Table of Contents
Overview
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- What you need to know
- Products covered in this report
Executive Summary
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- The market
- Inflation and success of certain segments drive market growth in 2012-17
- Weakened household incomes to erode volume sales over 2017-22
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- Figure 1: Total value sales of dark spirits and liqueurs, 2012-22
- Volume sales declines for whisky, while rum’s momentum to stall
- Inflation expected for all parts of the market
- Health organisations urge measures to reduce alcohol consumption
- Companies and brands
- The Famous Grouse regains ground as other blended whiskies struggle
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- Figure 2: Leading brands’ shares in the UK retail whisky market, by value, 2016/17*
- Captain Morgan strengthens its hold over the rum market
- Further growth in limited editions and premium variants in 2016-17
- Glenfiddich innovates with barrel type
- Advertising spend falls in 2016
- Lifestyle focus in both spirit and liqueur advertising in 2016/17
- Baileys is the most trusted brand, while Jack Daniel’s is the most widely seen as cool
- The consumer
- Half of UK adults drink dark spirits
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- Figure 3: Usage of dark spirits, by type, July 2017
- Ageing UK population to hinder growth
- Dark spirits’ high price underpins brand loyalty
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- Figure 4: Dark spirits buying factors, July 2017
- Promotions are more compelling than low price for dark spirits buyers
- Drinking with mixers is a key entry point for dark spirits
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- Figure 5: Behaviours relating to dark spirits/liqueurs, July 2017
- Gifting provides another key entry point
- Ethical aspects have strong appeal
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- Figure 6: Attitudes towards dark spirits/liqueurs, July 2017
- Sugar concerns limit the appeal of liqueurs
- What we think
Issues and Insights
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- Recipe suggestions can help companies to harness the power of mixers
- The facts
- The implications
- Brands need to make flavour differences more tangible to shoppers
- The facts
- The implications
- Consumer interest in products with ethical aspects suggests untapped opportunities
- The facts
- The implications
The Market – What You Need to Know
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- Inflation and success of certain segments drive market growth 2012-17
- Weakened household incomes to erode volume sales over 2017-22
- Volume sales declines for whisky, while rum’s momentum to stall
- Inflation expected for all parts of the market
- Health organisations urge measures to reduce alcohol consumption
Market Size and Forecast
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- Inflation and success of certain segments drive market growth 2012-17
- Weakened household incomes to erode volume sales over 2017-22
- Inflation expected for the market
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- Figure 7: Total value and volume sales of dark spirits and liqueurs, 2012-22
- Figure 8: Total value sales of dark spirits and liqueurs, 2012-22
Market Segmentation
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- Whisky grows value and volume sales 2012-17
- Consumer spending cutbacks to erode whisky volume sales
- Dominance of UK-sourced products to curb the effects of inflation
- … but Scotch whisky export boost could lead to higher domestic prices
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- Figure 9: Total value and volume sales of whisky, 2012-22
- Figure 10: Total value sales of whisky, 2012-22
- Rum to struggle to sustain its earlier momentum
- Import-led inflation to continue to push up values
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- Figure 11: Total value and volume sales of dark/golden/spiced rum, 2012-22
- Figure 12: Total value sales of dark/golden/spiced rum, 2012-22
- Brandy’s 2016 bounce is the exception to otherwise weak performance
- Rising prices to drive up brandy values on flat volumes
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- Figure 13: Total value and volume sales of brandy/Cognac/Armagnac, 2012-22
- Figure 14: Total value sales of brandy/Cognac/Armagnac, 2012-22
- Liqueurs see mainly flat volume sales 2012-17
- Liqueurs to see rising prices on flat volumes
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- Figure 15: Total value and volume sales of liqueurs, 2012-22
- Forecast methodology
Channels to Market
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- Higher prices in the on-trade allows it to lead on values but not volumes
- Inflation rises faster in the on-trade 2017
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- Figure 16: Value and volume sales of dark spirits and liqueurs, by channel, 2015-17
- Retail sales of imported whisky and dark rum continue to rise
- Malt whisky’s sales growth stalled as reduced supply drives up prices
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- Figure 17: Value and volume sales of dark spirits and liqueurs in the off-trade, by segment, 2015-17
- Figure 18: Value and volume sales of dark spirits and liqueurs in the on-trade, by segment, 2015-17
Market Drivers
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- Wider economic and political issues impact the market
- Exchange rate-led inflation affects some segments more strongly than others
- Other factors push up costs
- Income squeeze leaves the category vulnerable to cutbacks and switching
- A third of adults have reduced alcohol intake
- Health organisations urge measures to reduce alcohol consumption
