New products and new strategies, aged whiskies and age-old heritage: combining the old with the new is promising to be a winning strategy for Scotch. While the category has seen an almost constant decline in sales since the 1970s — with almost 60% of the sales volume having disappeared — the past few years has seen significant growth at the high end. Indeed, some consumers are viewing Scotch almost like wine these days, focusing on location, production methods, character and authenticity.

“It seems the premium to superpremium part of the market is experiencing growth and certainly single malts continue to grow and bring new consumers into the fold,” observed Bob Dubin, Scotch category manager for Seagram Americas, the company behind Chivas Regal, The Glenlivet and the Heritage Selection of single malts.

While the Scotch market as a whole continues to decline, superpremiums, including both blends and single malts, are up. According to suppliers, the single malt segment continues to grow at the rate of about 15% a year. And many superpremium blends boast growth as well. Schieffelin & Somerset reported, for example, that all its Johnnie Walker brands above Red, its premium label, grew last year: Black by 6% and Gold and Blue, both small, ultra-premium brands, by over 20% and 40%, respectively.

And the people who are interested in these higher-end Scotch brands are particularly desirable as consumers. According to a recent survey done for Hiram Walker & Sons by Alden & Associates, the consumers of single malt Scotch tend to have higher than average incomes (55% of those surveyed reported incomes of $75,000 and above) and are not afraid to spend their money on spirits (more than 50% reported spending an average of $35 or more on a bottle of single malt).


Though the single malt portion of the Scotch market is still small — sales of about 600,000 9-liter cases nationally, according to Adams Media research — its double-digit growth and the attention it attracts from both consumers and the media continue to make it a hotbed of activity for suppliers. The number of single malt brands available, for example, has exploded from about 10 brands in 1985 to more than 170 today.

And as more brands hit the shelves, the single malt market continues to take shape. For example, Brown-Forman Beverages Worldwide has positioned its newest offering, Glen Moray, introduced in October, as an “entry-level” single malt, relative to its more premium Glenmorangie line. In April, Barton Brands will introduce a higher-end single malt — Old Pulteney — to complement its existing offering, Speyburn. Old Pulteney is expected to retail for a little above $30, while Speyburn, which the company sees as more of an introductory single malt, retails in the $18 to $20 range.

Meanwhile, suppliers, including Brown-Forman, have beefed up the higher end of the single malt market, most often by introducing more premium versions of existing brands. These brand extensions represent two trends in the single malt segment: the addition of products that have been aged longer and the addition of products that have been aged differently.

Wood If They Could

The Macallan, the third-largest-selling single malt after The Glenlivet, has long stressed its difference from other single malts: unlike most other Scotch brands, which are aged in either new oak barrels or ones that had previously been used for bourbon, The Macallan is aged entirely in sherry casks. According to Hilary Peck, the brand’s marketing director at Remy Amerique, The Macallan has been outperforming the single malt market for a number of years, growing at annual rates of 20% and above.

Other suppliers, however, have taken note of The Macallan’s success. For example, last February, Hiram Walker introduced a new version of The Glendronach, an 18-year-old whisky aged entirely in sherry casks, as one of the three brands in its new Defenders of the Malt collection. (The other two are Laphroaig 10-Year-Old and Scapa 12-Year-Old.)

And Brown-Forman has developed an entire line of wood-finished single malts. It introduced its Port Wood Finish brand extension of Glenmorangie in 1995 and followed it with two other specially finished versions of the brand, Madeira Wood Finish and Oloroso Sherry Finish, in the fall of 1996. In the case of Glenmorangie, the whisky for all three finishes is first aged for 10 years in casks that had previously been used for bourbon, just as the base product, 10-year-old Glenmorangie, is. Then, the whisky destined to be specially finished spends two more years in one of three kinds of previously used casks: a port pipe, a Madeira drum or a sherry butt. Brown-Forman plans to release a limited-edition claret-wood-finished product this summer.

According to David Dorsey, vice president and group brand director at Brown-Forman, the special finishes have been well received. “Through November, sales were up by 18% for the total line and the brand had a very strong December,” he said. The Glenmorangie line includes an 18-year-old product and a 1971 vintage product as well as the original 10-year-old brand and the three finishes.

In late 1998, Schieffelin & Somerset plans to introduce a “Distiller’s Edition” of its Classic Malts collection. The Distiller’s Edition will feature a special version of each of the collection’s six brands (Glenkinchie, Lagavulin, Cragganmore, Talisker, Oban and Dalwhinnie). Each will have been finished in a different type of wood.

