Vodka Still Holding Court
Dollar sales of spirits grew 3.4% in the four weeks to May 18, 2008, according to IRI scan data. Vodka grew 6.5%, followed by brandy (4.4%), whiskey (4.3%), rum (3.5%), gin (3.1%), tequila (1.9%) and cognac (-3.1%). This indicates that pricing is either on the rise or people are trading up to more expensive spirits brands (improved mix/shift).
Volume of spirits rose 2.2% in the four week period, with vodka showing the most volume growth (6.3%) and cognac declining the most at -5.9%. Volume of brandy grew 3%, followed by gin (2.1%), rum (2%), tequila (1.9%) and whiskey (1.5%).
Most of the growth in whiskey comes from the Irish whiskey category, which grew 31% in value and 31.7% in volume.
INDIVIDUAL BRANDS. Dollar sales of Smirnoff rose 5.9% in the four week period, followed by Bacardi (1.2%), Captain Morgan (2.9%), Jose Cuervo (-3.6%), Jack Daniel’s (2%), Absolut (0.8%), Crown Royal (10.7%), Skyy (15.1%), Jim Beam (2%) and Sauza tequila (2.2%), according to IRI.
Hot brands like Grey Goose were up 6.2%, Jagermeister up 11.4%, Patron up 23.3%, Tanqueray up 0.4% and Svedka up 60%. Some of the other super-premium vodkas did not see the same rate of growth as Grey Goose in the four weeks. Ketel One was down -3%, Belvedere declined -4.7%, Stoli (-8%) and Chopin (-9.2%).
PRICE CATEGORIES. According to the data, trading up continues among consumers albeit at a slower rate. Dollar sales of ultra-premium vodka rose 6.4% and volume was up 5.6%. The highest rate of dollar sales growth of vodka, however, came from its mid-value price category. Dollar sales of mid-value vodka rose 7.6% and volume grew 6.8%. The highest rate of growth for volume came from vodka’s premium category, up 8%.
In all other spirits categories, its ultra-premium offerings showed the highest rate of dollar sales growth. Sales of ultra-premium whiskey grew 9.1% but volume was down -1.4%. Value of ultra-premium rum was up 72% and volume grew 82.4%. Ultra-premium tequila saw sales rise 14.9% and volume grow 14.5%. Lastly, ultra-premium gin rose 11.7% and volume increased 0.5%.
Other than rum, the spirits categories saw stronger volume growth in varying price categories. Volume of popular whiskey grew the highest at 1.4% out of the whiskey category. Super-premium tequila saw the highest volume growth rate (16.1%), while value gin grew the most at 3.4%.
EQUIVALENCY OUT THE DOOR AT BARS AND RESTAURANTS
The Chicago Sun-Times has an interesting article on equivalency, which argues that there is no such thing as a standard drink at bars and restaurants. William Kerr and colleagues with the Alcohol Research Group hit several bars in northern California and found that “the typical wine, beer or mixed spirits drink in bars is larger than a standard drink, often by 50 percent or more.”
The average glass of wine was 43% larger than a standard drink and the average draft beer was 22% larger than the standard 12 ounces. The team did no testing of bottled beer. And while shot glasses “are pretty uniform,” mixed drinks with liquor were 42% larger than the standard serving.
Factors such as glass size and the percent of alcohol by volume help make the on-premise drinks stronger, according to the study. However, Kerr said “probably the most important factor is the intentions of management and the bartender.”
For example, restaurants and bars tend to pour large glasses of wine so customers feel like they are getting their money’s worth.
The research, sponsored by the National Institute on Alcohol Abuse and Alcoholism, will be published in September in the journal Alcoholism: Clinical and Experimental Research, but was released online this week.
WINE INSTITUTE ELECTS NEW BOARD
The California Wine Institute has elected Margaret Duckhorn as the board chairman for the 2008-2009 fiscal year. She is co-founder and executive vp of industry relations at Duckhorn Wine Company, which includes Duckhorn Vineyards in St. Helena, Paraduxx in Napa Valley and Goldeneye in Anderson Valley.
Also elected were Raymond Chadwick of Diageo Chateau & Estate Wines, headquartered in Napa, first vice chairman; Tom Klein of Rodney Strong Vineyards in Healdsburg, second vice chairman; David Kent of the Wine Group, headquartered in San Francisco, treasurer; and Kathleen Heitz Myers of Heitz Wine Cellars in St. Helena, secretary.
