LIQUER: The Cream Team

Cream liqueurs are in decline, yet newcomers keep on entering the market. Will their futures be sweet – or just plain sickly, asks Clinton Cawood

Cream liqueur may not be the most buoyant category, but it remains a significant one nevertheless, at least in terms of volume. According to Nielsen, cream accounts for about 65% of the liqueur category as a whole.
The fact remains that cream is not at its best at the moment, declining in both volume and value in the UK (down 12% and 6% respectively, according to Nielsen). And yet there is never a shortage of new cream liqueur brands. Something about cream is obviously appealing – at least to drinks producers.
On an elementary level, Hi-Spirits managing director Jeremy Hill comments: “If you were thinking about designing a new drink, you’d think: cream, chocolate, a bit of mint… what’s not to like? It’s sugary, tastes nice, and it’s a bit refreshing. But if you put it in the market…”

The cream of the crop
And yet many continue to do so, with varying levels of success. The most striking recent example comes from the market leader, Baileys, with the launch of its Flavours range. The Diageo brand remains the undisputed market leader, apparently holding a 57% share of value sales of cream liqueur in the UK off-trade. Given this dominance, and the overall decline in value sales within the category, the logical assumption is that the brand is not as buoyant as it might once have been.
And yet, after the first year since the Baileys Flavours range was launched, the company reports that it has been a huge success, both in the UK and elsewhere. Perhaps there is still potential in the category, even if the overall figures are a bit bleak.

Early 2007 saw the launch of Coole Swan, whose creators, David Phelan, Adrian Walker and David Gluckman, have no shortage of drinks industry credentials and experience, particularly within this category. The brand’s super-premium positioning is its distinguishing feature. As Gluckman, who was involved in the creation of Baileys, explains: “We’re addressing the issue of the category being dominated by one brand. We’re a small company, so decided we didn’t want to get into a high volume, low margin business. The super-premium category was an attractive area to be in.”
Gluckman continues: “One of the nice things about going into the cream liqueur category is that unlike something like vodka, where a consumer has to take quality on trust or belief, with cream you can offer a perceptible quality difference.”
Coole Swan, much like both the market leader and the runner up, Carolans, is a whiskey cream liqueur. This prevalence of whiskey in the category was one of the motivations for the very recent launch of Pisa cream liqueur, the range extension of the relatively new nut-flavoured liqueur of the same name. As the company’s managing director, Maurits Cosijn, explains: “Most cream liqueurs are based on whiskey. Of course, you get Amarula, which is a big player, but all of the others are creams. I feel there’s room, but of course there will be a fight. The competition is not giving up space easily.”
Marketing manager at C&C for Carolans, Ann O’Leary, points out that “at a global level, cream is a very large category. The UK is not as buoyant as the global market, but it has been a consistent performer over the years”. A reason for this, according to O’Leary, is that “it’s an easy drink – it’s not challenging, and so appeals to a broad market. It’s more geared to female consumption, but not necessarily marketed as such.” This final point is almost universally true of cream liqueurs – although actual consumption figures probably vary from one brand to another, the gender line for cream liqueur drinkers is a well-defined one.

As Jenny Allaway at Global Brands (which produces the Corky’s range of cream liqueurs) confirms: “Traditionally, cream liqueurs have been consumed by older females looking for a luxurious way to finish off an evening meal. Now, however, this category is being driven by a much broader base of consumers, still predominantly female, but ranging from those in their mid to late 20s, right through to the traditional consumer.”

The category curdles
Despite these positive reports, the cream liqueur category as a whole is declining. For Florian Iro, international brand manager for Mozart chocolate liqueurs: “The cream segment is simply undergoing its normal curve, especially in the whiskey-based segment, which is driven by a couple of major players. Limited diversity always harms segments, as innovation is seldom achieved.”
The Mozart range consists of both cream liqueurs and pure chocolate liqueurs. Iro explains: “Chocolate in the cocktail world is just starting, and bartenders and consumers alike are surprised about the high versatility of ‘chocolate alcohol’. The most important thing with liqueurs is to find a way to build a bridge between the on- and off-trade.” Speaking about Corky’s, this is not such a challenge for Allaway. “They are a perfect way to create a wide variety of creamy cocktails which are easy to make and bring the feel of a vibrant bar into a consumer’s home.”

Corky’s are not the only player focusing on cocktail production in the off-trade. For Carolans, this is a major part of marketing activity. The recently updated website for the brand now features a number of cocktail recipes. “There are more people consuming cream liqueurs in cocktails and in desserts. We’re building on that trend.”

Not to be mixed up with…
Cosijn is not as enthusiastic about cream’s potential in the realm of mixology. Speaking about the original Pisa versus the new cream incarnation, he explains: “They’re for different circumstances. There are more occasions for Pisa [original]. With the cream you can’t mix it so much. The problem is it’s difficult to mix it, especially with carbonated drinks.”
For the liqueur category in general, cocktails and mixability still play an important and growing role in promoting brands. For Grand Marnier, for example, “many classic liqueur brands have revived in recent years due to the growth of cocktails”, according to Terry Barker, responsible for the brand’s distribution at UK agent, Cellar Trends.
For liqueurs in particular, the cocktail route is not without its pitfalls, however. For Kevin Abrook, marketing manager for Frangelico and Irish Mist at C&C, “Cocktails are an important part of how we promote the brand. While we talk about cocktails, though, in terms of what delivers results, it’s tastings.”
Hill, whose portfolio includes a number of liqueurs, makes a point about brand identity and cocktails. “Cocktails have at least three or four components, so     they homogenise into something different. With a long drink you’re typically taking one spirit, such as a liqueur, and adding a mixer to it. The liqueur keeps its identity.”

A brand’s ability to mix with other ingredients remains an important factor for Hill, however. “If you’re going to couple this with responsible retailing, the days of bringing out shooter brands is in decline. You have to be a bit more intelligent than that – emphasising its mixability, and not in the context of people necking it.”
It’s not all about cocktails and mixing, however. A significant new marketing campaign is currently suggesting that Baileys is best when shaken with ice, something to “add a little excitement and theatre to Christmas parties”, according to marketing material.
Hill has hope for the after-dinner occasion for the category in general, suggesting a return to the use of a liqueur trolley. “It’s an encouraging way of showing people that they can carry on their dining experience.”
For Catherine Rigby at Cellar Trends, with brands such as Luxardo (the dominant player in the buoyant sambuca category in the UK), “We’re still seeing it consumed as an after-dinner drink. But it’s also popular short or in cocktails. It’s a dominant flavour, but people obviously like that flavour.”
There are indeed a number of flavours within liqueurs that consumers (and bartenders) evidently like – drinks such as sambuca and Jägermeister show no signs of declining in popularity any time soon. And others are emerging. Rigby makes particular mention of Limoncello, explaining that it is “becoming more and more dominant”.

Cream dreams
Despite its ailing Nielsen stats, even cream is far from a lost cause. Wild Africa Cream’s Russel Gillwald is optimistic. “The attention to the category is indicative of the major players’ belief in it, not the least reason being that the top brands experience longevity that many in other categories would like to emulate.” He qualifies this, however, saying: “The many failures on the back of huge budgets indicate that it is an extremely difficult category in which to establish a brand.”
This consistently fails to deter those drinks innovators, however, and the steady stream of new cream launches seems set to continue unabated.

 © db January 2008