Post on 21-Apr-2017
WHISKIES & SPIRITS CONFERENCEMark Meek, CEOThursday, 30 March 2017
Contents• The Numbers • Global• United States• Europe• Asia-Pacific
• Key Global Trends
• Key Whisk(e)y Trends
Global Beer, Wine, Spirits & Cider Summary
• Beer grew by 4.2% from 2010 to 2015 and is forecast to grow 4.8% from 2016 to 2021.
• Wine grew by 4.4% from 2010 to 2015, but we forecast that growth to decline -0.3% from 2016 to 2021.
• Spirits grew by 9.7% from 2010 to 2015 and are forecast to grow 1.4% from 2016 to 2021.
• Cider grew by 33.6% from 2010 to 2015 and is forecast to grow 22.6% from 2016 to 2021.
Overall
• Wine grew by 21.1% from 2010 to 2015 and is forecast to grow 20.3% from 2016 to 2021.
• Spirits grew by 26.2% from 2010 to 2015 and are forecast to grow 19.8% from 2016 to 2021.
Premium-and-Above
Source: The IWSR 2016 Global Database
Global Growth – All Qualities
2010 2011 2012 2013 2014 20150
100,000
200,000
300,000
400,000
500,000
600,000
489,263 483,640 485,070 486,157 483,630 474,989
322,609343,869 356,862 366,411
379,112 390,551
146,273 150,118 149,907 146,341 143,005 141,826
57,289 55,936 54,160 53,079 53,939 55,097
23,877 24,723 25,973 26,794 27,618 28,771
Vodka Whisk(e)y Rum Gin & Genever Tequila
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
Global Growth – Premium-and-Above
2010 2011 2012 2013 2014 20150
10,000
20,000
30,000
40,000
50,000
60,000
70,000
44,04747,273
50,33552,301
53,839
57,753
22,08623,769 25,423 26,404 27,287 27,434
5,545 6,175 6,967 7,704 8,249 9,093
4,528 4,867 5,345 6,246 6,721 7,254
Whisk(e)y Vodka Tequila Gin & Genever Rum
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
Overall
United States – Beer, Wine, Spirits & Cider Summary
• Beer declined -0.3% from 2010 to 2015, but is forecast to grow 3.7% from 2016 to 2021.
• Wine grew by 9.9% from 2010 to 2015 and is forecast to grow 5.6% from 2016 to 2021.
• Spirits grew by 13.7% from 2010 to 2015 and are forecast to grow 5.2% from 2016 to 2021.
• Cider grew by 509.2% from 2010 to 2015 and is forecast to grow 45.6% from 2016 to 2021.
• Wine grew by 45.1% from 2010 to 2015 and is forecast to grow 28.2% from 2016 to 2021.
• Spirits grew by 39.1% from 2010 to 2015 and are forecast to grow 20.8% from 2016 to 2021.
Premium-and-Above
Source: The IWSR 2016 Global Database
United States: Growth – Premium-and-Above
2010 2011 2012 2013 2014 20150
5,000
10,000
15,000
20,000
25,000
14,66115,736
17,016
18,490
19,423
22,297
16,221
17,34818,478 18,803
19,272
19,318
4,632 5,1145,759
6,352 6,7357,372
2,352 2,545 2,682 2,839 2,924 3,043
1,152 1,301 1,573 1,710 1,826 1,995
Whisk(e)y Vodka Tequila Gin & Genever Rum
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
United States: Fastest-Growing Spirits Brands – Premium-and-Above
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
Crown Royal Apple Whisky
Tito's Vodka
Hennessy VS Cognac
Jack Daniel's Tennessee Fire Whiskey
Jack Daniel's Whiskey
1,480
800
350
329
171
2014 to 2015
2014 to 2015
Online Sales in the US: Top 10 Brands1. Bud Light2. Tito’s Vodka3. Corona Extra4. Bulleit Bourbon5. Coors Light6. Stella Artois7. Álamos Wine8. Svedka Vodka9. Absolut Vodka10. Grey Goose Vodka
Source: The IWSR Analysis of top 20 US cities,Drizly, Mini Bar, Total Wines pooled data 2015
Europe – Beer, Wine, Spirits & Cider Summary
• Beer declined -2% from 2010 to 2015 and is forecast to decline -0.1% from 2016 to 2021.
• Wine declined -5.5% from 2010 to 2015 and is forecast to decline by -2.7% from 2016 to 2021.
• Spirits declined -6.2% from 2010 to 2015 and are forecast to decline -0.2% from 2016 to 2021.
• Cider grew by 10.1% from 2010 to 2015 and is forecast to grow 6.3% from 2016 to 2021.
Overall
• Wine grew by 3.8% from 2010 to 2015 and is forecast to grow 8% from 2016 to 2021.
