Gin has emerged as the most vibrant and dynamic spirits category in recent years, enjoying unrivalled growth thanks to retailers giving it more shelf space, bartenders showcasing its versatility, wholesalers keeping the trade stocked with interesting variants and commentators spreading the word of its greatness among drinkers.
OLN teamed up with sister titles Harpers Wine & Spirit and Drinks International to host the second annual Think Gin event, where hundreds of delegates not only thought about gin, but talked about it, bought it, sold it and, above all, drank it.
Nicholas Cook, director general of the Gin Guild, told the delegates: “The gin craze is most definitely in full swing and doesn’t show any signs of slowing down.
“Initially the gin renaissance was led by bartenders. But it is now consumers leading this interest, with often surprisingly well informed and curious consumers seeking out something new, exciting, or a gin which has a production methodology, botanicals or back-story that makes them want to find out more.
“Having discovered, or perhaps rediscovered, the glories of gin, consumers have now moved into collector, experimental or treat myself mode, often seeking out and trying gins they have not seen before. This is certainly good for individual brands, especially those at the top of their marketing and promotion game, but also for the gin category as a whole.”
Cook added: “Small brands have helped create a buzz for the whole gin industry, and there hasn’t been a spirit industry conference recently that does not feature – with envy and amazement – gin and its growth.
“Interest in the profusion and choice offered by the multiple brands encourages consumer interest and experimentation and, in turn, has encouraged exponential growth in new brands and distillery start-ups.”
Gin is such a vibrant and opportunity-laden category that it seems everyone and their mother is trying to muscle in, and a new small-batch gin is seemingly released every other day.
This is one of the elements that makes gin so exciting and has driven such growth, but it can be confusing for buyers to sift through the multitude of SKUs and curate the perfect gin range that allows them to maximise returns.
So OLN and Harpers brought together some leading operators from across the on and off-trades to share best practice on how to create a strong range and ensure the category continues to grow.
Waitrose BWS category manager Anne Jones, co-founder of online retailer Gin Kiosk Emile Ward, Mitchells & Butlers spirits buyer Jez Manterfield and bar operators Alex Wretham and Sam Mitchell joined us for the panel discussion.
Jones said: “Gin is such an exciting category and customers are definitely working with the trend. We have a really great selection of craft gins and craft products, but our top-selling lines are still the standard brands that you might expect to see.
“Our split between what we call premium and what we call standard is about 50/50 in sales. But within premium we include Tanqueray and Bombay, which I don’t know if other people would or wouldn’t. So, it’s about 25/75 if we include them as standard.
“Our customers love to see the choice they have. They love to see exciting new brands, but obviously the majority are still buying their standard product. It enables us to explore their repertoire and we spend a lot of our education and magazines and publications and content to encourage people to add one more gin to their repertoire.
“In terms of the customer evolution, people are looking for new and they are looking for interesting and that means we have to work really closely with our new brands on their entire brand lifecycle. If the customer wants a new brand that is great, but after six months that might be another new brand if you haven’t actually managed to drive enough loyalty. So I think we have a few really strong craft gins, but there is also a real cycle that happens.”
When asked if Waitrose stocks more niche brands to build itself up as a gin destination rather than to drive profits, Jones said: “What we want to drive is loyalty, so a customer might come in because you stock Daffy’s, but three times out of four they’ll buy Gordon’s. But actually they are still coming in and buying their Gordon’s from you because they see you are a good, credible gin retailer.
“With gin we want to be market leading. We want to be the drivers of the category and we want to make sure we are a destination for gin-interested shoppers and people who are in the on-trade so we balance that off.”
Jones said there are some top-end products that are must-haves, where Waitrose sacrifices a bit of margin and has to make it up on some of the volume brands.
Everyone has different challenges when curating a gin range. Independents and specialist bars can arguably afford to stock quirkier SKUs than the supermarkets and big pub chains and hand-sell them, while online retailers could easily have thousands of lines.
But Ward likes to keep his range relatively tight and focused, although he does focus on the more niche, up-and-coming brands. “We are in a unique position because we are online and we could probably stock everything in the world if we wanted to,” he said.
“We have learned the power of curation is important to us and is what makes us stand out. When a gin comes across our desk – we maybe see five or six a week – we are looking for high quality, above all. We are looking for good branding with a great story and genuine people that we can actually connect to and understand and they are transparent with us as well as our customers.
