Booze: Who's drinking what where
The world consumed 18.3 billion liters of spirits in 2007, with China, whose thirsty citizens drank 3.7 billion liters, leading the way, according to the global market intelligence firm Euromonitor International. But don't expect to have heard of any of these brands—a majority of this tipple is local hooch made and consumed in China.
By far the most popular category of liquor in the world was vodka (3.7 billion liters), thanks to Russia's immense appetite for the stuff, followed by whiskey (2.1 billion liters). But fans of Dewar's or Jack Daniel's will be surprised to learn that most of this is not the familiar Western brands but rather Indian-made whiskeys, with some ersatz Scottish names like Bagpiper and McDowell's. Indians consume nearly 800 million liters of whiskey, both domestic and imported, a year.
But local labels produced purely for local markets aside, which are the global brands that have established the greatest presence behind the bar?
With the opening up of Russia and Eastern Europe, the growing prosperity in Asia and South America, and above all the Westernization of popular culture, Western spirit brands have become the drink of choice for the emerging middle class from Shanghai to São Paulo—and the category that's leading the way is Scotch whisky.
According to Martin Riley, international marketing director for Chivas Brothers (Chivas Regal, Glenlivet, Ballantine's, Royal Salute, Beefeater Gin), a division of Pernod Ricard: "These are very good times for Scotch whisky. The whole world, with one or two exceptions, is really embracing it in its different forms. We are seeing growth at all levels."
He points out that Scotch whisky is the only spirit you can find in every market where it's legal to sell alcohol, and in most markets of the world it's the imported spirit of choice.
Blended or single Malt?
Scotch has a major advantage in that it is not really one but three categories of spirit—blends, super-premium blends such as Johnnie Walker Blue and Chivas Regal's Royal Salute, and single malts—so even if one is in decline in a particular market, another might be growing.
An example of this is the U.S. and Britain where sales of blended Scotch are flat or even declining while single malts are growing at double-digit rates. These countries both have a strong history of Scotch drinking and a knowledgeable consumer base that's receptive to the appeal of single malts.
With the opening up of Russia and Eastern Europe, the growing prosperity in Asia and South America, and above all the Westernization of popular culture, Western spirit brands have become the drink of choice for the emerging middle class from Shanghai to São Paulo—and the category that's leading the way is Scotch whisky.
According to Martin Riley, international marketing director for Chivas Brothers (Chivas Regal, Glenlivet, Ballantine's, Royal Salute, Beefeater Gin), a division of Pernod Ricard: "These are very good times for Scotch whisky. The whole world, with one or two exceptions, is really embracing it in its different forms. We are seeing growth at all levels."
He points out that Scotch whisky is the only spirit you can find in every market where it's legal to sell alcohol, and in most markets of the world it's the imported spirit of choice.
Blended or single Malt?
Scotch has a major advantage in that it is not really one but three categories of spirit—blends, super-premium blends such as Johnnie Walker Blue and Chivas Regal's Royal Salute, and single malts—so even if one is in decline in a particular market, another might be growing.
An example of this is the U.S. and Britain where sales of blended Scotch are flat or even declining while single malts are growing at double-digit rates. These countries both have a strong history of Scotch drinking and a knowledgeable consumer base that's receptive to the appeal of single malts.
The US, not surprisingly, drinks more bourbon than anywhere else, though American whiskey—bourbon and Tennessee—have long played catch-up with Scotch in global markets. Scotch established itself around the world in the 19th and 20th centuries thanks to the wide reach of the British Empire, while U.S. whiskey was crippled by Prohibition, but the major labels, such as Brown-Forman's (BFA) Jack Daniel's and Fortune Brands' (FO) Jim Beam, are now making a big push into the emerging markets of Eastern Europe, Russia, and China.
However, while they are showing success in terms of growth—sales of American whiskey grew by 269% in China from 2002 to 2007—they still represent only a small fraction, 5.6%, of the overall whiskey market there. In fact, one brand of Scotch, Chivas Regal, sells four times as much whisky in China as all the American whiskey brands combined.
The US is also, and somewhat surprisingly, the largest market for cognac. In contrast, the French, while embracing Scotch, have fallen most decidedly out of love with their own national spirit; consumption fell by 55% from 2002 to 2007 and now is just 1/20th of that of Scotch.
Russians drink more vodka than anyone else (274 million cases), but growth is minimal, whereas cognac is up 134% in that country over the last five years, and Scotch a whopping 561%, all according to IWSR.
Big "Scotch" drinkers
The world's largest consumer of "Scotch" is India—the word is in quotes because 99% of it there is not produced by Messrs. Walker, Haig, and their Scottish friends, but a local spirit as often as not made from molasses rather than barley.
To protect this domestic production, India imposes a controversial 52.5% tariff on imported Scotch, so the real stuff accounts for only 1% of Indian whiskey consumption.
Needless to say, the Scotch Whisky Assn. is not happy with the situation, and the lawsuits are flying. The SWA recently won a case in the Delhi High Court forbidding the locals from labeling their spirit "Scotch," but this is only the beginning of the fracas. With angry accusations of protectionism and imperialism being tossed around, it's going to be a long time before this particular liquored-up brawl is settled.
What this all amounts to is that the international premium spirits brands are becoming an increasingly successful worldwide phenomenon. In the developed world they are an affordable luxury; in the emerging markets of Eastern Europe, Russia, and China, they have become emblematic of an aspirational Western lifestyle; and for everyone, every patron of trendy cocktail bars and pulsing discos from Singapore to Seattle, they connote a self-congratulatory air of worldly sophistication.
