MIXING THE OLD AND THE NEW



Ireland is a land of contrasts and contradictions, a place where the ancient and the recent blend together seamlessly. Known around the globe for its traditional music and dancing through such spectacles as Riverdance and Lord of the Dance, it’s also home to one of the world’s most popular and modern-sounding rock bands, U2. What was long considered the last peasant country in Europe is now the world’s second-largest exporter of software after the U.S.


Everyone knows that the Irish fled their homeland in a tidal wave of emigration that started with the potato famines of the 1840’s and continued on through the 1980’s because of the lack of jobs. But how many are aware of the huge numbers of expatriated Irish that have returned home in recent years or that Eastern Europeans are now moving to Ireland because it affords them an opportunity to live a better life?


This same dichotomy can be seen in Ireland’s two main spirits exports — Irish whiskeys and Irish creams. The first traces its origins back one-and-a-half millennia to Irish monks who brought the secret of distilling to the Emerald Isle. The intoxicating potion they created was called uisge beatha (water of life). Irish creams, on the other hand, are a creation of the modern world, having been launched just 30 years ago with the debut of Baileys Original Irish Cream. Today, Baileys is one of the most recognized spirits brands in the world and it’s two-and-a-half times larger than the combined sales of all Irish whiskey brands in the U.S.


Category Shows Growth in 2004

Although Irish can claim to be the world’s oldest whiskey, it remains the smallest in sales volume, not only of whiskeys, but of all distilled spirits categories in the U.S. The collective category only broke the half-million case barrier nationally for the first time in 2004 and its share of the entire distilled spirits market remains well below 1%. Relative to itself, however, Irish whiskey is a dynamic and exciting category and has enjoyed a double-digit growth rate over the last decade that is the envy of the entire industry.


Carolans Irish Cream is hoping to increase sales with “out-of-category” displays in stores.


Leading the way for Irish whiskey in the U.S. market is Jameson, the flagship of Pernod Ricard’s Irish portfolio, which also recently surpassed Power’s to become the number one Irish whiskey in Ireland. A big reason for the brand’s success is that it has a year-round marketing budget and a level of support not enjoyed by most of the category’s other brands. “We just launched a very dynamic new advertising campaign for Jameson in November,” explained Suzanne Freedman, who handles marketing for all of Pernod Ricard USA’s Irish brands. “It’s a print, radio, outdoor and Internet effort. Essentially the premise behind the campaign is that Jameson is a great-tasting whiskey and it’s growing by leaps in bounds — 15% to 18% a year for the last five years. Basically, what we’re trying to impart to the consumer through this ad campaign is that there are many reasons why people think Jameson is so popular, but at the end of the day, people just love the way it tastes.”


Irish Brands “Own” St. Pat’s Day

As might be expected, the period around St. Patrick’s Day has been the most important for Irish whiskeys, as it is for just about everything Irish. It’s no secret why The Chieftains and other major names in Irish music can be found on U.S. tours in March. “Irish brands are fortunate in that they are able to experience two holidays, not just the November/December Christmas holiday, but they own St. Patrick’s Day,” said Freedman. “However, over the past two-to-three years Jameson has actually been growing at a faster rate outside those two holiday periods than it does during them. That’s really good news for us, because it means that the brand is de-seasonalizing itself and becoming more of a mainstream, year-round whiskey brand.”


Jameson, the category leader, has seen sales increase by 15% to 18% annually over the past few years.


Still, the March 17th period remains an important part of the overall Jameson marketing mission. “We support the holidays tactically with materials for the trade, for the consumers to engage in different types of promotions, value-added packaging and gift packaging, festive case cards and displays,” continued Freedman. “However, we engage in high-level promotions outside St. Patrick’s Day as well.” Examples she cited include a Jameson and ginger ale summer promotion with co-packs and a new rack display program that won’t be available to retailers until early April. Starting in April, Jameson will also be launching a consumer recruitment program that will tie in with different concerts and offer consumer sampling opportunities.


For Bushmills, however, the big deal is always in March. “Bushmills really puts everything into St. Patrick’s Day,” said Freedman. “Everything we do stresses the Irishness of the brand.” And the brand has been growing by 5% to 7% annually nationwide. “The fact is we’re very excited about the brand,” Freedman said. For St. Patrick’s Day this year, one of Bushmills’ efforts will be tie-ins with American beer brands that will vary from market to market, using an Irish-American theme.


Bushmills targets St. Patrick’s Day and the “Irishness” of the brand in its merchandising materials.


Rounding out the Pernod Ricard USA Irish whiskey selections are: Power’s, which Freedman concedes that because of its price, quality and popularity among the Irish, is showing growth of about 10% a year without any marketing efforts; Red Breast, a $45 per bottle whiskey, of which the U.S. is only allocated about 2,000 cases a year, and at the top of the price heap, Midleton, an excellent whiskey which she refers to as being “in that sort of $100 range.”


Strong Irish Category Awareness

Other brand executives are also highly enthusiastic about the prospects for the entire Irish whiskey category. “The whole Irish category, the Irish phenomenon, is continuing in the United States, which augurs very well for all the brands,” said Mark Marcon, senior brand manager, C&C portfolio, which includes Tullamore Dew, for Allied Domecq. “Tullamore Dew itself just continues to grow. There’s just such awareness of the whole Irish category that virtually anything you do is going to work if you’ve got a powerful brand in that category itself. It’s very much a voyage of discovery for this whiskey aficionado.” Marcon also said, ” If you look at the numbers, you can see there’s been a turnaround in Scotch whisky, even blended Scotch whisky. You’ve seen a turnaround in Canadian whisky. You’ve seen the dynamic growth in Irish whiskey. There’s been a true appreciation for brown goods again. But within that category, the one that’s growing the fastest is Irish.”


Tullamore Dew, from Allied Domecq, has continued its annual growth, and while small, is the third best-selling Irish whiskey in the U.S.


Alan Lewis, senior vice president, sales & marketing, for Dublin-based brand owner C&C International, said, “The Irish whiskey category is growing and projected to keep growing by at least 8% or 9% for the next five or six years,” pointed out “With Tullamore Dew we intend to exceed the category growth by exploiting what we call a ‘building block’ program, building the brand in three or four markets each year by overinvesting in those markets and then following up with continued support in those markets.”


“One of the most amazing things I’m seeing now when I go out to liquor stores, even in the control states, is Irish whiskey sections,” said Marcon. “All of a sudden you’re not just another whiskey, you’re a category now. And for the liquor boards and the independent stores and the chains to recognize that there’s an Irish whiskey category is a big step forward for us.”


In addition to the category’s major brands, in recent years there’s been an exciting expansion of the Irish whiskey selection as a number of companies have stepped up and found a bevy of brands to offer consumers.

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