By Amelia Levin, Foodable Industry & Research Editor
We’re entering a new generation of spirits consumption and cocktail drinking. It’s all about marketing the craft, social media engagement, and heightened hospitality at the bar. And the cocktail-oriented consumers who partake in this elixir continue to create new and emerging trends.
Millennials are a huge driver in the growth of spirits consumption, which now rivals craft beer consumption. According to Foodable Labs research, 31.9 million Millennials consume nearly 3.8 spirits-based cocktails per month compared to 28.5 million who drink 3.3 craft beers per month.
Enjoying cocktails with food is more of a thing, too; Foodable Labs reports that 8.7 million Millennials pair spirits with menus .085 times a month. Still, beer and food pairings reign, with 19.4 million Millennials pairing craft beer with menus at least 1.3 times per month.
Social media and mobile seem to be the clear platform winners for Millennial consumption growth; the top 100 spirit brands connect with over 22.4 million Millennials, but the top 250 craft beer brewers only connect with 12 million Millennials each month.
In a study of 1,860 spirit brands over the past six months, Foodable Labs found Patron tequila (3.8 x/month), Captain Morgan rum (3.4 x/month), Maker’s Mark (2.9x/month), Tito’s Vodka (2.7 x/month), Bacardi (2.5x/month), and Hendricks Gin represent brands that are mentioned, tagged and photographed on social media the most.
It works the other way, too; the biggest group of social media users who engage with spirits brands fall in the 21- to 34-year-old age range (aka, Millennials), with 4.7 spirits-related digital engagements per month. That’s followed by Gen Xers (ages 35-44) at 4.1 times per month, and the 45-plus group at 3.8 times per month.
In a ranking by Foodable Labs of the top “most loved” spirit brands, Maker’s Mark easily led the pack with a score of 75.81, just above Jameson Irish Whiskey.
Jameson seems to be doing a better job connecting with consumers, scoring 129.88 compared to 125.52 for Maker’s Mark in another Foodable Labs’ ranking on Top 10 Overall Spirits Brands, based on social consumer and operator sentiment and engagement.
The love for bourbon and whiskey as of late is no surprise, according to Scott Goldman, veteran cocktail artist, bar and beverage consultant, and founder of Cocktail Courier, a cocktail delivery service that collaborates with bartenders around the country. On the heels of a classic cocktail revival focused on the dark stuff, “people have plenty of confidence going to a bar now and ordering an Old Fashioned or specifying their bourbon,” he says.
Apparently, bourbon is really blowing up. According to Nielsen, bourbon and whiskey sales grew 6 percent this past summer, with premium volumes up 6.2 percent and ultra volumes up 19 percent.
In fact, some brands are having a hard time keeping their inventory in stock. Spirits makers “didn’t predict years ago that today you would see this massive demand for bourbon and whiskey,” says Goldman. Barrel-aged spirits like those require some planning ahead.
Burgeoning bourbon brand Buffalo Trace, which is owned by Sazerac Company (Sazerac Rye, Blanton’s, Weller, etc.) publicly admitted to facing a shortage, but announced plans to boost the bounty. The 225-plus-year-old distillery recent purchased an additional 300 acres of farmland next to its current space in Frankfort, Kentucky, and it is currently renovating former barrel warehouse buildings purchased years ago on the main distillery campus. The brand has been experimenting with new blends as well; warehouse X has had more than 3,000 experimental barrels aging for the past year.
“Not a day goes by that we don’t hear from fans asking why they can’t find their favorite whiskey at the local liquor store, so we are offering an annual update to inform people where we stand, and ensure fans we are distilling more whiskey and planning for the future,” Kris Comstock, Buffalo Trace’s marketing director, said in a release.
For many spirits brands like Buffalo Trace, the marketing strategy represents more of a balancing act between being and/or appearing like a craft distiller to cater to Millennials who increasingly seek out local, artisan and/or small-batch brands.
“Bigger brands get more pushback from bartenders,” says Goldman. “If you’re a smaller brand, your goal is almost to get to a point where mixologists don’t like you anymore – this means you’ve gone mainstream.” Buffalo Trace hasn’t gotten there yet, but it could as production ramps up.
But is this what spirits brands really want? “If Applebee’s came along and offered to put your brand on every menu around the country, you would want to say, ‘yes,’ but then you would have to ramp up production significantly,” says Goldman. Technically that makes a brand not so small batch anymore – the exact image they’re onto, which they’re trying to hold for marketing purposes.
As such, Goldman wouldn’t be surprised if larger spirits companies expand their portfolio of the smaller guys as a way to grow sales versus building up the already big guys.
In addition, these bigger brands have had to become more innovative about their social media engagement and marketing. “A marketing expert used the word ‘discovery’ with me the other day,” says Goldman. “Instead of in-your-face, aggressive marketing, these companies are allowing consumers to discover the brand in a native way, through friends, bartenders and of course, Instagram, Twitter, Facebook, and the like.”
One whiskey maker to watch is Bulleit, which makes both bourbon and rye blends. But while it might appear like a “craft” spirit, it was actually bought out and is now produced by one of the largest spirits companies in the nation: Diageo.
