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Rum’s Top Players Look To Expand Occasions And Premiumize The Category

July 8, 2019

Total rum volumes declined 1% to 22.6 million cases in the U.S. last year, according to Impact Databank. Overall, 10 of the top 15 rum brands in the market lost volume last year, and the category has fallen by about 1 million cases since 2010.

But the emphasis on value is on the rise as marketers premiumize the category. Bacardi, for example, has made a concerted effort to premiumize its mix. Last year it introduced two new aged expressions: the 4-year-old Bacardi Añejo Cuatro ($20 a 750-ml.) and the 10-year-old Gran Reserva Diez ($40). Additionally, the company continues to focus on flavored extensions. The most recent Bacardi release came in April with Bacardi Lime ($13), its ninth flavor. While Bacardi lost 166,000 cases in the U.S. last year to stand at 6.37 million cases, it added approximately 300,000 cases globally.

“Rum is the final spirits category whose volume remains predominantly within the standard segment,” Ned Duggan, senior vice president of Bacardi rum, tells SND. “Only 15% of the value of the rum category is at the premium-plus level. We’ve seen stabilization and growth from Bacardi Superior and new volume through the launch of the Bacardi premium portfolio.”

For Captain Morgan, brand-owner Diageo has focused on expanding rum’s occasions. Captain Morgan was down 2.7% to 5.6 million cases in the U.S. last year, but rose 1% globally to 11.9 million cases. “There’s something of a rum renaissance within the cocktail culture right now,” says Linda Bethea, vice president of marketing for Captain Morgan at Diageo North America. Lately, Diageo has highlighted serves like Captain & Iced Tea, Captain & Ginger, and Captain & Cola that only need a single mixer and a garnish. Bethea also noted that the brand’s Apple Smash, a green apple-flavored rum, has been successful in the shot occasion.

While Sailor Jerry from William Grant & Sons slipped 1.6% to 713,000 cases in the U.S. last year, the company says the brand is holding its ground in a tough category. “Although the spiced rum segment was down in 2018, Sailor Jerry continued to outperform the competition,” Josh Hayes, Sailor Jerry’s senior brand manager, tells SND. “It’s one of the few brands to hold share over the last year.” Sailor Jerry joined Captain Morgan in the apple-flavored arena with the recent release of Savage Apple.

Don Q, from Serralles USA, fell 2% last year to an even quarter-million cases. Don Q is pursuing the twin strategies of premiumization and product innovation to generate growth. “While the Cristal and Gold are holding steady, the flavors and aged lineups are driving growth,” says John Meisler, Serralles USA’s vice president of sales. “Flavors such as Pasión and Piña (pineapple) showed particularly strong advances last year, and Coconut grew on a much larger base.” Beam Suntory’s Cruzan saw a 0.8% decline to 857,000 cases in the U.S. in 2018. The brand recently launched flavor extension Cruzan Watermelon.

Pernod Ricard-owned Malibu rose 4.6% to just over 2.1 million cases in the U.S., driven by its Pineapple and Lime variants. Other rum brands on the rise lately include Admiral Nelson’s from Heaven Hill Brands, Proximo Spirits’ The Kraken, and Edrington subsidiary Brugal. Admiral Nelson’s slowed slightly from the previous year but is still closing in on the million-case mark. The Kraken, meanwhile, had a good year in the U.S., rising to 400,000 cases, while Campari America’s Appleton brand advanced 2% to 225,000 cases.—Danny Sullivan

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