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Liqueurs’ Longtime Leaders Struggling Amid Changing Tastes

December 23, 2015

With a thriving cocktail culture radiating from key urban centers to more up-and-coming markets around the country, the U.S. liqueurs category is poised for strong growth going forward. But that potential hasn’t helped a number of the category’s longtime leaders, which are rapidly losing ground as consumers’ tastes change and other brands and flavor profiles grow in popularity. De Kuyper, Jägermeister, Baileys Irish Cream, Southern Comfort, Kahlúa and Hiram Walker—the U.S. market’s six largest liqueur brands by volume—have all been fighting an uphill battle.

Excluding the fast-rising flavored whisk(e)y segment, liqueurs are projected to decline by roughly 2% to just under 19 million cases this year, according to Impact Databank. Nearly all of the category’s top players are in decline, with the notable exception of RumChata, which has benefited from its positioning as a mixer with flavored whiskies like Fireball and Jack Daniel’s Tennessee Honey. RumChata, marketed by Agave Loco Brands, is on pace for another double-digit advance this year.

Once the U.S. category leader, Jägermeister lost its top ranking in 2013 to De Kuyper. The German import has since fallen further and is now below the 2-million-case threshold. Over the past five years, Germany’s Mast-Jägermeister has seen its flagship brand shed some 30% of its U.S. volume as a raft of new competitors like Fireball and other flavored whiskies have entered the on-premise shot occasion.

Brown-Forman has actively sought to revive its struggling Southern Comfort liqueur brand, which has seen its U.S. volume erode by around 30% over the past decade. Earlier this year, the company rolled out a packaging revamp and new label design across the entire Southern Comfort line—which includes Southern Comfort 100 Proof, Lime Comfort, Cherry Comfort and March’s launch of Caramel Comfort (27.5% abv, $17). “The new packaging was designed to be timeless and future-proof, remaining reverent to our past and relevant to today’s market, while also standing out on shelves to further illustrate the brand’s unique position within the whiskey category,” says Southern Comfort brand director Lisa Hunter. In addition to the new bottles, Brown-Forman has also enlisted comedian Danny McBride in its newest marketing campaign, “ShottaSoCo,” which includes a song and music video starring the actor, as well as digital short features.

Despite recent efforts to revive the brand, in late September Reuters reported that Brown-Forman was considering a sale of several brands, including Southern Comfort and its super-premium Chambord liqueur label. Brown-Forman declined to comment at the time about the rumored sale.

A full report on the liqueurs market appears in the December 1&15 issue of Impact.

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