Gin: Time to Shine?

Is gin, once again, becoming fashionable?

Well, it depends on where you ask.

“Nothing much is going on with gin,” reported one Mid-Western retailer. Another echoed the thought. “In our market, gin is growing, but very slowly,” he said.

But ask a retailer in an East or West Coast city, a retailer who is surrounded by trend-setting restaurants and bars, and you might hear a different answer. “We are seeing an increase in the gin category, particularly in the boutique-quality gins,” said Eric Goldstein, vice president of marketing at Park Avenue Liquor Shop in New York City. “There has been an explosion of new brands and people are starting to experiment. We just might be on the cusp of a trend.”

Park Avenue Liquor carries approximately 40 gin brands, including two local brands named after Brooklyn (Brooklyn Gin and Breuckelen Gin), Comb 9, a gin flavored with honey comb, Junipero, which celebrates the juniper taste of gin, and Farmer’s, an organic gin. “It’s almost as if gin has become like wine, in a sense,” said Goldstein. “The sky’s the limit if you want to experiment and find your taste profile.”

According to Angus Winchester, brand ambassador for the Tanqueray Gins (Tanqueray, Tanqueray No. TEN and Tanqueray Rangpur), over 50 new gin brands have been launched in the U.S. in the last two years. “Consumers tend to look toward products with authenticity, heritage and provenance, and over the past few years, gin has surged back as a key spirit of choice for discerning consumers and professional bartenders as they rediscover its flexibility,” he said.

The answer might differ, too, if you ask bartenders compared to off-premise retailers. As the saying goes among spirits suppliers, “Brands are built on-premise.” “According to a recent MSS Bartender Survey, bartenders are saying the two hottest spirit categories are Irish whiskey and gin,” said Richard McLeod, brand manager for Bombay Sapphire.

“People really look to bartenders to be their guides, they take note of cocktail lists,” said Clare Kanter, brand director for the Seagram’s, Beefeater and Plymouth brands at Pernod-Ricard. “They look to see what brands bars and restaurants are featuring and take that into the off-premise.”

According to the latest figures, from The Handbook Advance 2011, the gin category as a whole declined by 2.9%, with the largest, leading brands – Seagram’s, Tanqueray, New Amsterdam – registering slight declines or staying flat. Bombay Sapphire, the number-four brand, showed a growth rate of 1.3% in 2010.

Still, Seagram’s remains the largest-selling gin by far, with sales of 2.5 million 9-liter cases in 2010, followed by Tanqueray, which notched sales of 1.3 million 9-liter cases last year. New Amsterdam held steady at sales of 810,000 9-liter cases.

It is, as Park Avenue’s Goldstein observed, the boutique gins that are showing the most growth. According to Caspar MacRae, marketing director for Hendrick’s at William Grant, Hendrick’s has been growing at the rate of 40% for the last three years, based on Nielsen figures.

New Style Gins

Hendrick’s was one of the first of the new style gins, along with Tanqueray No.TEN and Citadelle. These three brands first appeared about ten years ago. Like many of the newer brands that have since joined them, they pride themselves on the quality of their production and also on the uniqueness of their flavor profile. Hendrick’s, for instance, counts, among its eleven botanicals, rose of damascus and cucumber, while Tanqueray No. TEN uses fresh grapefruit, orange and lime in its recipe, and Citadelle’s formulation is based on recipes dating back as far as 250 years and contains 19 botanicals, including coriander, orange peel, almonds, angelica and grains of paradise.

Reading about the botanicals of all the different gin brands can be like reading poetry: green tea, raspberry, melon, white pepper, cinnamon, poppy, elderflower. By law, all gins must have, as their dominant flavor, juniper. The problem is: not everyone likes so much juniper. So, some of the so-called neo-gins developed formulations where the juniper is less prominent. The idea was that these flavor profiles might be more appealing to people who think they don’t like gin and more flexible for use in cocktail recipes. But the gin market has quickly expanded beyond that. Now, there are new brands, such as Anchor Distilling’s brand, No. 3 London Dry Gin, introduced in March, that pride themselves on being “classic gins.” “We are absolutely classical and we do it right,” said David King, president of Anchor Distilling.

The result is not that, overall, the flavor profile of gin is moving in one direction or the other. All the newest gins are not all more floral or more citrus. It is that there is now a broad range of flavor profiles within the category.

“We are at the forefront of a gin renaissance,” said MacRae, Hendrick’s marketing director. He, like other suppliers, points to three main factors driving the interest: bartenders and their interest in cocktail culture on-premise, consumers being much more discerning and interested in unique products and the innovation of the gin brands themselves.

“When we introduced Citadelle in 1997, nobody cared that is was made in small batches in copper-pot stills. It was way ahead of its time,” said Guillaume Lamy, vice president, North America for Cognac Ferrand, the maker of Citadelle Gin. “Today, the market has completely changed. Now the consumer is so much more into how things are made and we are finally having success.” Lamy pointed out that Citadelle’s sales are up by 58% this year.

One thing that all gin suppliers can agree upon is that the saturation of the vodka market has, paradoxically, left them an opening. “More than 70 new vodka brands are introduced per year. That’s more than one a week,” said Anshuman Vohra, founder and CEO of the Bulldog Gin Company. “Younger consumers are looking for something more exciting.”

Appealing To a New Generation

And that’s another point upon which gin suppliers agree: that gin is appealing to a new generation. “Vodka first became popular in 1979, 1980, thirty years ago,” said Anchor Distilling’s King. “That’s why we are looking at generationality.” In other words, the new generation of consumers sees vodka as the thing their parents drank.

