Rum: the stuff of legend
Legend has it that Admiral Horatio Nelson’s body was put in a rum cask to preserve it for transportation back to England following his death at the Battle of Trafalgar. He had just defied the odds to secure a decisive victory, constantly thwarting Napoleon and defeating a combined French and Spanish fleet, and he was due to receive a glorious open-casket funeral. But the navy officials who received his body discovered the sailors had drilled a hole in the cask and sucked it dry, leaving Nelson semi-pickled and unfit for an open casket.
Brits have always had a raging thirst for rum. They turned it into a global phenomenon after colonising Jamaica in 1655, when privateers began trading it as a valuable commodity as Britain set about conquering the world. Its popularity waned a little in the 20th century, but now it is back with a vengeance. Off-trade rum sales grew 4% to £340 million in 2017 (Nielsen) and sales have continued on an upward curve this year, driven by spiced, golden and dark as white rum continues to struggle.
“We have seen good growth in rum recently,” says John Vine, spirits buyer at Waitrose. “Over the past few years, the volume and value has been stripped out of white rum and it has gone from 60% to 40% [of the total rum category]. We have tried to rely less on white rum and expand different areas. We have done work on dark, spiced and golden.”
He warns that white rum will be in trouble if the trade does not pull together to premiumise the category. “There is a way of trading people up through the different ranges, educating them, getting them to try different cocktails, different serves, different countries of origin, and move them through the process. Mount Gay is a good example, where you have Eclipse, Black Barrel and XO, so we have been able to take people through the range and get them to spend more with us, and at the same time educate them.”
Market leader Bacardi is very much on board with this mission. “Rum is undergoing massive premiumisation in the UK market at the moment, with premium rum growing 24%, and retailers can maintain momentum by activating premium rum in addition to rum in general,” says Amanda Almond, managing director of Bacardi. “They should be relooking at their shelves and building a strong premium rum portfolio. It’s important for retailers to organise the category in a way that helps consumers navigate it and truly understand what premium rum is.
“Brands also need to start putting premium rum at the forefront and not just focus on the cheaply priced versions. Consumers have become more sophisticated drinkers and are interested in craftsmanship and authenticity of the products they drink. As a result, they are drinking less but better, so to meet this demand we recently launched Bacardi Añejo Cuatro to help us deliver against consumer taste and provide an entry point to premium. Brands should be clear with regards to explaining what premium rum is to their consumers, defining the difference between, for example, blended and aged rums. Rum culture, as a whole, is at a turning point, with consumers looking for premium spirits without sacrificing quality or taste over price.”
Spiced rum has emerged as the star performer in the category in recent years. Some see this as a hindrance to the overall category, arguing that it makes consumers think all rum is sweet and holds them back from trying more complex rums. But Dawn Davies MW at The Whisky Exchange says: “If spiced rum is bringing people into the category, then, hell yeah, what’s wrong with that? We want more rum drinkers at the end of the day. The spiced rums are absolutely talking to the right consumers. Rum is talking to the consumer who is taking that journey from white spirits into dark spirits, through the softer, rounder styles. It’s about now building on it.”
Halewood is backing the sub-category by rolling Cornish spiced rum Dead Man’s Fingers out across the country. “Dead Man’s Fingers has grown a cult following in the south west since its launch in 2015, receiving lots of acclaim in a relatively short space of time, so it’s exciting to finally share its exceptional qualities with the rest of the country,” says brand manager Lucy Cottrell. “Consumers will see a brand that finally breaks away from some of the pirate and palm tree category stereotypes, as well as a premium rum that, at £22, holds its own as a bold ingredient in cocktails but also neat as a sipping rum, which is rare to see at this price point. With the support of Halewood’s expertise in building artisanal brands and securing new routes to market, it’s set to be an exciting next 12 months for the brand.”
Almond at Bacardi says: “While white rum is still the largest rum category in grocery, spiced rum is our strongest performer overall, with total sales up by 17.9% and a total market share of 39% [Nielsen, year to April 2018]. White rum has a total market share of 35% in comparison. As such, spiced rum is a key driver of both performance and growth, largely driven by new, younger shoppers. It has been responsible for recruiting new consumers, especially a younger audience, by offering something interesting, exciting and fun.”
The UK rum category is diverse and vibrant, blessed with a wide range of big brands, craft rums and own-label offerings, and the growth looks set to continue as innovation ramps up. “Innovation is fundamental for the growth of any category, and naturally important for the expansion of the premium rum segment,” says Almond. “Several years ago, retailers and pubs would have a limited choice of rum to offer, whereas today, consumers are spoiled for choice.
“Big brands have the responsibility of driving the ever-evolving trend of premium rum, giving the category that extra push that is still needed to break through on a much bigger scale. That said, all parties need to keep innovation front of mind, including smaller craft brands. Innovation doesn’t necessarily need to stop at new product development – it includes educating consumers about new and fresh ways to enjoy premium rum, the unique styles of rum-making, and interesting ways of telling a brand’s story.
“Educating consumers about premium rum is massively important, and every player involved needs to play their part in doing so. It’s not only about talking to our existing rum enthusiasts, but reaching out to people who might not have considered drinking rum in the past.
“The education process allows us to define what premium rum is and how it’s made, explaining the ageing, blending, fermentation and distillation processes. Communicating with our existing and prospective consumers really allows us to elaborate on the craftsmanship that goes into creating premium rum, ultimately helping premiumise the category even further.”