Cocktail craze develops mass market edge

A growing UK demand for cocktails, which is seeing them spread well beyond their traditional upmarket bar setting, is fuelling the ready-to-mix market.

Pubs and restaurant chains have been adding cocktails to their offer, and a number of brands are seeking to capitalise on the opportunity for a mass market product.

Among those enjoying strong growth in the UK is Finest Call, produced in the US by Kentucky-based firm American Beverage Marketeers.

In its domestic market, the product sold four million cases last year, with the UK’s more modest 32,000 cases nevertheless representing an 18% increase on 2011.

First introduced to the UK market six years ago and more recently taken on by Cellar Trends, brand manager Peter Thornton feels there is plenty of room for further growth, although the market is becoming increasingly crowded.

“Over the last two years more and more [competitors] have been creeping in, both non-alcoholic and with-alcohol versions,” he noted, highlighting in particular the enlarged off-trade offer.

“You can go into a supermarket now and there are so many to choose from,” Thornton remarked, pointing both to RTD brand extensions by Smirnoff and Bacardi and also retailer’s own brand alternatives.

For Finest Call however, Thornton emphasised: “Our focus with this is purely on-trade. RTMs are about bringing cocktails to the mass market. We’re not trying to be fancy – we’ll build the offer around whatever bar tools a venue has already.”

Research commissioned by Cellar Trends from UK on-trade analysts CGA last year indicated the sales uplift that a cocktail offer can provide. “Sales increased by 36% because of cocktails,” quoted Thornton. “That’s additional sales, not detracting from a venue’s spirit sales.”

What’s more, Thornton pointed to further CGA estimates, which identified up to 20,000 UK outlets that would be suitable for these pre-mix products. Over the last year alone, Cellar Trends expanded distribution into venues as diverse as hotels, sports arenas and even cage fighting events.

The brand’s offer is split into three core ranges: ready-to-mix popular options such as Mojito, Cosmopolitan and Margarita, which require minimal training and suit high volume venues; fruit purées for flavoured cocktails or alcohol free, smoothie style drinks; and a ‘bar essentials’ range of sugar syrup, grenadine and a sweet and sour mix.

Made from natural flavourings and with 100% recyclable packaging, the Finest Call products do however contain some preservatives, which brand manager Peter Thornton defends as an essential point of difference in what he confirms as an increasingly competitive market.

“It will sit open for 30 days, or up to 60 days in a fridge,” he highlighted, a convenient and waste-minimising asset that Thornton described as “a very strong USP,” adding: “If you can’t sell 12 Cosmopolitans in 30 days then don’t do cocktails.”

In addition to this long shelf life, the brand has been designed with speedy service in mind, from its non-slip neck to colour-coded flavours and deliberately straightforward preparations instructions. “I can make a cocktail in less time than it takes to pour a pint,” promised Thornton.

Despite being designed for efficiency and consistent quality, Finest Call is, admitted Thornton, “not designed for the back bar.” He conceded: “The biggest obstacle is to get people to look past the packaging,” stressing that the products are intended to be used in speed rails behind the bar.

Analysing the gross profit strength of the product, Thornton noted that Finest Call is available online for around £4.50 per litre bottle, with each bottle offering 10-14 serves depending on the cocktail. Depending on location, he reported that venues tend to sell the cocktails for “about £3.50 to £5 max”, noting that the generous margin means the drink is popular for happy hours.

Summing up the appeal of cocktails, Thornton remarked: “People are going out less, but when they do it’s more of a special occasion. Premium spirits and cocktails are in growth because they’re seen as more of a treat.”