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CATEGORY REDEFINES ITS IMAGE AND WINS OVER A DIFFERENT CONSUMER

By Cory Jones

T here was a time—200 years ago to be exact—when Irish whiskey

was the most coveted brown spirit in the world. In the late 1700’s

and early 1800’s the act of producing whiskey in Scotland was still

mainly illegal, and bourbon had just been invented. Yet in Ireland, which

is widely regarded as the birthplace of whiskey, there were over 1,000

licensed distilleries (and over 8,000 illicit distilleries) producing the

world’s largest supply of whiskey. According to Peter Mulryan, author of

The Whiskeys of Ireland, “Up to one hundred years ago, Irish whiskey

was so prized that Scottish distillers often shipped their whiskey to

Dublin, mixed it with a minute amount of the Irish, and then re-exported

it as ‘Irish whiskey’ so they could sell it at a premium!”

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WHAT MAKES ANIRISH WHISKEY,WELL… IRISH?

I rish whiskey (spelled with an “e”,unlike Scotch whisky) is a grainwhiskey made in Ireland. There are

several types of Irish whiskey: SingleMalt, Single Grain, Pure Pot Still andBlended whiskey. Irish whiskeys, bothblended and malt, are usually tripledistilled through both column and potstills, although there are a few exclu-sively pot-distilled brands, which aregenerally labeled as such. Irish Maltwhiskey is always designated andStandard Irish whiskey is a blend ofmalt and grain whiskeys.

The malt in Irish whiskey is dried insealed ovens, keeping only the puremalt flavor. Peat is almost never usedin the malting process, resulting in awhiskey with an arguably smoother,sweeter flavor – a perfect entry pointfor new whiskey consumers. Adding tothe smoothness of the spirit is the factthat, traditionally, Irish whiskey is dis-tilled three times (as opposed to twicefor Scotch whisky and once for bour-bon), which results in a milder, softerand rounder whiskey.

To be called Irish, the whiskey hasto be distilled from native grains inIreland and stored in wooden casksfor at least three years. Distillers avoidusing new oak casks because thewood is believed to impart a roughtaste to the whiskey. Instead, manydistillers select used barrels that onceheld the contents of another type ofliquor, such as bourbon or rum. Thispractice accounts for subtle differ-ences in whiskies that may originatefrom the same distillery.

Today, though, there are only three legally licensed distilleries in all ofIreland—Midleton, Bushmills and the independent Cooley. How did theinventor of the Water of Life lose its crown as king of the whiskey world?The answer: bad luck…and some bad decisions. While famine and infight-ing took a toll, the biggest blow to the Irish whiskey market occurred whennew Cooley whiskey namesake and Irish hero Michael Collins led a fightwith England for Irish independence in the 1920s.

At the time, the Irish were well versed in the making of whiskey, butEngland was in charge of selling it. After the Irish rebellion, Englandrefused to sell Ireland’s whiskey and turned their enormous sales and distri-bution channels to Scotch. The Irish, who had never sold a barrel ofwhiskey on the open market, couldn’t compete and lost the majority oftheir market share.

AA RReevviivvaall iiss UUnnddeerrwwaayyBut today Irish whiskey is making a significant comeback. While brownspirits worldwide are seeing an upsurge in sales, Irish whiskey has becomethe fastest growing spirit on the market. According to David Ozgo, chiefeconomist for the Distilled Spirits Council of the United States (DIS-CUS), “The segment of the whiskey marketplace that competes with Irishwhiskey – high end and super premium products – will experience robustgrowth this year. Premium Scotch and premium bourbon are expected togrow at near double-digit rates, but Irish whiskey will grow by 20%.”

It seems the more people try Irish whiskey, the more they like it. Withits lighter body and fruity notes, it’s a much more accessible spirit thansome of the daunting, heavier Scotches. “It has the special cache of beingimported, while it doesn’t have the smoky and peaty flavor of Scotch,” addsOzgo. As more and more consumers are entering the whiskey market andtrying it for the first time, the approachable flavor of the Irish gives it agreat opportunity to create a wealth of new customers and continue togrow at its current rapid pace.

