With New Partner Pernod Ricard, Sovereign Brands Sees Ample Runway For GrowthDecember 3, 2021
For wine and spirits marketer Sovereign Brands, 2021 has been a banner year. CEO Brett Berish tells SND that his portfolio continues to trend upward, with both a huge boost in the on-premise and sustained growth at retail. “We’re up about 200% on-premise on average,” he said. “It’s a combination of things. Our brands are taking share, the consumer is looking for them and interested in them, and the buyers want them. It’s the meshing of the two best scenarios.” This year’s strong performance builds on 2020, when the company’s two largest brands—Luc Belaire sparkling wine and Bumbu rum—both roughly doubled in size amid an off-premise surge.
In September, Pernod Ricard took a minority stake in Sovereign for an undisclosed sum, further bolstering the company’s prospects. Berish said Pernod’s investment will give Sovereign access to new markets as well as improve distribution in the current footprint. “They’ve got amazing infrastructure and assets all over the world,” he said. “To me, it’s now an opportunity to do new things, whether it’s new brands or to go into duty free.” Berish, whose father Barry served as chairman and CEO of Jim Beam Brands during the 1980s and 1990s, added that Sovereign plans to launch two new brands in 2022 and two more in 2023, with their rollouts expected to be enhanced by the Pernod partnership.
The Sovereign portfolio is up over 100% this year, according to Berish, with Luc Belaire leading the way. For 2020, Impact Databank had the brand at 429,000 cases, putting it just behind the leading sparkling French imports Moët & Chandon and Veuve Clicquot. “I’m hoping we can be number-one by the end of the year or come early next year,” he said. “But we still have so much more we want to accomplish both on-premise and off-premise.” Impact Databank expects that Luc Belaire will easily leap into the top 10 imported sparkling wines overall in the U.S. for 2021.
Luc Belaire, which retails in the $25+ category, has seen growth rates similar to many of the leading Prosecco brands, according to Impact Databank, while retailing for $10-$15 more per bottle. Currently, the brand does roughly 90% of its sales in the off-premise, according to Berish. “This has been eight or nine years of consecutive growth to get here,” he said. “At some point there’s a tipping point with all brands and we’re starting to hit those.”
Beyond Luc Belaire, the company is seeing continued success with Bumbu, Sovereign’s rum distilled in Barbados and Panama. For 2021, Berish estimates that Bumbu moved 240,000 4.5-liter cases (120,000 9-liter cases), up from 72,000 9-liter cases in 2020, according to Impact Databank. Moving forward, Berish has high hopes for Bumbu and super-premium rum in general. “My opinion is that you need a brand to catapult certain categories,” he said. “Patrón did that for Tequila. I think Grey Goose did that for vodka, and Hendrick’s has done that for gin. And I think Bumbu is already doing that in the rum category.”—Shane EnglishSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.