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As Single Malt Thrives, Blended Scotch Looks To Turn The Corner

October 19, 2016

As whiskies surge in the U.S. market, blended Scotch is being left out of the boom. Last year, total Scotch shipments to the U.S. posted a 0.1% increase by value to £749.3 million ($977m), with depletions slipping 0.4% to 7.6 million cases. Those numbers include the white-hot single malt segment, whose volumes were up 9% last year to 1.5 million cases—making it clear that blends are impeding overall category growth.

The first six months of 2016 saw some improvement in the value equation, as total Scotch rose by 9% to £357 million ($467m). But volumes slipped by 3%, according to the Scotch Whisky Association.

Still, top marketers are fighting back with premiumization strategies. Category leader Johnnie Walker slid 6% in the U.S. market last year to 1.6 million cases, but a 23% net sales increase at the Reserve level led it to a 7% sales boost in brand-owner Diageo’s fiscal year through June. Late last year, Johnnie Walker unveiled its largest-ever global marketing push, titled “Joy Will Take You Further,” which appears to be paying dividends.

Several other leading blended Scotch players—including Johnnie Walker portfoliomate Buchanan’s and Bacardi USA’s Dewar’s—are also gaining. Buchanan’s, with a strong following among Latino consumers, recently released a new campaign called “Es Nuestro Momento” (It’s Our Moment), hoping to build on last year’s 9.5% growth to 465,000 cases. Meanwhile, Dewar’s has been staging a turnaround over the past year, thanks to new efforts such as Scratch Cask, a Bourbon-influenced offering.

Meanwhile, single malt Scotch brands like Pernod Ricard’s The Glenlivet and Edrington’s The Macallan are buoying the overall category. The Glenlivet, up more than 8% by volume in the U.S. last year, has focused on new product development, recently unveiling Founder’s Reserve ($45), a new expression made with both aged oak and American first-fill oak casks. The Macallan recently added to its core lineup with Double Cask 12-year-old ($65), which combines the influence of American oak Sherry-seasoned casks and European oak Sherry casks and is positioned between the brand’s existing Sherry Oak and Fine Oak ranges. —Christina Jelski

U.S. – Top Seven Scotch Whisky Brands
(thousands of nine-liter cases)
Rank Brand Importer 2012 2013 2014 2015 Percent
Change1
2014-2015
1 Johnnie Walker Diageo North America 1,724 1,741 1,733 1,638 -5.5%
2 Dewar’s Bacardi USA Inc 1,158 1,293 1,140 1,196 4.9%
3 Buchanan’s Diageo North America 300 360 425 465 9.5%
4 Clan MacGregor William Grant & Sons USA 510 444 454 441 -2.9%
5 The Glenlivet Pernod Ricard USA 361 388 386 418 8.3%
6 Chivas Regal Pernod Ricard USA 394 391 357 357 -0.1%
7 The Macallan Edrington Americas 155 186 203 217 6.9%
Total Top Seven2 4,602 4,802 4,697 4,731 0.7%
1 based on unrounded data
2 addition of columns may not agree due to roundingSource: IMPACT DATABANK
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