Despite Influx Of New Competitors, Patrón’s Progress Ramps UpFebruary 7, 2014
While competition in Tequila’s ultra-premium tier has been intensifying, Patrón, one of the segment’s pioneers, remains in expansion mode, advancing 5.3% to reach 2 million cases in the U.S. market in 2013, according to Impact Databank. With that performance, Patrón (minority-owned by Bacardi) has grown by nearly 20% since 2009, despite contending with increased competition in its own price tier, as well as a boom in accessibly-positioned 100%-agave Tequilas and the lingering effects of the economic downturn.
Patrón Spirits tells SND that high-end offerings like Gran Patrón Platinum ($200) and Gran Patrón Burdeos ($500) did particularly well last year and are helping to affirm the brand’s ultra-premium credentials, as competitors like Pernod Ricard’s Avión, Brown-Forman’s Herradura and Diageo’s newly-acquired DeLeón ramp up their own upmarket activities. Patrón says rising consumer interest in handcrafted, artisanal spirits is driving gains at the connoisseur level, and it will continue to target that segment with new releases, such as its recent Gran Patrón Piedra entry, an extra añejo aged more than three years in American and French oak and retailing at $400 a bottle.
Beyond its namesake Tequila, Patrón Spirits saw mixed results for its brand stable in the U.S. Pyrat rum enjoyed a 6% increase to 32,000 cases, while Ultimat vodka was up 2% to 26,000 cases. The year proved more challenging for the company’s liqueur brands, however, which had been on a steep growth curve.
Patrón Citronge eked out a 1% advance to 134,000 cases, but portfoliomate XO Café took a step back, slipping 6% to 150,000 cases. Like Patrón’s core Tequila, XO Café has confronted an increasingly competitive landscape of late. Both Avión and Campari America’s Cabo Wabo have extended with coffee-flavored liqueurs over the past year. For 2014, Patrón says it will sharpen its focus on XO Café in the on-premise, as well as backing the brand with advertising and digital and social media activations.
As Patrón Spirits aims to extend its progress in 2014, it will do so with some new faces amongst its leadership team. Following the departure of former COO John McDonnell, who joined Tito’s vodka as managing director, international last May, Patrón tapped industry veteran Dave Wilson to fill its COO post. Then, on January 1, it welcomed a new CMO, Lee Applbaum, a veteran of Coca-Cola, Target and Radio Shack, who replaced the retiring Matt Carroll.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.