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Taking Aim At Brown Spirits Trend, Rum Marketers Make New Premiumization Push

July 13, 2017

While premiumization has long been elusive for the rum category, some of the market’s key players are renewing efforts to upscale their portfolios, taking a page out of whisk(e)y’s playbook.

Bacardi North America president Pete Carr recently told SND that the spirits giant’s namsake brand has been too focused on stealing share from vodka in recent years, and is going to go head-to-head with whiskies moving forward. “We’re emphasizing the core, but we also see huge opportunity for Bacardi Gran Reserva Ocho Años and Maestro ($25 a 750-ml.),” Carr says. “Ocho and our high-end rums such as Facundo can go up against any whisk(e)y in the market.”

Bacardi isn’t the only rum player looking to premiumize. William Grant & Sons is bullish on future prospects for the Flor de Caña brand, which rose 27% last year to 129,000 cases. “There are two divergent trends happening for rum. While overall value in the rum category has declined due to the discounting of mid-tier and premium rums, we’re seeing growth at the high end of the category,” says Amy Bidwell, senior brand manager for Flor de Caña. “In 2016, the ultra-premium category saw an increase of 7.1% in annual sales according to Nielsen.

Shaw-Ross International has also carved out solid growth in this space with its Ron Barceló and Pusser’s brands. “We took on Barceló rum (from the Dominican Republic) about six years ago, starting from close to nothing, and this year we’ll approach 70,000 cases, averaging about $25 a bottle,” says Bruce Hunter, managing director, Shaw-Ross International Importers. Hunter notes that Pusser’s is also going strong, growing by about 10% a year and in striking distance of 50,000 cases for 2017.

Serrallés USA recently extended at the premium end with Don Q Oak Barrel Spiced, which retails at around $30 a 750-ml., and is a 90-proof blend of rums aged from three to six years. The Don Q lineup has posted steady growth recently and is nearing 300,000 cases in the U.S. market.

With a focus on the luxury tier, Venezuelan rum brand Diplomático is also thriving. The brand, which is handled by Domaine Select, passed the 50,000-case mark in 2015 and has been advancing by more than 30% since then. Early this year, the brand launched its new Mantuano ($24) and Planas ($29) labels as part of its Tradition range, which also includes the flagship Reserva Exclusiva ($40).

Campari’s Appleton is burnishing its premium credentials with the launch of Joy Anniversary Blend, the brand’s first 25-year-old rum. Created to commemorate the career of 20-year Appleton Estate master blender Joy Spence, the 90-proof limited release ($250) is a blend of hand-selected rums. “While rum has been slow in seeing premiumization trends, we’ve recently started to see respectable growth in the premium and super-premium segments,” says Christine Moll, category marketing director, rums, at Campari America.

Meanwhile, Stoli Group USA and Edrington are on the move with their Bayou and Brugal rum labels respectively. Bayou ($20-$37) is a Louisana-produced brand that is projected at 40,000-50,000 cases this year, while Brugal, from the Dominican Republic, is nearing 70,000 cases. Diageo is also active in the upscale rum segment with its Zacapa brand, which is currently at around 30,000 cases.

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