Spotlight – Gin’s In

06 June 2004 By db staff writer

d=”standfirst”>With flavour back in favour, premium gins are leading the fightback against ubiquitous vodka, says Dave Broom

Looking at Gin purely from a stats point of view shows that, though the global gin category is worth 60m cases, volumes have been on the slide for the past five years, during which time 4m cases have disappeared. If you then were to read the UK press from last year you would begin to believe that the effects of this fall were terminal. After all, last summer gin, that quintessentially English spirit, had been jettisoned from the shopping basket of essential household items which is used to calculate the retail price index. 

It would be wrong, however, to write gin’s obituary. In reality the category is in pretty rude health. Though overall volumes in its major markets, the US, UK and Spain, are down, profits are up thanks to premium gins – Bombay Sapphire, Tanqueray, Plymouth, Greenall’s Q, etc – which continue to rise. Gin is cool once again. 

And this premium growth isn’t restricted to the major markets but is being seen across the board. Gin is now making headway in Canada, Italy, Germany, Greece, Japan and Australasia. New premium and super-premium brands, like Miller’s, Blackwood’s and Hendrick’s, are being launched, though we’ll have to wait longer than expected for the eagerly awaited Blue Goose to appear – now due in 2005.

Gin, it would appear, has managed to reinvent itself as a hip young spirit – and much of the credit must be given to Bombay Sapphire. “There are many factors driving this rise in premium, like lighter spirits, mixability and trading up,” says Marshall Dawson, global director for the brand at Bacardi. “For years the industry has been talking about how people are drinking less but better. We did it initially to try and make ourselves feel better when spirits volumes were falling, but now it really is happening. Gin is benefiting from the global rise of premium white spirits and, through Sapphire changing the mould of what gin actually is, the divisions between gin and vodka are being lowered.”
 
As far as Michelle Chin, senior brand manager for Tanqueray US, is concerned gin’s resurgence in the US has been fuelled by the oversaturation of the vodka category. “In the US, consumers are looking for something different, bartenders are looking for something a bit more substantial to work with and there’s a trend of ‘return to flavour’,” she argues.

There is also a generational shift under way. Younger drinkers ( aged 25+), and younger vodka drinkers especially, are turning to gin. Why now? Gin hasn’t changed. Jane Yelloly at Plymouth gin feels it is partly down to image. “Packaging has improved so much in the past few years that gin is now appealing to the trendy vodka drinker. It’s done incredibly well to shake off the old image and become relevant and meaningful.” 

Gin producers would appear to have taken a long, hard look at the premium vodka category and taken on board the lesson that in the 21st century image is a vitally important element in any brand’s makeup. 

In addition, anecdotal evidence suggest that top-end bartenders in the UK and US are, to put it bluntly, bored with vodka. Could the same be happening with consumers? Is gin, as Yelloly suggests, appealing to thirtysomething vodka drinkers whose palates have matured? “I believe that there’s a cyclical effect in white spirits,” says Steve Ferris, sales and marketing director at G&J Greenall. “The consumer moves from vodka to premium vodka and then, wanting more flavour, moves to flavoured vodka – and from there into gin.” That said, he doesn’t see gin cannibalising vodka’s share of the white spirits market but feels that the whole category will continue to grow. 

“I think there has been something of a vodka overload – so many brands, many with similar messages,” adds Elwyn Gladstone, new brand development manager at Hendricks’ producer, Wm Grant. “Gin has a great lever in that there are very distinctive taste profiles between the brands, and these flavours are highly sophisticated, yet it is a white spirit, and therefore hugely appealing.” 

It’s a pertinent point. Though packaging is an important part of the overall mix, premium gin’s growth is more down to flavour. As Chin says, “There’s an explosion of new restaurants in the US with new cuisines being brought to the forefront. The consumers’ desire for ‘flavour’ in their food is translating into desiring new flavours in their cocktails, which gives gin the perfect opportunity to become highly relevant again.” This is underlined by the fact that discussions about botanicals are at the forefront of brand marketing. Gin is learning from malt whisky as well as vodka and beginning to draw on strong production truths and heritage – something which vodka has struggled to do. Though there’s little chance of gin becoming the preserve of spirituous trainspotters like malt has, heritage is a powerful tool in the marketing mix.

