Home' FMCG Business : FMCG SPT 2015 Contents [ industry trends ]
uromonitor International Alcoholic Drinks Senior Analyst,
Jeremy Cunnington assesses the performance of the spirits
category by its ‘Millionaire’ brands, which are brands
selling over a million 9-litre cases.
Whiskies continued to see healthy volume growth of
3% in 2014. Indian whiskies growth was driven by a
mixture of the higher priced brands in Pernod Ricard’s portfolio as
well as the cheaper brands, such Officer’s Choice. The most dynamic
growth in whiskies came from the Irish whiskey category. Jameson and
the category’s key growth driver continues to be the US, although it is
helped by secondary markets such as South Africa, Russia and Canada.
Irish whiskey is closely followed by Japanese whisky in volume
growth terms, as witnessed by the Suntory’s Kakubin brand
performance. Despite the growing publicity around its higher end
single malts in export markets, growth is still being driven by domestic
Bourbon’s healthy growth is also being driven by the US but also
greatly aided by healthy growth in many international markets notably
France, Germany, Russia and also growing rapidly from a low base in
Latin America. Both major brands, Jack Daniel’s and Jim Beam saw
strong growth, although it is really only Jack Daniel’s that is driving
the international growth.
Single malts continued to grow healthily thanks to continued
good growth in the US, due to the category’s ability to tap into the
continued premium premiumisation trend. That trend is also apparent
in the positive performance in certain Western European markets such
as Germany and parts of Scandinavia.
The one whisky category that continues to disappoint in growth
terms is Canadian whisky with the global category declining by 1%,
driven by its largest market, the US. While producers have looked
to copy the success of bourbon/other US whiskies, by introducing
flavoured variants and greater focus on small batch/craft brands, both
have failed to capture the imagination of consumers so far.
Brandy & Cognac – slow as it goes
The picture for cognac would be a lot worse if it was not for the
dynamic double digit growth of the category’s biggest market - the
US. Many of the cognac’s traditional markets in Western Europe
suffered continued declines and the former category growth driver,
China, suffers from the continued fallout from the anti-corruption
crackdown. Apart from the US the only other bright spot is Africa and
the Middle East, which saw double digit growth driven by Nigeria and
South Africa. It is thus of little surprise to see that the brand with the
broadest geographic spread, Hennessy has performed the best of all
Brandy saw slightly stronger growth but that was only thanks to
the continued growth of its largest market, India, although it was also
helped by a slight return to growth by the next biggest market, the
Philippines after a steep decline the preceding year caused by a duty
hike. However, declines in traditional brandy markets in Europe,
Brazil and China have restricted the rate of growth.
Global spirits performance
Euromonitor International Alcoholic Drinks Senior Analyst, Jeremy Cunnington
assesses the spirits category by its ‘Millionaire’ brands.
ENGLISH GIN HAS SEEN
ITS STRONGEST GLOBAL
GROWTH THIS CENTURY
Vodka – major market weaknesses
Global vodka volumes declined steeply during 2014, down 5% on
the previous year. The key factor in this is the steep decline in the
category’s core region, Eastern Europe, where volumes saw double
digit declines. This decline was led by Russia, which was driven by
legislative changes, notably minimum pricing pushing consumers
towards black market products as seen by the decline in Pyat Ozer
and Green Mark. Other markets such as Ukraine and Poland greatly
contributed to the decline too.
In the US, volume growth has slowed to 1.8% in 2014, less than
half the rate it was in 2012 as the flavour frenzy has fizzled out as
witnessed by the decline of Pinnacle Vodka and as consumers focus
more on whiskies.
Another major vodka market, Western Europe, saw overall category
decline, with steep declines in markets such as Ireland and Finland,
while other larger ones such as Germany and the UK struggled for
62 FMCG BUSINESS - SEPTEMBER 2015
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