The month in drinks: Scotch shake-up

In this month’s summary of the most interesting product launches, Spiros Malandrakis focuses on the direction the Scotch industry is heading in terms of innovative developments.

Scotch: The Gloves Come Off

The tartan kilts are hesitantly lifted to unveil a pair of skinny jeans while the sound of bagpipes is fading behind the cacophony of American folk, Irish drinking songs and intricate Japanese improvisations blaring in the background. As blended malt Scotch’s once explosive growth rates are currently drowning in the noise made by the category’s younger and more adventurous siblings, keeping quiet is not an option anymore.

Positioning, occasions, marketing semantics and communication signifiers are being reassessed as inertia and complacency are taking their toll. Unrelenting traditionalism and aversion to radical innovation still have a place as stalwarts of ageless luxury but cornering the mass market and re-establishing relevance to the ever illusive millennial demographic requires experimentation and the irreverent breaking of taboos.

The figures are anything but music to Scotch’s ears. As the emerging market mantra is tested under the weight of the on-going Chinese austerity campaign, mature markets are shifting back into focus but aspirational archetypes are far less relevant to London’s urbanites than to the Chinese Nouveau riche. Respectively securing enviable 5%, 8% and 7% total volume growth for 2014, Bourbon, Irish and Japanese varietals are jubilantly ordering more rounds at the proverbial bar while Blended Scotch nurses the bitter drink of an anaemic 1% for the year.

Breaking away from the party line has already proven lucrative for the few within the Scotch stable that have dared to do so. Appropriating Bourbon’s subtly sweeter profile and more casual, quirkier design cues has already paid huge dividends for disruptive Scotch brands such as Monkey Shoulder and Big Peat- primarily within the German market.

It is no coincidence then that Diageo is choosing trend-setting Metropolitan German cities to test out their latest batch of Scotch offerings, going further than most of innovation has ever gone before. Acknowledging that ‘People’s trust in big institutions is being eroded,’ the global spirits behemoth is instead opting for word of mouth momentum and social media interest to build from the ground up. And in the process, it is proving that Scotch can be as revolutionary and on-trend as any of its rivals.

Boxing Hares and Smoky Goat from Diageo

Now available in Berlin, Hamburg, Munich and Vienna on trial and soon to be released globally, Smoky Goat (€24) is described as a “smoky sweet” blended Scotch whisky, while Boxing Hares (€22) has been labelled as a “spirit drink”, essentially a hybrid drink made from Scotch whisky infused with hops. Also planned for release is Huxley – a “unique” blend of Scotch, Canadian and American whiskies. All brands will be launched under a “new business model” at Diageo that ‘would allow for experimenting, testing and giving freedom to ‘makers’ imaginations’. It was about time.

For further insight, contact Spiros Malandrakis, Alcoholic Drinks Analyst at Euromonitor International, on spiros.malandrakis@euromonitor.com