Market Watch, April 2018

APRIL 2018 MARKETW ATCHMAG COM MARKET WATCH 33 Four Bourbons made the Hot Brands roster The largest is Jim Beam which was up 65 to 49 million cases including flavors Beams core Bourbon is showing solid mid single digit growth but according to Rob Mason vice president of American whiskey at Beam Suntory the brands flavored variants are providing a burst of momentum We continue to see our flavored portfolio up by mid double digits Mason says It was buoyed a bit by the launch of Jim Beam Vanilla but Jim Beam Apple also continues to grow Diageos Bulleit whiskey also continued its tear up 13 to more than 12 million cases last year The 115 million Bulleit Distillery opened in March 2017 and Diageo is currently building a 10 million visitor center there as well Bulleit has nearly doubled in size since 2014 Its volume split is about two thirds Bourbon and one third rye whiskey Bulleit rye is the biggest rye in the country and it continues to grow Mahlan says Sophie Kelly Diageos senior vice president of North American whiskies adds that Bulleits Barrel Strength and 10 year old offerings are also contributing to the brands overall growth Woodford Reserve surpassed the half million case mark on 19 growth last year and brand owner Brown Forman is primed for further progress as Bourbon consumers embrace premiumization The range is growing across its pricing tiers with the core Woodford Reserve around 35 a 750 ml driving volume Woodford Reserve Double Oaked retailing at around 60 is flying for us right now says Brown Forman senior vice president and CMO John Hayes At that price point its certainly one of the leading Bourbon brands even though its been under the radar Luxcos Ezra Brooks also made the list crossing 250000 cases on a 19 bump in 2017 as did Ole Smoky moonshine after posting two straight years of strong double digit growth In Tequila Beam Suntorys Hornitos led the way by volume passing 800000 cases on 12 growth last year Last fall Hornitos was extended with a new Cristalino offering 30 a 750 ml which starts as a triple distilled añejo Tequila aged at least 12 months in American white oak casks It then undergoes a filtering process that results in a clear liquid Portfoliomate Sauza Silver also earned Hot Brand honors as did Brown Forman standout El Jimador Meanwhile Campari Americas Espolòn Tequila was one of the fastest growing entrants on the 2017 Hot Brand list rising by 475 to 295000 cases Last year the brand released its Blanco expression in 175 liter bottles 50 to further promote expansion in the off premise where Espolòn does most of its business While Bacardi made a seismic move in Tequila with its recent multi billion dollar deal for Patrón the companys Cazadores label is also on the rise averaging 14 growth over the past three years Likewise Diageos play for Casamigos last year made headlines but its Don Julio brand continues to show strong growth of its own advancing by 26 to 529000 cases last year Though most of Don Julios success comes from its Blanco expression the Añejo has been making rapid gains as well Tequila is also becoming more important within the Pernod Ricard portfolio as the company recently took full control of Avión Alongside Avión Pernods Olmeca Altos brand continues to fly surging past 200000 cases on 26 growth in 2017 Domestic Wines Premium Focus In domestic wine this years Hot Brands roster features a wave of newcomers replacing several longtime stalwarts Absent are such former award winners as Gallo owned Barefoot Cellars and Barefoot Refresh as well as Ste Michelles 14 Hands and Columbia Crest Some of those brands grew last year but fell short of the Hot Brand growth criteria But nine honorees make their debut on the list proving that domestic wine remains as dynamic and competitive as ever With the Barefoot franchise ceding its Hot Brand status Constellation Brands Black Box 19 21 a 3 liter box takes over the domestic wine lists top spot at 66 million 9 liter cases The markets fast growing premium boxed wine player has enjoyed double digit gains since its launch in 2003 and it now offers 11 different varieties Though most of its business remains focused on its core 3 liter product Black Box is also carving out growth via its 500 ml Go Pack with the brands Cabernet Sauvignon Chardonnay Pinot Grigio Pinot Noir Merlot and rosé all available in the smaller format In addition to Black Box Constellation counts a pair of super premium California brands Meiomi and Robert Mondavi Winery among this years winners Acquired by Constellation from Joe Wagners Copper Cane Wine Provisions in 2015 Meiomi 25 a 750 ml is led by its flagship Pinot Noir though recent forays into Chardonnay and rosé have also proven fruitful helping to add nearly 120000 cases in 2017 Portfoliomate Robert Mondavi Winery has been part of Constellations fold since 2004 when the company acquired the iconic brand for roughly 1 billion The Robert Mondavi Winery portfolio has three tiers with its core Napa Valley lineup 20 40 accounting for around 75 of the business Our Napa Valley Cabernet Sauvignon and Maestro red blend over deliver on quality using some of HORNITOS 2009 2017 thousands of 9 liter case depletions Calendar Years Source IMPACT DATABANK 2018 300 400 500 600 700 800 900 17 16 15 14 13 12 11 10 09