BROWN SPIRITS: SCOTCH WHISKY Asia’s creeping export share provides food for thought


Global Scotch whisky exports enjoyed a sterling year in 2017, increasing in volume and value by 1.6% and 8.9%, respectively, to total £4.4bn ($6bn) according to UK HMRC data courtesy of the Scotch Whisky Association (SWA). Luke Barras-Hill reports on a thriving industry.


I


n volume terms, Scotch whisky shipped 1.23bn bottles globally in 2017, underpinned by strong


demand from the EU (31%), followed by North America (26%) and Asia/ Oceania (22%). Asia’s continued appeal for


Scottish whisky is in no doubt, with the region steadily building ground against its US counterpart in the total share stakes. Although it is interesting to note


that only Singapore (+29.4%; £291m) and Taiwan (-8.3%; £160m) feature among the top 10 largest export destinations, reveals the SWA. Obviously this is not DF&TR


specific and as TRBusiness has noted in the past there is no definitive DF&TR ‘sales league’ in which to compare like-for-like data. DF&TR Scotch has not enjoyed


the easiest of rides in recent years – attributable to a combination of


factors including global


currency depreciation, depressed Russian spending, a curb on ostentatious Chinese purchases and sluggish growth in the South American market. However, overall global travel


retail spirit sales lifted by 3.2% in 2016 over 2015 to reach 22.5m nine-litre cases, according to the IWSR’s most recent Top 100 Travel Retail Brands list released last year. As reported in the October print


issue, Diageo’s Johnnie Walker eclipsed its brand rivals with case sales of 2.6m (+3.5%), followed by Pernod Ricard’s Chivas Regal at 886,200 (+2.5%).


North American appeal In the US, Scotch in general continues to thrive against the backdrop of what has been challenging climes for the overall beverage sector. The IWSR’s Beverage Alcohol Review (US BAR) database indicates a second consecutive year of decline in US alcohol volumes last year (-0.2%). Yet within spirits, whisky improved its momentum by 3.9%,


MAY 2018 An interior view of DFS Group's impressive wine & spirits duplex store at Changi Airport T2.


outperforming non-whisky growth of +1.7%. Scotch – alongside Bourbon, Rye, Malt Scotch, Irish and Japanese offerings – performed the best, spurred by the introduction of more compact bottlings. Such has been the success of


Glenfiddich’s aged range in GTR that distiller William Grant & Sons (WGS) has launched new fractional sizes. “Twenty one year-old has got


stunning packaging – that’s helped a lot with sales because it has got wonderful shelf presence,” comments Richard Bush, Regional Marketing Manager – Americas. “The box can actually serve as a


glorifier and it’s become popular to the point that we have launched a 20cl, which is more of an impulse purchase or casual gifting occasion.” WGS says GTR growth of +8% in


the US last year outperformed overall wines & spirits category growth. “We are getting more interest


in fractionals in general,” enthuses Bush. He adds that 20cl sizes in the Glenfiddich Cask Collection’s Select Cask and Reserve Cask editions are attracting interest from customers. Indeed, Scotch’s performance in


other North American travel retail channels is also encouraging. This is especially the case in


Canada, where ARI North America (ARINA) continues to see demand for Scotch whisky at key airport locations such as Québec and Montréal.


“We are expanding our range to


bring in more World of Whiskies,” Jackie McDonagh, General Manager, Aer Rianta International North America (ARINA) tells TRBusiness, adding that the retailer is expecting double-digit growth from the Scotch category this year. A spokesperson from Beam


Suntory, which carries household brands such as Laphroaig and Bowmore, says Scotch whisky’s momentum is set to carry through into 2018 and beyond. “The Scotch category in


particular is so wide with very distinctive products for each of the producing regions,” explains the spokesperspon. “The key to sustaining this growth


for travel retail will be two-fold: Scotch brands will have to build on the success they experience in the domestic market and at the same time stay relevant and offer exclusive products to the consumer.” «


“The key to sustaining growth for travel retail will be two-fold: Scotch brands will have to build on the success they experience in the domestic market and at the same time stay relevant and offer exclusive products to the consumer.”


Spokesperson, Beam Suntory TRBUSINESS 135


Above: Richard Bush, Regional Marketing Manager - Americas, William Grant & Sons.


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