- Ageing population to impede both dark spirits and liqueurs
Companies and Brands – What You Need to Know
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- The Famous Grouse regains ground as other blended whiskies struggle
- Captain Morgan strengthens its hold over the rum market
- Further growth in limited editions and premium variants in 2016-17
- Glenfiddich innovates with barrel type
- Advertising spend falls in 2016
- Lifestyle focus in both spirit and liqueur advertising in 2016/17
- Baileys is the most trusted brand, while Jack Daniel’s is the most widely seen as cool
Market Share
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- The Famous Grouse regains ground as other blended whiskies struggle
- Jack Daniel’s continues to benefit from the Americana trend
- Trend also gives a leg-up to Jim Beam
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- Figure 19: Leading brands’ sales and shares in the UK retail whisky market, 2014/15-2016/17
- Figure 20: Leading distributors’ sales and shares in the UK retail whisky market, 2014/15-2016/17
- Captain Morgan strengthens its hold in buoyant rum market
- NPD helps own-label to grow in rum
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- Figure 21: Leading brands’ sales and shares in the UK retail dark/golden/spiced rum market, 2014/15-2016/17
- Figure 22: Leading distributors’ sales and shares in the UK retail dark/golden/spiced rum market, 2014/15-2016/17
- Own-label loses ground in brandy
- Three Barrels piggybacks on the tonic trend
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- Figure 23: Leading brands’ sales and shares in the UK retail brandy/cognac market, 2014/15-2016/17
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- Figure 24: Leading distributors’ sales and shares in the UK brandy/cognac market, 2014/15-2016/17
- Baileys’ focus on its treat aspects helps it to retain its lead
- Pimm’s loses out from lacklustre summer of 2016
- Southern Comfort rebrands under new owners
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- Figure 25: Leading brands’ sales and shares in the UK retail liqueur market, 2014/15-2016/17
- Figure 26: Leading distributors’ sales and shares in the UK retail liqueur market, 2014/15-2016/17
Launch Activity and Innovation
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- Companies continue to release limited editions
- Major and niche brands add new editions
- Premium launches continue
- Jägermeister looks to refresh brand image with new premium variant
- Diageo expands the Haig Club range to go more mainstream
- Historical references used to give an authentic image
- Glenfiddich innovates with barrel type
- Whisky launches turn to iceberg water to imply purity
- Liqueurs turn to on-trend flavours
- Baileys adds a new seasonal variant
Advertising and Marketing Activity
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- Advertising spend falls in 2016
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- Figure 27: Total above-the line, online display and direct mail advertising expenditure on dark spirits and liqueurs, by leading advertisers (sorted by 2016), 2013-2017
- Diageo remains the leading advertiser despite reduced spending
- Baileys pushes treat aspects in female-orientated campaign
- Baileys highlights different usage occasions to create a versatile image
- Captain Morgan continues to urge fans to ‘live like the Captain’
- Jack Daniel’s puts the spotlight on its hometown’s residents
- Events used to drive home associations with American lifestyles
- Famous Grouse focuses on taste and balance
- Personalised bottles used to tap into gifting occasions
- Explaining the maturation process
- Whisky brands praise unconventionality
- Haig Club aims to widen whisky’s appeal
- Glenfiddich celebrates creativity
- Chambord puts the focus on fun
- Sampling opportunities used to further promote cocktail use
- Nielsen Ad Intel coverage
Brand Research
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- Brand map
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- Figure 28: Attitudes towards and usage of selected brands, August 2017
- Key brand metrics
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- Figure 29: Key metrics for selected brands, August 2017
- Brand attitudes: Baileys and Jack Daniel’s are the brands people are most proud to be associated with
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- Figure 30: Attitudes, by brand, August 2017
- Brand personality: Jack Daniel’s is most widely seen as fun and vibrant
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- Figure 31: Brand personality – Macro image, August 2017
- Glenfiddich and Famous Grouse are the most widely seen as traditional
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- Figure 32: Brand personality – Micro image, August 2017
- Brand analysis
- Jack Daniel’s scores well on the fun factor
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- Figure 33: User profile of Jack Daniel’s, August 2017
- Courvoisier enjoys the most sophisticated image
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- Figure 34: User profile of Courvoisier, August 2017
- Baileys is the most trusted brand
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- Figure 35: User profile of Baileys, August 2017
- Glenfiddich has strong associations with tradition and quality
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- Figure 36: User profile of Glenfiddich, August 2017
- The Famous Grouse is widely seen as traditional
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- Figure 37: User profile of The Famous Grouse, August 2017
- Captain Morgan favoured by under-35s
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- Figure 38: User profile of Captain Morgan, August 2017
The Consumer – What You Need to Know
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- Half of UK adults drink dark spirits
