Premium and super-premium brands have been integral to vodka's recent spurt in sales, but as
fuel, petrol and food costs continue to rise, is this going to change?
OLN asks key industry players whether
sales of mainstream, lower-priced vodkas will grow at the expense of more expensive, niche brands?
Senior brand manager
"Even in changing economic climates there will always be consumers who are willing to pay higher prices for premium brands.
"However, the majority of consumers will still want to enjoy their social life, but at a lower cost, which is why we believe mainstream brands will become more important. Consumers don't always want to trade down to own-label products . They still want a credible brand
but at a lower cost, such as Red Square Vodka."
Off-trade sales director
Whyte & Mackay
"There will always be a place for super-premium and mainstream brands .
"Discerning customers will always want to trade up to the premium end, but there will always be the customer who wants a cheaper but quality alternative, which is still a quality pure grain liquid but at a more accessible price."
Spirits buyer, Asda
"Despite concerns over the economy, the move towards drinking at home means customers are experimenting with super-premium brands, flavoured and regional [ie Polish] vodkas, so there's certainly scope for Asda to increase lines and volume, if demand dictates."
Marketing director, First Drinks Brands
"Retailers need to give people clear reasons to buy and why they should pay more. With rising costs and inflation we're going to see belt-tightening, and people will buy more own-label and cheapies.
Brands that will do well need to
communicate clear reasons why people would buy them. Consumers will get selective . Premium brands are growing really well and I don't see any signs of that slowing down ."
Marketing manager, Smirnoff
"It varies by consumer. Some will tighten their belts and this might affect choice of spirits, for others it won't. We still see growth in super-premium and ultra-premium brands, which are big opportunities for the future. Retailers have got to get the right portfolio to take advantage of that."
Marketing development director
"Vodka has been in dynamic growth, both in the off
and on-trade, for many years in the UK, and this trend looks set to continue. It is being driven by a number of factors, including the increasing popularity of premium and super-premium brands. The premium vodka category
grew 31.2% in the off-trade
by value in the year to June 16 , according to Nielsen, with consumers increasingly buying into the premium credentials of brands such as Wyborowa and Stolichnaya."
PR manager, Hi-Spirits
"People who have always bought premium brands are going to keep buying them. It's about making the statement: 'I can still afford to buy this'. They're not going to sacrifice image."
The independent's approach
Ian Loftus, The Bottle, York
The basement of The Bottle in York's touristy
Shambles district features 1,000 spirits in glass cases. Among that impressive collection
are between 40 and 50 vodkas, none of which are mass-marketed brands.
"We don't sell any mainstream vodkas because customers can buy them for
less in the supermarket," says Loftus. Instead, boutique brands and imported rarities grace the shelves. "We sell a
lot of vodka. We've always done well with Zubrowka Bison Grass Vodka, it's been a best-seller for the past few years," he adds.
Currently establishing itself as a cult favourite among customers is Vodka 666 - a Polish vodka with a hint of cherry flavour, first bottled on June 6 2006 at 66.6% abv. "Over the past year we've sold tons of 666. It comes in a devil-shaped bottle and we've created a display on the wall opposite with pictures of the The Little Devil statue in Stonegate."
Customers are attracted by what they
top-quality vodkas with a higher price tag, according to Loftus. "We sell more vodkas like Belvedere and Grey Goose around the £30 mark than the cheaper ones like Absolut. Shoppers tend to go for quality, and our top
sellers are premium vodkas."
Cash in on the rising take-home trend
A report produced for Pernod Ricard by Alcovision
has shown growing numbers of drinkers preferring to drink at home. Why are people opting to drink away from pubs, and how can retailers cash in on this trend?
The report reveals:
Over time vodka's volume is slowly shifting to the off-trade from 48% total vodka volume consumed in the off-trade
in the year to December 2003, to 51% in December 2007.
This is mainly driven by niche vodka (from 57% in December 2003 to 90% in December 2007). This category includes specialist vodkas like Organic Utkins UK5, Akvinta from Croatia and single-vintage Kauffman Selection.
However, vodka consumption is growing in night clubs (from 8% in December 2005 to 11% in December 2007) and decreasing in traditional and community pubs (from 15% in December 2003 to 12% in December 2007), and this trend is driven by mainstream vodka such as Red Square and
In the off-trade, 32% of
vodka-drinking occasions are around "up beat" moods (9% more than in total spirits), and one-third of vodka drinking occasions
involve couples. Retailers should capitalise on such data,
by sourcing vodkas that would be attractive to couples, or selling the ingredients for suitably romantic sounding cocktails