Bacardi eyes premium brands as young Britons ease up on drinks
Drinks giant Bacardi is banking on high-end spirits to bolster sales as the industry grapples with a drop in drinking rates among younger Britons.
Amanda Almond, Bacardi's managing director for the UK and Ireland, said the "premiumisation" of the company's portfolio "has been absolutely critical" to its strategy, having seen consumer trends shift to quality over quantity.
She added: "What we have seen in the younger generation is that they are drinking less but better, and sometimes that could mean teetotal but often it means just less and better, and therefore their choice of alcohol has changed.
"So something like the St-Germain spritz or a beautiful martini ... is actually seen and believed to be a better way to consume alcohol in a longer choice of drink, rather than high density drinking behaviours which you used to see."
She said Bacardi is now focusing on higher quality spirits, with a portfolio that features the likes of Grey Goose vodka and Bombay Sapphire gin.
Premiumisation may be key to avoiding a drop-off in sales for the wider sector, in light of recent studies that suggest the alcohol industry has been propped up by excessive drinking in the UK.
A recent study by the Institute of Alcohol Studies (IAS) and the University of Sheffield's alcohol research group found that booze sales would plunge by £13 billion if drinkers in England cut back their tipples to abide by low-risk government guidelines.
It found that those drinking above guideline levels accounted for around 68% of total alcohol sales revenue in 2013/2014 - representing around 77% of beer, 70% of cider, 66% of wine and 50% of spirits sales.
The study concluded that the alcohol industry in England seems highly dependent on heavy drinking and that average prices would have to rise "substantially" to mitigate the loss.
Ms Almond said: "Responsible drinking has always been part of the Bacardi's DNA for a long time, and equally we work very closely with trade associations and the government to make sure we support the right type of behaviour around alcohol - that's not debatable."
Bacardi, which is the largest privately-held spirits company in the world, employs nearly 800 people across the UK, with offices in London, Glasgow and Winchester, and seven distilleries including in Laverstoke where it makes Bombay Sapphire gin.
The company is now turning its eye to the rum it is most widely known for, but is one of the last spirits get the premium treatment.
"Rum is very hot in the UK and gaining real momentum ... we're the biggest rum producers and actually it's down to us to lead that premiumisation, and that's what we're starting to do with our launches," Ms Almond said.
"I just don't think there's been a strong enough offering in that space for some time and we have hopefully alleviated that with the launch of Anejo Cuatro and the relaunch of Ocho."
She said flavoured spirits have also done very well in the UK, with the likes of vodka, "but rum has been the last to go".