Interview, Part 1: Britt West, EVP And General Manager, Spirit Of Gallo

In addition to being the largest wine marketer both in the U.S. and worldwide, Gallo is now a force in spirits as well, with its Spirit of Gallo division ranking third among all spirits marketers in the U.S. in volume terms according to Impact Databank, after only Diageo and Sazerac, with a market share of approximately 11.5%. The company owns the largest-volume spirits label in the U.S. in RTD brand High Noon, and has continued to diversify its portfolio across all price points and categories, most recently adding upscale labels Condesa gin, Barrilito rum, and Derrumbes mezcal. SND executive editor Daniel Marsteller recently spoke with Spirit of Gallo executive vice president and general manager Britt West for an update.

SND: What’s your take on the overall state of the beverage alcohol market?

West: I am a glass-half-full person by nature. And I think a lot of the doom and gloom out there is unwarranted, quite frankly. One, we have to come back to looking at Covid resets and what that means for the industry. But this doom and gloom around Gen Z I don’t buy. There is very much a shifting of preferences, and they consume very differently than previous generations, but I’m actually quite optimistic about the future.

I believe that the Gallup research is very important because it tracks beverage alcohol back to the post-World War II era. When you look at per-capita consumption, this country has not fundamentally changed since that period. It ranges from about 2.3 to 2.5 gallons of ethanol per person in the United States. We got up to around the top of that range and now we’re just coming down to the bottom end.

In my travels and being out in the market, what I see is that consumers are now coming into beverage alcohol very differently. They might be coming in through distilled spirits rather than beer or wine, but the ethanol level is still about the same. The other reason to be incredibly encouraged is how attitudes to alcohol have changed. Just look around at the people promoting and talking about beverage alcohol. When I started my career, you couldn’t get major sports stars, celebrities, and major cultural figures to endorse and do alcohol deals. We have people talking about our brands and our category like never before. And you can’t tell me that’s not impactful.

SND: High Noon has already become the largest spirits brand by volume. What other brands do you see breaking out from the Spirit of Gallo portfolio?

West: Komos and Don Fulano, two very different Tequilas, are really finding their opportunities. On Komos, while there was a big retraction in that luxury over-$100 Tequila set post-Covid, Komos continues to grow and take share. And Don Fulano is also at that price point. The family owned, additive-free moment that is occurring in Tequila is helping to propel that brand. We’ve never been in full enough supply to really let Don Fulano run both from an on-premise standpoint and a geographic standpoint. We’re there now and it’s exciting to watch. It’s growing at +56%. Our investment with Horse Soldier Bourbon is continuing to grow and expand geographically, and we are going to be breaking ground soon in Kentucky on the distillery there.

SND: You’ve also continued to augment the portfolio at a steady clip. What are some of the latest additions?

West: There were three critical spaces that we needed to be in. The first is ultra-premium gin and our investment in Condesa and the strategic partnership that we’ve developed there. The second is Barrilito rum. With Brown-Forman’s acquisition of Diplomatico we had lost our foothold in the luxury rum game. And then Derrumbes mezcal, which is our entrance into mezcal and is also owned in part by Sergio Mendoza from Don Fulano. All three of those have an equity component.

First, with Condesa, I wanted to be in ultra-premium gin, but another Western European gin didn’t seem like the right consumer hook. Condesa has a presence in every hotspot in Mexico City. It’s a female-distilled brand made from Mexican botanicals. I met with them, and they just had the right approach. Then I came back stateside and suddenly I’m seeing this gin pop up in hipster accounts in Brooklyn. We have borders between Canada and Mexico, but brands are universally built across the borders. Tourism goes to Mexico and reverse. We’ve seen our Pink Whitney brand, because of its hockey affiliation, become huge in Canada, for example. So we’re excited about this. It has a clear point of differentiation.

Barrilito is interesting because, as you may know, Barrilito is owned by Joaquin Bacardi and his family. The brand has been challenged to get the distribution that it needs in the U.S. For Puerto Ricans specifically, Barrilito is top of mind when it comes to luxury and more premium rum. They’re seeing incredible numbers through their visitor center in Puerto Rico, and through the airport where they have an awesome presence in travel retail. Their Three Star rum has a very different flavor profile, a lot less sweet than its competitive set, and they have incredible inventories of rum laid down that will allow us to expand and offer different expressions in the future.

On Derrumbes, I was a naysayer on the mezcal category 15 years ago, and so I’m happy to eat crow and come back and look at this. This is a big business. It behaves a lot like single malt Scotch, with exploration being part of the attraction of the category. Derrumbes has seven expressions, one from each of the different states that produce mezcal. That’s interesting because it’s allowing the consumer to understand what the differences are. Some are very smoky, but not all of them are, and there’s full transparency on the label of the agave, the distillation type, and other details.

Tagged : Barrilito, Condesa, Derrumbes, High Noon, New Amsterdam, Spirit of Gallo

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