The U.S. liquor industry is expected to be worth $58 billion by 2022, growing 6% each year, and one drink that’s tapping into the market’s potential is rum.
Roberto Ramirez Laverde, vice president of Bacardi North America, noted that certain spirits thrive with their ability to capitalize on the premium market.
“Whiskey, bourbon, cognac have done great work in educating consumers about their premium beverages,” Ramirez Laverde told YFi AM. “I think it’s a lack of knowledge of the authenticity and the heritage of rum that has been preventing that growth.”
He went on to describe rum as “the best kept secret” of the liquor industry.
“Bacardi has a great heritage and great story,” he said. “There are a lot of things that we need to communicate” in order to drive consumers to Bacardi’s premium products.
The push for premium comes as the brand is launching Bacardi Lime, the ninth flavor in the Bacardi portfolio. More generally, Bacardi Limited — which also includes Grey Goose (vodka), Bombay Sapphire (gin), Patrón (tequila), and Martin & Rossi (vermouth) — is the world’s largest privately-held spirits company.
Record sales for spirits
Nielsen has been reporting a decline in American alcohol consumption, though that mainly due to a decline in beer consumption. The Distilled Spirits Council (DSC) reported record sales for the ninth consecutive year in the liquor sector.
“These robust results show adult consumers are continuing to favor spirits over beer and wine, particularly among millennials,” Chris Swonger, DSC president and CEO, said in a press release. “The spirits sector is benefiting from millennials who demand diverse and authentic experiences, and desire innovative and higher-end products.”
In 2018, according to DSC, total supplier sales rose $1.3 billion to a total of $27.5 billion. Premium rum sales in that time were up 28.5%, generating $2.3 billion in revenue for distillers. Premium alternatives to the traditionally flavored liquors are a big drive for the distillers and was a reason Bacardi launched its premium line last year.
“There are new trends shaping the spirits industry, “ Ramirez Laverde said. “One is the premiumization.” He added that consumers, who are increasingly seeking premium products “are experimenting. They are more aware of the ingredients included in their cocktails.”