Movin’ On Up

0408rm1To those of you on the front lines, selling or serving distilled spirits, it comes as no surprise to learn that rum is one of the hottest categories in the industry. Indeed, according to the new Adams Liquor Handbook 2004, rum gained 5.1% in 2003, to more than 19.5 million 9-liter cases. It is now the second-largest spirits category, comprising 12.3% of all spirits sold in the U.S., trailing only the vodka behemoth (at a 26.2% share of the spirits industry).

Why is rum shooting up the charts? One likely explanation is that it is a dynamic and diverse spirit with a “fun in the sun” image. Rums are made in exotic places, graced with brilliant hues, rich aromas and captivating flavors. Its approachable taste profile means that there’s no learning curve necessary to enjoy rum. It is a spirit that adapts well to barrel aging and is produced in an intriguing array of styles and types. Rum is also relatively inexpensive, another advantage it enjoys over other premium spirits.

APL RumPotPkg1Appleton Estate is featuring this new co-pack.

But the shared attributes that put rum on the map are its mixability and universally popular flavor. “Rum can be used in any cocktail that calls for either whiskey or vodka,” contended Chuck Shive, brand manager for Appleton Estate Jamaica Rum. “Premium rums have a taste and aroma that lifts them above any of the other light liquors when it comes to drink making.”

With the resurgence of the cocktail and strengthening sales of spirits on-premise, the category is a natural beneficiary. “Rum has always been skewed especially strongly toward younger legal age drinkers and the on-premise environment,” observed Reid Massie, marketing manager for Heaven Hill’s Whaler’s Rum. “Traditional on-premise consumers, empowered with more disposable income and knowledge as they mature, are now buying rum at retail outlets as well, further driving overall category sales.”

FLAVOR DRIVES CATEGORY

Undoubtedly the primary driving force behind the category’s extraordinary growth is the popular appeal of flavored rums. Where once there was but a handful of flavored rums, now there are dozens. It’s clear that the rum-craving public has taken to them in a big way. Today, flavored rums account for over 30% of the category’s sales, growing an astonishing 40% over the past 12 months, according to ACNielsen, which tracks sales in supermarkets.

Malibu 3 bottlesMalibu increased sales by 10.4% in 2003,
breaking the 1 million case mark for the first time.

Ilene Grimes, brand manager for Malibu Caribbean Rum, said that the explosion of flavored rums and vodkas make it perfectly evident that consumers want more variety in their spirits. “Flavored rums will keep the category highly competitive with other spirits by offering consumers the flavor options they desire.”

“The proliferation of flavored rums is also having the positive effect of bringing more attention and vitality to the entire category,” stated Tom Valdes, executive vice president of Todhunter International, importers of Cruzan Rum. “Bartenders are now featuring flavored rums in increasingly more cocktails, which surpass in every respect the tried-and-true rum drinks of the past. You now see bars and restaurants promoting Mango Mojitos, Pineapple Martinis, Banana Cosmopolitans and flavored rum Mimosas. They’re adding excitement to the market.”

“While consumers do bounce around trying new and different drinks, they are consistent in their expectations — they want cocktails that taste great,” observed Paul Francis, brand manager of Bacardi’s flavored rum portfolio. “Flavored rums deliver on this proposition. They offer a viable alternative to vodkas and flavored vodkas. They are drawing more consumers into the category, which in turn is causing our traditional rum business to grow in sales.”

EXPANDING PREMIUM PORTFOLIOS

This flavor explosion has caused most premium brands to expand their range of rums, particularly category leader Bacardi. Following the successful release of Bacardi O and Limon, the company recently expanded their portfolio with the introduction of Bacardi Razz (raspberry), Bacardi Vanila (vanilla) and Bacardi Coco (coconut). Each of the 70 proof rums are made from naturally flavored essences. Their recent product releases include Bacardi Ciclon, a blend of age-old rums infused with tequila and natural lime flavors.Bacardi

Bacardi’s year-old flavor lineup has played a part in the brand’s 4.4% growth in 2003 to 8.14 million 9-liter cases.

