WITH THE NUMBER OF tourists flocking to Spain on the increase in these troubled times, preferring the safety of the sunny costas and comfort of all there is to love above disruption and terrorist threats in other destinations, you would think it was the perfect time for Spanish brands to up the ante and make the most of the opportunity.
One ailing category is Spanish brandy, a great product that achieved the height of its popularity in the ’70s and ’80s but which has since waned. I remember my Dad enjoying a glass of Spanish brandy after lunch while holidaying in the south of Spain back in the ’80s and a bottle was always purchased on the way back home. But somehow it never made it on to the usual drinks consumed at home after that. Perhaps it never tasted as good back in chillier climes, but I still always wonder why conversion and adoption of Spanish drinks enjoyed on holiday is not higher in countries which are the main source of tourism. But that’s a whole different marketing angle.
Back to brandy. Not many statistics for the Spanish brandy category as a whole are available but the latest figures from the CRDO Jerez give a good indication. They show a continuing gradual decline in export and a rather static domestic market. The MAT to May 2016 shows overall decline in sales in Spain at just over 4% and in export by nearly 16%. Traditional markets that have been important to this spirit, such as the Philippines and Germany, have also seen decreases in sales. Italy is the only market in growth.
According to Gonzalo Medina, International marketing manager at Bodegas Williams & Humbert, the “US, Italy, Germany, Mexico, Puerto Rico and duty free sales are the most important markets for Brandy Duque de Alba. The Philippines, with Brandy Alfonso, remains our main brandy market in terms of volume.” He adds: “China, where we have successfully introduced the Gran Duque de Alba range, is a new market with potential.”
Speaking to key brand owners in the region there is hope, despite the fact that Spanish brandy and Brandy de Jerez have not enjoyed the cool boom with the Afro-American market that cognac has. A lot of Spanish brandy is exported around the world and, while the marketing hype might not have reached this spirit there yet, masses of consumers in the Far East and eastern Europe have been switched on to the smoother, sweeter style of Spanish brandy as opposed to its French counterparts.
César Saldaña, director general at the CRDO Jerez, laments: “As you probably know, we at the Consejo have very little resources for promoting Brandy de Jerez collectively – most of them are focused in the Spanish market. Out of Spain we are active in the Philippines, our number one export market, where we have participated in trade events.” He adds that, when promoting Brandy de Jerez, “we are always building on the Spanish heritage and on the enormous popularity of Spanish brandy in this country (Spain), concentrating our efforts at the premium end of the market (Solera Gran Reserva).”
The premium end of the market seems to be the focus for all main brands in this category. It would seem to be a logical move, following the revolution in sherry and the shift towards premium Jerez, given that the two are so closely linked. There appears to have been a shift in the region towards the upper end following the decision to reduce the alcoholic volume of solera brandies to 30% and turn it into a distilled product, no longer being able to use the name brandy.
This move has forced key brand owners to maximise their vinous values talking about the quality of the grape varieties used and the importance of ageing, as Marcelino Piquero, commercial director at Sanchez Romate, points out.
“The sherry cask is a key factor for smoothness and flavour. Spirits producers all over the world are looking for used sherry casks to age their spirits, so there must be something good in it.” He continues: “We are constantly carrying out tastings of our brandy in order to show there is not a gap between ours and other more established brandies (cognac and armagnac). Sherry casks are much more friendly than others. That is why they are being used for ageing premium spirits such as scotch whisky, rums, bourbons and others. We have been doing this for 200 years with Cardenal Mendoza.”
Bodegas Williams & Humbert’s Medina also believes that heritage and Jerez are vital USPs in the promotion of the category. “The legacy of this brandy is an asset to our company, as it is steeped in history. Also Brandy de Jerez is the only spirit that preserves practically all the properties of a fine wine. We always strive to preserve the origins of this unique spirit, which has numerous characteristics differentiating it from other brandies and spirits. One of the most important is the grape variety, Airen or Palomino, which produce clean, aromatic white wines perfectly suited to the production of sherry and Brandy de Jerez.”
Sanchez Romate’s Piquero goes further: “The original grape Airen, which is being used for distilling our brandy, gives us a fantastic raw material and it is also suitable for good white wines. The grapes used in other regions (Cognac) are not good for producing white table wines.” For him: “Cognacs are clearly overpriced, which is good in terms of [our] USP. Why pay more for something which is at least the same [quality]? The knowledge and tradition of distillation came to Europe through the south of Spain with the Arabs. In terms of marketing and promotion the French are currently winning but we are in this for the long run.”
QUALITY AND HERITAGE
Vinous values aside other companies, such as González Byass, are looking at new ways to promote Brandy de Jerez both at home and abroad. Eugeni Brotons, global marketing director at the company, believes that the way forward is about reinforcing the quality and heritage of premium brands such as Lepanto, but that brands have to constantly innovate in order to introduce new occasion ideas and ways to enjoy the product.
“We have an amazing history of top quality Brandy de Jerez and that only helps us when promoting a product that is 100% Jerez. The fact that we are the only bodega that sources 100% of its grapes from the DO Jerez, that distils Lepanto here and that ages it here in our cellars in Jerez, these facts have to be explained to consumers but they love the story.”
Brotons continues: “In addition, we have developed new occasions for enjoying Lepanto. It traditionally is an after-dinner drink, so we looked at ways of matching it with different foods. What else goes at the end of a meal? Cheese sounds strange but after a lot of experimentation with cheese experts and our master distiller we have developed a tasting palette which surprises and enchants people. And it works. Here in Spain, in the US, in Germany and the UK we have tried the experiments with sommeliers, chefs and critics and there is no doubt that a good aged Manchego works extremely well with Lepanto Solera Gran Reserva.”
An article on the Reuters website at the end of last year quoted that the challenge for Spain “is to attract tourists who want to spend more”. In the same piece it showed government statistics which estimated that the average spend per tourist had risen by 2.4% between January and September in 2015. This is a good sign for Spain as many believe that the costas model – ‘stack ’em high and sell ’em cheap’ – of yesteryear is not sustainable in the long run. Perhaps a focus on wealthier travellers visiting Spain’s historical attractions could be a part of the solution for Spanish brandy, and Brandy de Jerez in particular.
By using seeding strategies and creating tasting opportunities in selected Spanish city-break destinations brands could encourage an increase in potential adoption and subsequent purchase once home (given distribution is in place). Directly targeting visitors who see themselves as travellers, rather than tourists, who have higher incomes and a greater thirst for cultural knowledge and who are eager to impart and share their new experiences when back in their home countries, you might well create a greater thirst for one of Spain’s oldest and most prized premium spirits.
As stated before, if the ageing of Brandy de Jerez has worked well for other premium spirits such as rum, whisky and bourbon, why can’t this kind of concentrated marketing technique work for Spanish brandy?