Efforts to rejuvenate whisky are scotched
By Ian Fraser
The Herald
May 10th, 2007
Distillers look to US after UK campaigns hit the rocks
DISTILLERS’ attempts to revitalise the UK Scotch whisky market through the introduction of more “accessible” brands are faltering badly, with several recent launches specifically intended to attract a younger generation of drinkers to the category either being axed or withdrawn from the UK market.
Even though exports of Scotch whisky are growing at healthy clip, the picture is far less promising at home. According to the latest figures from the Sutherlands Scotch Whisky Yearbook, the UK market for Scotch slumped by 6.2% from 30.1 million litres in 2005 to 28.2 million litres last year.
Recent launches that industry insiders had hoped would help reverse declining UK sales by rejuvenating the image of Scotch at home include JMR’s Easy Drinking Whisky Company (majority-owned by The Famous Grouse parent Edrington Group) , Diageo’s J&B minus 6 degrees and William Grant & Sons’ Monkey Shoulder.
Diageo confirmed yesterday that it has ceased production of J&B -6ºc Scotch whisky. This virtually-clear blended whisky was specifically intended to attract younger drinkers to Scotch. Chill-filtered down to -6 degrees celcius, the product was billed as a “classic for a new generation” and seeded into carefully selected style bars and nightclubs.
In a statement issued to The Herald, Diageo said: “We have ceased production of J&B -6ºc. The decision has been made on a global level and there are currently no future plans for the product.”
“In Britain, despite gaining good distribution and building a reasonable consumer base, J&B -6ºc has not met the stringent performance criteria set by Diageo for ongoing production.”
Meanwhile JMR Easy Drinking Whisky Company, founded in 2003, has withdrawn its range of three blended malt Scotch whiskies – the Big Spicy One, The Smokey Peaty One and The Smooth Sweeter One – from the UK market after disappointing sales. The company, backed by Edrington had hoped to “demystify” the world of Scotch and make the sector more palatable to outsiders.
The company three founders, brothers Jon and Mark Robertson and master blender David “Robbo” Roberston, claimed they had “chucked out the Scotch whisky rule book” through their quirky and irreverent approach to marketing. However the company yesterday confirmed it has thrown in the towel in the UK market. Founder director Mark Geary said it will instead be focusing on the US market.
Geary, who also works as a head of planning and research at Edrington Group, said: “The UK is a tougher market in which to introduce new brands as a result of the low margins available. Because of its sheer size, there is a greater number of consumers open to this sort of thing in the US. It gives us a larger target to shoot at. The opportunity is huge over there.”
Geary said a distribution deal with the Oddbins off-licence chain “came apart” in early 2006 following the retailer’s demands for a big hike in margins but that Sainsbury’s in Scotland continued to be supportive right until the end.
Geary said JMR will focus on exporting to California, Colorado, Texas and Florida, where he said the company has had some success in persuading youngish Americans to acquire a taste for malt whisky. The products were launched in the US in 2005 and Geary said sales rose to 4000 cases during 2006. He said JMR’s products continue to be distributed by the French group Remy Cointreau in the US.
Geary added: “Whilst we are sad to leave the UK for the time being and leave the friends we have made at numerous stores, festivals and events, we are off to spread the news over the pond.” Writing on a blogging website, the Canadian writer Sam Simmons suggested that the JMR range may have failed to take-off in the UK market because of the innate conservatism, or even snobbishness, of consumers.
However a William Grant & Sons says it is committed to persevering with its own youth-oriented brand, Monkey Shoulder. Launched in 2005 this is a blend of three Speyside malts. It is named after the sore shoulder that Scottish distillery workers got from turning the malted barley by hand. A spokesman for William Grants said “we are gaining traction with retailers and the on-trade is becoming more interested. But there’s no denying the UK is a tought market, and blended malts is a relatively new category.”
Alan Gray, whisky analyst at brokers Sutherlands Edinburgh, said: “Just because these attempts at revitalizing the UK Scotch whisky market seem to have failed does not mean the industry should give up trying. Eventually, someone’s going to come up with a breakthrough product that revolutionizes the domestic market. While it’s in a different category the very success of Jack Daniels in the UK proves it can be done.
Gray added: “Even though the UK represents only 10% of global sales, it remains the prism through which many journalists and other commentators tend to look at the Scotch whisky category, so having a healthy and dynamic home market is quite important.”
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