Shaken and Stirred

Line extensions and flavor variations are raising sales and profits in the spirits category.   

Hey retailers—raise a toast to this: A proliferation of flavors and line extensions across the liquor category is leading to a spirited boost in sales and profits for the supermarkets that stock them.

Led by the premium brands, spirits line extensions are increasing dollar rings and basket sizes, say industry observers. This is because consumers now often stock more than one variety in their bars and liquor cabinets.

“There has been a rise of craft brands across all categories as consumers seek to explore, experiment and discover even more unique offerings,” says Kate Pomeroy, vice president, consumer insights and innovation, at Pernod Ricard USA, based in New York. As an example she cites Barrelhound, a new Pernod Ricard offering. “Barrelhound is a new blended Scotch with the attitude and taste profile of a bourbon.”

Sol Clahane, vice president, director of channel and chain development group, at Brown-Forman, the Louisville, Ky.-based distiller of Jack Daniel’s, Southern Comfort, Woodford Reserve, Old Forester and other brands, says, “The whiskey category has enjoyed a renaissance fueled by consumers’ desire and interest for the more flavorful, complex and authentic spirits options.

“Flavored whiskeys have contributed growth, which we’ve found to be a great entry into the whiskey and bourbon category,” adds Clahane. “The premium and ultra premium segments have seen consistent growth which has been a plus for retailers looking to drive basket ring.”

Brown-Forman’s line extensions include Jack Daniel’s Tennessee Fire; a limited edition “Sinatra’s Century,” available in October to celebrate Frank Sinatra’s 100th birthday and Jack Daniel’s Single Barrel Barrel Proof. “This is the first-ever barrel proof offering in the brand’s history,” says Clahane. “We think the timing is perfect with the current interest in premium American whiskies.”

This month Brown-Forman is launching 1897 Bottled in Bond, the newest Old Forester’s line extension, and its second in the Whiskey Row Series. “To be labeled as Bottled in Bond, whiskey must have been the product of one distillation season, one distiller and from one distillery,” Clahane notes. “It must have been aged in a federally bonded warehouse for at least four years and bottled at a full 100 proof.”

Black Velvet Canadian Whiskey is currently available in four flavors, including the newest Cinnamon Rush and Toasted Caramel. “Retailers can increase sales by giving the flavors primary shelf placement, dynamic displays and making sure to only carry flavors that are trending as well as looking at brands that are moving through inventory to decide where to place them on the shelf,” says Vicky Arcos, brand director, spirits, at Constellation Brands, based in Canandaigua, N.Y.

Diageo has been expanding its flagship brands, say officials, for the Norwalk, Conn.-based company. That includes the Johnnie Walker brand, which has introduced Johnnie Walker Select Casks Series with the Rye Cask Finish, the first in a series of limited edition blends that will be released over the coming years, each featuring a different wood finish crafted for today’s whiskey explorer.

Cocktail in a shot

The spirits category is expanding with not only new flavors, but innovation as well. LIQS Cocktail Shots is a new player on the scene, merchandising what it calls the first premium, portable bartender-quality cocktail in a shot. Available in Lemon Drop, Vodka Lychee Grapefruit, Vodka Cucumber Lime, Vodka Kamikaze and Tequila Cinnamon Orange, the line is packaged in novel sealed plastic shot glasses, sold in sleeves of three.

“We work with small craft distilleries in the U.S. to get our vodka and a distillery in Mexico for the tequila,” says Michael Glickman, co-founder of New York-based LIQS Cocktail Shots.

Premium vodka also continues on an upward swing.

Brown-Forman’s Finlandia brand is using the environment to set itself apart. “As a new member of 1% For The Planet, Finlandia dedicates one percent of U.S. sales to environmental non-profits that work for preservation of pure water in efforts around the country,” says Clahane.

Vodka is one of the categories undergoing a “whiskyfication” says Pomeroy of Pernod Ricard. “It is the emerging adoption/co-opting of whisky category processes, like barrel aging, different grain bases, etc.,” she says. “Our OAK by ABSOLUT is our traditional ABSOLUT vodka, from a single source in Sweden, rested on oak for a smooth and slightly smoky character.”

Constellation’s SVEDKA Vodka recently launched Grapefruit Jalapeno and SVEDKA 100-Proof. “SVEDKA 100-Proof came on the scene with the goal of bringing quality vodka to the 100-Proof category, which has been growing stronger than both 80-Proof and flavored vodkas,” says Arcos. “With SVEDKA Grapefruit Jalapeno, we are leading the charge, leveraging and embracing the ‘sweet heat’ trend.”

Mixing It Up

Cross-merchandising mixers with spirits and other alcoholic beverages can lead to an increase in sales and profits for both the alcoholic beverage and center store grocery departments, according to industry observers.

“People are investing in their home bars and spending $60 on a bottle of bourbon or $70 on a bottle of vodka, and still dumping cranberry juice and soda water into it,” says Maria Littlefield, partner/president of Owl’s Brew, a New York-based manufacturer of a line of non-alcoholic tea-based cocktail mixers. “Owl’s Brew is that solution. We are a premium mixer that is fresh with new flavors. All of our blends are fresh-brewed, all-natural, essentially double-strength teas meant to be paired with spirits—vodka, bourbon, gin, tequila, even beer and wine.”

Packaged in 8- and 32-ounce bottles, Owl’s Brew is available in four varieties: Pink & Black, Darjeeling with a hint of hibiscus; The Classic, English Breakfast tea with lemon and lime; White and Vine, white tea with watermelon and tart pomegranate; and Coca-Lada, blend of black tea with coconut pieces, chai spices, pineapple juice and agave.

Pasta sauce maker Vino de Milo has gotten into the mixer category with its JB’s Best Classic Bloody Mary Mix. “We take a very similar recipe to one of the market leaders, but we’ve cleaned it up with a natural version that uses local tomatoes, local horseradish, along with Tabasco and Lee & Perrins Worcestershire Sauce,” says Jonathan Milo Leal, founder of the Athens, Ohio-based company.

Vino de Milo’s Bloody Mary mix is packaged in quart wide-mouth spaghetti-sauce style jars. “We did that because McClure’s, which is one of the leaders in Bloody Mary mix, has a similar jar, and we also found that people use more that way,” Leal says. According to Leal, mixers are also great for cross-merchandising.

“In Kroger’s Columbus (Ohio) Division we are being merchandised in the liquor department on an end cap with vodka,” he says. “And in my local Kroger they put the McClure’s Bloody Mary Mix above the olive bar. That makes sense because it is near stuff that consumers put in mixed drinks and it is utilizing previous unused space on the top of the counter.”

Cross-merchandising can also do wonders in the frozen aisle, say officials with Old Orchard Brands, which manufactures a line of frozen juice concentrates that include Strawberry Daiquiri, Piña Colada and Margarita mixes.

“We’re in the process of aligning with a leading liquor brand to pair with our new mixers on a promotion that will kick off in the fourth quarter,” says Kevin Miller, vice president of marketing at Old Orchard Brands, based in Sparta, Mich.