And are that fewer of them are even making that level of investment in a bottle, with this year’s First Drinks Report suggesting off-trade sales were down 11% year on year, a figure which seems even more acute when you consider the pace of drinks duty increases.
The spectre of Baileys looms large over a category in which much of the competition comes from lower-strength price-fighters. Baileys itself is frequently discounted at this time of year by retailers who recognise its power as a footfall driver in the Christmas run-up. Even independents are prone to getting dragged into the annual Baileys price-drop challenge.
Richard Parrish, BWS manager at the Dorset independent supermarket Dike & Son, says it is planning an early price blitz on the brand to get people through the door.
“We’ll have Baileys at £8.99 for a weekend and advertise it locally,” he says. “We could sit on the stock and make extra margin in the longer term but people will remember that deal and come back. It’s good way to build footfall.”
Diageo’s strategy to get out of the once-a-year discount spiral has taken many forms over the years: advertising with hunky young men to position it as a unisex drink; Baileys over ice promoted as a summer serve for year-round appeal; a short-lived Baileys RTD; and the range of flavours, two of which occupy slots in the top five off- trade cream liqueurs in their own right.
“We did the flavours but they didn’t sell too well,” says Parrish at Dike, which now lists only the main flavour in a limited cream liqueur range alongside CWF’s Pastures and Diageo’s Sheridan’s – and this for a retailer that has a diverse and adventurous drinks range for a mainstream supermarket.
“We had the latest one, Biscotti, and ended up discounting it to sell it through,” adds Parrish. “Pastures flies out, but it’s going out at £5.59 a bottle anyway.”
With the Baileys flavours, like all range extensions, there was bound to be an element of consumers trying one once or twice and then reverting to the one they were quite happy with all along.
Rosalind Nash, senior category development manager for convenience at Diageo GB, says that “Baileys flavours drive category growth by recuriting new and lapsed shoppers,” and adds that “34% of flavours buyers had not purchased Baileys in the past three years”.
The brand recently launched Orange Truffle as a Tesco exclusive. But the Baileys flavour programme aside, where is the innovation to rescue the category? First Drinks is planning some sort of activity in 2013 for Campari-owned Carolans, although it was unable to share its plans at time of writing – but maybe that will bring some energy back to the category.
Global Brands is slowly nudging its Thorntons chocolate-flavoured cream liqueur into the market, but without the massive budget of Baileys – or for that matter brands in other categories such as, say, Lambrini, which are arguably competing for the same audience.
“Although the category is experiencing decline, it’s not one to be overlooked,” says Global marketing director Simon Green, who admits some brands are “struggling as consumer interests shift to more modern, innovative flavours and serve options”.
Green thinks Thorntons’ chocolate flavour will help it mine sales at times of the year other than Christmas, such as Valentine’s Day, Easter and Mother’s Day, and by promoting it as an ingredient in cocktails and deserts. “The annual cycle is wider than for some more traditional cream liqueurs,” he adds.
Thorntons is coveting similar territory to Mozart, the chocolate liqueur with solid distribution in top-end independents and style bars.
“There is lack of innovation in the category and the distribution of quality products in the sector is limited,” says Nick Gillet, managing director of Mangrove, Mozart’s distributor. “Mozart is more expensive to produce than others due to the materials involved. We focus on the raw materials and encourage tasting, as this is very successful.”
Another cream liqueur brand which favours consumer sampling is Amarula, the South African liqueur which has made repeated plays at challenging Bailey’s domi- nance over many years.
Katie Jones, brand manager at supplier Cellar Trends, says a recent programme got the brand into the hands of 20,000 consumers. “Feedback following the sampling demonstrated great interest, with 64% of consumers saying they would buy the product, compared with just 7% before sampling.
“It is key that brands conduct consumer engagement activity to drive the category and open up the sector to new consumers.”
But perhaps what cream liqueurs need more than anything is a stalking horse brand to come in with a substantial above-the-line budget to provide some real competition.
As for Baileys, its marketing plan has gone back to basics, with a new Christmas campaign overtly aimed at women, which it sees as the category’s core audience – and its future as well as its past.