Diversity of rums, diversity of markets – An Italian Perspective on the European rum scene
It has just been issued, the interesting document published by Authentic Caribbean Rum called The Decade of Rum, and its data and arguments are the source of thousands of themes on different markets. Research is based on IWSR, the most recognised audit on the On Trade channel, a good indicator for rum trends.
First of all it’s important to note how different European markets are. From a global view, it seems that the last decade has been that of rum, receiving the highest growth among all categories, +40% (2000-2010), from 100M 9Liter cases to 142M, pushed by the doubling of the Asian market with the largest area of volume, with 63M (Americas 54M, Europe 21M). To put this into perspective, Italy represents only little more than 1M cases, 1/100 of the world, and Pampero, the omnipresent leader produces 300k cases. Brugal, easy to see almost everywhere pushes out 40k cases.
Will the next decade be taken by rum as well? Let’s have a look; the title of the documents is crystal clear.
To compare countries is necessary to start from their stories and cultures: in the UK, it is normal to have heavy presence of British rums from Jamaica and Barbados, in France we have rhums from French Antilles, in Spain big presence of rons from Latin Caribbean like Dominican Republic, Venezuela or Central America. Multinational companies, on the contrary, are present in almost all markets. Germany and Italy never had colonies in the tropics and have always handled their own rum. The first German ‘rums’ like Verschnitt which contained rum from Jamaica in late 19th century and they hadn´t had any additions to this until just a few years ago. In Italy, after WW2 dozens of bottlers and importers started to buy bulk from Jamaica, and no real brands surfaced until the 80s and 90s with the ‘ethnic’ bars trend featuring exotic mood and drinks.
But how are these European markets evolving, with no real rules and untouchable traditions like whisky or cognac? Is Rum moving as a pirate, or as a cyclone? It is like the eye of a storm, as in the middle of the decade, looking 5 years into the past and 5 years onward.
UK: The Anglo-Saxon world is more sensitive to trends, even when these trends are accurately studied by marketing. As with the USA, the booming category in the UK is Spiced Rum, with Morgan Spiced, Sailor Jerry, Kraken and other small brands, which are quickly developing their own products. Mount Gay from Barbados is the Off Trade leader, and Bacardi is moving far from a ‘rum’ identity. Other big players are from British islands, even more so because the Caribbean community is large in the UK. Rum is gold, to be enjoyed alone or with ice, and rum means ‘party’. White rums are not so popular, even if the Mojito is in growth. The bartender community is super strong and it is thought that the category is moving towards ‘out of home’ consumption. Very old rums not yet conquered the consumer. They probably don’t really reflect a dream, that is to say they are not sufficiently aspirational perhaps but this is changing. Diversity and premiumisation will be the opportunities for the future, and training of the trade and consumer to let them know how potentially wide the range of rum is.
France: The French world is more culturally linked to the French Antilles, part of France itself. Martinique and Guadaloupe are upper-class destinations, not only for all inclusive resorts, but even for typical ‘exploring’ of the French experience. Rum is ‘agricòle,’ meaning they emphasise the agriculture and raw material behind it and rum is visited in museums through guided tours. It is presented as an important part of their history. In France rhum has been always present in all market levels, but up until ten years ago there was no future for growth, the category was so mature that it was thought to be exhausted: white agricòle rhum was the spirit of Grandfathers, in the small cabinet close to the sofa. In a few rhumeries in St. Germain rum was popular as an out of home drink. It did not appeal to young people, which drink pretty much anything else. The same happens with grappa in Italy or tequila in Mexico. The high-level aged products reflected in the cognac culture, packed in ‘grandiose’ golden decanters and in ‘balloons.’ However, things are changing, and rapidly: France, dominated by the whisky category, is becoming more and more interesting, pushed by the passion and business of two companies, Dugas and La Maison du Whisky. Rum is also taking back its glory. White rhum is developing a new trendy style with a similar look to vodka, with attention on premium agricole brands and flavours, and lower degrees unlike the traditional range of 55° to 40°. There is a boom of mellow rounded Latin rums, new trendy ‘second-ageing’ rums, independent bottlings, and some attention to new provenances, like Clairins from Haiti. Cocktails are the new thing, with dozens of cool places to be in Paris that have a deep cocktail culture and a high level of mixology technique. Even wine & liquor shops are growing, mostly owned by young passionate owners, always up to date. In the next 5 years rum will grow more and more, let´s go to Paris to have a look!
Spain: After the rum ‘orgy ‘ during the first decade of the millennium, the category is now opening up for gin. In the document data, Spain moved from 3.2 in 2002 to 3.9M cases in 2012. Exploring this more in detail, we can see that Spain actually reached 5M cases three years ago, showing a negative trend. Almost all rum is golden rum (89%) from Latin America and multinational companies. Rum was always in a long drink, rum & cola above all. At least 3M cases (of 3.9M) are consumed with cola. White rum is even less popular and Mojitos are not consumed as much as in Italy. It is not an easy thing. Spain needs to discover new concepts and opportunities. There is now some feeling that Gin too is on the wane and perhaps this is the time for a new wave of rums.
Germany: After the last Rum Festival and Bar Convent 2013, we can see that the enthusiasm and consensus is that Germany is where the big opportunity is for rum brands: market is still to consolidate, high desire for consumption of cocktails, high desire to identify new trends, high interest in diversity and news, and general ‘Deutsche’ determination. Rum grew 26% in ten years, +34% in the aged category, and -10% in traditional Verschnitt. All in all, there has been a great growth in value.
Italy: As previously mentioned, Italy never had a colony in the Caribbean, so the discovery of the rum culture and an exotic world didn´t arrive until the 80s and 90s, mostly after the ‘93 economic crisis. Before that the only brand available was Bacardi, and it didn´t spark much interest. After decades of Italian ‘aperitives’ and old school drinks, a movement started with ethnic bars: Caçhaca, Tequila, and Rums arrived, and they passed through the typical first phase of every category: big players took over the market with big investments to close doors to competitors and squeeze out as much as they could with advertising and ‘fake’ perfect serves for young spenders. In the 90s Tequila became the ‘salt and lime’ shot or the ‘tequila boom boom’. Rum was promoted in shots only, with an afterthought side shot of pear juice. Usually categories fall asleep after this point, until the second phase begins: that of re-discovery, diversity, the rush for innovation. This is now happening with gin. Nevertheless, rum never really died. During late 90s and beginning of the 2000s it had another beneficial development based on cigar fashion and aspirational life. Tourism to the tropics boomed and many top quality rums were being discovered. A few companies started to import new styles of rum and to communicate diversity, and consumers became aware of agricoles, British rums, independent bottlings, and even many strange private labels.
It could have been that Italy remained a ‘poor’ rum country, but the opposite occurred: now Italy is the most cluttered market in the world with almost 1000 different labels! The last 5 years have been dominated by sweet rums and promoted by big players, which has made it difficult for others to maintain market share. Even independent bottlings and vintages grew a lot, and this new interest for super and ultra premium is almost unique in Europe. People got used to spending more than 50€ for a bottle, and consequently the 20-25€ rum is suffering and is in ‘limbo’ between pouring young rums and top level. In the next five years a space could open up for new subcategories, with higher awareness, and after that opportunity for rum collections and super-premium white.
So much diversity, so many brands, and such a ‘global’ spirit: we expect more decades of rum!
Dan Biondi – Rum Club Italiano
‘The views expressed above are the opinions of the writer and do not necessarily represent the views of WIRSPA Inc’.