Andy Morton

The beverage business blog from Andy Morton

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Illicit stills and a dose of patriotism

06 Feb 2013 12:33

Moonshine operations are on the rise in Oklahoma, but one newspaper is firmly behind the illegal liquor merchants. 

“Distilling moonshine for personal use is a God-given, American right,” the Oklahoma Daily thundered until it was red, white and blue in the face. Apparently, those meddling “wig-wearing” politicians refuse to drop the moonshine tax, much to the Daily's annoyance. As it says, “Would we tax a backyard vegetable garden or chicken coop making eggs?”

Last year, an analyst told me that Russia's low-value vodka makers are finding consumers either trading up to premium spirits or falling down into the illegal, non-taxed sector. With US beverage companies seemingly more fixated on premiumisation than ever, perhaps Oklahoma's moonshiners will find their customer base increasing correspondingly.

Then those wig-wearers might have something to worry about.

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Bottled water weighs in as bans start to trickle

21 Jan 2013 17:00

Energy drinks are facing increased scrutiny and the Coca-Cola Co has aired an advert tackling obesity - but will 2013 come to be known as the year critics turn on bottled water?

Earlier this month, a town in Massachusetts banned the sale of bottled water in containers smaller than one litre, while last week news broke that the University of Vermont has outlawed all on-campus water bottle sales.

The bans are for environmental reasons, and in places like UVM - fiercely proud of its natural habit - not especially surprising. But could this trend spread?

The US-based International Bottled Water Association has already hit back, saying the bans “are not in the public interest”, especially with the country facing a rise in the number of overweight people.

Interesting to note that while one sector of the beverage industry is being attacked with the obesity issue, another uses it as a defence.

 

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Molson Coors as good as its word with cider launch

17 Jan 2013 16:41

There's no guarantee Molson Coors' new cider offering in the UK, Carling British Cider, will make a dent in an increasingly crowded sector.

But what Monday's launch did show was that Coors was serious when it said in November that it will push ahead with innovations to plug a hole in its premium portfolio.

No doubt Coors will hope Carling British Cider will follow in the footsteps of Carling Zest - a summer and winter innovation that has found traction - and not go down the road of the now-discontinued “lady beer” Animée.

In the world of innovations, not all are created equal.

 

 

 

 

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Scotch for the Scots?

10 Jan 2013 16:04

A BBC Scotland investigation, aired last night, got all hot and bothered over the apparent lack of benefit whisky companies were according the country, particularly now business elites from Anhui to Angola are pushing profits ever higher.

An economics professor even suggested slapping a water tax on every bottle - it is, after all, only Scottish water that can be used to make real Scotch. (The Scotch Whisky Association yesterday heaped scorn on any so-called "tartan tax".)

But the programme's main beef – that not enough whisky companies are based in Scotland – may partly be offset by two stories out of the badlands of Fife this week. One, that a new whisky maker has received planning permission for a 4m-litre distillery, is on a far larger scale than the other, which saw funding secured for a 150,000-litre 'boutique' plant. But both are Scottish-owned and based and, though catering for widely disparate markets, are being aided by the Scottish Government.

In a comment piece last week, I mentioned the Food Processing Marketing and Cooperation grant that is set to play a key role in the setting up of smaller-scale, locally-owned distilleries, similar to the hundreds around the US that have added colour and diversity to the North American whiskey market.

The grant is targeted and focused on assistance for small-business development - surely a much better idea for Scotch, and Scotland, than a blanket tax hike. 

You can view the BBC Scotland programme, Scotched Earth, here (only available in the UK).

 

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Oregon's big idea - the wine growler

07 Jan 2013 15:45

Oregon's winemakers have enjoyed a decent run in recent times. Figures released by the region's trade body last month showed that volumes and sales rose by 9% in 2011. 

But to keep up that momentum, the Oregon Winegrowers Association (OWA) has unveiled a new secret weapon: the wine "growler".

Based on the half-gallon jug-like container traditionally used to transport beer in the US, also known as a growler, the wine version can hold up four-times that, but is still reusable.

The OWA, which prides itself on its innovation, foresees refilling spigots in wine shops, grocery stores, restaurants and bars. It hopes it will save on glass wastage and give the state a marketable idea, while the group is confident it will catch on elsewhere.

The growler is already available from on-site stores at a few Oregon wineries, but the OWA is backing a state bill to extend their use.

