Interview, Part 1: Lawson Whiting, President And CEO, Brown-FormanApril 21, 2020
Lawson Whiting has led Brown-Forman as president and CEO since the start of last year, and has immediately confronted significant challenges including tariffs on American whiskey in global markets and, most recently, the Covid-19 pandemic.
Still, Whiting sees long-term strength in the Brown-Forman portfolio, anchored by the Jack Daniel’s brand and augmented by a number of fast-rising whiskey and Tequila labels including Woodford Reserve, Old Forester, and Herradura, among others. Overall, Brown-Forman’s U.S. volume totaled 14.6 million cases last year on a 4.3% increase, according to Impact Databank. SND executive editor Daniel Marsteller spoke with Whiting to get an update.
SND: How is Brown-Forman adapting to the Covid-19 crisis?
Whiting: The market conditions vary, but in the U.S. the on-premise has been nearly eliminated. This has been offset, at least partially, by a booming off-premise business. When there is a great deal of uncertainty, consumers often turn to established, reliable brands, including Jack Daniel’s and Woodford Reserve. From a marketing perspective, I’m so proud of our Jack Daniel’s brand team and the spot they put together with Energy BBDO called ‘With Love, Jack.’ It celebrates the special and genuine ways people are connecting throughout the world, and provides a real sense of optimism and hope in the face of so much ambiguity and anxiety. It’s really hard to watch our friends in the hospitality industry struggling right now, so we’re showing our support both within the U.S. and internationally.
SND: Turning to the portfolio, how is brand health in the U.S. for Jack Daniel’s?
Whiting: At over 5 million cases in the U.S., Jack Daniel’s still has some of the highest brand health measures in the spirits market. The whiskey category has gotten much more competitive, but the Jack family remains a key driver of our entire U.S. business. It’s been growing at a low single-digit rate now for roughly a decade. We’d like to see it a little bit better than that, but we feel good about our position. Gentleman Jack is over 700,000 cases globally and it’s growing at a mid to high single-digit rate. It’s growing faster outside the U.S. than domestically. Single Barrel appeals to the whiskey connoisseur. Whisky Advocate in 2018 ranked Single Barrel at No.-3 on its Top 20 list, and featured it on the cover of the magazine, which was very nice for us.
SND: How is Jack’s flavor lineup performing?
Whiting: Tennessee Honey and Tennessee Fire both have continued to bring new consumers into the Jack family. Together, they’re at 2.4 million cases globally, so it’s a big business at this stage. We continue to diversify with Tennessee Apple, which has gotten off to a strong start in the U.S. (reaching 165,000 cases last year in its debut) and is now gearing up for its international launch. It’s very easy to drink and has a lot of global appeal, unlike some of the other flavored offerings in whiskey that are more U.S.-centric.
SND: How do you plan to keep up the momentum on Woodford Reserve?
Whiting: Woodford was first sold in the U.S. in 1997, and it’s had double-digit growth every year since then. Its Double Oaked extension is another very healthy label that consumers and whiskey aficionados love. Woodford is now at over a million cases globally, and growing at around 20% a year. Like Jack, it’s also going to be under the Energy BBDO network for new creative, which is coming out soon. Internationally, Woodford has a good base in travel retail, the U.K., Australia, France, Germany, and Japan—the big Bourbon markets outside of the United States—and it’s our intention to continue to grow in those important markets.
SND: Tariffs on American whiskies in the European Union have been making that international development harder. Where do you see that situation headed?
Whiting: The tariff situation has been awful for Brown-Forman, now coming up on two years. It’s in the range of $100 million a year in cost to us, which we’ve absorbed in order to maintain momentum with our consumers. We’re being opportunistic, taking price in a handful of markets, but it’s tough in those markets. We believe in the long-term potential for American whiskey in Europe. Jack Daniel’s has had a long headstart there, and while there are a lot of brands entering now, we’re established and have the relationships to continue to grow. The good news is that the industry associations—ourselves and our competitors—are working with our respective governments to make these tariffs go away. Everybody is at the table. That gives me confidence that we’ll be able to return to a more normal, open, free market trading environment.
|Brown-Forman’s Top 10 Brands in the U.S. (thousands of 9-liter case depletions)|
|1||Jack Daniel’s||Tennessee Whiskey||5,255||5,318||1.2%|
|2||Korbel||California Sparkling Wine||1,437||1,435||-0.1%|
|3||Jack Daniel’s Country Cocktails||Flavored Malt Beverage||1,097||1,279||16.6%|
|4||Canadian Mist||Canadian Whisky||1,081||1,012||-6.4%|
|6||Jack Daniel’s Tennessee Honey||Flavored Whiskey||747||766||2.5%|
|8||Sonoma-Cutrer||California Table Wine||445||453||1.8%|
|9||Early Times||Kentucky Whiskey||457||426||-6.8%|
|10||Gentleman Jack||Tennessee Whiskey||404||418||3.5%|
|Total Top 102||12,194||12,577||3.1%|
|1 based on unrounded data
2 addition of columns may not agree due to roundingSource: IMPACT DATABANK © 2020