Back in autumn 2018, I was enjoying a tour of Adnams’ Copper House Distillery in Southwold on the UK’s Suffolk coast, in the company of the wonderful John McCarthy, Adnams’ late engineer-turned-distiller. As we whizzed around the building, we happened to enter a room where members of staff were hurriedly cramming bottles of the distillery’s garishly hued Copper House Pink Gin into boxes, ready for the imminent Christmas rush. Looking at John, I raised a quizzical eyebrow. “I know, I know,” he said. “But it pays my wages.”
That was, pretty much, ‘peak gin’ in the UK – the culmination of a remarkable period of growth that had been lent even more momentum by the rise of flavoured gins, originating in southern Spain. From Southwold to Seville, gin was simply huge – and, although some people (me included) may have voiced concerns about some of the catalysts of the boom, few were seriously complaining.
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Nearly seven years on, gin consumption in the UK has been steadily declining since the first year of the Covid-19 pandemic, echoing similarly depressing trends in Spain. As for the US, well, it’s just never lived up to its promise, despite the efforts of Hendrick’s, Aviation and a few others in the higher price echelons. The association with cheap legacy brands, it seems, has been hard to shake off.
This was the somewhat gloomy backdrop to a global gin trends presentation given by Chris Pitcher, partner at Redburn Atlantic, during The Gin Guild’s annual Ginposium event in London earlier this month. When a category’s stalwart markets take a turn, where should brand owners look for future growth? There’s an answer but it’s by no means straightforward.
According to Pitcher’s presentation, almost all of the immediate growth prospects for gin lie in emerging markets. But some of them, I’d argue, aren’t serious growth prospects at all, or at least not immediately.
Most obviously, the Philippines – the biggest market of the lot – remains a destination dominated by low-priced, local brands. And that reliance on locally produced, volume-focused products extends into other territories too, including India and pockets of Africa such as Nigeria.
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By GlobalDataThat could change. As economies develop – and China’s (hopefully) returns to more robust growth – opportunities will arise. If a good proportion of consumers have become acquainted with gin in the meantime, that will ease the brand- and category-building process.
And then there’s India. With conditions challenging in China, the US and western Europe, India is everyone’s great hope today – and gin is no exception. A winning mix of demographic and economic factors, underpinned by urbanisation and an increasingly sophisticated on-premise, is undoubtedly good news. For UK distillers, the recent free trade agreement and consequent cuts to import tariffs from 150% to 75%, and eventually to 40%, only adds to the positive momentum.
But – and you knew there had to be a ‘but’ – India remains a complicated place in which to do business and there are plenty of domestic competitors now focused on exploiting Indian consumers’ thirst for premium-and-above products – not to mention their Modi-inspired pride in the ‘Made in India’ banner.
For all its opportunities, India illustrates a broader truth about these ‘emerging markets’ for gin brand owners: the difficulty for those who lack the deep pockets of the multinationals in penetrating them in the first place. Doing so entails a lot of investment, in terms of time, money and patience. This isn’t quite the same as having a chat with the Tesco buyer, or touting your wares around the bars of Barcelona.
This column was always going to be about gin but, before I’d heard about Chris Pitcher’s Ginposium presentation, it was inspired by a LinkedIn post featuring an image of the gin shelves at UK supermarket Waitrose, which bemoaned the fact that hardly any of the products on display were priced north of £40 ($53.50) a bottle.
Maybe I’m viewing that picture through the longer lens of history but I find it more surprising that there were any gins in Waitrose at that price level. There were plenty sitting above £30 a bottle, and almost 50 gins altogether available to buy. I know these are tricky times, what with inflation, raw materials costs and duty changes, but I’m not sure there’s all that much there to complain about.
For the right products with the right mix of quality, packaging and messaging, there are still rewards to reap closer to home
What’s my point? That we can be too distracted by (relatively) short-term declines and end up writing off markets where a category is well-established in terms of consumer awareness, and where – taking a step back and looking at longer-term trends – it’s not in bad shape right now anyway.
Gin’s emerging markets will work for some but for others they may just be too much of a stretch, without external investment. For the right products with the right mix of quality, packaging and messaging, there are still rewards to reap closer to home.
You may say that the consumer has moved on but I’m not so sure. Think back for a moment to the mid- to late 2010s heyday of the gin boom – all those theatrical serves involving outsized glassware, loads of ice and exotic garnishes.
Long, refreshing drinks to while away a summer’s pub garden afternoon, with a satisfying prickle of fizz and just a tang of bitterness to keep you coming back for more. Sound familiar? There are more similarities than differences between an Aperol or Hugo Spritz and a bar-quality gin and tonic – with one crucial exception: the colour.
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