Meanwhile, Glen Ord, from United Distillers & Vintners North America (UDV), a brand introduced in 1995, also markets its use of sherry wood. In the case of this brand, 75% of the whisky is aged in standard American casks, 25% in casks previously used for sherry, and then the two are combined. In the three years since its introduction, Glen Ord has grown in size from a little over 8,000 cases to a little over 14,000 cases.

And The Balvenie, from William Grant & Sons, is also available in differently aged versions: Doublewood, Single Barrel and Port Wood products as well as 10-year-old Founder’s Reserve.

When Old Becomes New

Even when they do not change the type of wood they use, many single malt suppliers release older versions of their whisky brands. The newest releases include an 18-year-old and a cask-strength 25-year-old Highland Park, a brand from UDV North America, and a 15-year-old version of Isle of Jura from Heaven Hill. Aberlour, marketed by Austin, Nichols, offers single malts of different ages and different types of aging. Its newest versions, introduced last October, are 15-Year-Old Sherry Wood Finished, which has been aged first in bourbon casks and then in sherry ones, and 18-Year-Old Sherry Wood Matured, which was aged entirely in sherry wood.

“The older products are very popular,” said The Macallan’s Peck, whose brand is available in 12-, 18- and 25-year-old versions. “People love the idea that something was made 25 years ago. Anything that’s rarer is more desirable, and when something’s old, it’s like drinking history.”

Into The Mix

Both suppliers and retailers wonder if the appeal of the single malts can be extended to the blends. The potential result of stirring up the rest of the 9 million-case Scotch market would be enormous. Most observers believe that suppliers have to find a way of relating the tradition and excitement of single malts to blended Scotch.

Many companies are trying to do just that. Some focus on educating consumers about the fact that the blended brands contain single malts. As part of its Mentor Program for the Johnnie Walker brands, for example, Schieffelin & Somerset sponsors component tastings for consumers, where the single malts contained in the Johnnie Walker brands are sampled along with Johnnie Walker itself. “Part of our challenge on blends is, number one, to educate consumers that one [single malt versus blend] is not better or worse than the other, they’re just different, and number two, that the malts they know and respect are part of our blends,” said Steve Meyers, brand manager for Johnnie Walker Black and Gold.

The Famous Grouse is taking this tack with a gift box promotion, available until Father’s Day, that combines a bottle of The Famous Grouse with miniature bottles of Highland Park and Tamdhu, two of its component malts. And, in an interesting reverse, UDV North America has also included a 50 ml bottle of The Famous Grouse as an on-pack to the single malt Highland Park. “We’re trying to change the way malt drinkers think about blends,” explained Whitney Repp, marketing manager for the brands.

Suppliers seek to bridge the gap between single malts in two other ways: with vatted brands and with super- and ultrapremium versions of their blended brands.

Vatted Scotch is different from blended Scotch. A blended Scotch combines both single malts and grain whiskies. A vatted, or pure malt, Scotch is made by combining several single malts but contains no grain whisky. Several have been introduced to the American market in recent years.

Some suppliers — such as Jim Beam Brands, with its Sheep Dip, and Heaven Hill Distilleries, with its Glen Salen — position these brands below the single malts in price. “Glen Salen [which retails for $12.99 to $14.99] is for someone who isn’t quite sure about single malts and about taking the leap to them,” said Stephen Kauffman, group marketing manager for Heaven Hill. “Glen Salen gets them there: it gives them the flavor, but not the price, of a single malt.”

Other vatted brands are meant to be superpremium products themselves, such as Chivas Brothers The Century of Malts, a vatted brand made of 100 single malts, introduced last April by Seagram. The brand retails for approximately $50.

And Schieffelin & Somerset plans to position its vatted brand, Johnnie Walker Pure Malt, to be introduced at the end of the year, as a superpremium, probably somewhere between Johnnie Walker Black and Johnnie Walker Gold in price. “Pure Malt offers consumers who are already involved with Johnnie Walker a malt,” said Arturo Nunez, brand manager.

