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From Scotch Loch to Whisky Tsunami

The whiskey industry’s once notoriously placid lake of oversupply has already witnessed the mounting ripple effects of a generational shift towards brown spirits.The waves of interest will retain momentum although not all proverbial barrels will be harmoniously lifted by the rising tide. Bourbon and Irish varietals will continue capturing the millennial zeitgeist through their accessibility credentials, increasingly more premium expressions and radical experimentation initiatives at the same time that Japanese mystique and Canadian leftfield aspirations will bring those segments under the limelight. Scotch will belatedly appropriate its boisterous siblings’ more joyous positioning, semantic references and bold innovative steps as the fetishisation of age statements and tartan has run its course.

From once sacrilegious concepts such as hybrid whiskey products to personalised oak infusion contraptions and from the introduction of special mixer pairings to a plethora of boutique distilleries finally bringing their aged stock to market, the whiskey tsunami will be felt across the world. Nevertheless, while amended and new international trade agreements will provide additional fuel, the downside risks from the category’s generic and increasingly greater focus on higher end offerings makes it especially vulnerable to macro-economic headwinds rising on the horizon.

Vodka: After the Bender, the Hangover

Caught between a maturity and stagnation-induced state of torpor in its Eastern European bastion and the hard reality of committing the cardinal sins of over indulgence, navel gazing and inflated pricing in western markets cyclically abandoning the category, the hangover for vodka will set in further. Following decades of unflinching, seemingly infinite growth, its short to medium term future will hence become increasingly more polarised.

On the one hand, micro offerings will capitalise on their genuine or perceived artisanal credentials adopting increasingly clearer localisation kudos while embracing a ‘farm to bottle’ mentality to support their premium pricing.

On the other hand mass mainstream brands will most likely back pedal and hesitantly step out of the overcrowded craftsmanship bandwagon to return to their unpretentious, utilitarian roots and a focus on high energy environments, shot occasions and the support of musical or cultural scenes relevant to the younger cohorts of the millennial demographic. Following the cannibalising effect resulting from the congested flavoured innovation arena, planned obsolescence and quicker activation periods will de-clutter the category and make it more resilient to the volatility of fads.

Smells Like Latin Spirit

Tequila – and its more niche, artisanal sibling- mescal, rum , cachaça and pisco will continue finding their way to trend setting metropolitan western hotspots , satiating the demand of a promiscuous Gen X demographic for exotic alternatives to staple categories while at the same time adopting an increasingly more premium positioning. While their appeal has the potential to be universal, it will be primarily fuelled by favourable hispanic demographics and will be anchored on communicating celebratory positioning and depth of options through educational campaigns as well as through liberalised trade agreements and the media spotlight capturing international sports events and drinking rituals in their host countries.

Cognac: A sidecar named diversification

The category’s re-alignment towards the US, the African American community and lower-end varietals will continue providing a hedging mechanism against the still severely challenged Chinese market.

Mixability , flavour sophistication, higher abv extensions and targeting whiskey occasions and positioning will cement the category’s renaissance in North America and put it back into the fray in other western markets. Considering the rising downside risks of still operating heavily in a Chinese economy assuming landing position, further regional as well as pricing diversification will become ever more vital.

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