Millionaires' Club: The spirits market overview

20 June, 2016

Of the 171, 83 were in growth in 2015, 22 were flat and 66 were in decline. That’s something of a turnaround from last year, when fewer than a third of brands were in growth. So what changed? Well, emerging markets seem in a similar predicament to last year. Brazil is plunging into its worst recession in decades. China is still buoyant but days of the gold rush feel like history. India grows slowly, but is still weighed down in import levees and Russia, well, let’s just say the economy vodka segment there is going great guns.

So not a lot of change from this time last year. Which explains why global volumes are flat. The reason some brands have pulled themselves out of the red and into the black is that last year the volatility was new and they’ve had a year to adapt to market conditions and get used to the idea that emerging markets sometimes take a break from emerging. That and the fact many brands’ volumes dropped considerably in 2014, so any improvement in 2015 gives the impression of redemption when it is often partial recovery. Take Johnnie Walker – 5% growth looks great, until you realise it dropped 11% the year before and is still 1.3m cases down from 2013. Martell is another example – 16% growth in 2015. Fantastic, but the brand is still 0.4m off its 2013 sales. But it happens to the best of them. The Millionaires’ Club overlord, Jinro, may have found growth in recent years, but it is a few million cases from its peak nearly 10 years ago.

In the end, we can say things are stable, erring on positive, which isn’t exactly earth-shattering news, but a significant improvement on the headline last year, ‘Trying time’. What is exciting is Euromonitor’s forecast that total spirits volumes will increase 10% by 2020. For the sake of brands that experienced the global downturn five years ago, followed by boom and bust in emerging markets in the past few years, let’s hope the road to 2020 is without any diversions.





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Joe Bates

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I’ve always maintained that the cards are stacked against craft spirits brands wanting to build a meaningful travel retail presence.

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