The Bacardi family of flavors has been well received. Their combined impact added 4.4% to the brand’s already sizeable volume in 2003, which stands at more than 8.1 million cases.

Launched 20 years ago, Malibu Caribbean Rum continues to be the U.S.’s leading brand of coconut-flavored rum, increasing in case sales by 10.6% in 2003. Malibu recently extended it franchise with the introduction of Malibu Mango and Malibu Pineapple Caribbean Rums. Both are made on a base of light- and full-bodied rums that are blended together prior to the addition of natural fruit flavorings.

Grimes noted that the highly recognizable Malibu packaging presents a tremendous competitive advantage when releasing brand extensions. “We tried to stay true to the Malibu bottle while at the same time creating two totally distinct products. The packaging of the new Malibu flavors incorporates the same recognizable logo and bottle shape, only we made the packaging more vibrant and colorful.”

Mango 750Cruzan recently launched this Mango Rum,
and has had notable success with its portfolio of tropical flavors.

One of the pioneers of the flavored rum category is Cruzan. With the additions of Cruzan Raspberry and Cruzan Mango to the line, the ever-expanding portfolio of flavor now has eight entries. Made in St. Croix in the U.S. Virgin Islands, the 55-proof rums are triple-distilled and aged in oak bourbon barrels between two and three years. After aging, they are filtered to remove any color and natural flavorings are added to create the finished product.

The company is also successfully marketing Cruzan Rum Cream. The light-bodied, 30-proof liqueur uses Irish cream, caramel and vanilla, as well as rum from St. Croix. The Cruzan line of rums is experiencing notable success, increasing sales by 11.8% in 2003.

TRYING TO STAND OUT

In 2003, Allied Domecq launched Kuya Fusion Rum. Produced by Kahlúa, Kuya is made from a blend of gold rums that are infused with natural citrus flavor extracts and an array of spices. The 70-proof rum is best described as a fusion between a classic spiced rum and the new breed of fruit-flavored rum.KUYA bottle

Kuya is best described as a “fusion” of a classic spiced rum and a fruit-flavored rum.

According to Suzy Kilgore, brand manager for Kuya, Allied Domecq was looking to create a product that would differentiate itself from the competition. “Kuya offers consumers an entirely new taste experience. In fact, fusion rum is an entirely new category, one that we expect will be a long-term success.”

MtGayMount Gay recently introduced Vanilla
and Mango Rum line extensions.

Of the various brands of Barbadian rum, the oldest and most recognized is Mount Gay. While renowned for their estate-produced dark rums, the 300-year-old producer has recently entered the flavor category with the release this year of Mount Gay Vanilla and Mount Gay Mango. Both of the 70 proof rums are singular creations, a blend of best-selling Mount Gay Eclipse rum with natural flavors — Madagascar vanilla and Mexican mangos.

“The two new rums from Mount Gay give consumers a clear choice and an opportunity to buy up into what will hopefully become a new segment of the category — premium flavored rum,” observed Kenya James of Remy Amerique and Mount Gay.

Whalers.casecardWhaler’s line of four flavors grew a hefty 13.3% in 2003.

Another popular brand closely associated with the flavored rum category is Whaler’s. Sales of these classic Hawaiian spirits grew a hefty 13.3% in 2003. Whaler’s Original Vanille is a dark, aromatic rum infused with natural vanilla flavors. The Whaler’s line also includes Killer Coconut, Pineapple Paradise and Big Island Banana.

ParrotBay.MangoCaptain Morgan’s Parrot Bay
just debuted Pineapple and Mango flavors.

