The ‘Whisky Baron’ overcame ill-health to create some of Scotch’s most successful blends.
For lovers of ‘rare’ Scotch whisky, these are rich times indeed – provided, that is, that their passion for the spirit is matched by the thickness of their wallet.
In the past couple of weeks alone, we’ve seen whisky at UK auctions clearing £2m a month, with the average bottle of Scotch single malt fetching £286; a new Dalmore 40-year-old expression with a £6,000 asking price; a 50-year-old blended grain from Angus Dundee for close to £900; and, my personal favourite, a 12-year-old Port Charlotte reduced with some iceberg water that’s attracting auction bids of ‘upwards of £1,000’.
But it’s a big world out there, and these scarce bottlings attract a hugely disproportionate share of the headlines. Taken together, the Dalmore, the Angus Dundee and the iced Port Charlotte account for less than 1,250 bottles of Scotch whisky. For an industry that sells well over one billion bottles a year, that’s a drop in the proverbial ocean – or the merest chip off an iceberg.
The results recently announced by leading Scotch producer Diageo amply illustrate this fact. It was no surprise to see that the company’s Scotch whisky sales had risen during the year to the end of June – but the manner in which that growth was achieved might give us pause for thought.
The company’s stable of single malts – including The Singleton, Talisker, Lagavulin and Oban – increased their sales, but not as much as Diageo’s formidable roster of blends, spearheaded by the remarkable Johnnie Walker.
At this rate, it won’t be long before Scotch’s most famous name shifts 20m cases of product a year, meaning that more than one in five bottles of Scotch sold around the world will have a striding man on its label.
But Walker wasn’t (for me, at least) the big story that emerged from the figures. Instead, the unlikely hero of Diageo’s whisky year was a low-priced blend with a label featuring a pair of lovable/sickly (delete as appropriate) canines: Black & White.
Top dog: Black & White has successfully recruited people into Scotch whisky
A brand of Scotch conceived by James Buchanan while on his way back from an 1890s dog show, Black & White is now Diageo’s tactical, affordable blend designed to drive recruitment into the Scotch category in emerging markets such as Mexico and India.
That’s working well, but a new use was found for Black & White during the past year. Brazil, previously a golden market that drained more than 2m cases of Johnnie Walker a year as recently as 2013, is now beset by economic woes and political scandals.
When that happens, people tend to have less money to throw around on fripperies – and expensive Scotch whisky, however great its joys, is almost the definition of a frippery. If large numbers of Brazilians can’t afford a bottle of Black or Red Label, you either sell them something less expensive, or they go back to the cheap cachaça they were buying before, perhaps never to return to Scotch.
This is the lucrative (relatively – the profit margins are much slimmer than Walker’s) furrow that Black & White is ploughing in Brazil right now. And, if we broaden our gaze to a global perspective, it isn’t alone.
Diageo has White Horse, Old Parr and VAT 69 also inhabiting what company boss Ivan Menezes calls the ‘primary Scotch’ hinterland, and together they sell something like 8m cases of Scotch whisky a year – and all have had a decent time of it in the last 12 months.
Foot soldier: Chivas’ Passport is one of a number of less heralded blends
These aren’t necessarily household names (you may not even have heard of some of them), but they all sell more than leading single malts Glenfiddich and The Glenlivet, even if at substantially lower prices.
They are the foot soldiers of the Scotch whisky industry, doing the hard yards by combining a low price with an acceptable quality level to create a product that somebody wants to buy. It may be that person’s first foray into the world of Scotch, or it may be a way for them to stay in that world when the good times recede and cutbacks have to be made.
These blends are the products that may have provided us with that often terrifying first sip of Scotch whisky at 15 or 50, drawing us into the tantalising web of single malt, aged grain, of Islay, Campbeltown and Speyside. Given this pivotal role, it’d be nice if they were celebrated more and shown a little greater respect and gratitude by all of us who love Scotch whisky.
After all, despite their modest price tags, they form the bedrock of the industry, and without them no rare single malt or self-indulgent ‘limited release’ would exist in the first place.
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Sales were up in the last six months of 2017, with Johnnie Walker leading the charge.
In depth 31 July 2017
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World’s biggest Scotch whisky company returns to growth in China following austerity struggles.