By far the most popular category of liquor in the world was vodka (3.7 billion liters), thanks to Russia's immense appetite for the stuff, followed by whiskey (2.1 billion liters). But fans of Dewar's or Jack Daniel's will be surprised to learn that most of this is not the familiar Western brands but rather Indian-made whiskeys, with some ersatz Scottish names like Bagpiper and McDowell's. Indians consume nearly 800 million liters of whiskey, both domestic and imported, a year.
But local labels produced purely for local markets aside, which are the global brands that have established the greatest presence behind the bar?
With the opening up of Russia and Eastern Europe, the growing prosperity in Asia and South America, and above all the Westernization of popular culture, Western spirit brands have become the drink of choice for the emerging middle class from Shanghai to São Paulo—and the category that's leading the way is Scotch whisky.
According to Martin Riley, international marketing director for Chivas Brothers (Chivas Regal, Glenlivet, Ballantine's, Royal Salute, Beefeater Gin), a division of Pernod Ricard: "These are very good times for Scotch whisky. The whole world, with one or two exceptions, is really embracing it in its different forms. We are seeing growth at all levels."
He points out that Scotch whisky is the only spirit you can find in every market where it's legal to sell alcohol, and in most markets of the world it's the imported spirit of choice.
Blended or single Malt?
Scotch has a major advantage in that it is not really one but three categories of spirit—blends, super-premium blends such as Johnnie Walker Blue and Chivas Regal's Royal Salute, and single malts—so even if one is in decline in a particular market, another might be growing.
An example of this is the U.S. and Britain where sales of blended Scotch are flat or even declining while single malts are growing at double-digit rates. These countries both have a strong history of Scotch drinking and a knowledgeable consumer base that's receptive to the appeal of single malts.
With the opening up of Russia and Eastern Europe, the growing prosperity in Asia and South America, and above all the Westernization of popular culture, Western spirit brands have become the drink of choice for the emerging middle class from Shanghai to São Paulo—and the category that's leading the way is Scotch whisky.
According to Martin Riley, international marketing director for Chivas Brothers (Chivas Regal, Glenlivet, Ballantine's, Royal Salute, Beefeater Gin), a division of Pernod Ricard: "These are very good times for Scotch whisky. The whole world, with one or two exceptions, is really embracing it in its different forms. We are seeing growth at all levels."
He points out that Scotch whisky is the only spirit you can find in every market where it's legal to sell alcohol, and in most markets of the world it's the imported spirit of choice.
Blended or single Malt?
Scotch has a major advantage in that it is not really one but three categories of spirit—blends, super-premium blends such as Johnnie Walker Blue and Chivas Regal's Royal Salute, and single malts—so even if one is in decline in a particular market, another might be growing.
An example of this is the U.S. and Britain where sales of blended Scotch are flat or even declining while single malts are growing at double-digit rates. These countries both have a strong history of Scotch drinking and a knowledgeable consumer base that's receptive to the appeal of single malts.
The US, not surprisingly, drinks more bourbon than anywhere else, though American whiskey—bourbon and Tennessee—have long played catch-up with Scotch in global markets. Scotch established itself around the world in the 19th and 20th centuries thanks to the wide reach of the British Empire, while U.S. whiskey was crippled by Prohibition, but the major labels, such as Brown-Forman's (BFA) Jack Daniel's and Fortune Brands' (FO) Jim Beam, are now making a big push into the emerging markets of Eastern Europe, Russia, and China.
However, while they are showing success in terms of growth—sales of American whiskey grew by 269% in China from 2002 to 2007—they still represent only a small fraction, 5.6%, of the overall whiskey market there. In fact, one brand of Scotch, Chivas Regal, sells four times as much whisky in China as all the American whiskey brands combined.
The US is also, and somewhat surprisingly, the largest market for cognac. In contrast, the French, while embracing Scotch, have fallen most decidedly out of love with their own national spirit; consumption fell by 55% from 2002 to 2007 and now is just 1/20th of that of Scotch.
Russians drink more vodka than anyone else (274 million cases), but growth is minimal, whereas cognac is up 134% in that country over the last five years, and Scotch a whopping 561%, all according to IWSR.
Big "Scotch" drinkers
The world's largest consumer of "Scotch" is India—the word is in quotes because 99% of it there is not produced by Messrs. Walker, Haig, and their Scottish friends, but a local spirit as often as not made from molasses rather than barley.
To protect this domestic production, India imposes a controversial 52.5% tariff on imported Scotch, so the real stuff accounts for only 1% of Indian whiskey consumption.
Needless to say, the Scotch Whisky Assn. is not happy with the situation, and the lawsuits are flying. The SWA recently won a case in the Delhi High Court forbidding the locals from labeling their spirit "Scotch," but this is only the beginning of the fracas. With angry accusations of protectionism and imperialism being tossed around, it's going to be a long time before this particular liquored-up brawl is settled.
What this all amounts to is that the international premium spirits brands are becoming an increasingly successful worldwide phenomenon. In the developed world they are an affordable luxury; in the emerging markets of Eastern Europe, Russia, and China, they have become emblematic of an aspirational Western lifestyle; and for everyone, every patron of trendy cocktail bars and pulsing discos from Singapore to Seattle, they connote a self-congratulatory air of worldly sophistication.
source: BusinessWeek
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