LVMH BEATS ECONOMY WITH EXPENSIVE BOTTLES
In an interview with Bloomberg, Xavier Ybarguengoitia, chief executive of Paris-based Estates & Wines, a division of LVMH Moet Hennessy, says the company’s strategy is selling expensive bottles despite the tough economic conditions. He said demand for wines that cost $15 or more has risen, and Estates & Wines will focus on that top 1% of the market. As a result, he said, the Estates & Wines division has experienced “double-digit growth” in the past six years, outpacing Moet Hennessy.
Ybarguengoitia said the company doesn't need any more vineyards at the moment, but may consider “buying some more in 2011,” particularly in a premium wine area that focuses on the top end of the market.
NEW YORK TIMES ON BRUNELLO BAN
The New York Times featured an article on the Brunello upset in Italy. Wine journalist Eric Asimov calls news that the TTB has dropped its threat to block imports of brunello into the U.S. “a step forward, given that the laboratory analysis apparently takes a long time and the margin for error is great.” Instead, the U.S. will accept certification from the Italian government that the wines comply with the rules.
WSD BRIEFS:
CALIFORNIA MAY SOON TAX BEER AND MALTERNATIVES THE SAME AS LIQUOR, according to our sister publication Beer Business Daily. The California State Board of Equalization has issued regulations that would increase state taxes on FMBs by 1,660%, which would also apply to all beer unless each manufacturer applies to the state to be reclassified as beer. That means beer would go from $0.20 per gallon to $3.30 per gallon. Wine is exempt.
Diageo is suing, claiming the BOE has exceeded its jurisdiction. The form hasn't been finalized but is expected to be ready by July 10.
FOSTER’S WINE ESTATES has appointed Matthew Parish to the position of vice president of premium winemaking in the US. Parish will oversee Foster's Americas winemaking activities for all premium brands and report to Michael Kluczko, vp of wine production in California. Parish most recently worked at Constellation as director of group winemaking for California, the Pacific Northwest, and internationally.
UB GROUP OF INDIA HAS DEVELOPED A DIET WHISKY AND VODKA by using Garcinia fruits, says chairman Vijay Mallya. He said it has been successfully tested for calories and was developed and patented in the U.S. Mallya said manufacturing and marketing was delayed as he haggles over classification with the European Union.
Until tomorrow, Megan
“To invent, you need a good imagination and a pile of junk.”
Thomas A. Edison
--------- Sell Day Calendar ----------
Today's Sell Day: 14
Sell days this month: 21
Sell days this month last year: 21
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: 0
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
Volume of spirits rose 2.2% in the four week period, with vodka showing the most volume growth (6.3%) and cognac declining the most at -5.9%. Volume of brandy grew 3%, followed by gin (2.1%), rum (2%), tequila (1.9%) and whiskey (1.5%).
Most of the growth in whiskey comes from the Irish whiskey category, which grew 31% in value and 31.7% in volume.
INDIVIDUAL BRANDS. Dollar sales of Smirnoff rose 5.9% in the four week period, followed by Bacardi (1.2%), Captain Morgan (2.9%), Jose Cuervo (-3.6%), Jack Daniel’s (2%), Absolut (0.8%), Crown Royal (10.7%), Skyy (15.1%), Jim Beam (2%) and Sauza tequila (2.2%), according to IRI.
Hot brands like Grey Goose were up 6.2%, Jagermeister up 11.4%, Patron up 23.3%, Tanqueray up 0.4% and Svedka up 60%. Some of the other super-premium vodkas did not see the same rate of growth as Grey Goose in the four weeks. Ketel One was down -3%, Belvedere declined -4.7%, Stoli (-8%) and Chopin (-9.2%).
PRICE CATEGORIES. According to the data, trading up continues among consumers albeit at a slower rate. Dollar sales of ultra-premium vodka rose 6.4% and volume was up 5.6%. The highest rate of dollar sales growth of vodka, however, came from its mid-value price category. Dollar sales of mid-value vodka rose 7.6% and volume grew 6.8%. The highest rate of growth for volume came from vodka’s premium category, up 8%.
In all other spirits categories, its ultra-premium offerings showed the highest rate of dollar sales growth. Sales of ultra-premium whiskey grew 9.1% but volume was down -1.4%. Value of ultra-premium rum was up 72% and volume grew 82.4%. Ultra-premium tequila saw sales rise 14.9% and volume grow 14.5%. Lastly, ultra-premium gin rose 11.7% and volume increased 0.5%.
Other than rum, the spirits categories saw stronger volume growth in varying price categories. Volume of popular whiskey grew the highest at 1.4% out of the whiskey category. Super-premium tequila saw the highest volume growth rate (16.1%), while value gin grew the most at 3.4%.