In addition to the smoother flavor of Irish whiskey being an evidentconversion factor for new consumers, Larry Neuringer, brand director forJameson Irish Whiskey at Pernod Ricard USA, says, “We live in a ‘trend-driven’ society where we’re bombarded with thousands of different mes-sages a day via the Internet, cell phones, emails, and blackberries, etc. andpeople are looking for an island to stand up on for five minutes wherethings are real and authentic.” Neuringer believes that there is a group ofpeople who are cynical about trends and purposefully reject them. He alsocites the consumer shift towards premiumization as a reason for Irishwhiskey’s resurgence. “People want to express their use of luxury goods,”Neuringer says, “and Jameson is a discovery brand, which is really drivingoverall category growth.”

The Irish whiskey distilleries are pouring a great deal of energy andmoney into raising awareness of their spirit. “At Tullamore Dew, we’re put-ting a significant investment into the brand right now,” says Jim Brennan,brand manager at Skyy Spirits. “You’ll see a newadvertising campaign this year, which isgoing to get the word out about it.” Thetask at hand is to make people realizethat Irish whiskey is a high qualityproduct. The goal is to get whiskeydrinkers (and non-whiskey drinkers)to try it. Once it’s in their mouths,the quality of the product speaks foritself and keeps them coming back,which leads some brands to a moregrassroots marketing approach.

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At Clontarf and Knappogue, two sisterbrands that offer premium blends and singlemalts, they are taking their spirits to the streets.“Our marketing approach for the whiskeys isfocused on touching the consumer directlyrather than on traditional print advertising.Our goal is to get the consumer to taste thebrands,” says Roseann Sessa of Castle Brands.Regardless of the marketing strategy employed,it’s clear that more marketing dollars will meaneven more growth for the industry.

OOvveerrccoommiinngg tthhee OObbssttaacclleess While the future is undoubtedly bright for Irishwhiskey, certain challenges still lie ahead.According to Neuringer, shelf positioning isone of the key obstacles facing the category asa whole. “Irish whiskey needs to de-coupleitself from blended Scotches, which is whereyou will find it positioned on liquor storeshelves,” he says. “The reality is it needs to beplaced closer to more vibrant categories, suchas premium Canadian whiskeys and premiumAmerican whiskeys.”

Additionally, the public cur-rently drinks the majority of theirIrish whiskey in an Irish Coffee orto celebrate St. Patrick’s Day. Forit to break into the realm of aneveryday spirit like bourbon orScotch, drinkers need to be reedu-cated to consider an Irish whiskeysometime other than just inMarch or the winter months. Andthe growth numbers suggest thatthe education is finally coming tofruition. According to AbigealHendron, brand manager forMichael Collins, the newest Irishwhiskey on the market, “Goingback ten to fifteen years, anythingthat came out of Ireland, whetherit was whiskey or soap, had agreen flashing shamrock or a lep-rechaun. It perpetuated the oldworld Ireland stereotype. But tocompete today, you have to be acontemporary, mainstream prod-

uct.” And she’s right. Over the past year,Jameson has launched a large advertising cam-paign that is sleek, modern and targets the 30-something crowd. This has paid off, growingJameson’s already large market share to a huge58.6% of all Irish whiskey sales in 2006. “Theircampaign has really worked because it hasmoved them beyond the typical Irish market-ing and has repositioned their product into atruly global brand,” says Hendron. Expect tosee more Irish brands follow their lead.

TThhee FFuuttuurree iiss WWiiddee OOppeennAs the marketing and advertising campaignsbring more awareness, there are still manyopportunities to grow and evolve Irish whiskey.As both bourbon and Scotch distillers haveproven, there is a large market for new, differ-ent forms of the spirit. The small batch brandshave been a huge success for Jim Beam, andwalking by the Scotch section of your localliquor store will tell you that Scotch distilleriesaren’t afraid to try something new. Jay Erisman,

fine spirits manager for TheParty Source in Cincinnatiagrees: But while I see some newlines and new products, I don’tsee the innovation, the reallycutting edge fearlessness that Isee in a lot of Scotch distilleries.”Which means that while Irishwhiskey is growing at a strongrate, there are still a great deal ofoptions left in the industry’s arse-nal to keep adding new productsthat will attract anyone from thewhiskey geek to the casualdrinker.

More investment, more mar-keting and advertising cam-paigns, and great products allpoint to a banner year for thebrown spirit from the land of thegreen. As Irish whiskey battlesback to reclaim its place amongthe giants of brown spirits, raise adram and toast the whiskey thatstarted it all. n

FPOBerniko 1/3

“Premium Scotch and premium bourbon are expected to grow at near double-digit rates,

but Irish whiskey will grow by 20%.”- David Ozgo, chief economist for Distilled Spirits Council of the United States (DISCUS)

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