People

Vat is the fuss about?

Are vatted malts set to be the success story of 2004? We asked a group of experts
By Dominic Roskrow
Round table question: Vatted whisky is the way to attract new drinkers. DiscussThe PanelNeil Macdonald, brand director, malt whiskies – Chivas Brothers (NMcD)
Annabel Meikle, Scotch Malt Whisky Society (AM)
Nick Morgan, marketing director for Classic Malts, Diageo (NM)
Richard Paterson, master blender, Whyte and Mackay (RP)
Dave Robertson, director of Easy Drinking Whisky Company (DR)Q: Will there be a growth in vatted malts over the next few months?NMcD: Vatted malt is already a significant category in a number of countries most notably France where it is a large, low price segment. I do not envisage significant growth in the short termNM: I agree. There is already a thriving vatted malt segment within the malt whisky category that accounts for several hundred thousands of cases. I can’t see this increasing spectacularly over the next few months, but clearly it has potential to grow further over the next few years.RP: That’s my view too. Unlikely I feel unless there is considerable promotional spend on this type of product.DR: There will be growth, but limited until Diageo reveals what the replacement strategy for Cardhu will be. Our range includes vatted malts and we will continue to grow, driving success via sampling and giving people a way to navigate through the plethora of malts out there. Diageo with its marketing muscle and dollars will drive the category in due course which can only benefit the wee guys like us.Q: Are big companies such as Diageo likely to drive the sector in the future?NM: Its a segment of the malt category in which a number of both large and smaller companies play – some distillers, some not. Some very small companies have created very successful and I assume profitable niches – such as Compass Box. Diageo already has a presence with brands such as Johnnie Walker Green label and it’s natural that we should look to increase our presence in a segment which we believe is
important to developing the malts category as a whole.NMcD: I don’t think it is necessarily the case that a big company needs to drive it, particularly if that company already has a strong portfolio of single malts and blends. I would hope that any new products in the vatted sector are driven by a clear consumer benefit rather than the availability of surplus malt stock. The larger whisky companies have tended to drive initiatives in vatted malt that support existing large brands eg the development of Johnnie Walker Malt or Ballantines Malt.DR: I think bigger companies have to look beyond the current handcuffs of single malt and seek to grow a pure/vatted malt proposition possibly based on J Walker. Given their needs to drive the business forward at all costs in tandem with the global downturn in ready to drink products
they must seek to innovate and drive value from all their priority spirits sectors – whisky is fundamental to that strategy.RP: I actually think it’s doubtful but Diageo may have other plans. Single malts will always remain the priority. Vatted malt products are just window dressing.DR: Diageo, as we all know, was late to the party on single malts and is now catching up with rare malts, aged malts, distillers editions, etc, but these whiskies are only of real interest to the aficionados and connoisseurs – a very small part of the global whisky market in the grand scheme of things.Q: Are vatted malts a good thing or a bad thing?AM: I think the development of the vatted malt market must be seen as a good thing – things that encourage diversity in the industry should be viewed without suspicion. If the public clearly do understand what a vatted malt is – I have no problem with its development in the market place. The quality must be maintained – and it isn’t perceived as a second best/ cheaper product etc. I do think there has to be more to let the customer know – I think the term ‘pure’ was very misleading and shouldn’t be used. NM:Providing the liquid is of a sufficient and consistent quality, and the proposition not value destroying, then of course they are a good thing. I believe vatted malts offer a route to bringing new malt whisky drinkers into the category with an offering that’s a bit more straight-forward, and less complicated than, lets say, a Laphroaig or a Lagavulin. I guess this is what the Easy Drinking Whisky Company is trying to do too – attract drinkers into the category on the basis of a simple proposition of taste.DR: What we have found is that once customers try the whisky they love it because they understand exactly what we are trying to do – help them understand flavour and create a ‘waffle free’ whisky environment that does not mean you have to worship the distillery, the master distiller
and the heritage of 250 years of expertise. Surely the only thing that really matters is if it tastes great – we fundamentally believe that this is what we do best and are finding great success with those that dare to experiment!RP: I think they’re a good thing even if they are misunderstood. They allow blenders to create a number of complex and interesting styles. To my mind they have been underrated for years. NM: And don’t forget – vatted malts have been around for more than 100 years. They’re not an invention, but a traditional offering with as much heritage and integrity as single malts or blends. Many believe, ‘though the case is not proven, that the first ‘blends’ were in fact vatted malts – and its certain that Usher’s first blend was sold as ‘Old Vatted Glenlivet’.Q: If vatted malts do have a place, is the SWA proposal to remove an association with a single distillery the right thing to do?AM: The recent rumptions have clearly shown how muddy the waters are and how few people didn’t have a very clear idea of what vatted malt actually was. I think the most important thing the SWA can do is to make clear the definitions of single, vatted and blend.NMcD: Less confusion for the whisky drinker is always a good thing!DR: Yes – no one that has previously sold a single malt of the same name should be allowed to create a vatted malt using that name. The Cardhu scam of changing the distillery name was ridiculous. Custodianship is a hugely important part of our industry and heritage – though we must be free to innovate and seek to push the boundaries. Ultimately the only arbiter that matters is the consumer – they will decide if the new product is OK by spending there hard earned cash on it.Q: Do we need to do more to let the customer know what the difference between a single, vatted and blended product is?NMcD: Yes, absolutely. Scotch whisky blends, vatted malts and single malts are amongst the finest spirits in the world with a precious tradition. The more we help our consumers understand the differences between these products and their respective strengths, the better.NM:Yes, definitely. There is an enormous amount of misunderstanding out there – OK – possibly not amongst the erudite and well-informed readers of Whisky Magazine, but to be frank they make up a very small percentage of whisky consumers in the United Kingdom – or anywhere else for that matter. We all know that consumer education and product understanding is category building.RP: It’s all about educating the consumer they must have total clarity on these styles whether it is a single malt, single grain, vatted malt, blend or deluxe. Education! Education! Education!Q: Would a large vatted malt sector help or hinder the interest and sale of single malts?NM: Help. Vatted malts can act as a good entry to the malts category for consumers who are intimidated by the complexities of premium ‘Chateau Malts’, and who find little relevance in the rather tired mainstream malt offerings currently on the market. They also offer a way to grow the malts segment that is relatively unconstrained by the inventory problems that all distillers either are, or will be, facing.DR: It would help the sector – it gives customers more choice and typically you would find overall quality improves. NMcD: The attractiveness of malt whisky has been its singularity. It’s one whisky from one place – the ultimate discovery with a lot of information increasingly available to perceptive consumers eg cask types for maturation. This singular strength will always make single malt the most discerning choice.Q: So overall do you agree or disagree with the original question?NMcD: I tend to disagree, because a lot of vatted malt to date has been very cheap and the products can be unpredictable and disappointing. The single malt category has already shown itself to be highly attractive to discerning drinkers looking for new taste discoveries. The challenge is to show why vatted malt might be preferable – after all why have hamburger when you can have steak!RP: The vatted malt is one way to attract new drinkers but until you remove the confusion new drinkers are hard to convert.AM: If the public clearly do understand what a vatted malt is – I have no problem with its development in the market place. The quality must be maintained – and it isn’t perceived as second best/a cheaper product etc. I do think there has to be more to let the customer know.NM: Vatted malts offer a potential route to attract new drinkers to the category who are intimidated by the complexities of malt whiskies – which as we know can start with the name and finish with the taste. But whilst we as a company will look at this opportunity, we will also continue to recruit new ‘malt interested’ drinkers to our premium single malt brands such asTalisker, Dalwhinnie and Caol Ila.