• Spirits grew by 28.7% from 2010 to 2015 and are forecast to grow 25.1% from 2016 to 2021.
Premium-and-Above
Source: The IWSR 2016 Global Database
United Kingdom: Growth – Premium-and-Above
2010 2011 2012 2013 2014 20150
500
1,000
1,500
2,000
2,500
1,983 2,005 2,0332,118
2,186
2,354
357 371453
552
686
966
172
222 245324 359 382
224207 229 246 278
330
10 14 22 26 32 43
Whisk(e)y Gin & Genever Vodka Rum Tequila
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
United Kingdom: Fastest-Growing Spirits Brands – Premium-and-Above
Figures in ‘000s nine-litre cases Data for domestic consumption Source: The IWSR
Jack Daniel's Whiskey
Bombay Sapphire Gin
Bombay Original Gin
Tanqueray Gin
Hendrick's Gin
121
97
83
26
25
2014 to 2015
2014 to 2015
Asia-Pacific – Beer, Wine, Spirits & Cider Summary
• Beer grew by 7.4% from 2010 to 2015 and is forecast to grow 8.1% from 2016 to 2021.
• Wine grew by 29.8% from 2010 to 2015, but is forecast to decline by -2.1% from 2016 to 2021.
• Spirits grew by 17.2% from 2010 to 2015 and are forecast to grow 2.5% from 2016 to 2021.
• Cider grew by 139.7% from 2010 to 2015 and is forecast to grow 21.4% from 2016 to 2021.
Overall
• Wine grew by 41.5% from 2010 to 2015 and is forecast to grow 36.5% from 2016 to 2021.
• Spirits declined -6.2% from 2010 to 2015, but are forecast to grow 21.2% from 2016 to 2021.
Premium-and-Above
Source: The IWSR 2016 Global Database
Category Blur
Key Global TrendsPremiumisation Consumer Evolution
Health Consciousness Appetite for Flavours Desire for Convenience
Manifested by trends including:- Continuing growth of craft- Premium niches (e.g. mezcal,
Japanese whisky)- Aged brown spirits
But economic problems limiting premiumisation in some regions
Erosion of boundaries between categories:- Products spanning multiple
categories, e.g. ‘speers’- Increased switching from one
category to another
Vodka
Cider
Premium gin/Brown spiritsProsecco/beer
New consumer groups challenging the status quo:- Millennials in developed
markets- Female consumers and
emerging middle class in less developed markets
- Ethnic groups in the US
Consumers adopting healthier lifestyles and more aware of dangers of excessive alcohol consumption:- Less but better trend- Demand for ‘lighter’ drinks- Consumption occasions
changing- Future impact of centennials
Consumers seeking out new experiences and tastes:- Flavour innovation still strong,
though appears to be slowing- Increasing popularity of
cocktails and mixed drinks
Key factor behind many recent developments:- New formats, e.g. canned
wines, Heineken ‘Sub’ at home draught beer device
- Growth of mixed drinks partly due to convenience
- Increase in online sales
Key Whisk(e)y Trends• Blended Scotch Whisky• Malt Scotch Whisky• US Whiskey• Irish Whiskey
Overview of Total Whisk(e)yHeadlines • Total whisk(e)y has grown 3.1% on a three-year
CAGR to 2015, adding almost 12m cases in the last year; this is heavily influenced by the Asia-Pacific region.
• Whisk(e)y has grown its presence within total spirits and the trend is set to continue.
• In addition to the Asia-Pacific, the Americas and Africa & Middle East regions are growing; Europe and duty free are flat; and the CIS is declining.
• With the exception of blended Scotch, exciting growth levels are being seen with the other whisk(e)y segments.
+4.2%+4,172k cases
1. Diageo2. Beam Suntory3. Brown-Forman
Jack Daniel’s (+5.9%)
+3.5%+8,676k cases
1. Diageo2. Pernod Ricard3. ABD
Officer’s Choice (+22.7%)
-2.6%-1,055k cases
1. Diageo2. Bacardi Ltd3. Pernod Ricard
William Lawson’s (-3.4%)
DUTY FREE
WHISK(E)Y WORLD VIEW VOLUME DASHBOARDAMERICAS EUROPE CIS ASIA-PACIFIC AFRICA & MIDDLE
EAST+0.7%+1,054k cases
1. Pernod Ricard2. Diageo3. Brown-Forman
Jack Daniel’s(+7.8%)
+2.1%-1,065k cases
1. Diageo2. Pernod Ricard3. Westside
Johnnie Walker (+5.9%)
WORLD VIEW
+3.1%+11,440k cases
1. Diageo2. Pernod Ricard3. ABD
Officer’s Choice (+22.1%)
+0.8%-353k cases
1. Diageo2. Pernod Ricard3. Brown-Forman
Johnnie Walker (+1.8%)
Market GrowthThree-year CAGRActual cases diff
Top owners
Number one brand
Source: IWSR 2015 volume data. Rankings based on largest volume in 2015. Three-year volume CAGR growth % used (2012 -2015). Actual cases diff = actuals versus previous year.