“We have a different approach to supermarkets. What we are seeing a lot is people want craft, want new, want something intriguing. So we tend to prioritise that.
“But we do also see that tonic is extremely popular and different brands of tonic and pairing tonics with different gins. Everyone is really interested in mixing gins with other ingredients.
“We are seeing a lot of call for international gins. We are also seeing a great shift in regional. Anyone who is doing something in a remote corner of the UK is very appealing.”
Much of the innovation in gin is launched in the on-trade, where consumers can afford to experiment a bit more as they are buying just one serve rather than an entire bottle.
When asked what the different channels can learn from one another, Wrethman, founder of gin bar group Charlotte’s, said: “The off-trade quite often picks up from the on-trade because it can see what people are buying and enjoying and what is being sold.
“It is possible that people are after new, new, new, rather than having brand loyalty with some of the craft stuff. It’s important for us to be consistent and make sure we are sticking with brands if they are quality rather than just having the temptation to constantly change the list and then having to do the work all over again. I don’t think that is a sustainable model.”
Manterfield, who buys gin for 1,700 on-trade outlets across the UK, added: “The growth in range on offer in the off-trade keeps us on our toes in regards to our ranges. Consumers are going to want to be able to purchase in the on-trade what they can purchase in an off-licence or supermarket and you are going to want to be able to match those trends to a certain extent – as long as it is a measured approach and if the spirit deserves to be there.”
Jones is wary about splitting the market into on and off-trade too much because she believes everyone should start from the position of the consumer. “We do some fairly deep-dive insight into who our customer is, who we are targeting and what they want. It is naïve to think your customer is your customer. All of our customers shop everywhere. They drink everywhere. They go to the on-trade and they go to the off-trade and different outlets in all of those.
“Being a multiple retailer, we have to make sure we tailor to both those markets. What we do learn is that the trends start in the on-trade. People are more willing to experiment when they are only buying one serve. They want it to be created properly, rather than do it themselves. We can take that away.
“We run tastings in-store. We do a showcase every year and within that we will take simple cocktail serves and the garnish thing has been very important for us. It’s been easy for us to say ‘put some rosemary in this gin’. It’s an easy message and they will take that away and think they have created something special.
“Within that showcase we encourage people to feel the same way they feel about gin in the on-trade. Whether that is through serves, through tastings and content and giving them a very moderate discount, that encourages them to trade up to more exciting products.”
Jones added: “Customers want to see products in as many touch points as possible. That’s press, PR, on-trade, off-trade – because to a customer familiarity is important. Yes, they want new and exciting but they need to see that new and exciting in three or four places before they will consider purchasing it because they need some kind of confidence with it as well.”
The Holy Grail for many retailers is trading shoppers up through the range to earn greater margins on premium brands.
Indies can do this by hand-selling, but larger retailers have to be creative as they don’t have the staff to hand, and convenience operators that do not employ gin experts can learn from retailers such as Waitrose, which are strong in this field.
Jones said: “There are a couple of ways we can trade shoppers up. There’s the easy short-term way and then there is the long-term, sustainable way. The easy, short-term way is the word that no one likes, which is promotions, and then there is the long-term way, which is using promotions cleverly.
“So we will run a showcase with 20% off selected gins and we will try to select those to be gins that are interesting but also come to about the right price point and encourage people to trade up and try something they maybe wouldn’t have tried before.
“We don’t have the same hands-on opportunities that bars have, but we do use tastings as much as possible. Online we use content and email to run specific promotions that will encourage people to trade up.
“And then we are lucky that we have a good set of publications. We do eight-page pull-outs on gin every year, so we use all that content to get to a normal Waitrose shopper who might not already be buying gin from us. That’s where we start to add the extra depth into product stories and new lines – encouraging them to use specific serves. With My Waitrose we can target promotions at people who we know, for example, already buy a gin but only buy Gordon’s. We can send them specific promotions on something that is a little bit more interesting.”
To sum up, when asked what makes the perfect gin range, Jones said: “A credible offering that gives something for everybody. It has got what you would expect to see at the value end at a good price and then some really exciting, new niche brands at the top end that deliver credibility for us but also deliver sales.”