Shanken's Impact Newsletter October 1, 2020

THE SINGLE MALT SCOTCH CATEGORY continues to thrive in the U.S. with con-sumers increasingly reaching for malts from across Scotland. Overall, single malts were up 7% in the U.S. last year to over 1.8 mil-lion cases, according to Impact Databank. The category tacked on 120,000 cases last year, its largest single-year gain since 2014. While interest in single malts continues to grow, the October 2019 imposition of a 25% tariff on the category in the U.S. now threatens to blunt its momentum. “For single malt Scotch, I see rare releases and limited edition releases with unique finishes and cask types continuing to play a role in creating excitement around the category,” said Michael Giardina, director for the Glenfiddich at William Grant & Sons. He points to Glenfiddich expressions like Winter…

EVEN AMID THE WIDER WHISK(E)Y BOOM, BLENDED SCOTCH HAS STRUGGLED TO achieve positive growth, as interest in a number of promising new releases has failed to stem the category’s overall decline. Last year, blended Scotch volume decreased by 3% in the U.S. to 5.8 million cases, according to Impact Databank. Eight of the top 10 brands declined, with drops ranging from 0.2% to nearly 10%. “I anticipate innovation to lead the blended Scotch whisky category as a whole. With globalization on the rise, I anticipate blended Scotches to have unexpected finishes from all around the world to give the category a more global approach,” said Mwanza Lumumba, brand director for Chivas Regal at Pernod Ricard. Lumumba pointed to Chivas Regal’s Mizunara expression as a success for the brand, as it…

IT WAS UNWELCOME NEWS FOR ONE OF THE MOST vibrant spirits categories in the U.S. last fall when the government imposed 25% tariffs on single malt Scotch whiskies, among a number of other imported wines and spirits. The trade tensions failed to weigh down single malts in the U.S. through the end of the year, as they kept up their strong momentum to increase 7% to 1.8 million cases, comprising almost one-quarter of the entire Scotch whisky market, a share far beyond that seen in most other countries. This year, the tariffs are undoubtedly affecting the category, especially at the more price sensitive lower end. But key players tell Impact their brands have been largely resilient in the face of the challenge, with consumers often migrating to the middle ranges…

AFTER THREE STRAIGHT YEARS OF accelerating gains, the spirits industry’s momentum has decelerated slightly this year, down to 2.1% growth, according to Impact Databank, to a total of 241.5 million 9-liter cases estimated by year-end. The market will register its 25th consecutive annual volume advance in 2020, as stocking up due to the Covid-19 pandemic is projected to bolster the off-premise sector. Still, those off-premise gains won’t be enough to offset the on-premise losses during the crisis, and retail dollar value for the total industry is expected to decline slightly this year. Looking ahead, the recession and lingering negative impact of the pandemic, as well as fierce competition from other drinks sectors—mainly hard seltzer—will cause the overall spirits market to keep slowing. The spirits industry recorded a solid 2.7% annual…

RAY HERRMANN TURNED 100 YEARS OLD ON September 11. Herrmann played a key role in the formation of the U.S. distribution landscape as it stands today, led by giants like Southern Glazer’s, RNDC, and Breakthru Beverage—a $5.5 billion behemoth of which he remains chairman emeritus. “This is an incredible day in Ray’s life. What a mile-stone for this gentleman,” said Marvin R. Shanken, chairman of M. Shanken Communications, Inc. “We are all blessed to know him and honor his many decades of leadership in the American wine and spirits industry.” Herrmann began his career as a sales-man in New York’s distribution tier after serving in the U.S. Army and seeing action in the Pacific theater during World War II. He eventually held leadership roles at McKesson, Schieffelin and Co. and…

TORRES, ONE OF SPAIN’S ICONIC wine families, has announced a new route to market in the U.S. Wilson Daniels has been appointed as the U.S. importer for the fifth-generation family-owned winery’s Familia Torres range, which includes premium and super-premium wines from Penedès, Priorat, Ribera del Duero, Rueda, and Rias Baixas. “This provides us an entry into Spain in grand style, working with a family that has a legacy of 150 years and nearly 2,200 hectares (5,400 acres) un-der vine,” Wilson Daniels president Rocco Lombardo tells Impact. “When people think of fine wine from Spain, they think of the Torres family.” The Familia Torres portfolio retails from about $15 a 750-ml. at the lower end to above $100 at its higher tiers. Currently at around 25,000 cases in the U.S., Lombardo…