The malt whisky sector has grown from being a niche to being a category in its own right. In addition to providing an overview of the malt market, along with brand and country forecasts to 2011, a new report from just-drinks also examines how malt whisky marketing is changing as the category expands.

The growth of the malt whisky segment means this is no longer a niche of the larger Scotch whisky market but a category in its own right, which has implications for how malts are marketed going forward.

According to a new report on the malt market published by just-drinks, Global market review of malt whisky - forecasts to 2011, the days of malt simply being a well-crafted product have passed. If all malt is equally well-made then each brand needs to find its own way of attracting possible purchasers. In other words, differentiation and brand identity are key.

However, even if malt whiskies are entering a new phase in their development, asserting themselves as brands, this does not mean that the intrinsic attributes of production and provenance, which differentiated malts from blended whisky brands in the first place - are to be lost. Rather, those characteristics must be retained but the malt brand's identity is enhanced and developed.

As Martin Price, marketing director at Maxxium UK, puts it: "Today it is not just about quality or provenance but self-expression, so the personality of the brand has to reflect the personality of the consumer. Therefore there are more ways to talk about malt than just 'it's made from heathery peat'."

The development of malt as a category in its own right is not simply about the size of the sector - though it does now account for 14% of the Scotch whisky market in value terms - but is also reflected in how the offering is broadening, with sub-sectors such as value-for-money, mainstream, premium and esoteric now being identified.

The newly-defined sector of blended malt has an intriguing role to play in this. Positioned slightly above value-for-money, edging into the mainstream, blended malts have fewer volume constraints and the phenomenal growth shown by brands such as Johnnie Walker Green Label and Famous Grouse Vintage Malt, suggests that this sector could act as a significant volume player in the new malt category.

Although brand owners largely agree that blended malt will act as a useful introduction to the category, many are focusing equally strongly on establishing malt's luxury credentials.

In essence, luxury equals craftsmanship, tradition, limited production and high quality, all buttons which malt pushes. However, the existence of a value-for-money sub-sector within malt shows that not all malts can be seen as luxury products. In other words, if some malts wish to be seen as part of a luxury category then they have to establish themselves as such, which once again comes down to an enhanced brand marketing approach.

"Luxury equals authenticity, provenance, supreme crafting, scarcity," says Ken Grier, malts marketing director, Edrington Group. "It must be aspirational and relevant and, finally, it must be innovative and fresh in order to attract new consumers."

The key to any malt whisky has always been in its individuality, but as malt grows globally, even the importance of a national identity becomes less overt and more of an underpinning. The fact that malt comes from Scotland conceivably matters less to a consumer in Taipei than an ex-pat in New York. The same goes for heritage. It is a fundamental part of malt and a powerful cue for the premium/luxury consumer but is only part of a more complex marketing mix.

There is now greater divergence of message from malts than at any previous
stage of its existence. The different approaches taken by the major players are a clear indication of malt growing up, of products becoming brands. The key to their success is how they engage with the new global consumer who is shifting towards premium and luxury.

Malt drinkers today tend to be upscale, affluent and there are, theoretically, a growing number of them. But while malt marketers generally agree that there is a global trend towards premium and towards malt, there is also a consensus view that there is no such thing as a malt consumer, but a number of different groupings all of whom are engaged in one way or another with malt.

However, as the malt sector continues to grow, the key question distillers have to ask themselves is how mainstream do they want malt to become. For all the talk of latent potential, the bottom line is that the majority of brands are currently using stock which was laid down a minimum of ten and more often than not, 12 years ago. Malt's growth is entirely dictated by the stock profile within each distillery. The tap cannot simply be turned on to satisfy rapidly increased demand. Steady growth is the by-word, and any move into the mainstream needs to be carefully managed.