Agave-based spirits had their moment in the spotlight at the TFWA World Exhibition & Conference last month, while new launches generated a buzz around the future prospects for gin and vodka in global travel retail.
In today’s unaged spirits category, Tequila is shining the brightest. Indeed, Tequila has gone supernova, eclipsing other category stars: According to IWSR Drinks Market Analysis, over the next four years, premium-plus Tequila will grow at an enviable CAGR of 11%.
Tequila’s stellar status was very much on display during October’s TFWA World Exhibition & Conference in Cannes. Diageo Global Travel threw a lavish Don Julio 1942-fronted beach party to celebrate the high-end expression’s launch into Europe’s global travel retail channel at London Heathrow Airport’s Terminal 5 in August. The LHR pop-up featured tastings and the chance for passengers to download an exclusive summer soundtrack compiled by top DJ & music producer Kayper, who also performed at the beach party.
Meanwhile, Bacardi’s GTR division showcased two new prestige iterations from Patrón at the show to further cement the brand’s position as the best-selling super-premium Tequila in GTR, as well as help premiumise the wider category. Last year, Patrón saw its sales by value soar by over 90% in the channel, underlining GTR’#’s potential.
Created by master distiller David Rodriguez and his team over 150 tasting sessions, Patrón El Cielo, meaning ‘the sky’ in Spanish, is a four-times-distilled silver Tequila with a light, smooth, sweet profile.
The second release was Patrón El Alto – ‘the highest’ in Spanish – a luxury blend of four-year-old extra añejo, añejo and reposado Tequilas, which has already been released in domestic and GTR markets across the Americas. The extension will receive a wider international roll-out next year.
“The difference between El Cielo and El Alto is that El Alto is a blend of aged liquids,” Bacardi GTR global head of marketing Ignacio Vázquez explains. “It … gives you an element of complexity that you don’t get with El Cielo, which is all about the purity and the smoothness. El Alto would be the perfect premium Tequila for someone who is already enjoying the category and wants to enjoy something more complex with more versatility of flavour.”
More generally, Vázquez believes Tequila has “humungous” potential in GTR. “Travel retail is a really interesting playground for the category,” he says. “There are so many reasons for this, but when you look at travel retail versus the other regions in the world, we are already the fourth-biggest region after the US, Canada and Mexico.”
Up-and-coming mezcal is the ‘single malt’ of agave spirits
As Tequila marches on in GTR, mezcal, its up-and-coming cousin, is getting noticed too. According to IWSR, the super-premium-plus mezcal segment is set to grow over the next five years at a CAGR of 16%.
In Cannes, Bacardi GTR showcased the super-premium Ilegal brand, which the group acquired for an undisclosed sum in September. Ilegal is made from Espadin agave and is double distilled in small batches with no artificial colours, yeasts, flavours or additives.
“When you compare mezcal with Tequila, it’s still very small,” admits Vázquez. “We like to say that mezcal is the single malt of the Tequila category in the sense that maybe it’s a rarer, smaller category that eventually once we see Tequila developing, we will see this [mezcal] coming up behind it. We’re really happy about the acquisition,” he adds. “It’s a brand that’s really appreciated by bartenders.”
Meanwhile, Tequila Corralejo owner Fraternity Spirits showcased its new Mezcal Guerrero Maya brand at the exhibition. The range includes a 40% ABV Espadin Joven mezcal presented in hand-painted bottles produced by 200 local amateur artists from Oaxaca in Mexico.
Gin eyes GTR potential
In the UK, gin’s biggest market by value, the craft gin boom peaked long ago. Further afield, meanwhile, the quintessentially British spirit is also losing momentum in previous growth markets such as Brazil, Australia and South Africa.
Countering this slump is an increase in demand in countries such as Nigeria and the Philippines, which are set to help gin achieve a modest CAGR of 3% between 2022 and 2027, according to IWSR.
The recovering GTR channel is emerging as a key post-pandemic market for premium-plus gin – sales in the channel were up 112% last year, the highest growth rate recorded by any spirits category.
Unsurprisingly, there was no shortage of gin releases at the TFWA World Exhibition. Novelties included the launch of a new flavour for Ian Macleod Distillers-owned Edinburgh Gin, Strawberry & Pink Peppercorn; Gin Gold 999.9, a tangerine-flavoured gin from Spanish Sherry producer Osborne; and Bottega’s Green Gin The Wild, a herbaceous Mediterranean gin from the Italian wine & spirits producer, whose Bottega Gold Prosecco has been ranked as the second best-selling sparkling wine in GTR by IWSR since 2017.