And this newest generation of consumer is more sophisticated and savvy than ever. “The tastes of consumers today have changed,” pointed out Carl Nolet, executive vice president of Nolet Spirits USA, which launched Nolet’s Gin last October. (Nolet Spirits is also the company behind Ketel One Vodka.) “These days, you see flavor in everything. There are different flavors of maple syrup – cinnamon, raspberry, honey – in the grocery store. Consumers are used to flavors and they are expecting more robust ones.”

Anchor’s David King sees the same trends. “When it comes to restaurants, people are interested in ethnic food with strong flavors, like Thai. Light beers are tanking, while craft beers are growing. People’s palettes are changing,” he said.

Nolet also sees that today’s younger consumers are knowledgeable and willing to learn. “They are ready to explore at a much younger age,” he said. “Gin has one of the largest potentials [of any spirit type].” Bulldog’s Vohra sees that trend too. “You definitely see that interest in superpremium products with consumers starting at the legal drinking age,” he said.

Key: Product Education and Trial

The key to unlocking this potential, say suppliers, is education and trial.

To help spur interest and trial, Pernod Ricard has developed two limited-edition, seasonal versions of its iconic Beefeater brand. Its Beefeater Summer Edition highlights a slightly more floral character than the original, while Beefeater Winter Edition Gin blends cinnamon, nutmeg and pine shoots into the botanical mix to give it a more wintry taste.

 For its part, William Grant has hosted 600 sampling events, both on- and off-premise, so far this year for Hendrick’s. “We hope to sample over 40,000 consumers on Hendrick’s this summer,” said MacRae. “And we have a great trial-to-conversion ratio.”

“The biggest thing is to educate people, in order to get them interested,” agreed Anchor Distilling’s King. “That means some old-fashioned tools: good-quality shelf talkers and brand ambassadors out hand-selling and educating employees in stores.” Citadelle Gin has four teams across the country dedicated to holding gin seminars in stores. “Educating consumers is the only way,” said Lamy.

Some high-end gins have another advantage against other superpremium products: price. Bulldog Gin, available on the East and West Coasts, is a micro-distillery product priced in the low $20s. Citadelle Gin is taking advantage of its special situation. Citadelle is made by a cognac distillery. By law, cognac cannot be made during certain months of the year, so Citadelle is made on equipment – very expensive copper-pot stills – that would otherwise be idle. “For us, that is a huge advantage,” said Lamy. “Price is always a factor, but now especially. With Citadelle, consumers can get a small-batch, luxury gin” at a premium price point. Other high-end gins, however, have correspondingly high prices. Oxley, for example, which has been on the U.S. market only a few years, has a $50 suggested retail price. The English import boasts its small batch production and a unique cold distillation process.

Retailer Goldstein, at Park Avenue Liquors, agreed. “Gin’s great price point is another thing it really has going for it,” he said. “You can really still find an artisanal product with an interesting story and recipe and it’s not that expensive.”

A new generation is looking for its spirit and that generation is interested in classic cocktails, handcrafted products, flavors and a lower price. It just may be gin’s time to shine once again.

The Colorful History of Gin

— Gin started out as a medicine. People believed juniper berries had medicinal properties as early as the 11th century. The word “gin” comes from the Dutch word for juniper. A Dutch doctor named Franciscus Sylvius is often cited as gin’s inventor. In the 17th century, his gin was sold in pharmacies as a treatment for a range of symptoms.

—  When British troops fought against the Spanish in the Eighty Years’ War or the Dutch War of Independence, they were introduced to gin and gave it its first nickname, “Dutch courage,” because soldiers drank it before going into battle.

—  When William of Orange, the Protestant Dutch leader, and his wife, Mary, became King William and Queen Mary II of England, Scotland and Ireland, they brought gin with them. They actively encouraged the British people to drink gin rather than the brandy they had been importing from Catholic wine-making countries.

—  According to the book, The Much-Lamented Death of Madame Geneva: The 18th Century Gin Craze, by Patrick Dillon, when the British government allowed the unlicensed production of gin, the spirit became very cheap and wildly popular, sparking a period of history known as “Gin Madness.” One estimate has it that by the early 1700s, a quarter of all the households in London were either making or selling gin. This is when the term “gin joint” was invented.

—  The Gin & Tonic, still the most popular way to consume gin, was born when British colonists in tropical areas such as India and Africa took a daily dose of quinine to prevent malaria. The anti-malarial effect of quinine was first recognized in the 17th century and quinine remained the most effective anti-malarial right up until the 1940s. The tonic water the colonists imbibed contained a large amount of quinine, as opposed to the very small amount used to flavor tonic waters today. Gin masked the very bitter taste.

—  There are many different stories about how the Martini was invented. Drinks by that name started appearing in bartending books by the late 1800s. One of the most colorful stories of the Martini’s creation has it that a California Gold Rush miner came into a saloon in Martinez, CA, placed a large gold nugget on the bar and asked for something special.

—  During Prohibition in America in the 1930s, bootleggers discovered that they could easily make a cheap version of gin. Basically, grain alcohol was mixed with flavorings including juniper, in whatever large vat was available, such as a bathtub. Many classic cocktails may have originated at this time to mask the flavor of this “bathtub gin.”

—  Gin remained the most popular spirit type in the United States from Prohibition until the 1960s, when vodka began its rise in popularity.


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