Marketing

Craft 1 in 7 global spirit launches

The US seems to have been driving the craze for craft spirits globally with half of all 2016 new launches of craft spirits taking place there in the first five months of the year.

Whilst craft beer has taken the world by storm there’s a new drink taking a shot at global popularity – craft spirits.

Research from Mintel’s Global New Products Database reveals that spirits positioned as ‘craft’ so far account for one in seven (15%) new global spirit launches to date in 2016, up from just one in 20 (5%) in 2011.

Overall, Mintel’s GNPD reveals that craft spirit launches increased by 265% between 2011 and 2015 and it seems that the US has been to the forefront of these. Of all craft spirits launched in that period, half (49%) have been in the US and 42% in Europe compared to just 4% in Latin America and 3% in Asia Pacific.

This surge in craft spirits launches is backed globally by strong consumer demand for artisanal alcoholic beverages. Over half (55%) of US alcohol drinkers agree that craft alcohol brands are of higher quality than big brands and demand is mirrored across Europe too. Around half of consumers in France (55%), Italy (53%), Germany (50%) and Poland (46%) agree that spirits from small/craft distillers are more appealing than large, mass-produced brands. Whilst in the UK 37% of dark spirits/liqueur drinkers are prepared to pay more for craft variants.

“Craft spirit launches are growing at a rapid pace and will continue to rise in more mature markets –  particularly the US – as consumers continually seek out ‘special’ offerings,” claims Jonny Forsyth, Global Drinks Analyst at Mintel, “Despite being a relatively small sector of the market, craft spirits are growing in response to the huge consumer-led demand for more authentic, more distinctive, more local, less processed and more interesting spirit brands.”

When it comes to the ‘craftiest’ spirit, whisky reigns supreme, accounting for 43% of global craft spirit launches in 2015, up from 37% in 2011. However gin is hot on its heels, accounting for 23% of global craft spirit launches in 2015, up from 9% in 2011.

“For craft producers, gin has the advantage of taking days rather than years to produce, unlike whisky,” Jonny explains, “Therefore as start-ups seek to balance production of more nuanced spirits with the commercial realities, gin is an appealing choice.”

Mintel’s research reveals that Millennials are driving demand for craft spirits around the globe. Three quarters (75%) of US Millennials believe that craft alcohol brands are of higher quality than big brands and 34% of UK Millennials agree craft drinks are worth paying more for.

Mintel’s research also indicates that almost half (46%) of German Millennial spirits buyers say “high quality” is an important factor influencing their purchase intention, up from 35% in 2013.

“Rather than wanting to affiliate themselves with bigger brands, Millennials often seek to define themselves by more niche, higher quality brands with a quirky backstory – and ideally, they are brands their peers have not even heard of,” states Jonny.

As craft spirits gain traction, they’re increasingly venturing into flavoured territory too, particularly in the US market. Almost half (47%) of the craft spirits launched in the US in 2016 are flavoured, up from one fifth (21%) in 2015.

Indeed flavour remains a key driver in spirit choice in the US, with 41% of US white spirit drinkers looking for a flavour that they like when choosing white spirits while fruit (36%) and sweetened (34%) top the list of flavours US dark spirit drinkers are currently consuming.

While not as established in Europe, consumers still show an interest in these drinks, reports Mintel. Around one fifth (23%) of consumers in Poland agree that spirits with added flavour are worth paying more for, followed by 19% in Spain, 18% in Germany and 18% in Italy.

“Traditionally, many craft distillers have stayed away from flavouring spirits as this is seen as less premium,” states Jonny, “However, with flavour a key driver for spirits drinkers in many countries, craft innovators are now seeking to use more premium, nuanced and naturally flavoured innovation. This is a route that craft brewers have previously followed.”

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