EQUIVALENCY OUT THE DOOR AT BARS AND RESTAURANTS
The Chicago Sun-Times has an interesting article on equivalency, which argues that there is no such thing as a standard drink at bars and restaurants. William Kerr and colleagues with the Alcohol Research Group hit several bars in northern California and found that “the typical wine, beer or mixed spirits drink in bars is larger than a standard drink, often by 50 percent or more.”
The average glass of wine was 43% larger than a standard drink and the average draft beer was 22% larger than the standard 12 ounces. The team did no testing of bottled beer. And while shot glasses “are pretty uniform,” mixed drinks with liquor were 42% larger than the standard serving.
Factors such as glass size and the percent of alcohol by volume help make the on-premise drinks stronger, according to the study. However, Kerr said “probably the most important factor is the intentions of management and the bartender.”
For example, restaurants and bars tend to pour large glasses of wine so customers feel like they are getting their money’s worth.
The research, sponsored by the National Institute on Alcohol Abuse and Alcoholism, will be published in September in the journal Alcoholism: Clinical and Experimental Research, but was released online this week.
WINE INSTITUTE ELECTS NEW BOARD
The California Wine Institute has elected Margaret Duckhorn as the board chairman for the 2008-2009 fiscal year. She is co-founder and executive vp of industry relations at Duckhorn Wine Company, which includes Duckhorn Vineyards in St. Helena, Paraduxx in Napa Valley and Goldeneye in Anderson Valley.
Also elected were Raymond Chadwick of Diageo Chateau & Estate Wines, headquartered in Napa, first vice chairman; Tom Klein of Rodney Strong Vineyards in Healdsburg, second vice chairman; David Kent of the Wine Group, headquartered in San Francisco, treasurer; and Kathleen Heitz Myers of Heitz Wine Cellars in St. Helena, secretary.
LVMH BEATS ECONOMY WITH EXPENSIVE BOTTLES
In an interview with Bloomberg, Xavier Ybarguengoitia, chief executive of Paris-based Estates & Wines, a division of LVMH Moet Hennessy, says the company’s strategy is selling expensive bottles despite the tough economic conditions. He said demand for wines that cost $15 or more has risen, and Estates & Wines will focus on that top 1% of the market. As a result, he said, the Estates & Wines division has experienced “double-digit growth” in the past six years, outpacing Moet Hennessy.
Ybarguengoitia said the company doesn't need any more vineyards at the moment, but may consider “buying some more in 2011,” particularly in a premium wine area that focuses on the top end of the market.
NEW YORK TIMES ON BRUNELLO BAN
The New York Times featured an article on the Brunello upset in Italy. Wine journalist Eric Asimov calls news that the TTB has dropped its threat to block imports of brunello into the U.S. “a step forward, given that the laboratory analysis apparently takes a long time and the margin for error is great.” Instead, the U.S. will accept certification from the Italian government that the wines comply with the rules.
WSD BRIEFS:
CALIFORNIA MAY SOON TAX BEER AND MALTERNATIVES THE SAME AS LIQUOR, according to our sister publication Beer Business Daily. The California State Board of Equalization has issued regulations that would increase state taxes on FMBs by 1,660%, which would also apply to all beer unless each manufacturer applies to the state to be reclassified as beer. That means beer would go from $0.20 per gallon to $3.30 per gallon. Wine is exempt.
Diageo is suing, claiming the BOE has exceeded its jurisdiction. The form hasn't been finalized but is expected to be ready by July 10.
FOSTER’S WINE ESTATES has appointed Matthew Parish to the position of vice president of premium winemaking in the US. Parish will oversee Foster's Americas winemaking activities for all premium brands and report to Michael Kluczko, vp of wine production in California. Parish most recently worked at Constellation as director of group winemaking for California, the Pacific Northwest, and internationally.
UB GROUP OF INDIA HAS DEVELOPED A DIET WHISKY AND VODKA by using Garcinia fruits, says chairman Vijay Mallya. He said it has been successfully tested for calories and was developed and patented in the U.S. Mallya said manufacturing and marketing was delayed as he haggles over classification with the European Union.
Until tomorrow, Megan
“To invent, you need a good imagination and a pile of junk.”
Thomas A. Edison
--------- Sell Day Calendar ----------
Today's Sell Day: 14
Sell days this month: 21
Sell days this month last year: 21
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: 0
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
posted at 10:43 AM
<< Home