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Patrón Targets Tequila’s High End, Unveiling “El Alto”

November 8, 2022

Luxury Tequila leader Patrón, part of the Bacardi portfolio, is aiming to capitalize on rapid growth at the high end of the burgeoning agave category with the debut of Patrón El Alto. The new entry is expected to help trade up existing consumers within the franchise and draw interest from drinkers of other upscale spirits categories while countering rising competition in the luxury Tequila segment. Patrón has added almost 1 million cases of U.S. volume over the past four years and is now above 2.7 million cases, according to Impact Databank, with its retail value climbing past $1.5 billion.

“We’re seeing where consumers are gravitating and it’s toward prestige, particularly aged variants,” Patrón vice president of marketing D-J Hageman tells SND. “This growth is coming from both existing Tequila drinkers as well as other spirits categories, and Champagne drinkers in high energy occasions.”

Retailing at $179 a bottle, El Alto is made from 100% Weber Blue Agave grown in the highest parts of Jalisco, Mexico, a territory known for producing the sweetest agaves, according to the company. It’s primarily composed of Extra Añejo, blended with Añejo and Reposado Tequilas, and has been in development for four years under master distiller David Rodriguez. Its aging includes 11 different types of barrels, mostly hybrid barrels of American oak body and French oak heads.

“Patrón El Alto will primarily focus on on-premise and will allow Patrón to propel even further in the industry with this step into the prestige category, a segment forecasted to double in size by 2025,” Hageman notes. The on-premise target—initially focused on New York, Miami, Las Vegas, and Los Angeles—is more important than ever currently, he adds, “especially as drinkers are spending more nights out—at bars, clubs, and restaurants—than they have since early 2020.”

The high-end launch comes as Tequila’s over-$40 sector is projected to account for more than a quarter of the total market in 2022, according to Impact Databank, as premiumization continues across all categories of the U.S. spirits industry. While Tequila still ranks only third among all spirits categories in the U.S. by volume, the Tequila category climbed ahead of American whiskies in dollar terms last year.

One concern for the category remains the draining of agave supplies owing to the U.S. market’s rising thirst for Tequila, but Hageman says “Patrón is well positioned to meet the demand this holiday season and into 2023.”—Daniel Marsteller

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