Key trends for the spirits sector in 2017 - Focus
As Euromonitor continues its look at the trends that are poised to drive the drinks industry in 2017, senior drinks analyst Spiros Malandrakis turns his attention to the spirits category.
The beat of the dram
With the fumes of over-production and commoditisation hanging menacingly over Bourbon, with Scotch still struggling to find relevance with elusive Millennial demographics, and with Irish whiskey belatedly taking a shot in the premiumisation narrative, it is niche offerings that hold huge leftfield potential this year.
World whiskies from as far and wide as Sweden, France, Australia and England will revolutionise perceptions, production techniques and positioning while terroir, single estate offerings and hyper-localisation initiatives will shift the narrative further away from a monolithic age focus and towards a unique sense of place.
While single malts will continue to capitalise on their established aspirational credentials, blended variants are set to come of age in 2017. And, as non-age statements proliferate, a greater appreciation of the art of blending will alleviate some of the recent pressure build-ups on stocks while providing a template for radical experimentation.
White spirits - Different shades of grey
The fortunes of vodka and English gin will diverge further, as the former continues fighting a saturation-induced hangover, while the latter embraces ever-more obscure botanical concoctions, small batch iterations and a clear premiumisation trajectory structured around signature recipes and a new generation of premium mixers.
With flavour fatigue leaving a bitter taste - as well as providing a cautionary tale for all other spirits segments - vodka will shift its marketing focus back towards authenticity and provenance, spiced up by 'glocal' initiatives and innovation focused on personalisation, hybrid and crowdsourced initiatives.
Cognac - A tale of two countries
As China overcomes its centrally-planned crackdown on conspicuous consumption and lavish extravagance, Cognac will emerge more versatile and less one-dimensional in its status associations and drinking rituals. Beyond the much-vaunted trading down to more affordable VS and VSOP varietals signalling the transition away from investment vehicles or luxury gifting and into mass consumption, novel price points and ageing brackets in between the traditionalist benchmarks will further expand the category's reach.
On the other hand, the all-important US market will remain approachably-aspirational while the category doubles down on its most recent efforts to connect to niche age, gender and cultural demographics. From celebrity endorsements to the once-controversial embrace of the resurgent cocktail culture, the category will continue shaking off its complacency while creating the template for urgently-needed geographic diversification.
Micro-distilling - Big things have small beginnings
Boasting authentic stories, enthusiastic physical and virtual communities and a de facto experimental modus operandi, micro-distillers will solidify their place as the incubators of future trends and pioneering brands. As white spirits production provides the funding base for their future brown spirits ambitions, small independent distillers will make their presence felt beyond the metropolitan centres of their US and Western European bastions.
As trade wars, sanctions and border taxes flare up, they will also provide the opportunity for aspirational trading down through providing sophisticated yet affordable options with roots in their respective communities.
That said, as the term 'craft' becomes painfully commoditised, micro-distilling will not reach the heady heights of microbrewing – signature and craftsmanship credentials within corporate spirits offerings tend to be genuine. The category's behemoths will further underscore the point through special limited releases and a renewed focus on radical innovation in order to stem the micro tide before it envelops them.
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