Lessons from the Biggest Brands in the Booze Business – Blue Chip Brands

Savvy marketers know there is plenty to learn from having your finger on the pulse of the market. To keep up with the top performers, marketing professionals rely on industry experts to rank brands by growth. One of my favorite rankings comes from Impact Databank and their annual ranking of “Blue Chip Brands.”

Published each year in Market Watch Magazine, these “Blue Chip Brands” have shown staying power over the last decade, reporting average growth rates of at least 0.5% each year of the past decade, plus reporting a gross margin of at least $25 million in 2014. For this reason, these are important brands to watch and learn from. Rounding up 58 brands across all three categories of wine, beer and spirits, these results act as a barometer of the current booze industry. Let’s see what valuable marketing lessons are hiding in this year’s results:



Spirits – Market Innovation Appeals to Consumers

The three largest Blue Chip spirits brands all come from the portfolio of industry giant Diageo and include Smirnoff vodka, Captain Morgan rum and Crown Royal Canadian Whiskey. Surprised to see Crown Royal at the top of the list? They credit the brand’s growth to the recent success of their newly launched Crown Royal Regal Apple, which is anticipated to hit a million cases by the end of 2016. This new flavor innovation is a modern twist for a brand that was in need of some serious freshness.

Captain Morgan also credits innovative brand extensions for their continued growth, which included the launch of “Cannon Blast,” an enticing blend of rum, citrus, chipotle and jalapeño. Intended to be consumed as a shot, Diageo has identified their target consumer’s desire for “shot occasions” and are capitalizing on the market’s wish for innovative flavors and drinking occasions.

While overall growth in the US rum market has been pretty much flat since 2010, the high-proof, vanilla and cinnamon spiced rum from Sailor Jerry has seen 7% annual growth over the last five years. It’s likely due to Sailor Jerry’s embrace of the easy-to-mix cocktail wave. Consumers are enjoying this spirit both as shots and stirred up with their favorite mixers, such as root beer and ginger beer.  Old fashioned rum has been revamped for the millennial audience.

Also capitalizing on the “shot occasion,” the Smirnoff vodka brand developed their Smirnoff Sour Shots lineup in 2015. With packaging that glows neon in black light, this innovative Smirnoff brand extension stands out on the shelf, but fits in with the current flavor-focus of the vodka category.

smirnofff sours


Wine – Price Points, Premiums and Advertising have Consumers Taking Note

Thanks to its affordable price point and extensive distribution channels, Gallo’s ubiquitous Barefoot Cellars is nearly twice as large as any other wine ranked for the 2015 Blue Chip awards. With sales of more than 17 million cases in 2014 alone, Barefoot boasted an average annual gain of 43% over the last decade. That’s serious growth.

Other notable wine brands include Ruffino and Rex Goliath. With over 12% growth in 2014, Ruffino crossed the million-case threshold with a wine that retails for just about $15. According to Constellation’s global marketing director of imports, Scott Ehlirch, “Italian wine continues to premiumize and outpace the category,” thanks to the US market’s willingness to trade-up for wines over $10 at retail. And Master of Wine, Dr. Liz Thach, explains: “The sweet spot for wine pricing is $9 – $11.99, but Americans are trading up and spending more on wine.”

As Americans opt for higher priced bottles, wine marketers are taking note and launching higher-end extensions of their tried and true brands. Cavit, known in the US as the top-selling Italian wine, only reported modest gains of their $8 per bottle Pinot Grigio. With only 1% growth in this under $10 segment, Cavit launched a $13.99/bottle under their Alta Luna brand.  Bottom line: consumers are willing to pay more for a bottle of vino if there is a greater perceived value, whether it comes from packaging, flavor or appellation.  Everyone’s seen Barefoot and Cavit on shelves of local retailers. Innovate your brand with higher-level, premium offerings.

Finally, it is important to note that while the Australian wine segment continues to fight for US market share, [Yellow Tail] remains a force to be reckoned with. At more than twice the size of any other imported wine brand, Deutsch-imported [Yellow Tail] reports sales of more than 8 million cases each year.  This is certainly due to their impressive marketing campaigns, with an annually increasing budget and some of the largest ad spends in the industry. In a December 2015 ad published in Beverage Media, [Yellow Tail] appealed to retailers by boasting, “this fall, [yellow tail] will generate over 16 million impression in New Jersey” alone. This brand is truly not afraid to spend money to make money.

Friends Having Dinner Party


Beer – Innovative Craft Brews and Premium Imports

It’s no surprise that craft beer sales are on the rise across the country. In fact, the craft beer segment continues to swell as the Brewer’s Association reports 2014 annual sales of 300 million cases, over 17% growth in one year. This is certainly due to their innovation of new flavors and styles, and their willingness to bring new products to market that truly excite consumers.

But the market does not only belong to craft brews. Imports are also fighting for market share in the beer segment. Imported beers are outpacing domestic beer growth, earning a 1.5% growth rate in 2014.  This means import sales are up to about 406 million cases a year, or 15% of the total beer market. While that may have seemed impossible a decade ago, it is because imports, like craft beers, have a perceived premium with consumers. Megabrewers know this, and they continue to acquire craft and import brands as fast as they can. Despite the market share losses they’ve seen for their flagship light brands, Anheuser-Busch InBev has seen steady growth with their ultra-premium, imported portfolio. Take a look at their Stella Artois brand:  this Belgian brew averaged over 25% growth each year of the past decade. To further capitalize on this, AB InBev is continuing to innovate with the launch of Stella Cidre, a hard apple cider that is exactly on point with consumer demand.


Innovative flavors, eye-catching packaging, perceived premiums. These are the tools being used by the biggest brands in the booze business. Monitoring the success of our competitors is a great way for PR professionals to understand the current climate of the market. By observing what our competitors do right, we can adjust our marketing tactics and increase growth within our own brands, too. Cheers to that!


Photo Credits: Smirnoff.com

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