Spirits of the North
Americans’ fascination with’and predilection for’brown spirits continues to accelerate. Whether it’s sipping a single-malt Scotch, making a homemade Manhattan with rye, collecting the finest bottles of bourbon or kicking back with a simple shot of Jameson, whiskies have gained significant attention’and all signs indicate the streak will continue. Amid the amber-hued flood, however, the one segment of the category that has often shied away from the limelight is Canadian whisky. But with clamored-for flavored expansions and craft newcomers, spirits from the Great White North are sought after now more than ever before.
According to statistics complied by the Beverage Information Group, depletions of Canadian whisky gained 0.9% to about 15.5 million 9-liter cases nationwide in 2012 (the last year for which there are full-year statistics.) This generated more than $1.6 billion in revenue for distillers. In the control states, the category performed even better, gaining 1.8% overall (on a 12-month rolling calendar through September 2013), to about 4.2 million 9-liter cases. Driving this growth were premium and superpremium brands’a departure from the iconic value labels most often associated with Canadian whisky.
At New York wine and spirits retailer Whiskey & Wine Off 69, owner Frank Giresi says he’s seen the Canadian whisky drinker evolve from ‘a Seagram’s, Canadian Club and Crown Royal crowd.’ A younger demographic frequenting his store now fancies themselves whiskey geeks, and they want to sample every bottle they can. ‘We don’t really have an old-school clientele,’ he points out. ‘I see people work their way through the bourbon section. Then, with the explosion of craft cocktails, I see people buying rye, because they know putting it in Manhattans is the way it’s supposed to be. Canadian whisky is definitely the slowest to catch on, but if you build it, they will come’whether it’s for soft, smooth Pendleton or Fireball Cinnamon Whisky, which is flying off the shelves.’ Giresi thinks educating his staff first, then his customers through frequent tastings, is key to building interest in different brands. ‘The growth of the whiskey category in general,’ he says, ‘has really helped Canadian whisky.’
Forever Young
One of the most familiar Canadian whisky brands on retail shelves is Beam Global’s Canadian Club’which certainly got a helpful mainstream boost as a favorite of Don Draper on Mad Men. Rob Tucker, senior brand manager of Canadian Club Canada, says that the brand has managed to stay at the top through its new spokesman, an integral part of their campaign strategy. ‘We’ve found a fun and relevant way to share Canadian Club’s history and heritage through our Canadian Club Chairman. Our target consumers love him and his Whisky Whisdoms. He is a wake-up call to all men entering the next stage of life that the same old beer, the same old clothes and the same old attitude will no longer do. It is time for them to step up, and Canadian Club whisky is a terrific way to affirm that they are growing up.’
Brown-Forman’s Canadian Mist is another category behemoth. Pedro Berrueco, senior brand manager, says Canadian Mist has gained a number of loyal drinkers since the brand’s inception in 1967. ‘The premium and premium plus Canadian price segments are driving growth for the most part. However, a few brands in the value price segment have also generated modest growth, including Canadian Mist, which has significantly improved its volume trend over the past 10 months,’ he explains. Buoyed, the brand decided to venture into the appealing world of flavors with Peach Mist, Maple Mist, Cinnamon Mist and Vanilla Mist offerings. These, Berrueco says, ‘look to keep the trademark relevant for years to come. Our major focus has been to ensure the Canadian Mist brand continues to be produced with the same high level of quality and taste our core consumers expect. This past summer, after carefully looking at whisky and flavored specialty spirit trends in the U.S., we decided to introduce four Mist flavors. Our intent is to provide consumers with a new and exciting ‘brown spirit experience.’’’ In particular, Berrueco singles out LDA ‘ 29 consumers as a key target. The debut dovetails nicely with a new tagline, ‘All Whisky. No Bite.’ ‘This year, we will be executing a new off-premise initiative including the opportunity to taste our brand at the store level in key markets.’ Berrueco says.
Constellation Brands’ well-known Black Velvet brand also capitalizes upon customers’ affinity for flavor. This fall, on the heels of its Black Velvet Toasted Caramel Flavored whisky, it debuted Black Velvet Cinnamon Rush, with hints of clove, allspice, vanilla and orange peel.
Diageo’s beloved Crown Royal hit a home run with the unveiling of Crown Royal Maple Finished in 2012. ‘Crown Royal’s extraordinary growth last year was much in part due to the launch of Crown Royal Maple Finished. Through that specific product launch and with Cabin Fever, we grew a new flavor’maple’within the exciting flavored whisky segment,’ says Yvonne Briese, VP whisky, Diageo North America. Now, Crown Royal is looking ahead toward its brand new Crown Royal XO, an ultra-premium Canadian whisky finished in Cognac casks from the French Limousin Forest. The brand also has the power of the National Basketball Association lending it marketing cachet. Now in the second year of its ‘Reign On’ campaign, the Canadian whisky provides fans access to players through unique video content on digital and broadcast channels. Next up: a multi-part video series, On-Point, will debut on TNT featuring television personality Terrence J.
Kevin Richards, whisky and specialty brands director for Sazerac Company, says that its Rich & Rare Reserve brand, a peppery upgrade from the original sweet and creamy R&R, continues to expand across the U.S. ‘Recent innovation within the category and overall consumer growing interest in brown spirits has helped Canadian whisky brands get a fresh look from consumers who not only value Canadian whisky’s fantastic mixability, but the stunning complexity of newer, higher-end offerings like our Caribou Crossing Single Barrel,’ he notes.