“One reason for Sapphire’s growth is down to product credibility,” says Dawson. “People today are looking for products with intrinsic values. While the bottle pulls them in, it’s the liquid which keeps them coming back.” This emphasis on liquid as well as pack underpins Sapphire’s new advertising campaign. “People don’t like being marketed to. They’re savvy and don’t just want pretty pictures but something with depth and innovation,” he continues. “For the ‘Inspired’ campaign we approached international designers to create their take on the brand – and not just the pack, but how the brand is made – and create functional design pieces.” The first treatment features a tile design, the second textiles.

This emphasis on production is hardly new. Sapphire has always placed great stock on its method of production and botanical mix. Now the new premium arrivals are doing the same. Hendrick’s makes great play of the inclusion of rose petal and cucumber in its mix, Tanqueray Ten uses “fresh botanicals,” Beefeater’s Wet (somewhat controversially) uses pear, Blackwood’s is flavoured with wild flowers from Shetland, while Miller’s has a distinct orange twist to it. “Hendrick’s was designed so that consumers could drink it neat or as a g&t (with cucumber, not lime),” says Gladstone. “Both bartenders and consumers are looking for spirits that have unique taste profiles, and that shine through in cocktails.” 

What is certain is that as gin establishes itself with a new audience its flavour profile is shifting. Is this a good thing? In principle, Yelloly thinks so. “The new super-premiums do appeal to a vodka drinker who may find gin too robust a flavour. Hendrick’s and Tanqueray Ten act like bridges between the two camps and are brilliant for the gin category.” Plymouth, which launched its gin-based fruit cup last year, has a new product in the pipeline which Yelloly calls a “gin lover’s gin” adding, “We’re not straying too far into vodka drinkers’ territory like some of the  other products.” 

And there’s the rub. How far can you push gin? Already there are mutterings that, in its search for a new audience of bored vodka drinkers, gin is in danger of losing its authenticity. By toning down the “traditional” flavour – ie juniper – are gin producers not just making a flavoured vodka? More than one commented that they thought that Wet by Beefeater had crossed that line. Gordon’s illfated rtd, Twist, suffered as a result of having its “gin-ness” removed entirely. Vodka drinkers didn’t want it because they thought it was gin, while gin drinkers didn’t like it because it tasted of vodka. At its core, any new product must obviously be gin was the consensus. 

“I think the flavour is shifting,” says Dawson. “Sapphire’s success is partly down to it not being too ‘giny’. The question for those who follow is not just whether they can produce a new flavour but whether they can do so in a balanced way.” 

The other question, surely, is does this premium boom have legs or is it simply a blip, the result of notoriously fickle vodka drinkers picking up on something else for a short period of time? Chin feels the shift to premium has longterm potential, but only as long as brand-owners step up their advertising efforts in order to keep their brands top-of-mind. As she says, the US market is heavily saturated with vodka advertising. Gin, in other words, must fight to sustain its growth. 

What of the new brands? At the moment there appears to be a new gin almost every week, but can they survive in what is becoming a cluttered sector? “Not all of the new brands will stick,” says Dawson, “but that’s the way the marketplace works. We’ve gone through the same situation with malt in the US and we’re now seeing it with vodka. Gin brands will continue to reinvent themselves, the category will grow and new ones will appear. The question is who will be left on the battlefield?” 

Overall though, brand owners are in a positive frame of mind. “There’s no question in my mind that gin is back,” says Ferris. “We’re offering quality at the right price, there’s a hell of a lot more interest in gin as a category and a renaissance in premium. This can only be good for the category as a whole and for gin’s long-term global success.”