Shanken's Impact Newsletter October 15, 2020

EACH YEAR, IMPACT RECOGNIZES THE drinks industry’s best long-term performers with its “Blue Chip” Brands. To earn honors, brands must show at least 10 consecutive years of volume growth, or average annual compound growth of at least 0.5% from 2009 through 2019 with positive growth in at least eight of those 10 years. In addition, the brands must have maintained gross margins of at least $25 million last year. A total of 27 spirits brands earned Blue Chip honors, including five new winners joining the returning awardees. Whiskies, once again, are the largest general category, with 12 winners spread across Bourbon, Irish, Canadian, Scotch, and flavored segments. The Blue Chip whiskies range from some of the biggest brands in the U.S.—Jack Daniel’s and Fireball, for example—to rising representatives from the…

THE GLASS FIRE, WHICH ERUPTED SEPT. 27 IN THE HILLS ABOVE ST. HELENA, BURNED wineries and vineyards. It also halted harvest and may prove to be the knockout punch for the 2020 vintage in both Napa and Sonoma. The preceding LNU Complex fires in August had already impacted the vintage, as smoke lingered over the region for weeks when much of the year’s crop was going through veraison and thus acutely susceptible to smoke taint. The Glass fire only further jeopardized the vintage, and very few wines will be made this year as a result. “It is one of the saddest years ever,” winemaker Phillipe Melka told Wine Spectator. “Usually, harvest is a happy time. We have very, very little hope.” Melka consults for 25 clients throughout Napa and Sonoma.…

IN A YEAR LIKE NO OTHER, THE THINGS THAT STAND the test of time have been magnified. Drinks marketers report renewed gains for “tried and true” brands across the business, as consumers have gravitated to the solid and familiar in their selections amid the pandemic. At just such a moment, IMPACT’S “Blue Chip” brands list is more relevant than ever. It showcases the drinks franchises that have not only garnered momentum in the marketplace, but maintained that momentum over the course of a decade. In many cases, these same brands have accelerated this year from already impressive bases, demonstrating their ongoing importance within the industry. The Blue Chip spirits honor roll includes august labels like Crown Royal, Tito’s, Jack Daniel’s and Jim Beam, while the wine roster recognizes consumer favorites…

WITH CONSUMPTION UP BY 52% THIS year amid the pandemic, Patrón is experiencing product shortages in as many as 10 states. Vice president of marketing Adrian Parker said social distancing measures have complicated the production process at Patrón’s Mexico distillery, slowing output, even as the distillery has expanded its 2,000-member workforce by an additional 200 this year. Parker said the Bacardi-owned brand will need to manage outages and supply issues for the next few months and into next year. According to Impact Databank, Patrón’s U.S. volume soared 14% to 2.2 million 9-liter cases last year, and the brand jumped 54% in control states in the year-todate through August. “If you look at our core aged Tequilas, they’re up anywhere from 25%-75% over last year, which is incredible,” Parker recently told…

BROWN-FORMAN HAS KICKED OFF “Make It Count,” a new global advertising campaign for Jack Daniel’s, in what it says is a first for the whiskey brand. The company partnered with Energy BBDO to create TV, print, and out-of-home ads, plus social and digital activations in over 100 countries. The campaign tells the stories of everyday people who live with purpose. It kicks off with “First Timers,” a 60-second video shot in Kiev, Ukraine. Last year, Jack Daniel’s depleted 13.31 million cases, according to Impact Databank, making it the fourth-largest premium spirits brand worldwide.…

IN A RECENT TRADING UPDATE, DIAgeo said a strong performance in the U.S. market has propelled it to a good start to its 2021 fiscal year, which ends next June. “Our U.S. business is performing strongly and ahead of our expectations, reflecting resilient consumer demand and the spirits category continuing to gain share within the total beverage alcohol market,” said CEO Ivan Menezes, adding that increased restocking in the off-trade and the gradual reopening of the on-trade are contributing to momentum. In Europe, Menezes noted, “off-trade demand remains robust and the ontrade channel has largely re-opened with the easing of lockdown measures in most countries, although the risk of additional restrictions remains where infection rates are worsening.” China is also seeing improvement, with recovery in the on-premise, despite the slower…