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Despite attempts to fuel volume growth and jumpstart premiumization trends, the rum category has failed to make meaningful progress in the U.S. market, declining by 1.8% to 23 million cases last year, according to Impact Databank. Leading players Bacardi and Captain Morgan have struggled, with both brands collectively shedding more than a million cases since 2010, even as the overall U.S. spirits market grew by nearly 20 million cases during the same period.
After years of lackluster results, Bacardi and Captain Morgan’s combined share of the rum category has fallen from over 65% a decade ago to around 57% in 2015. Still, with the two brands continuing to account for a solid majority of rum consumption, their performance largely determines the direction of the overall category. Brand owners Bacardi USA and Diageo North America are now focused heavily on reversing their brands’ declines with a raft of new initiatives.
Bacardi, which slipped 2.7% to 7.1 million cases in the U.S. last year, has ramped up emphasis on the core brand, recently unveiling a $25 million campaign targeting millennial consumers and the “party occasion.” Running under the tagline “There’s Nothing in the Way,” the push marks the brand’s largest-ever promotional spend. Bacardi is also looking to attract young LDA consumers with its recent launch of new Grapefruit and Raspberry flavor extensions, and it has backed its Oakheart spiced rum offshoot with a millennial-targeted campaign, titled “All In, All Heart.”
Mauricio Bermudez, director of marketing for Bacardi rums, tells SND that connecting with the younger set is crucial to the future of the brand. “Light and flavored rums are still relevant among millennials, especially as an entry into the category,” he explains. “These consumers favor easily mixable spirits.”
Second-ranked rum brand Captain Morgan has also been losing ground, posting a 4.5% volume decline to 6.2 million cases last year. Under pressure from a bevy of spiced rum newcomers, Captain Morgan is taking a different tack with its recent launch of Captain Morgan Cannon Blast. A 35%-abv blend of rum, citrus and chipotle and jalapeño pepper, the new entry is targeted toward shot consumption, going up against popular shot-focused brands such as Fireball.
Matt Bruhn, Diageo’s senior vice president, release brands, says that, like Bacardi, Captain Morgan is angling for a renewed role in consumers’ party plans. “Cannon Blast is our re-introduction into the shot occasion, which represents a shift in the brand’s approach as we focus on Millennial recruitment to build back our leadership as the number-one party spirit,” he says.
Treasury Wine Estates (TWE) has sold 12 non-core brands, further streamlining its operations following its acquisition of Diageo’s wine business earlier this year. TWE says the brands—all from the U.S.—had annual aggregate sales of around 1 million cases. While it didn’t disclose the buyer or the brands (citing its current blackout period in advance of its full-year results release in mid-August), TWE said it received “roughly book value” for the sale. Last month, TWE announced plans to streamline its supply and production operations.
•Wine Spectator has unveiled its Grand Award winners for 2016, honoring restaurants with extraordinary wine programs. This year seven restaurants earned the Grand Award for the first time. They join the ranks of 81 Grand Award winners that successfully renewed their title this year. Wine Spectator will reveal its full slate of Restaurant Awards for 2016 later today.
•Brazil’s Yaguara Cachaça is debuting two new offerings in the U.S. market, Yaguara Branca, a white cachaça (40.5% abv), and Yaguara Ouro (42% abv), a barrel-aged expression. Yaguara Branca ($30 a 750-ml.) and Ouro ($44) join the existing Yaguara Organic Blended Cachaça ($32) in the portfolio, which is distributed by Union Beer/Blueprint Spirits in New York, New Jersey, Connecticut, Rhode Island, Massachusetts and Florida.
•David Stewart, malt master for William Grant & Sons’ Balvenie single malt, has been honored by Queen Elizabeth II as a Member of the Most Excellent Order of The British Empire (MBE). Presented to individuals recognized for a significant achievement or outstanding service to their profession or community, the MBE was bestowed to recognize Stewart’s more than 50 years of dedication to the Scotch whisky industry.
•California-based Infinium Spirits has been appointed the exclusive U.S. importer for Kerrygold Irish Cream liqueur, effective immediately. Kerrygold, which is owned by Ornua, Ireland’s largest dairy exporter, was handled by Marie Brizard Wine and Spirits Americas (formerly Imperial Brands) from its 2014 launch up until May 9, when the two companies mutually parted ways. Kerrygold is a 17%-abv blend of natural Irish cream, oak-aged Irish whiskey, Irish spirit and chocolate.
•California-based Ballast Point is introducing a new flavored India Pale Lager (IPL), Orange Vanilla Fathom. Rolling out in 22-ounce bottles and on draft, Orange Vanilla Fathom is a 7%-abv IPL that is billed as a warm weather brew that is reminiscent of “a creamsicle in a glass.” Ballast Point, acquired by Constellation last year for $1 billion, saw depletions rise more than 60% in Constellation’s recently completed first quarter, ended in May.
•Hawaii’s Maui Brewing has partnered with Cavalier Distributing to enter Indiana and Ohio. Maui Brewing is launching its flagship Bikini Blonde Lager, Big Swell IPA, Coconut Hiwa Porter and Pineapple Mana Wheat labels, as well as seasonal and limited edition offerings, across both markets. The move brings the brewer’s U.S. footprint to a total of 17 states. Established in 2005, Maui Brewing expects to brew around 45,000 barrels this year, and recently expanded its production facility, growing its annual capacity to nearly 100,000 barrels.
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