Interview, Part 1: Paul Basford, President And Managing Director, William Grant & Sons USA

Super-premium spirits brands like Milagro Tequila, Hendrick’s Gin, and Reyka vodka have been leading growth for William Grant & Sons in the U.S. lately, benefiting from the on-premise rebound to drive the portfolio to 3.4 million cases last year, according to Impact Databank. This year, William Grant is aiming to keep up that momentum while also leveraging its strong position in brown spirits with single malt Scotches like Glenfiddich and The Balvenie and Irish whiskey Tullamore D.E.W. SND executive editor Daniel Marsteller spoke with Paul Basford, president and managing director of William Grant & Sons USA, for an update.

SND: How is the overall health of the spirits market at the midway point of the year, and what business dynamics are you monitoring for the second half?

Basford: We’re undoubtedly seeing a period of normalizing post-Covid. The personal disposable income of a lot of people post-stimulus has changed. You’ve had a supply chain context that’s been very difficult and has caused different brands problems at various times. Obviously with the on-premise, we see a channel normalization as well. The Covid period was actually really strong for spirits, and a lot of people are trying to hold onto that +9% so spirits’ market share doesn’t decline. RTDs are continuing to take share from wine and beer. There are a lot of category dynamics in play that continue to make spirits the right bet to back at the moment. Premium-plus within spirits has been gaining share, and the majority of the William Grant portfolio sits in that area.

SND: What are you seeing on core brands like Hendrick’s and Milagro?

Basford: Gin overall has slowed, but Hendrick’s is leading growth at the super-premium level. We invest heavily behind it and we’ve had quite a lot of success stealing from other white spirits, particularly vodka, because it’s not the heaviest, botanical kind of gin. The return of the on-premise has been a very important trend for Hendrick’s. It’s the most listed gin on restaurant menus in the U.S. and it’s become the default call generally for Gin and Tonic. It’s great to see Hendrick’s almost back to a 50-50 split on- versus off-premise, which is where we were pre-Covid.

Milagro has been our strongest growing brand, and it’s growing in all variants. We have a nice differentiation within the category. Tequila is quite a black-and-white type of category in terms of the way it looks and its orientation, and with Milagro’s packaging and “Brighter Side of Tequila” campaign it brings a more colorful feel. We’ll continue to grow the spend, and we’ll also continue to push Milagro further with innovation, which will be coming early next year.

SND: How’s progress in single malt?

Basford: It’s the heart of our business, with Glenfiddich and Balvenie. Both have definitely benefited from the normalization of the on-premise, getting listings and menu features back as outlets replenish their lists. Both of them have been impacted by supply, but we’re through that and now moving forward in a very progressive way, which means we can start to do more with special releases. Glenfiddich recently released the Grand Yozakura, 29 years old and finished in Japanese Awamori barrels, which sells for about $1,999. And then Balvenie, we tend to be more aged in our variants, so 30-, 40-, 50-, and recently we released a 60-year-old, commemorating master distiller David Stewart’s 60th year in the business.

Tagged : Glenfiddich, Hendrick's, Milagro, The Balvenie, William Grant & Sons

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