“Millennials seem to love Bulleit, maybe because of the bottle, which looks a little old school or like a craft spirit,” says Goldman. But it could also be due to the “discovery” social media campaign that looks more like an insider’s club than an out-of-the-box showdown. The brand has a presence only on Instagram where it posts photos of the bottle in different settings, and it has just 8,447 followers.
Meanwhile, Maker’s Mark posts every few hours on Twitter and has 94.3K followers. Seems like once a brand has made its way into the “big player” territory, the insider’s club method just isn’t possible anymore.
As the most consumed spirits category, according to Foodable Labs data, tequila brands continue to clamor for the top through social media engagement and other methods (more on that in a minute).
Patrón Tequila ranked 6th on the list of top 10 social media spirits brands, scoring 126.55 in social consumer and operator sentiment/engagement in between whiskey, vodka, and rum. The brand has a whopping 217K followers on Twitter, posting a ton of recipes to educate drinkers on how to use the spirit.
On the other hand, higher-end tequilas like Don Juan and Tequila Ocho continue to perform well, according to Goldman, but they’re relatively quiet on social media and seem to be taking more of that “discovery” approach.
“We’re also seeing a rise in mezcal as consumers appreciate the smoky taste,” says Goldman. “Mezcal is not cheap, and it’s mainly made by smaller producers except for Del Maguey — but even they work with smaller farms.”
Like whiskey, mezcal and even tequila makers must plan at least six to eight years out because of the time it takes to grow and harvest the agave. Only spirits made in the tequila region using 100-percent blue agave can be called tequila, so some makers have sought to buy out huge plots of land to prepare for what they see as a potential spike in growth, says Goldman. The Tequila Interchange Project is an attempt to stop or slow that buyout to allow smaller brands more play in the game.
Once shunned by whiskey lovers and as a less sophisticated spirit good only for boring mixed drinks, vodka has since become part of the repertoire for many craft/artisan distillers around the country. From CH Distillery and Koval in Chicago to Death’s Door in Wisconsin, Prairie Organic in Minnesota, and Hangar One in California, many makers are evading long-held notions that vodka shouldn’t taste like anything, and are making aromatic vodkas from local foods with their own terroir, like Wisconsin red wheat and West Coast grapes. As such, vodka has slowly become more respected among cocktail artists and the mixology community, where it’s begun to find its footing once again.
Tito’s, while no longer considered a small-batch producer, started off this way. Cocktail artists are beginning to see beyond the “craft” status it portrays, Goldman says. At the same time, the brand has maintained a powerful social media campaign throughout the years to energize and make drinking Tito’s sound like fun.
And the research proves it: Tito’s ranked third on the list of most loved brands, with a combined score of 74.61 for spirits brand sentiment and engagement, just surpassing SKYY vodka at 74.37. And it also happened to rank 4th among top 10 spirit brands on social media based on social consumer and operator sentiment and engagement, with a score of 127.72, putting it only behind Jameson Irish Whiskey, Hennessy and Veuve Clicquot.
I met Tito Beveridge (yes, that really is his name) in 2009 when the company was just taking off. It was part of a tour of the Tito’s “plant,” then a small, wooden ranch house consisting of a few office desks and a warehouse-type space with bottling equipment and product. Now the scale is much larger, with a production of over 100,000 bottles a year and a distribution system from coast to coast.
It was here in this “shack,” as Beveridge described it, that he first attempted to distill vodka, sleeping overnight in the 100-plus degree room with a shower overhead, that he could pull to douse himself with water, you know, just in case the distilling tank caught fire, or worse, exploded. Beveridge had chosen this particular location outside of Austin to set up shop because the liquor laws were more forgiving in this area; most other areas only allowed wine and beer production.
As the company started to take off, Beveridge told the story of how he maxed out various credit cards buying equipment and supplies on eBay – including bottles and labels he made himself with his small staff.
The company prides itself on vodka made from corn that’s distilled six times for a smoother, cleaner taste, putting it in the same category as powerhouses SKYY and maybe even Grey Goose. Though the price runs far less than those premium spirits, few would categorize it like a Smirnoff or Absolut.
Even thought Tito’s Handmade Vodka might have become less “handmade” and more mainstream, its marketing program continues to push that story about artisan craftsmanship consumers crave these days. Case in point: On Facebook, the brand announced it teamed up with an Austin-based sock maker to “celebrate the American craft movement with our ‘Meet the Maker’ program,” through which Tito’s introduces other “artisans” throughout the country.
The brand has remained heavily involved in energetic and even kitschy marketing strategies and social media activity, posting event notices, recipes, and other fun promos on its Facebook page, tweeting on Twitter about its screening event for “The Big Lebowski,” and uploading photos and videos to Pinterest, Instagram and YouTube.
And Tito’s continues to get the backing at the bar. Bartenders are giving more credit to vodka these days, stocking the shelves with both big and small brands and not flinching when someone orders a vodka tonic. “It’s not about shunning the consumer anymore,” says Goldman. “If someone orders a vodka tonic, they know they need to make the best vodka tonic that person has ever had. Everything goes full circle – we’re seeing a happy medium between customers that are more interested in sophisticated cocktails but bartenders who are more focused on hospitality and the customer is always right.”
With such heavy social media engagement between spirits brands and their consumers, this “meeting in the middle” seems to be happening both offline and on.