Defining the New Luxury in the Indian Spirits Market

 


Recently a friend knocked a few spaces in his new and well-appointed house to create a Work from Home space and a …Bar ! He avers that WFH will be the new norm and entertaining at home has never been better, so it`s important to invest in a new bar for the future ! Say Cheers to the New Drinks destination!

Luxury Spirits have a new Home – The Home! The Indian Beverage industry has discovered a new channel in the post Covid Environment as Indian starts entertaining more at home, given the restrictions of the outdoor environment. This trend will occupy most of 2021 this leading to an uprise in the premium spirits market.

With limitations in global travel impacting Duty Free, Hotel bars not being able to offer Experiential Drinking, free standing bars mostly closed down, the retail industry has raised the bar with new format stores like Tonique in Hyderabad, The Liquor Warehouse in Gurgaon and World of Wines in Mumbai offering a host of range & instore services.  In the current context, retail is the new luxury destination in India, at least for the moment.

So how have the Bars, Beverages & Brands been impacted by the Covid factor and how have they emerged in the new scenario. We evaluate the same in view of Luxury spirits.

At the outset luxury spirits in India have their own definition, we cannot compare global luxury brands in the Indian market, since internationally a luxury brand is upwards of US$ 500 and above, per bottle whereas in India, we are looking at US$ 200, in the retail segment. This is due to high duty, complex label requirements & a host of other factors, where deter these brands from launching in India. Keeping in view the tax structure & challenges in the Indian market, the Luxury market in India is restricted to not more than 10,000 cases ( 12 x 750 ml ), with product cost being INR 15,000 – 25,000 per bottle.

Brands like Premium variants of Bowmore Single Malt, The Balvenie 30 YO, John Walker, Royal Salute 262 Gun Salute are the Epitome of Luxury Whisky offerings in India. In White Spirits, Luxury is still being defined though Beluga Vodka, are considered luxury. In the current context & in some cases, luxury is more about premium spirits than true blue luxury brands, as on offer globally.

Luxury offerings as the aged variants like The Macallan & Bowmore – Aston Martin are yet to make an impact in India. True luxury market is yet to make an advent in India, post the Rare Whisky Collection, launch in 2003.

According to, Neeraj Kumar, Managing Director at Beam Suntory,” Companies are witnessing a return on demand on premium variants. During the lock down most consumption was witnessed at home, leading to depleting of stocks. Keeping in view that there have been travel restrictions, most consumers have been being premium whiskies from the new format retail that is witnessing a significant growth. Since Hotels, Premium Bars & GTR are also witnessing restricted movement, consumers are not being to enjoy luxury spirits. Though this has led to a growth in premium segments. This trend will continue for at least the next 6 months until Hotels & Standalone Bars witness a resurgence of guests. Same applies to Duty Free, which will stay muted until international travel starts again.”

 

Luxury Categories

Luxury drink categories are mostly Whisky & Cognac. Even though there are premium gins on offer, the category is largely led by premium whisky. Tequila is growing in the luxury segment globally, but is yet to make a mark in India, due to non-availability of brands.

India still views champagne as a celebratory drink and keeping in view that last year was anything but about celebrations, the sales have been muted. Champagne consumption is also associated with Hotel Brunches & Home parties, which are only now witnessing a resurgence, with almost 30%-50% already coming back.

Luxury Channels

Besides premium retail, the luxury segment has seen growth across home consumption, gifting & in terms of Luxury considerations, Age in Scotch Whisky, Provenace in Japanese Whisky, limited edition Bourbons are considered the current benchmark.

Whilst Covid may had an Economic impact on people, luxury spirits have not been  impacted and consumption is still witnessing a new High ! In fact the last quarter witnessed new sales benchmarks for premium brands including Glenmorangie Signet, Paradis Cognac, Yamazaki Distillery Reserve & Roku Gin.

 

Ipsita Das, Managing Director at Moet Hennessey, states, “People are enjoying smaller groups, premium spirits & more frequent interactions, aided by the advent of Home Chefs & Luxury dining services at home. They are also buying fancy bottles like the Glenmorangie Signet to craft new drinking experiences at home.” The company has showcased a significant amount of home mixology sessions at premium homes. Cognac is also moving regions, making an entry in the western & northern markets from south of India , where it enjoys a premium. DIY Kits are increasingly popular with most people trying their hands at making new crafted cocktails with premium spirits including champagne and single malts.

Premium vodka which was more about “night trade” is finding its way into lunches & brunches. Hotels which did not beouved in delivery are now offering spirista s well as premium dining servoces. This aiding the entire experience of drinkinga t hme.

Mixology is another are which has seen a significant adoption. Home bound with some great spirits in the bar and more frequent drinking, mixology & cocktails making is being adopted by a lot of consumers both towards drinking & entertainment. Even though most people are wary of external bartenders coming at time, it has not stopped them from learning bartending skills & crafting small evening

Another area which is witnessing a growth is Weddings & Social occasions, Even though the number of guests has come down but the budgets are still the same, thus ensuring that there is a significant upgradation of the spirits offerings.

Some areas are here to stay whilst the others will settle down after the peak, though one thing is for sure, that the luxury spirits market in India is set for yet another high.

 

More Information  :- https://spiritsandrituals.com/defining-the-new-luxury-in-the-indian-spirits-market/

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