The Marketing of the Ultra-premium Whiskeys

Eric Asimov, the chief wine critic at the New York Times, takes a look at bourbon and its increase in popularity.

The dive in sales forced bourbon producers to accept that the whiskey market had changed. They might not be able to compete with vodka, but to avoid permanent relegation to the dusty back shelves of liquor stores, bourbon producers would have to find a way to attract the budding connoisseur class.

For me, this evolution in the whiskey industry here in America is quite fascinating. For all of this talk of “tradition” and “history” in the Kentucky/Tennessee whiskey industries, the fact remains that these companies didn’t really hit their stride until our own lifetime. Around the fifties and sixties, Canadian Whisky was the popular drink. Then Jack Daniels and Jim Beam hit their stride in the sixties and seventies, mostly from the fact that they had good financial backing, decent marketing, and the ability to get into markets that other distillers could not. No where on this list is the phrase “devoted to the quality of the product”.

The drinks from these places were good enough to get by, but once single malts from Scotland began hitting the American Market, only then did they realize that a better product will lead to better sales. Here came a competitor that marketed themselves as “sophisticated” and their distillers as “craftsmen”. With some of the Scotches out there this was (and still is) pure hype. But there were (and are) some Scotches that could back up the words coming out of marketing. Jim Beam and Jack Daniels, with their distilling processes almost fully industrialized to the point where the craft of distilling was nearly an afterthought, simply could not back up any similar claim.

Or to put it another way, the Bourbon industry got schooled by the Scotch, both in terms of quality and of marketing.

Thus all the recent introductions of new bourbons that have been marketed as “crafted”. In my own experience, some are worthy, some are not. My own favorite, if I were to drink Bourbon regularly (which I currently don’t, because of all the research into other whiskeys) would be Bulleit, while I would bring (and have brought) out Jim Beam’s Basil Hayden to introduce new comers to the world of good bourbon. But admittedly, I have yet to try many on the list favored by Asimov’s reviewers, but I hope to rectify that within the next few months.

Meanwhile, the Canadian Whisky industry, truly the last whisky “varietal” to acknowledge the allure and benefit of Ultra-premium whiskeys, has been left reeling. In talking with the folks up north last week, they’ve lost market share every year for the past fifteen years. That is not a good trend, especially when compared against the following:

From 2002 to 2006, sales of bourbon and Tennessee whiskey rose by 12.23 percent. In the same period, sales of high-end whiskeys ($20 to $30) rose by 27.62 percent and sales of superpremium bourbons (above $30) rose by 60.52 percent.

The only thing that has saved the Canadian Whisky industry was the fact that their market share was so huge back fifteen years ago that they could afford to lose customers. But clearly this trend is not sustainable for them.

Like I said, I find this stuff fascinating.