What's in a name

What's in a name

A good deal, no matter how you look at it?

Thoughts from... | 10 Dec 2018 | Issue 156 | By Chris Middleton

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If you’re the owner of Johnnie Walker or Jack Daniel’s it’s worth several billion dollars in brand equity alone – assuming they ever wanted to sell the trademark. This brand equity rests entirely with consumers, as they buy labels they trust, creating brand loyalty, which in turn generates repeat future sales and consumption. Rivers of revenue gold.

Since the 1850s, there have been over 50,000 unique whisky brands. By a weird statistical chance, this averages a new whisky brand every day somewhere in the world. Today, only a small fraction of these 50,000 whisky trademarks are on the shelves around the world. The vast majority now fill the whisky cemetery.

Before the advent of modern marketing, whisky was a provincial spirit, sold in bulk containers through trade channels to be served at public bars, taverns and grocer’s shops. At Scotland’s whisky dawn, during the 18th century, the Forbes family dominated whisky production and had the world’s first recorded malt and grain spirit brand at the time synonymous for whisky, the Fernitosh.

Before consumer brands such as Andrew Usher’s the Real Glenlivat Whisky (sic) were sold in the mid-1840s, Scotch moved through dealers and agents, and sold as regional whiskies from the Highlands, Campbeltown and Islay. Ireland’s whisky industry enjoyed a head start on the Scots and their regional whiskies from Dublin, Cork and Drogheda were now appearing as brands names such as Jameson’s, Murphy’s and Callaghan’s in the 1830s.

America’s early rye whiskies were also first recognised by distilling regions such as Monongahela, Roanoke and Tuscaloosa. The first Bourbon brand in Kentucky is ascribed to Joseph Peyton’s Old Joe whiskey back in 1818. These early whiskies were sold by the barrel. Bottled brands would change the marketing landscape and offer a greater guarantee of product integrity from tampering. The first bottled Bourbons appeared in the late 1840s with Binninger’s Old Kentucky Bourbon, followed by Monk’s Old Bourbon.

It's bound up in networks of trust and familiarity, based on emotional connections

The boom in whisky brands began after the US Civil War and the UK’s Single Bottle Act of 1861. Production and demand leapfrogged each other to make whisky the leading spirit of the Western hemisphere, replacing rum. To protect these new business assets, trademark laws were enacted. From differing State jurisdictions, the US Congress legislated a federal trademark regime in 1870, and British Parliament’s Trade Marks Registration Act of 1875. Whisky, packaging and brand name were bound together against counterfeits and adulteration.

Presenting as an expert witness in a federal court case involving two major global brands' trademarks, I analysed many thousands of whisky brands under the dry title: Taxonomy of Whisky Nomenclature. Some interesting patterns were evident across the major whisky producing nations over the past 150 years.

An impressive 95 per cent of whisky brand names originated from the US and Scotland. From the beginning, ‘Old’ was the most popular brand prefix by a factor of four. In Scotland, malt whiskies were commonly named after a geographic feature near the distillery, overwhelmingly Gaelic. ‘Glen’ was the most popular Scotch brand prefix. Blended Scotch brands favoured the owner’s name, often a grocer such as Walker, Teacher, Chivas, Ballantine, or Dewar. The personal endorsement also proved popular with leading American whiskies with Messrs Daniel, Beam, Heavenhill, Brown, et al. However, their distilleries are often named after the local town. After people and places, symbols (royalty) and animals were the next most popular classifications.

Those external valuations mentioned above revealed a surprising financial construct: the brand’s equity was valued at two and a half times the net sales value of the whisky. For consumers, brands represent quite a different equation.
It’s bound up in networks of trust and familiarity, based on memories, emotional connections, need states, price-value, product consistency and drinking pleasures. Whether an owner or a drinker, a great deal depends on a good name.
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