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Flavor Focus Drives Gains For Canadian Whisky

November 2, 2018

Over the past few years, flavors have become a hugely influential part of the Canadian whisky category and contributed to overall gains in the U.S. market. Last year, for example, Canadian whisky volumes including flavors rose by 1.9% to 20.4 million cases in the U.S., and are up by nearly 2 million cases from their 2014 level of 18.6 million cases. Excluding flavors, the Canadian category is down by nearly 2 million cases since 2010, according to Impact Databank.

Diageo-owned Crown Royal has been a major mover within Canadian whisky’s flavor segment, led by its Regal Apple offering. Regal Apple ($25), which sells roughly 1.4 million cases annually, is now the second-largest flavored entry in the Canadian category, after Sazerac’s Fireball ($19), which looks set to cross the 5-million-case mark this year. Diageo followed up Regal Apple with the successful Crown Royal Vanilla—which was above 400,000 cases last year in its second year on the market—and the limited-edition Salted Caramel. Most recently the brand added Texas Mesquite, a blend of Crown Royal Deluxe and smoky Texas mesquite wood flavor. On the unflavored side, Crown Royal added 13-year-old Blenders’ Mash ($60) this summer.

Revel Stoke from Phillips Distilling Co. is also bullish on flavors, offering nine flavored extensions across its portfolio, among them Roasted Apple, Honey, and Maple (all $18 a 750-ml.). Last year, the brand rose 6.5% to 66,000 cases. The Revel Stoke portfolio also includes a flagship spiced whisky and a blended Canadian whisky.

Other key players in flavored Canadian whiskies include Constellation-owned Black Velvet, which offers Toasted Caramel and Cinnamon Rush whiskies ($10). “Flavors tend to have a life cycle, and consumer acceptance moves more quickly,” says Carl Evans, Constellation’s vice president of marketing for spirits. “You have to expect that the life cycle of how long a flavor will stay in the market is shorter.” Though Black Velvet’s flavored portfolio fell by 3% last year to 175,000 cases, Evans notes that flavors will remain an important tool in both recruiting and retaining consumers for the brand.

Earlier this year, Beam Suntory-owned Canadian Club launched Apple ($13), the first flavored expression in its portfolio. “Apple offers a whole new way for Canadian Club loyalists to enjoy the whisky, while its approachability opens up a door for entirely new whisky fans,” says Clement Reid, marketing director of commercial and regional brands for Beam Suntory, who adds that it’s been positively received during its initial months in the market.

Luxco launched two extensions to its core Lord Calvert Canadian whisky label last year, including a Spiced Peach expression. The release is currently restricted to select markets, as Luxco brand manager for whiskies Fletcher Buchman notes that the retail sphere is approaching oversaturation. “Introducing new labels is a challenge because shelf space is so overcrowded; as such, our new line extensions will likely remain regional brands for now,” he says.—Julia Higgins

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