Tequila leads luxury spirits boost

Luxury brands of Tequila backed by celebrities such as Sean Combs (aka P Diddy) and George Clooney have started to eat into the market share of white and brown spirits.

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(Courtesy of Euromonitor International)

Although Whisky and Cognac are most associated with luxury spirits, accounting for 45% of the global retail sales value of the premium market according to data from Euromonitor International, Mexico’s agave-based spirit is starting to make a move.

In Western markets it is seen as a boozy, head-banging spirit used by many to simply get drunk quickly, but brands like DeLeón and Casamigos faced by celebrities like Sean Combs, George Clooney and Rande Gerber, the husband of Cindy Crawford, are starting to change that image.

According to Diageo, the joint owners of DeLeón along with Sean Combs, 65% of all positive retail value change in the US Tequila market, the world’s biggest, has come from the ultra- and super-premium brands over the last year.

Alex Tomlin, vice president of marketing for Diageo’s Tequila portfolio in the US, said: “What we’re trying to do with DeLeón is to create a new take on luxury, not a traditional take. It’s a brand that is all about edge and attitude, and that screams unapologetic luxury.

It doesn’t come cheap though. A bottle of the Leona format of DeLeón retails for round $850, while Diamanté and Extra Añejo versions cost $150 and $350, respectively.

Since the Sean Combs and Diageo entered into the 50/50 partnership last year the brand has gone from strength to strength thanks to Diageo’s powerful distribution network and Combs’ access to Hollywood influencers, now selling 13 times more than it was under its former owners.

Combs’ magic touch also helped to turn around the fortunes of ultra-premium vodka brand Ciroc, also owned by Diageo. When the two joined forces it was selling around 50,000 9-litre cases a year, but that figure has risen to nearly 2 million cases.

He is not the only star of Hollywood to enter the luxury drinks fold. Best friends George Clooney and Rande Gerber, along with third partner Mike Meldman, jointly own super-premium Tequila brand Casamigos.

Speaking to Euromonitor International, Rande Gerber said: “George and I came up with Casamigos when we were building our (holiday) homes in Mexico. We were spending a lot of time there during the construction phase and, as you do in Mexico, we were drinking a lot of Tequila. At some point George said, ‘We’re spending so much time here drinking Tequila, why don’t we just make our own, one that’s perfect for us’.”

Apparently it was a lengthy process as they went through 700 bottles of samples before they found the “smooth with no burn” profile that they wanted. What started out as a hobby gradually expanded through friends and friends of friends to the business that it is today. Mr Gerber now says Casamigos is the fastest-growing Tequila brand in the US, with volumes growing around 500% last year.

In addition to a touch of the celebrity treatment, Tequila is also trying to shake off its formerly brash image and attract a new generation of customers through cocktails and innovative luxury drinks in the on-trade.

Growing numbers of mixologists in high-end bars are switching out their white and brown spirits in favour of the highest quality Tequila brands, with classic such as the Manhattan and Old-Fashioned getting a fresh Mexican twist.

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