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Tennessee Whiskey, Part 1: Jack Daniel’s Leads The Way

April 29, 2019

Tennessee whiskey is rising in popularity, with more than 7.5 million 9-liter cases depleted in the U.S. market last year, according to Impact Databank, up from approximately 6.3 million cases in 2013. From a volume perspective, the category continues to be dominated by Jack Daniel’s—which accounts for more than 85% of overall depletions.

The core Jack Daniel’s brand posted volume of 5.25 million cases in 2018, while upscale extension Gentleman Jack totaled just over 400,000 cases, and Jack Daniel’s Single Barrel was at 50,000 cases. Additionally, Jack Daniel’s Single Barrel Heritage Barrel ($65 a 750-ml.) finished at No.-3 in Whisky Advocate’s Top 20 rankings for 2018. Jack Daniel’s flavored offerings—including Tennessee Honey and Tennessee Fire—combine for over 1.1 million cases, and the lineup is reportedly set to be extended with a new Tennessee Apple offshoot looking ahead. The brand’s Tennessee Rye is also contributing to growth, reaching 45,000 cases last year on its second year on the market.

Tennessee’s other high-profile whiskey brand is George Dickel, which currently sells around 170,000 cases in the U.S. While it follows the mandated charcoal mellowing process that defines Tennessee whiskey, Dickel has branched out in recent years with some bold innovations. Last May, for example, saw the release of George Dickel Tabasco Brand Barrel Finish in partnership with McIlhenny Co. Tabasco hot sauce. At 35% abv, this line extension doesn’t qualify as a whiskey, but instead seeks to replicate the success of spicy flavored whiskies like Fireball.

In what could prove to be an historic move, brand-owner Diageo has changed the name of Dickel’s distillery to Cascade Hollow Distilling Co., evoking the original name. While Cascade Hollow will remain the home of George Dickel, Diageo feels the name change, announced in March 2018, will give the distillery a platform to pursue the rollout of other brands, without interfering with Dickel’s progress. “With George Dickel serving as the flagship, Cascade Hollow represents a new business model for North American whiskey for Diageo,” says Nicole Austin, general manager and distiller at Cascade Hollow. The first Cascade Hollow label is slated for release in the coming weeks.

While it’s known for moonshine, Gatlinburg-based Ole Smoky is now also active in aged whiskies with a Tennessee blended whiskey, Tennessee Straight Bourbon, and a range of flavored offerings. Ole Smoky has averaged 17% growth over the past two years, and reached 330,000 cases in 2018, according to Impact Databank, earning “Hot Brand” honors.

In the second part of this feature, we’ll cover the newer players aiming to help take Tennessee whiskey to the next level.Kimberly Tharel

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