Super- and ultrapremium blends are also often meant to act as a sort of bridge between blends and single malts. Seagram recently introduced a limited-edition 18-year-old Chivas Regal, retailing in the $60 range. “We have two goals: number one, it helps put a halo around Chivas, and number two, it addresses the growing market for superpremium Scotch whisky. People are looking for the best Scotch and for something new and different,” explained Seagram’s Dubin. He believes that the single malt phenomena has already sparked interest in blends. “The emerging superpremium market [for blends] definitely has been triggered by single malts,” he said. “There are a lot of articles in consumer magazines, larger Scotch sections in stores and a lot of enthusiasm.”

And what of the mainstream blended Scotch brands? Currently, the number-one Scotch on the market, Dewar’s, is in limbo. When Guinness and Grand Metropolitan merged at the end of last year, the Federal Trade Commission required the new company, Diageo, to divest itself of Dewar’s as well as the Bombay and Bombay Sapphire gin brands. A new owner for Dewar’s has not yet been named.

Meanwhile, J&B is expecting to launch a new consumer campaign this summer, the goal of which is to “transcend the Scotch category,” according to Alan Weber, general manager of the aged spirits group for UDV North America. The idea is to position J&B as a “contemporary, hip brown spirit with a history and heritage behind it” that will compete against a whole range of successful brown spirits, such as Jack Daniel’s.

In a way, Scotch has turned conventional distilled spirits wisdom on its head. “The phenomenon is almost strange: entry-level consumers are coming into Scotch through the single malts,” said Nunez of Schieffelin & Somerset, who observed that consumers usually start with the premium or price/value products in the Scotch segment and then trade up.

Naturally, this is a welcomed development. Indeed, it is proving that one of the adages of the Scotch market — that Scotch is an acquired taste for experienced drinkers — may be only part of the story.

In fact, in the end, it may prove to be a new way for retailers, marketers and consumers to think about Scotch.

Leading Brands of Scotch in the Control States
(Mixed Cases)



% Change


Schieffelin & Somerset


J & B Rare
IDV North America

Barton Inc.

Johnnie Walker Red
Schieffelin & Somerset

IDV North America

Clan MacGregor
William Grant & Sons

Chivas Regal
Seagram Americas

Inver House
Barton Inc.

Cutty Sark
Hiram Walker & Sons

Grand MacNish
Domecq Importers

Total Top Leading Blends



Single Malt Scotch

The Glenlivet
Seagram Americas

William Grant & Sons

White Rock Distillery

The Macallan
Remy Amerique

Brown-Forman Beverages

Total Top Leading Single Malt





Total Scotch in the Control States

(*) Last 12 months data ending September 1997.
FB=Foreign Bottled. USB=U.S. Bottled. SM= Single Malt.
Source: Adams Media Research Database from NABCA data.

Springing Into Action

A selection of the promotional campaigns Scotch
suppliers plan for the spring.

(Schieffelin & Somerset)

General-market and ethnic-market advertising campaigns are gearing up for Black Label. The brand is continuing its Mentor Program of consumer tastings and sponsoring an expanded ScotsFest marketing campaign.

(Seagram Americas)

Chivas is due to launch a new advertising and public relations campaign this spring.

(Hiram Walker & Sons)

The brand is running a consumer contest, from March until June, for the chance to serve as a member of the crew on one of the ships in the Cutty Sark Tall Ships Race, which, this August, will go from Ireland to Spain. The brand will also offer a Ships Decanter pack, in markets where legal, containing a glass decanter and a 750 ml bottle of the brand.

(Hiram Walker & Sons)

The Defenders offer a tasting kit, including a video.

(Heaven Hill Distilleries)

Cluny continues its “The Perfect Round” campaign with golf-themed point-of-sale materials.

(Austin, Nichols)

New advertising is set to launch in the second quarter.


The brand is continuing its advertising and PR campaign targeted at Hispanic-Americans.

(William Grant & Sons)

A consumer offer for Clan MacGregor gear, which features shirts, caps and jackets.

(United Distillers & Vintners North America)

A new gift box includes miniature bottles of Highland Park and Tamdhu, two of the brand’s component malts. Promotions include consumer offer for four historic golf posters.

(Heaven Hill Distilleries)

Off-premise merchandising includes two new shelf-talkers highlighting favorable reviews.

(William Grant & Sons)

A consumer premium offer features a selection of three hand-rolled cigars, chosen to complement the Scotch.

(Jim Beam Brands)

One of several of the company’s superpremium brands is scheduled to be featured in a new advertising campaign.

(Barton Brands)

A consumer offer, in markets where legal, for a free copy of The Orvis Fly Fishing Guide.


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