Whisk(e)y’s share of total spirits is forecast to continue to climb having seen continued growth for the last four consecutive years.
2007 2008 2009 2010 2011 2012 2013 2014 2015 F2016 F2017 F2018 F2019 F2020 F20210
0.05
0.1
0.15
0.2
0.25
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
0.1841801198873730.1820551519862510.187628357442920.2018872698941070.215857146931290.221250246934228
10.8% 10.9%11.5% 11.3% 11.3% 11.5%
11.8%12.2%
12.5%12.9%
13.3%13.7%
14.1%14.5%
15.0%
IWSR 2015 Data – Whisk(e)y share of total spirits
Global Whisk(e)y Value Share Global Whisk(e)y Volume Share
Valu
e sh
are
Volu
me
shar
e
Source: The IWSR 2016 Global Database
Overview of Blended Scotch WhiskyHeadlines • Blended Scotch accounts for 20% of total
whisk(e)y sales, but is the only segment to decline.
• Correspondingly, the share of total Scotch has fallen back considerably, particularly for value sales.
• The top four markets for blended Scotch are in decline. Growth comes from less mature markets such as Mexico, Poland, India and South Africa.
Other Whisky
Blended Scotch
US Whiskey
Canadian Whisky
Japanese Whisky
Malt Scotch
Irish Whiskey
3.3%
-1.3%
5.8%
7.9%
10.2%
5.0%
7.6%
Three-year volume CAGR growth to 2015
As we have seen, although blended Scotch accounts for more than 20% of whisk(e)y volume, it is the only sector to experience decline.
53.5%
21.8%
10.5%
6.8%
3.2%2.3%2.0%
IWSR 2015 Data – Global whisk(e)y volume by key sector
Other Whisky Blended Scotch US Whiskey Canadian Whisky
Japanese Whisky Malt Scotch Irish Whiskey
Total whisk(e)y 3.1%
Source: The IWSR 2016 Global Database
Blended Scotch’s share of total Scotch has started to reduce in the last six years for both value and volume.
2006 2007 2008 2009 2010 2011 2012 2013 2014 201589.0%
89.5%
90.0%
90.5%
91.0%
91.5%
92.0%
92.5%
93.0%
93.5%
76.0%
78.0%
80.0%
82.0%
84.0%
86.0%
88.0%
90.0%
92.9% 92.9% 92.9% 92.9% 92.5% 92.2% 91.9% 91.5% 90.9% 90.4%
87.8% 87.8%88.1% 87.9%
86.4%
85.6%
84.8%
83.7%
82.2%
80.6%
IWSR 2015 Data – Blended Scotch’s share of total Scotch (Axis scale set to show movement)
Blended Scotch Volume Share Blended Scotch Value share
Volu
me
Shar
e
Valu
e Sh
are
Source: The IWSR 2016 Global Database
Overview of Malt Scotch WhiskyHeadlines • Malt Scotch accounts for 2.3% of total
whisk(e)y and has grown by 5% on a three-year volume CAGR to 2015.
• Malt Scotch has increased its share of total Scotch by 7pts over the last decade.
• Eight of the top 10 markets for malt Scotch are in growth.
Although accounting for a small proportion of total Scotch sales, malt Scotch has grown steadily over the last decade for both volume and value.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
6,089 6,433 6,373 6,180 6,733 7,329 7,781 8,086 8,485 9,001
2,326,396 2,557,497
2,683,236 2,669,245
3,056,095
3,548,066
3,897,456
4,245,189
4,745,802
5,309,684
IWSR 2015 Data – Long-term malt Scotch volume in ‘000s nine-litre cases and value in $000s USD.
Malt Volume Malt Value
Source: The IWSR 2016 Global Database
Key Whisk(e)y Trends – Blended & Malt Scotch
High-end Scotch generally performing well• Consumers trading up across most regions in a quest for interesting
brands and/or social status.
Mixed fortunes for blends• Category performing well in most of key Europe, India, Japan, the
Philippines, Mexico and many parts of Africa.• Economic trouble in the CIS, Latin America and parts of Africa and Asia
leading to falling volumes and downtrading.• ‘Blended’ has no discernible identity in many key markets.
Interest in malts continues to expand• Benefit from the perception of sophistication in many markets.• The segment has also benefited from an association with high-quality
craft spirits, which are trending in several regions.
Non-age-statement whisk(e)y not universally accepted• Many new expressions continue to be launched, but many consumers
remain sceptical and continue to see age as an important indicator of quality.
Overview of US WhiskeyHeadlines • US whiskey has grown consistently
throughout the last decade for both value and volume.
