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TASTES ARE CHANGING. Bitter foods and drinks are challenging the palate and coaxing consumers to experiment with bitter alcoholic beverages, breathing new life into a rather staid category.
“For decades, bitter was the redheaded stepchild of flavour in the US, taking a backseat to salty, savoury and sweet,” Dave Karraker, Campari America vice president of engagement and advocacy says. “But the American palate is coming around and it is finally accepting the flavour.” Karraker says this is thanks in part to the likes of Starbucks, Whole Foods and Trader Joe’s. “We are drinking more bitter drinks such as coffee and eating more bitter foods such as Brussels sprouts, kale and radicchio.”
At the same time bartenders are rediscovering the Italian Amaro category and adding them to their cocktail-making repertoire, he says. “There is not a more vibrant category in the spirits market today than Italian bitters,” Karraker says.
Biased perhaps, but the VP has numbers to back up the claim: “Bourbon might be getting all the attention, growing at high single digits but the Italian bitters category is growing at double digits every single month. “Granted, it is a smaller category but you can’t ignore the extreme customer and bartender interest”, Karraker says.
The Italian bitters interest in the US does not stop there, “It is bleeding into Middle America,” he explains. “What started on the coast a few years ago is now making an impact in the Midwest.” An increase in interest makes for a heightened trading market and an influx in choice for consumers. Where some have profited, German bitters brand Jägermeister has been burned.
The company’s US sales decreased by 5.6% in 2014 from 92m to 87m 0.7-litre bottles. The German brand has blamed “extremely aggressive pricing by competitors” and “challenging trading conditions” for this fall.
Despite the loss in sales and steady fall within the US over the past few years, bitters are on the rise again says Mast-Jägermeister SE director corporate communications Michael Eichel. “The shot segment in the US is faced with fast-growing competition,” he adds. “The market is flooded with hundreds of product introductions addressing the millennial target, which is keen to try out new things.”
Rather than slashing prices or shifting brand message, Jäger will invest in driving content and better communicating what is behind the brand to the consumer, it says. “We will never succeed in price fights,” Eichel concedes.
The US is the third biggest market for bitters behind Germany and Argentina. In the UK ‘passing off’ is a continual thorn in the company’s side but in the US, Eichel says: “Passing off is not a topic.”
Jägermeister is making a concerted effort to move away from the bomb and push the ice-cold shot – something it believes cannot be passed off. Internal research carried out by the company has shown that consumers who have tried Jägermeister served ice cold are more likely to repeat purchase.
“Whereas bitters are more likely to be consumed within off-trade channels, companies are trying to focus on the on-trade by activating shot and long-drink consumption,” Eichel says. “This potential is now being seen by many global players, all trying to gain share within the category.”
Whether the bitter is embraced in cocktails or shot form, the change in consumer taste has provided dynamism to the category.
