Flavored spirits: a big commercial opportunity - or could there be a catch?

It is a fact that many consumers, particularly younger ones, do not like the taste of alcohol. The purpose of drinking alcohol is all for the effect.

Hence historically, consumers have looked to mask the taste with mixers or in the form of cocktails. It’s no coincidence that cola is still the biggest single mixer for this very reason.

Enter the role of flavours – another masking device, but offering an added dimension to that of a simple mixer...

The case for flavours - vodka​

Vodka flavours have added a natural dimension to a category that stands for versatility and fun. History has also proven that flavours can redefine category appeal as consumer trends change and develop.  Absolut Peppar and Absolut Citron, launched in 1986 and 1988 respectively, were curated as recipe ‘drivers’ for the likes of the Bloody Mary and the Cosmopolitan.

At the standard end of the market in 2008 flavour proliferation continued, introducing nostalgic childhood concoctions including cotton candy and whipped cream. For the target audience, they brought fun, excitement and irreverence to their vodka drinking experience.

But as tastes changed, so did the fortunes of single flavoured vodkas, being perceived as sweet, artificial, and somewhat passé...

In 2018, Ketel One launched their Botanical range, reinventing the concept of flavoured vodka… on-trend, designed to compete with gin and be consumed with the likes of soda.

All the other major vodka brands have now followed suit in order to broaden overall brand appeal.

The case for flavours - whiskey​

Whiskey represents the most valuable category within the world of spirits. It offers ultimate serve versatility coupled with endless opportunities for premiumization.  Historically, however, the category has been seen as intimidating and challenging to many younger and female consumers.

Big brands started launching flavours to entice new consumers and expand versality and usage amongst their existing franchise.

The likes of Jack Honey (2011), Crown Royal Apple (2014) and Jim Beam Apple (2015) delivered impressive and immediate volumes, and flavoured whiskey is here to stay.

These mass brands continue to drive volumes and are now starting to be replicated as RTD offerings, further expanding brand usage and appeal.

Earlier this year, Jameson announced the launch of Orange, with a Lime & Ginger flavour to follow, clearly convinced that this strategy with help the brand continue its strong growth and appeal.

A big commercial opportunity - or ‘sleeping with the devil’...​

Are these attractive commercial opportunities creating potential damage to long-term brand equity? For example, have the Baileys flavours contributed to the commoditization of the brand (versus its early days ‘specialness’?). And since Jameson Orange cannot describe itself as an Irish Whiskey, will this in time erode the authenticity of the overall trademark?

Are brands over-reacting to competitors, rather than leading with their own agenda, with the danger of this approach launching ‘copycat’ flavours that fail to have anything to do with the brand and its consumers?

And finally, are brands ultimately forgetting the consumer, and launching flavours to command retailer shelf-space as well as to deliver the annual business plan (versus previous years’ flavour volumes)?

The answers to many of these questions might only be known in ten years time, to see who has navigated the flavour opportunities in the smartest way possible.

About the author​

Mike Spurling has worked in the international drinks industry for some of the world’s most iconic brands, both client and consultancy side. He started life at IDV/Diageo and has built a career that has taken him to senior sales and marketing roles in the US, South Africa and Europe.

During that time, he’s managed the US Smirnoff business, and headed up a series of global brands including Bombay Sapphire and Malibu. In 1998, he was headhunted by Seagram (now Pernod Ricard) to head up their global scotch whisky business, including leading brands such as Chivas Regal and The Glenfiddich.

In 2001, he set up his own innovation consultancy to support new product development at the world’s major drinks businesses. Amongst his achievements was delivering a comprehensive new innovation agenda for Johnnie Walker, including the Double Black and King George V expressions. Additionally Mike also worked with the likes of Grey Goose and Jack Daniel’s to deliver super premium expressions for the powerhouse trademarks.

In 2014, he founded Barfly with Nick Dudley-Williams – an innovative and commercially-focused drinks consultancy, now representing all of the leading drinks companies in the world.