Vodka is so 2012
Peter Evans writes: Sales of the colorless, odorless spirit have slowed substantially in the U.S. in the past two years after more than a decade of roaring growth.
“We are seeing a generational shift away from vodka.”
—Jonny Forsyth, global drinks analyst at research firm Mintel Group Ltd.
Tired of lurid flavor extensions—from fluffed marshmallow to menthol tobacco—and at the limit of what they are willing to pay for upscale versions, drinkers are increasingly choosing bourbon or tequila over vodka. That spells bad news for the world’s biggest distillers.
Vodka Sales Fall as Drinkers Raise Glass to Whiskey
Vodka makes up a quarter of U.S. spirits sales by value, and the slowdown is starting to eat into profits at liquor companies. North American sales of Diageo PLC’s Smirnoff brand declined 8% in the six months ended December, contributing to an 18% slide in overall profit.
“Vodka’s identity crisis comes after a prolonged period of success. For years, flavor extensions helped drive sales, while bottles of triple-filtered vodka sold at $30 swelled the profits of major distillers.”
Pernod Ricard SA said late last year that its Absolut brand is struggling in the U.S.
“Taste profiles have moved to appreciate whiskey more,” said Ivan Menezes, Diageo’s chief executive, in an interview last week. “It’s a trend that’s been building for a few years.”
Experts say the attributes that first attracted consumers to vodka now appear to be turning them off. Specifically, the anonymity that means vodka can be mixed with almost anything to add an alcoholic kick is becoming less appealing. Drinkers are instead turning to whiskey for its perceived greater depth of flavor.
“Taste profiles have moved to appreciate whiskey more. It’s a trend that’s been building for a few years.”
— Ivan Menezes, Diageo’s chief executive
Attempts by marketers to plug that gap with flavor variants are running out of steam: There are more than 600 flavors of vodka available to U.S. consumers, but demand growth decelerated in 2014, according to Bernstein research.
The biggest distillers have been hit the hardest by the shift in taste. Sales of Smirnoff vodka flavors—a roster of more than 30 products, including root-beer float and whipped cream—are in decline in the U.S. Pernod Ricard has admitted its “Oddka” experiment—with flavors from salty caramel popcorn to fresh-cut grass—has fallen flat.
Total U.S. vodka sales increased 1.9% in 2013, compared with 2.7% growth in the wider spirits industry, according to industry body IWSR—the first time since 2000 that vodka has underperformed the sector average. Analysts expect a similar result when 2014 figures are released.
“Part of the problem for vodka has been attracting younger drinkers. Once seen as an exciting alternative to the brown spirits favored by their parents, vodka is now viewed as too mainstream for newly legal drinkers.”
Big liquor companies have seen their share of U.S. vodka sales eroded by intense competition. Supermarkets charging low prices for smaller brands have stolen customers from midmarket labels like Smirnoff and Absolut. While sales of superpremium vodkas such as Diageo’s Ketel One and Cîroc have held up, the brand that kicked off the superpremium trend in 1997, Bacardi Ltd.’s Grey Goose, has suffered a sharp decline.
Russian vodka has also suffered from the slowdown. In 2013—the latest available year—the amount of vodka imported from Russia into the U.S. dropped 70% from the prior year, according to the Distilled Spirits Council of the U.S. The most popular Russian label—Stolichnaya Premium vodka, known as “Stoly”—fell out of the top-five best-selling brands in 2013.
At the same time, an explosion of craft distillers is encroaching on sales. Diageo says there have been more than 200 new vodka brands launched in the U.S. in the past two years.
Part of the problem for vodka has been attracting younger drinkers. Once seen as an exciting alternative to the brown spirits favored by their parents, vodka is now viewed as too mainstream for newly legal drinkers in the U.S., analysts say. Read the rest of this entry »
A naked man, of robust proportions, was spotted riding the New York City subway sporting only a pair of sneakers and socks.
“He was just really drunk. He would swig it and then nod out. He must’ve taken four swigs in four stops. He was oblivious…”
— Peter Davis, an editor at the Daily Front Row
Onlookers say that in between gulps of Jack Daniel’s on the train, he dozed off.
The NY Post reports that Peter Davis, an editor at the Daily Front Row fashion magazine, snapped a photo of the naked man. “He was just really drunk. He would swig it and then nod out. He must’ve taken four swigs in four stops,” he told the New York paper. “He was oblivious. He kind of looked at me when I took the picture, but he didn’t seem to care.”
The incident took place on the E-train according to The NY Post, though Davis’ tweets say it was the A-train…
slurp noodles and welcome their new Japanese Overlords are furious about the sale of their beloved Jim Beam to a company in Japan, a suspiciously safe, sake-drinking, abnormally clean and polite society, a foreign country where vending machines sell underpants, executives get drunk and throw up in train stations, and nobody understands American whiskey…
[See also: Sugoi! Oishii! Japan’s Suntory buys Jim Beam]
Michelle Lynn Dinh reports: Nothing quite screams “USA! USA!” like a glass of Kentucky bourbon; it is “America’s only native spirit” afterall. Maybe that’s why patriotic fans of the beverage have taken to the Twittersphere in protest of Japanese company, Suntory, purchasing Beam, Inc., the distillers of American classics, Jim Beam and Maker’s Mark. The $13.6 billion deal was announced on January 13 and was followed by a flurry of angry messages claiming the Illinois-based company had “sold out.” Let’s take a look at the angriest of the bunch. Read the rest of this entry »