-home dinner party occasions in 2018 and that 11% more of those featured spirits than in 2013.

Gifting

Our research has shown that consumers increasingly view spirits as a great gift for “special moments” (where there is greatest potential for value to be unlocked).

According to our research, we know that 50% of whisky shoppers are buying as a gift. In line with this, there has been substantial investment into products and formats to meet this need whether limited editions, special gift packs with value-add items or formats geared towards the gift market.

Whether positioning premium or limited editions as perfect gifts, or developing gift packs to cater for the latent demand for whisky as a gift, we believe there is huge value to be realised by catering for the gifting driver.

At the same time, retailers are also fuelling growth by offering year-round gifting for their customers, rather than rolling whisky gifts out solely around Christmas and Father’s Day – the traditional moments.