Mumbai: Indian tipplers’ thirst for premium and imported spirit brands — from Jack Daniel’s and Jim Beam to Bacardi and Teacher’s — is still growing even as sales growth of locally-made, affordable versions tapered off in the nine months to September.
“Premiumisation has actually accelerated and premium products are being impacted by delays or regulations and not necessarily because of demand,” said Neeraj Kumar, managing director, Beam Suntory India, which is launching a new premium whiskey Oaksmith, Japanese brands such as Yamazaki and Hibiki whiskey as well as Roku gin in the country.
Indian-made foreign liquor (IMFL), with brands like Royal Stag, McDowell’s, Blenders Pride and Officer’s Choice account for over 70% of market.
These grew 1.2% during the first nine months of the calendar year, a sharp fall from 13% a year ago. However, companies, especially selling either imported or pricier bottled-in-India (BII) spirits, said their business has remained insulated in the country where 20 million people are becoming eligible for drinking every year.
“We have grown in double digits consistently and have not seen any slowdown yet. We are growing as consumers upgrade to more quality products,” said Mahesh Madhavan, global chief executive at Bacardi that sells the eponymous rum, Bombay Sapphire gin, Grey Goose and Dewar’s Scotch.
Brown-Forman, the maker of Jack Daniel’s, said a slowing tourism sector has a bit of an impact on liquor, but overall consumption still remains strong.
“During the year, there have been disruptions in terms of distribution and excise policy. While we also have the benefit of a lower base, we are driving more activations for restaurants and bar and launching special packaging for gifting,” said Vineet Agrawal, marketing and commercial director, Indian subcontinent and Maldives at Brown-Forman India.
Experts feel there is also a shift within premium categories as consumers become more discerning.
“When consumers have less dollar to spend, they opt for popular and versatile brands for assurance. Cult brands like Jim Beam or Jack Daniel’s score on that parameter. Also, many premium brands have taken price cuts or have started bottling in India,” said Sandeep Arora, director at luxury spirits consultancy Spiritual Luxury Living.
Source: economictimes.indiatimes.com