A few weeks ago, Diageo, the world’s largest spirit-maker, reported its best set of results since 2013. Not because its core portfolio of Smirnoff, Johnny Walker and Guinness is doing particularly well. In fact, scratch under the surface and you’ll see that favourable currency movements were largely responsible for the good performance. One category that is seeing significant growth at Diageo, is its Reserve brands, which includes Johnnie Walker Blue and Green Label, Ciroc, Bulleit and Ketel One Vodka. Representing 15% of net sales, Reserve brands grew 7% in FY 2016.
Artisanal and seemingly ‘select’ brands are eating away at the market share of “Global Giants” brands, as Diageo calls them. Brands emphasising heritage, craftsmanship, transparency — that’s a macro trend that’s been brewing for years. Consumers are also increasingly seeking out brands that are off-the-beaten path.
High-end, artisanal Whisky is a challenging category to break into though, with Scottish and Japanese holding the top ranks of single-malt Whisky. Heritage can’t just be ‘manufactured’ by attaching an old-looking bottle label. They really do need to age to get better.
So how do you establish yourself if you’re not from a traditional Whisky-making country? We thought we’d ask one brand that’s done just that: Australian Sullivans Cove was awarded the world’s best single malt in 2014 and has gone from strength to strength since. Its “Sullivans Cove French Oak” commands A$450 (£280); a proud price tag which Whisky connoisseurs are clearly willing to fork out — the item is currently out of stock. We spoke to Sullivans Cove’s Nathan Campbell about their success story:
What have been some of the challenges in building the “Tasmanian Whisky” brand?
The biggest challenge was the fact that the idea of Tasmanian Whisky didn’t exists at all until recently, so we really had to build it from scratch. We didn’t have backing from any big companies, and we didn’t have years of whisky making tradition, so we’re all self-taught and pretty much self-funded. A couple of the earliest whiskies to come out of Tassie were pretty average too, so we had to overcome those early missteps.
How do you go about establishing credibility, when you don’t have centuries of local tradition behind you?
We just try to make good whisky, be transparent about what we’re doing, and respect our customers. There’s also a great community of distillers in Tassie and we’ve all tried to help each other out and share knowledge so everyone has the best chance of producing something great. But a couple of awards never goes astray either.
What has helped you build your brand?
The awards we’ve picked up over the years have certainly helped a lot, as well as the increased demand for whisky in general. People are also more interested in drinking well these days and prefer things to be locally made, hand crafted, and a bit out of the ordinary. But at the end of the day, it’s our customers: the folks who buy our whisky, drink it, talk about it, come for a visit and spread the word.
What do you think is important in building an artisanal brand?
For us, using locally sourced ingredients is really important as we want our whisky to be uniquely Tasmanian. We look after our team as well, because it’s hard to have an artisan brand without artisans. But if you want to be a successful small brand, quality has to be your number one priority, and it certainly is for us.
Do you have any advice to other small, artisanal producers doing something unconventional?
Stick to your guns. We’ve had a lot of ups and downs over the years, and plenty of times where it looked like it wasn’t going to work, but we knew we had something special so we stuck with it. And remember to have fun, so if you do go belly-up, at least you’ll have a good time doing it.