Captain Morgan’s is the fourth largest spirits brand in the country, with sales of more than 4.2 million cases (up 7.0% in 2003), and second in the rum category. This year Diageo expanded the Parrot Bay range with the introduction of Captain Morgan’s Parrot Bay Pineapple and Captain Morgan’s Parrot Bay Mango flavored rums. Each is made from a blend of Puerto Rican rum and natural flavors. The new 48-proof releases join the original Captain Morgan’s Parrot Bay Coconut.

RedRum is also a charter member of the flavor category that is continuing its winning ways. Introduced in 1997, RedRum is made in the U.S. Virgin Islands from barrel-aged rums and an infusion of natural mango, pineapple, coconut and cherry fruit juice. The 70-proof rum has built an on-premise following based principally on its mixability.

Domaine Charbay, a family-owned artisan distillery located in St. Helena, CA, has created the first American pot-distilled flavored rum — Charbay Tahitian Vanilla Rum. Priced at $28 (750 ml), this superpremium offering is triple-distilled from a proprietary blend of Hawaiian and Caribbean sugar cane syrup and infused with Tahitian vanilla beans. The 70 proof rum is now available nationwide.

RonRicoRonrico’s Vanilla, Pineapple Coconut and Citrus rums debuted last year.

Puerto Rican producer Ronrico has extended its range with the 2003 release of three new flavors — Ronrico Vanilla, Ronrico Pineapple Coconut and Ronrico Citrus. The trio is made at the Serrallès Distillery from a premium blend of barrel-aged rums and an infusion of flavor extracts. The Ronrico line has a suggested retail of under $10 for a 750 ml bottle.

White Rock Distilleries has just introduced Coconut Jack into selected major markets nationwide. A product of the Virgin Islands, the new coconut-flavored rum comes in an exuberant white bottle with a tropical scene. The brand has a suggested retail price of $12.99 for a 750 ml bottle and the company hopes to offer it in 20 states by the end of the year.

For its part, Admiral Nelson’s Rum has just added a Raspberry flavor to its lineup, which also includes Spiced, Coconut and Vanilla flavors. The brand has just launched a redesigned web site, www.admiralnelsonsrum.com. Besides historic information about the British naval hero Nelson, the site features favorites such as cocktail and food recipes, party planning tips, music and games.

Another line of flavored rums that carries a moderate price tag is Marimba. Imported from the Virgin Islands by Oregon’s Hood River Distillers, the Marimba range of 70 proof rums includes Tropical Tease, a blend of mango, guava, passion fruit, peach, grapefruit and banana, Orange S’Cream, Spiced Breeze and Lemon Squeeze.

AGED RUMS FIND A NICHE

Añejo rum swirled and sipped from snifters is becoming a common sight in many bars and restaurants, one indication that the category has ascended to the next level. Enthusiasts are enjoying superpremium rums straight — no mixers, no ice.

There is a cachet surrounding aged rums, similar to what is associated with añejo tequilas, single malt Scotch and alembic brandies. Smooth and luxurious, aged rums are elegant, sophisticated spirits best appreciated neat. Drinking patterns are changing and añejo rums are clicking in a big way.

“The complexity and style of the different islands and regions produce high quality sipping rums that vary dramatically in taste profile,” explained Kelley Spillane, executive vice president of Castle Brands, importer of Sea Wynde Pot Still Rum. “Consumers are discovering more and more the wonderful taste and body that comes with enjoying these fine rums neat or on the rocks.”

Matt Gilmore, brand manager of Matusalem Rum, believes that the rum category has years to go before reaching its fullest potential, but that it’s soaring popularity means good things for añejo rums. “The trade is becoming more educated about rum, much in the same way that vodka evolved in the minds of consumers. Rum is not the rumbuillon people used to drink in college. In fact, sipping rums play right into today’s consumer taste preferences.”

Chuck Shive of Appleton Estate Jamaica Rums has observed that consumers and bartenders alike are discovering that what they thought were only “sipping” rums actually produce more flavorful and character-laded cocktails. “The overall value that you get from aged, premium rums far exceeds the relative value of any other spirit. Consumers are beginning to appreciate and discover the affordable

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