• All but one of the top 10 manufacturers are in growth.
• Amazingly in the UK, the home market of Scotch whisky, Jack Daniel’s outperforms the Scotch whisky category at a premium level!
Good growth for US whiskey over 10 years, with year-on-year value growth exceeding volume during this period.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
28,295 28,974 29,444 29,689 30,468 32,326 34,522 36,812 38,972 40,852
5,343,066 5,632,472
5,926,867 6,240,538
6,610,984
7,235,867
8,041,832
8,760,705
9,521,765
10,334,234
IWSR 2015 Data – Long-term US whiskey volume in ‘000s nine-litre cases and value in $000s USD.
US Volume US Value
Source: The IWSR 2016 Global Database
Key Whisk(e)y Trends – US WhiskeyContinues to expand rapidly• Approachable taste profile.• High status of American products in many markets.• Rise in Millennial spending power and increasing
appeal among new consumer groups.• Craft trend and the resurgence of classic cocktails.• Renewed interest in Bourbon and rye whiskies.
Premium-and-above segment strong Jack Daniel’s still growing
• Dominates in many regions, especially outside the US.• Now the largest whisk(e)y brand by volume in the UK.• Difficulties in some emerging markets due to FX.
Flavours broadening the category’s appeal• Sweeter, accessible taste attracts new consumers.• Danger of over-proliferation, as in the case of vodka?
Overview of Irish WhiskeyHeadlines
• Irish whiskey sees significant growth and shows no signs of slowing.
• The category is dominated by Jameson, which accounts for almost 70% of sales.
• The US market is absolutely critical for success within Irish whiskey.
Forecast
The Irish whiskey category has been growing for years and shows no signs of stopping.
19851986
19871988
19891990
19911992
19931994
19951996
19971998
19992000
20012002
20032004
20052006
20072008
20092010
20112012
20132014
20152016
20172018
20192020
20210.0
2,000.0
4,000.0
6,000.0
8,000.0
10,000.0
12,000.0
Irish Whiskey Sales GloballyIWSR Data to 2015 – Volume in ‘000s nine-litre cases and forecast volumes to 2021.
Volu
me
‘000
s nin
e-lit
re ca
ses
Source: The IWSR 2016 Global Database and forecast volumes
Total Irish Whiskey
Jameson Whiskey
Tullamore Dew Whiskey
Bushmills Whiskey
Paddy Whiskey
Powers Whiskey
All Others
7.6%
9.1%
8.5%
0.8%
6.3%
-15.0%
9.1%
IWSR 2015 Data – Irish whiskey three-year CAGR volume change by brand
67.0%
12.1%
8.8%
2.7%1.3%
8.0%
IWSR 2015 Data – Irish whiskey volume share by brand
Jameson Whiskey Tullamore Dew Whiskey Bushmills Whiskey
Paddy Whiskey Powers Whiskey All Others
1. Source: The IWSR 2016 database2. Three-year volume CAGR 2012-2015
.
Accounting for almost 70% of all Irish whiskey volume in 2015, Jameson dominates the sector not only by size, but by growth – outpacing total by 1.5pts in the latest year (2015).
Key Whisk(e)y Trends – Irish Whiskey
Irish whiskey continues to grow well
• Follows trajectory of US whiskey in many markets.• Performing well in the key markets of key Europe and
North America.• Attracting interest in Australasia, Europe and Africa
where growth has primarily been driven by investment behind Pernod Ricard’s Jameson brand.
• Producers innovating and launching premium variants, which has helped to encourage greater exploration of the category.
• Focusing on developing the stories behind the brands.• Raft of new distilleries due to come on stream soon.
Overview of Japanese WhiskyHeadline
• Japanese whisky, a smaller sector of whisk(e)y, is growing strongly as it becomes available in more markets.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 F2016 F2017 F2018 F2019 F2020 F2021 -
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
Japanese Whisky – IWSR 2015 volume ‘000s nine-litre cases and forecast to 2021.
Japanese
Volu
me
sale
s ‘00
0s n
ine-
litre
case
s
Though considerably smaller than other whisk(e)y sectors, Japanese whisky is also on a steady upward trajectory.
Source: The IWSR 2016 Global Database
The number of countries Japanese whisky is consumed in has increased significantly over the last decade.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
10 11 14 17 28 33 38 41 45 47
IWSR 2015 Data – Japanese whisky – number of countries consumed in.
Num
ber o
f cou
ntrie
s ava
ilabl
e in
Source: The IWSR 2016 Global Database
Key Whisk(e)y Trends – Japanese WhiskyGreater interest in Japanese whisky
• Premium image and reputation for high quality.• Consumer curiosity for new and unique
products.• Approachable taste profile.• Volumes still small, and growth limited by
allocations.
Any Questions?