If the bill is approved, expect to see Oregon growlers before the end of the summer. 

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PepsiCo's 'drinkify' is no core strategy, but has Asian appeal

02 Jan 2013 16:29

The term 'Drinkify' popped up in a few end-of-year review lists, but it seems the new trend for “liquid snacks” apparently being pushed by PepsiCo's CEO Indra Nooyi is neither new nor trending.

The Financial Times flagged up the term last month after Nooyi mentioned it in an industry conference speech. The newspaper said PepsiCo was embarking on a strategy of combining its food and beverages to come up with products such as drinkable oatmeal. Before too long, other media picked up on the report and were running with the idea, often towards some rather imaginative Dr Moreau-style snack and drink hybrids. Think Pepsi-flavoured crisps or Frito-laced cola, if you dare.

Turns out PepsiCo have been thinking along these lines for some time now, since at least 2010, when it bought Russian dairy, baby food and juice manufacturer Wimm-Bill-Dann, a company spokesperson told me.  The FT report “was wrong and taken out of context”, the spokesperson said. “The background is that it's not a core strategy. It was just a one-liner at a beverage conference.”

That's not to say we'll never get the chance to try out Diet Frito Pepsi, though we may have to live in Asia. Innovation is a big deal to PepsiCo in developing markets, as shown by the opening of a US$40m research & development centre in Shanghai in November.

The company is proud of the brand loyalty it has built up in China through aggressive marketing and hopes combining those brands can bring exponential rewards. Tastes in Asia differ from PepsiCo's core US market - check out these cheese lobster Lays - and it will use the R&D hub to test what works and what doesn't. Maybe cheese-flavoured soft drinks is just what the region has been waiting for.

 

 

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Adverts, with an accent on the ridiculous

28 Nov 2012 17:29

Drinks advertising campaigns never fail to surprise in their approach to consumers. 

The industry may be global, covering Kansas to Karachi, but as far as advertising agencies and marketing departments are concerned Scotch is still made by rugged Scots in pretty glens and Bourbon by lumberjacks on their day off.

Basically, we're all a bunch of hometown rubes.

Which is why consumers are subjected to an unflinching barrage of accents and dialects in alcohol advertising. Some of them are good. Take, for example, this Canadian Club digital ad released today, with some solid Canadian inflections from the actor on duty. Some are less good. Have a look at this butchering of the Scottish accent, which in comparison makes Mel Gibson's Braveheart sound like Susan Boyle.

 

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SABMiller's rough guide to beer making in South Sudan

15 Nov 2012 15:59

It is the ultimate emerging market. South Sudan only became a country in July last year but it already has its own beer, thanks to a SABMiller plant near the capital Juba. This report from Zimbabwe's Daily Maverick, which interviewed the plant's South African boss Ian Alsworth-Elvey, gives some idea of what it must be like to work in a virtually lawless environment, with bad roads and no power. 

So why do it? “The cost of doing business here is high,” Alsworth-Elvey says. “But the returns are commensurate (to that cost).”

 

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AG Barr and Britvic show auld enemies should be forgot

14 Nov 2012 16:12

Britvic and AG Barr have proved that England and Scotland CAN work together to form a stronger union, in their case today's announcement to form one of Europe's biggest soft drinks makers.

In the spirit of the day, just-drinks made its own entente cordiale (or should that be cordial?) across Hadrian's Wall - a joint byline on the merger story shared between myself (a Scot) and James Wilmore (a Sassenach). 

Are you watching, Alex Salmond?

 

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TFWA - The bubble continues

26 Oct 2012 16:21

Friday, the sixth and final day of TFWA, and as the heavens open above Cannes, just-drinks joins everyone in packing up and heading home.

The consensus seems to be that its been a good exhibition, another chance to meet with a wide range of clients and see some familiar faces.

If there has been an overarching trend, it's the continuation of travel retail innovations, or "differentiation" as Diageo called it at the launch of its exclusive-to-airports Johnnie Walker collection. Travel retail units are still chasing Russians and Chinese around the globe, whether they are ditching Egypt for Thailand or Turkey, while newly-affluent customers in Africa, such as Nigerians, are becoming increasingly talked about.

New technology is also starting to filter in and firms are slowly becoming aware of its potential. On a wider scale, the sector still seems to be in a bubble and less prone to economic headwinds felt elsewhere in the drinks market.

And, everyone we spoke to at the exhibition seemed confident that will continue, to next year at least.

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