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Brown-Forman Looks To Ignite Southern Comfort With Launch Of Fiery Pepper Flavor Extension

September 20, 2011

Southern Comfort is a brand that’s been under pressure in its core on-premise shot occasion, notably from hot categories like flavored vodkas, flavored whiskies and spiced rums. But now the Brown-Forman liqueur brand is fighting flavor with flavor. Having launched Southern Comfort Lime last year, it’s set to introduce Southern Comfort Fiery Pepper—a collaboration with McIlhenny Co.’s Tabasco hot sauce brand that aims to deliver a “sweet-heat” taste profile.

Fiery Pepper, which rolls out nationally next month and is priced in line with the core brand at $17 a 750-ml., is Southern Comfort’s biggest new product launch to date. It will see a 10-week national TV buy from October through December, the largest for a single initiative in Southern Comfort’s history, according to the brand’s U.S. marketing director, Lena DerOhannessian. “We see Fiery Pepper becoming popular with our older consumers because it mixes so well in drinks like the Bloody Mary and the Margarita,” she says. “But we expect there to be a pretty wide adoption by younger consumers as a shot option in bars, as well as a mixer with Dr. Pepper, ginger ale and so on.”

DerOhannessian declined to provide volume targets for Fiery Pepper, but said it’s expected to surpass Southern Comfort Lime’s first-year volume within eight months. Lime received a significant part of the Southern Comfort brand’s marketing attention over the summer months. “Our fiscal year that began in May has been a steady ramp-up against Lime in the summer and now against Fiery Pepper,” says DerOhannessian. “For Lime, we ran local TV buys and saw a double-digit turnaround for our parent business in those markets. We expect Fiery Pepper’s national ads to pay back in a significant way for the parent brand as well.”

That would be good news for the core Southern Comfort brand, which continued to slide in Brown-Forman’s first quarter ended July 31, falling 6% by volume and value globally during that period. Southern Comfort, which does about half its 2.5-million-case global volume in the U.S., has seen its U.S. depletions decline from 1.54 million cases in 2006 to 1.28 million cases last year, a decrease of 17%. Its ready-to-drink and premixed cocktail business struggled most in the May through July period, falling 15% by volume and 14% by value.

“A couple years ago we saw a proliferation in the premium ready-to-serve cocktail category, and we had success there as well,” DerOhannessian says (Southern Comfort earned Impact “Hot Prospect” honors in 2009 with Southern Comfort Ready-to-Serve Hurricane, Lemonade and Sweet Tea). “But trends are shifting now, so we’ll need to keep coming up with new offerings, flavors and formats. We have an innovation strategy for now through 2020, so this is a long-term vision. And it’s consistently around Southern Comfort’s original mission, which is to soften brown spirits and make them more appealing.”

USA – Leading Cordials/Liqueurs
(thousands of nine-liter case depletions)
Percent Change
Brand Company 2008 2009 2010 2008-2009 2009-2010
Jagermeister Sidney Frank Importing Co Inc 2,880 2,700 2,700 -6.3% 0.0%
De Kuyper Beam Inc 2,700 2,529 2,447 -6.3% -3.2%
Baileys Diageo North America 1,411 1,311 1,312 -7.1% 0.1%
Southern Comfort Brown-Forman Beverages Worldwide 1,455 1,360 1,283 -6.5% -5.7%
Kahlua Pernod Ricard USA 1,100 1,029 998 -6.5% -3.0%
Hiram Walker Pernod Ricard USA 920 918 890 -0.2% -3.1%
Grand Marnier Moet-Hennessy USA (LVMH) 510 483 473 -5.3% -2.1%
Total Leading Brands 10,976 10,330 10,103 -5.9% -2.2%
Source: IMPACT DATABANK
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