Premium spirits thrive thanks to ‘cost-conscious’ consumers, says report

William Grant & Sons portfolio

Consumers are seeking “more genuine relationships” with drinks brands as part of a more “cost-conscious” approach to what they buy, according to a new report.

While confidence is growing, especially in London and the south-east, the 2015 Market Report from William Grant & Sons UK suggests that the recession has left a lasting legacy.

Marketing director Gary Keogh said: “Conscious choice-making about where to, and where not to spend disposable income is here to stay – thriftiness has become not only habitual but celebrated.

“This is conscious spending, not cost-cutting across the board. Consumers will spend money on those brands that offer something more to them, including the opportunity to associate themselves visibly and proudly with brands that project their values.”

Using data from research specialists CGA and Nielsen, the 2015 Market Report confirms that premium spirits remain in growth against a backdrop of declining sales of alcohol in the UK.

In the year to April, spirits grew almost twice as fast as the alcohol market, up 2.5%, with all channels of trade contributing to this. Premium spirits are growing at 14.1% by value, which is five times more than the total spirits market – the growth in premium spirits accounted for over 60% of total spirit value growth in 2014.

Despite continuing pub closures, the number of on-trade establishments in the UK has risen slightly to over 124,000. The highest rise was in the number of food-led outlets which was up 4.9% in 2014 in Britain, compared to drink-led outlets which declined by 3.8%.

In the on-trade, the biggest spirits category continues to be non-flavoured vodkas, although sales by volume fell by 5.1% and sales by value slipped by 0.4%.

The biggest growth among the main spirits categories in the GB on-trade was by tequila, which was up 15.8% by volume but by 26.6% by value, reflecting the popularity of premium agave spirits. See below for the table from the 2015 Market Report.

The Market Report also highlights the growth in cocktails in Britain, with 23.1% of on-trade outlets now offering them. According to category manager Adrian Green, the number-one cocktail on menus is now the Margarita, taking the place of the Mojito.

William Grant & Sons UK is a leading distributor of premium spirits and champagne in the UK, with brands such as Hendrick’s Gin, Sailor Jerry spiced rum, Disaronno and Tia Maria liqueurs, Reyka Vodka, Tullamore Dew Irish whiskey, Hudson whiskey, Piper-Heidsieck champagne, and scotch whiskies including Glenfiddich, Grant’s, The Balvenie and Monkey Shoulder.

Its Market Report is compiled using the wealth of available expertise and insight within William Grant & Sons UK, together with market data. It highlights key trends to watch, and performance in key spirits categories and champagne while identifying the growth opportunities and how to capitalise on them for its customers and partners.

CGA figures

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