Premiumisation is a key trend on the US alcohol market

Lawson Whiting, CEO of Brown-Forman, owner of such Scotch whisky brands as GlenDronach or BenRiach, indicates premiumisation as one of the key trends on the US alcohol market. In an interview with just-drinks.com, he pointed out the high resistance and upward trends in the premium alcohol segment despite the ongoing coronavirus pandemic

"Over the decade, premiumisation has been one of the biggest macro factors in our industry" said Whiting. “Even over the last 12 months, we continue to see very strong premiumisation trends in industry. If you look at what’s happened over the last couple of months, those trends have continued. You haven’t seen the trade down that some of us were worried about: Ultra-premium is still growing the fastest” added the CEO of Brown-Forman.

When asked about the company's long-term strategy for the coming years, Whiting replied: "Looking out ahead to the next couple of years, I don’t see us changing our portfolio strategy other than to focus on more super-premium-and-above brands."

On the other hand, the CFO of company, Jane Morreau, commented on the effects of previous crises on the premiumisation trend in the alcohol industry: “We can go back to the financial crisis in 2008-2009 and we did see some slowdown in premiumisation, but it still grew. It lasted for, say, a 12-to-18-month period, but it came back with a vision. It grew double digits”.

One of BBC portal latest articles seems to confirm this trend, supported by the latest financial results of Diageo, a concern with approx. 40 percentage of the Scotch whisky industry. The annual summary (covering the period of the year until June 30, 2020) showed that exports of Scotch single malt whisky to the USA increased by 1% in the reporting period. This is all the more surprising since last year United States imposed a high, 25%, duty on single malt Scotch whisky, and the coronavirus pandemic broke out earlier this year. The increase in exports under such conditions proves the enormous strength of Scotch single malt whisky on the American market.

Source: Just-drinks.com

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