Don Julio Drives Luxury Tequila Market To New Heights

A nearly 1-million-case surge by Diageo-owned Don Julio lifted Tequila’s above-$40 luxury tier to another year of growth in 2024, according to Impact Databank. With that performance, propelled in large part by its reposado expression, Don Julio vaulted to become the largest-selling spirits brand in the U.S. in retail value terms at nearly $2.6 billion last year, overtaking both Tito’s and Diageo portfoliomate Crown Royal.

“We identified that Don Julio Reposado was delivering for consumers eager to explore Tequila,” Diageo North America CEO Sally Grimes recently told analysts. “We rapidly reallocated spending to launch dedicated advertising—with first half sales of Don Julio Reposado up 150%, the brand captured more share of the spirits market than any other in the industry.”

While Don Julio soared last year, fellow Diageo Tequila label Casamigos saw volume decline. This year the company has taken several steps to turn Casamigos around. “We have increased distribution on large and small packs to meet consumer demand and have implemented a clear and aligned pricing strategy,” said Grimes. “We are now launching a new national campaign to build brand awareness, given Casamigos has under 5% household penetration. The campaign reinforces the easy sociability of the brand and the accessibility of the liquid. Finally, we have some exciting Casamigos innovation making the brand more convenient and accessible with a ready-to-drink Casamigos Margarita.”

Bacardi-owned Patrón also declined last year, although it remains above its pre-pandemic volume. Early this year Patrón kicked off a “100% Additive Free Tequila” campaign, a new marketing push focused on out-of-home ads in major U.S. cities, including advertising partnerships with major public transit hubs for services like the New York/New Jersey PATH train and Chicago’s CTA. In addition, the campaign features truck wraps and other mobile ads. Patrón has also focused on higher-end extensions like its El Alto and El Cielo bottlings recently.

Proximo Spirits saw its Maestro Dobel brand slip slightly last year after years of strong growth in which it doubled in size to about 130,000 cases from 2019-2022. But Proximo’s Gran Coramino offering in partnership with entertainer Kevin Hart remains on an impressive upswing, jumping 30% to 90,000 cases in 2024.

Flecha Azul, the upscale Tequila label backed by Mark Wahlberg and marketed by WES Brands, also showed rapid gains last year, leaping 57% to 94,000 cases. And El Tequileno was another fast riser in the luxury segment, with volume increasing 47% to 56,000 cases in the U.S. market in 2024.

Overall, the above-$40 Tequila tier reached 8.4 million cases on 1.5% growth last year, which marked a slight acceleration in terms of incremental cases added compared with the previous year. The total above-$40 segment is now roughly double the size it was in 2019, with much of that advance occurring during the pandemic-era boom of 2020-2022.

Tagged : Bacardi, Casamigos, Diageo, Don Julio, Flecha Azul, Gran Coramino, Maestro Dobel, Patrón, Proximo, WES Brands

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