- Ageing UK population to hinder growth
- Dark spirits’ high price underpins brand loyalty
- Promotions are more compelling than low price for dark spirits buyers
- Drinking with mixers is a key entry point for dark spirits
- Gifting provides another key entry point
- Ethical aspects have strong appeal
- Sugar concerns limit the appeal of liqueurs
Usage of Dark Spirits and Liqueurs
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- Half of adults drink dark spirits
- Considerable overlap in whisky drinking habits
- Gender bias prevails for dark spirits
- Promoting cocktail use could help to tempt women in
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- Figure 39: Usage of dark spirits, by type, July 2017
- Dark spirits are likely to lose out from ageing UK population
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- Figure 40: Repertoire of dark spirit types drunk, July 2017
- Blended whisky is as likely as Bourbon to be drunk with a mixer
- Drinking with mixers is higher among under-25s
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- Figure 41: Ways of drinking dark spirits, by type, July 2017
- Ageing population also has implications for liqueurs
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- Figure 42: Usage of liqueurs and flavoured dark spirits, by type, July 2017
Dark Spirit Buying Factors
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- Dark spirits’ high price props up brand loyalty
- Introductory offers and ‘trial-size’ bottles offer means to encourage experimentation
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- Figure 43: Dark spirits buying factors, July 2017
- Flavour is neck-and-neck with brand as purchase influencer
- Making flavour differences more tangible would help to address consumer uncertainty
- Dark spirits’ treat status makes promotions more compelling than price
- Need to explain the importance of ageing and small batch production
Behaviours Relating to Dark Spirits and Liqueurs
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- Drinking with mixers serves as a key entry point for dark spirits
- Cocktail recipes in on-trade and retail offer a platform for promoting mixability
- One in three people have moved on from the drinks of their youth
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- Figure 44: Behaviours relating to dark spirits/liqueurs, July 2017
- Gifting is another key entry point into dark spirits
- Companies must pitch their marketing both to drinkers and non-drinkers
- Important to ensure that drinkers let others know of their preferences
- A third of drinkers/buyers research dark spirits before buying
Attitudes towards Dark Spirits and Liqueurs
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- Ethical aspects have strong appeal
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- Figure 45: Attitudes towards dark spirits/liqueurs, July 2017
- Consumers’ researching tendencies boost socially responsible companies
- Charity tie-ups rare within dark spirits
- On-pack calorie labelling per serving could appeal to health-conscious drinkers
Qualities Associated with Selected Types of Liqueurs
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- On-pack recipe suggestions and cross-promotion could help liqueurs to forge a more versatile image
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- Figure 46: Qualities associated with selected types of liqueurs, July 2017
- Cream-based liqueurs are the most widely seen as a treat
- Consumer health concerns around sugar limit the appeal of certain types
- Scope to explore use of sugar alternatives
- Bitters could be promoted as a less sweet form of fruit liqueur
- Opportunities for expansion in vegetable-based products
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Figure 47: Forecast of UK sales of dark spirits and liqueurs, by value, best- and worst-case, 2017-22
- Figure 48: Forecast of UK sales of dark spirits and liqueurs, by volume, best- and worst-case, 2017-22
- Figure 49: Forecast of UK sales of whisky, by value, best- and worst-case, 2017-22
- Figure 50: Forecast of UK sales of whisky, by volume, best- and worst-case, 2017-22
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- Figure 51: Forecast of UK sales of dark/golden/spiced rum, by value, best- and worst-case, 2017-22
- Figure 52: Forecast of UK sales of dark/golden/spiced rum, by volume, best- and worst-case, 2017-22
- Figure 53: Forecast of UK sales of brandy/Cognac/Armagnac, by value, best- and worst-case, 2017-22
- Figure 54: Forecast of UK sales of brandy/Cognac/Armagnac, by volume, best- and worst-case, 2017-22
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- Figure 55: Forecast of UK sales of liqueurs, by value, best- and worst-case, 2017-22
- Figure 56: Forecast of UK sales of liqueurs, by volume, best- and worst-case, 2017-22
- Figure 57: Total volume sales of dark spirits and liqueurs, 2012-22
- Figure 58: Total volume sales of whisky, 2012-22
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- Figure 59: Total volume sales of dark/golden/spiced rum, 2012-22
- Figure 60: Total volume sales of brandy/Cognac/Armagnac, 2012-22
- Figure 61: Total volume sales of liqueurs, 2012-22
- Forecast methodology
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Appendix – Advertising and Marketing Activity
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- Figure 62: Above-the-line, online display and direct mail advertising on dark spirits and liqueurs, by parent company and brand (sorted by top four advertisers in 2016), 2013-17
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Appendix – Usage of Dark Spirits and Liqueurs
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- Figure 63: Ways of drinking liqueurs/flavoured dark spirits, by type, July 2017
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