Whisky's future

Whisky's future

We look at some of the pressing issues affecting whisky

News | 22 Jul 2008 | Issue 73 | By Rob Allanson

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Ask most people what the three most important factors are when looking to purchase whisky and chances are they’ll say price, choice and quality, with the Holy Grail being a great choice of top quality whisky at the lowest possible price.But with whisky supply struggling to keep up with world demand and grain, oil and wood prices on the rise, something has to give. But exactly what?We spoke to a handful of senior Scotch whisky marketing people for their views, offering them anonymity in return for their frank and personal – as opposed to official company – views.They agreed on one thing – that quality of Scotch whisky will not be compromised for short term benefits though one person did say there might be ‘meddling at the margins.’ There is no reason to disbelieve this claim.Malt whisky’s very success is down to the standards it is made to, and as society moves further towards the premium end of the drinks market, quality and heritage will become even more important as it separates itself from products such as vodka.What all agree on, however, is there will be a greater emphasis on flavour, and a legitimate attempt to encourage drinkers to break out of the ‘older is better’ mentality.They predict an increase in launches of whiskies without an age statement and with a non-distillery name such as Burnfoot or Monkey Shoulder.“Most people who appreciate whisky realise that that statement is just not true,” said one. “Some whisky, particularly some peated styles, are better young.” Which brings us onto the issue of choice.Here there were mixed opinions as to what is likely to happen. But predictions that markets such as Britain’s where whisky has been sold at low cost will be deprived of brands as they are reallocated to markets where the price is considerably higher might prove to be wrong.“Of course we want to make hay while the sun shines,” said one, “but nobody knows how long this current boom will last and you don’t want to burn bridges with loyal customers for a quick gain.” Others pointed to the new launches outlined above and predicted more innovation, too, effectively increasing choice rather than decreasing it. And there was also a view that the recent spate of rare and expensive whiskies at the top end of the market would continue, too.One marketing manager even predicted that the demand for rare whiskies would tempt some collectors to sell, releasing rare bottles into the market.And so to price, and it seems that nearly everyone expects prices to rise significantly.Indeed, one major retailer is encouraging investment in whisky because he believes it guarantees a healthy return.“Many in the industry moaned when the Chancellor put tax on whisky up,” observed one, “but he let the price genie out of the bottle and several companies have taken the opportunity to raise their prices beyond the tax hike.” There was a general view that there was a need for prices to rise particularly in markets where discounting is common-place, but there was a mixed view as to whether this would mean the end of the big discounts offered by the supermarkets. One person suggested that it might force the big stores to make some choices.“British supermarkets might be at a crossroads,” he said. “They either put the price up, educate their staff and sell whisky as a premium drink as they now do with premium bottled ale, or they concentrate on even less brands as a loss leader or get out of whisky altogether.” A mixed picture then, but the general view is there will be a steady flow of good quality whisky at both ends of the price scale, but with prices on the rise. Not the Holy Grail, but two out of three ain’t bad.
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