The highest-profile gin launch at the show, however, was Brockmans Agave Cut – a limited-edition ‘spirit drink’ featuring Brockmans Gin mixed with agave-based spirit and a hint of pink grapefruit priced at around US$55 per bottle. “The inspiration came from New York, where bartenders were cutting gin cocktails with agave spirit,” says CEO Guy Lawrence. “We felt that fit into the Brockmans ethos, which is about doing things a little bit differently.
“Agave Spirit is produced in small batches and comes in limited-edition, numbered bottles,” he adds, revealing the first batch is restricted to only 9,000 units. “We launched it in Cannes, because it will initially be exclusive to duty free, but will eventually be going broader than that.”
Independently owned Brockmans launched its namesake gin in the UK 15 years ago and is now available in 60 markets worldwide, selling around 1m bottles a year. The release of Agave Cut comes hard on the heels of the launch of Brockmans Orange Kiss, the brand’s first line extension, earlier this year. The citrus-flavoured Orange Kiss features triple sec and Valencia oranges alongside more classic gin botanicals such as juniper and coriander seed.
Elsewhere, William Grant & Sons, the owner of super-premium Scottish gin Hendrick’s, was also in Cannes for TFWA, proudly displaying its newly acquired ultra-premium gin brand Silent Pool. Multilayered in flavour with 24 botanicals and produced on a picturesque estate in southern England, Silent Pool was founded in 2007 and is now one of the UK’s best-selling ultra-premium gins with exports to around 30 markets.
“The acquisition is exciting for us in terms of how it complements Hendrick’s within the gin category,” says William Grant’s head of brand marketing for GTR, Gwilym Cooke. “Hendrick’s plays in the super-premium space, as defined by IWSR, then there’s the ultra-premium space and that’s where Silent Pool and Hendrick’s [GTR exclusive] Amazonia play.”
Vodka’s star is rising – and once again attracting celebrity backers
Vodka may not be shining as brightly as Tequila but this mature category, the base of so many classic cocktails, is back on the radar of many bartenders – for many, of course, it never left. “Vodka is a highly versatile spirit base, especially for long mixed drinks and cocktails, which is perfect to tap into growing consumption occasions such as early evening cocktail drinking and casual gatherings,” says Claire Li, global brand director of Amber Beverage Group’s Moskovskaya Vodka, which is produced in Latvia. “Brands can win with appealing, long, refreshing serves that are easy to create.
“There’s an appetite for high-quality vodka with a price comparable to standard vodka,” Li continues. “As a result, we have secured two important listings for Moskovskaya in the UK this year, with bar and restaurant group Monterey Jack’s, which has ten venues, and Scotsman Hospitality Group, which has 40 venues across Scotland. The brand is listed as the house pour across both groups.”
Nemiroff Vodka’s CMO, Mykola Takzey, echoes the optimism: “Vodka does have momentum and not only among traditional consumers, but also among Gen Z’s, because those guys are more into mixology, experimentation and at-home consumption.
“In some countries, vodka is the base for 50%-60% of cocktails, so it gives you such a freedom to experiment,” he continues. “That’s why we see a huge potential in the ready-to-drink [RTD] category moving forward. It’s my kind of challenge if you wish to make Nemiroff a credible player in RTD as well.”
During the trade fair, the Ukrainian brand launched super-premium extension Lex by Nemiroff. The 13-times filtered spirit, which spent nearly three years in development, is priced at around US$85 per 1-litre bottle.
According to Takzey, the addition of Lex gives each vodka in Nemiroff’s namesake portfolio a clearly defined role. Nemiroff Original is a mass-market option, ideal for traditional vodka markets such as Ukraine and Poland, while the more premium Nemiroff Deluxe is better suited for Western Europe and new export markets. Nemiroff’s naturally flavoured Inked Collection, meanwhile, is for “explorers”, Takzey explains, while Lex by Nemiroff is for “rulers – those who really savour the best products”.
Tito’s Handmade Vodka was also upbeat at TFWA Cannes, showcasing its latest addition to the ‘Ugly Sweater Collection’, which will be available on Tito’s bottles during the festive period. International MD John McDonnell says the US brand is booming in GTR, thanks to the return of American travellers to established markets, such as Greece and Italy, but also as they explore new destinations like the East European countries of Slovenia, Croatia, Montenegro and Bosnia.
In September, Tito’s announced its expansion into a raft of markets in south-eastern Europe. McDonnell says many bartenders from the region have travelled to the US in recent years, looking for temporary work. While there, they’ve become fans of Tito’s and have since returned home, spreading brand awareness.
As premium vodka wins new fans in unexpected places, like moths to a flame, it’s once again attracting celebrity backers. In recent months, for example, both Aquaman star Jason Momoa [Meili Vodka] and Hollywood A-lister Woody Harrelson [Origen Vodka] have launched their own brands.
Vodka might not have quite the lustre of Tequila, but its star is clearly rising once again.
Which spirits brands roared back to life in global travel retail in 2022? – data