Smaller Is Sometimes Better
The continued dominance of the big brands hasn’t stopped suppliers from pushing its less recognized offerings to boot. Consider Beam Global’s Alberta Premium Dark Horse, the sixth fastest growing brand in Canada in terms of dollars added to the category in the last 12 months, right behind its base brand Alberta Premium 100% rye, according to Tucker. ‘Dark Horse is growing at +818%, ‘he adds. While flavored whiskies have helped garner 30% of the category’s growth, Tucker notes, it’s the newer, small-batch brands like Dark Horse’ at 45% ABV, it’s a higher proof than most Canadian whiskies’that turn customers on to the spirit’s richer, sophisticated side.
Canadian Mist’s Berrueco notes that, ‘The rise of brown spirits has created momentum and built awareness throughout the entire whiskey category by creating a halo effect. From flavored whiskey to rye to Canadian whisky, more consumers are trying different types, which is leading to overall growth.’ All the more reason, then, for Brown-Forman’s new Collingwood Rye 21-Year-Old. ‘Collingwood is enjoying momentum sustained by the increasing numbers of handcrafted, smaller batch Canadian whiskies. With trends favoring the super-premium category, Collingwood is poised for a bright future. Due to its limited nature and unique proposition, the 21-Year-Old is receiving attention, which is helping to build awareness of the parent brand.’ Richard McLeod, brand director, North American Whisky, Pernod Ricard USA, is quick to point out that Canadian whisky is the largest imported whiskey category in the U.S. signifying upwards of $4.8 billion at retail. ‘The best part of the story is that in recent years, American consumers are now enjoying a whole new range of superpremium Canadian whiskies. A variety of spirits have been coming out of Canadian distilleries for quite a while now, but only recently have Americans seen so many at once alongside the handful of well-known brands,’ he notes. ‘It’s the perfect storm. There has been a real explosion of new consumers, as well as a maturing of current consumers into explorers and discoverers in the category. Consumers are demanding a huge variety now. Gone are the days when you could just have those bigger brands. They are still extremely important, but variety is now critical,’ he says.
J.P. Wiser’s, which has been around since 1857, is part of the Pernod Ricard portfolio. J.P. Wiser’s Rye and J.P. Wiser’s Spiced, McLeod points out, ‘go after the regular guy. He is looking for a product of exceptional quality, that stands up straight, mixes with cola and is of great value.’ Another offering, Pike Creek, whose whisky rest in non-temperature controlled warehouses in Ontario so the wood can be exposed to Pike Creek’s terroir, is finished in port barrels. ‘It’s for the more mature consumer, the one who is only really starting to explore what’s new in whisky,’ McLeod says.
Whisky connoisseurs, the ones who relish artisanal offerings, will gravitate toward Pernod Ricard’s Lot 40, which along with Pike Creek, just debuted stateside in October’after a seven-year hiatus. A 100% rye whiskey, it’s a seventh-generation recipe distilled in a 12,000-liter copper pot and aged in virgin white oak.
Smooth Sailing Ahead
Sidney Frank Importing Company’s ambitious launch of Sortilége, meaning ‘magic spell,’ is testament to how the category is keen to strip its past stigmas in favor of quality. A blend of three-year-old Canadian rye whisky and top-notch ‘Canada 1 Extra Clear’ maple syrup, Sortilége is aged in hand-selected white oak barrels for a minimum of three years.
‘Sortilége is currently available in Canada and is the country’s best-selling maple spirit. We feel the time is right as there is an increasing demand for maple-flavored spirits from U.S. consumers,’ says Bill Henderson, head of the brand. ‘Sortilége has seen early success largely due to the brand’s use of pure maple syrup while many others are using artificial flavoring.’ Tastings will be key in the off-premise. Says Henderson, ‘The proof of a whiskey combined with an all-natural, high-quality maple syrup makes Sortilége an extremely versatile base and modifying spirit.’
Tastes are shifting, and to illustrate this point, Whiskey & Wine Off 69’s Giresi recalls the time he gave his father a single malt Scotch as a gift, back in 1989. ‘He pushed it back and said ‘I drink Chivas,’’ Giresi laughs. ‘I told him how good it was, how it was made from a single barrel, and he still said, ‘I drink Chivas.’ Today’s customer is more open-minded than my father was then, and Canadian whiskies are so accessible. It’s only going to grow.’
Van Gogh Imports CEO Norman Bonchick agrees. In his portfolio is Tap 357 Canadian Maple Rye Whiskey, which melds cask-aged rye whiskies with ‘Canada 1 Light’ maple syrup tapped at the first hint of Quebecois spring. ‘After too long a period of time the consumer is finally coming back to brown spirits as a whole and Canadian whisky is receiving some of that attention’its rich and complex, yet approachable, making it an especially great choice for new enthusiasts,’ he notes. Still, he thinks more effective organization can propel Canadian whisky even further. ‘We believe that a separate Canadian rye section is warranted within brown spirit shelf sets at the retail level to help consumers understand that there are differences and what their choices are,’ he explains. ‘The myriad whiskey types within brown spirits can be confusing, especially to the novice, and we wholeheartedly believe that a designated section benefits both the category and the account.’
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