Top Drinks Executives Talk Brand-Building At Impact Seminar PanelApril 1, 2020
While COVID-19 has dominated headlines lately, drinks marketers also continue to monitor the longer-term trends driving the business. Bringing that view into focus, four top industry executives took the stage at last month’s 44th Annual Impact Marketing Seminar for a panel discussion entitled, “Where the Action Is In Wine and Spirits.” The panelists included Jim Clerkin, President of Strategic Development and Advisor to the CEO at Moët Hennessy; Mark Teasdale, Partner at Biggar & Leith; Joe Wagner, Owner & Winemaker at Copper Cane Wines & Provisions; and Jonathan Yusen, President & Managing Director, North America, at William Grant & Sons.
The panel touched upon a wide range of topics including cannabis, hard seltzer, alternative packaging, and the boom in whiskies and Tequilas. Discussing current brand-building efforts across the industry, the panelists noted that marketing is now largely intertwined with authenticity and craft attributes. “Something made locally connotes higher quality. The bigger brands have taken that lesson. You can see their messaging moving to more about authenticity, the story,” said Mark Teasdale. Hennessy, the Balvenie, and Belvedere were cited as a few notable legacy brands whose commitment to craft has been paying off.
While the craft spirits segment is facing new challenges due to COVID-19, there remains plenty of runway for growth over the longer term, Jim Clerkin explained. “There are 2,000 craft distilleries in America now, but back in 1830 there were 20,000,” he said. “I think there’s a long, long road for craft, and particularly craft whiskey.” Regarding the broader whisk(e)y market, Jonathan Yusen expressed optimism for continued expansion but warned about potential saturation. “Any time you have an explosion of production you run that risk,” he said. “The smartest companies are the ones that are able to balance that short-term and long-term opportunity.”
Along with whisk(e)y, the panelists also discussed the ongoing growth in Tequila, particularly at the higher tiers. “We all owe debt and gratitude, frankly, to Patrón for premiumization in the category and getting the price and quality up,” said Clerkin. Yusen added that the shift toward agave-forward flavor profiles is having reverberations beyond Tequila, with mezcal and other agave spirits presenting growth opportunities for the future.
Among the newer categories the panelists are watching closely, hard seltzer looms large. “I think it’s definitely eating into our business,” said Joe Wagner. “I find it interesting because it’s at the intersection of health and wellness and authenticity, but you’re looking at a malt beverage that has flavoring.” The wine world, he added, needs to do a better job of courting a market that’s looking for authentic products. Wagner pointed to opportunities offered by alternative packaging, whether cans, pouches, or other formats. Clerkin, meanwhile, sees hard seltzers as more than a fad. “I think they’re going to be internationalized,” he said, pointing to natural fruit flavors as a possible future for the category.
The panel also addressed another potential disruptor in the wine and spirits world, the emerging cannabis category. “We (William Grant & Sons) haven’t yet seen the impact of cannabis on our brands,” said Jonathan Yusen. “But in the longer term, we certainly expect to be competing for some of the same occasions,” he added, citing cannabis beverages in particular.
Joe Wagner, as a winemaker with substantial interest in the California market, said that cannabis hasn’t impacted Copper Cane thus far. “We’re not seeing any loss of business, at this time,” he said. “I do think that drinking and smoking or using cannabis are two very different social occasions.” At the present, none of the panelists are planning to expand into cannabis, but said they’ll continue to keep an eye on the cannabis space moving forward.—Shane EnglishSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.