4 Reasons Irish Whiskey is a Golden Opportunity for Sales Growth

Feb. 24, 2017

Irish whiskey is suddenly giving other alcoholic beverages a reason to be green with envy. The golden-hued elixir, often pigeonholed into being sipped only in March, is starting to gain a substantial year-round fan base in the U.S. In fact, according to an International Wine and Spirits Research (IWSR) report, the Irish whiskey category has grown more than 400 percent over the past decade. That is a breakneck pace for a category that has historically been dominated by only one or two brands. 

So why the meteoric rise, and how can that surge help your business? You don’t have to follow a rainbow to get those answers.

 

What’s Brown is Now Gold

It is no secret that brown spirits, especially American Bourbon, are booming in sales across the U.S. This is having a trickledown effect that is bringing more consumers into Irish whiskey as well. Irish whiskey is typically sold at a lower price point than Scotch or Bourbon and is also a lighter, more delicate spirit. These two factors make it an entry-level category for new consumers looking to get into the whiskey movement. 

The increase in new consumers is abundantly clear when you look at the numbers. Volume in the U.S. topped 3.2 million nine-liter cases back in 2015, a 16 percent increase from the prior year according to the Distilled Spirits Council of the U.S. Irish whiskey was also the best performing category among all spirits categories that year, easily besting the industry's 2.3 percent growth. 

 

A New Wave of Craft and Independent Producers

The modern Irish whiskey sector has long been sustained by just four distilleries. While there was a broad spectrum of Irish whiskey brands available, all liquid had been supplied under contract from these four sites.

Over the past few years, demand for Irish whiskey has soared, prompting a number of investments in building new facilities of all varieties and scales. In 2016, the Trade body of the Irish Whiskey Association (IWA) announced that 10 distilleries had commenced production of Irish whiskey in the last year or so, with plans for an additional 22 as well.

This increase in producers is nothing but good news for on- and off-premise accounts, who can use this category growth as an opportunity to expand their Irish whiskey selection as well as increase their margin and basket ring. Account owners might want to add in some extra shelf space for future bottlings as well, since the IWA forecasts Irish whiskey’s ability to grow global market share by 300% over the next 15 years. 

 

Expressions in Innovations

For a long time, blended Irish whiskeys were all that could be found in the U.S. Not anymore. 

With the increase in craft and independent producers came a need for differentiation in the form of Irish whiskey styles and creative innovations. Single pot still, single malt and even single grain Irish whiskeys are now available widely across the country. Producers are also getting more creative when choosing casks to age or finish their whiskeys in. Ex-American Bourbon barrels are still frequently used, but now we are seeing bottlings that feature sherry, port, red wine, beer and cider barrels as well. These new expressions are bringing in consumers from across the beverage gamut into the Irish whiskey category, as they look for new, unique beverage experiences.

 

High-End in High Demand

In 2016, the Distilled Spirits Council of the United States (DISCUS) published a report stating that in the previous year, super premium Irish whiskey grew 54.4 percent, while high end premium Irish whiskey rose 13.7 percent. This trend continues to lead the impressive growth of the Irish whiskey category with high end and super premium Irish Whiskeys growing a staggering 589 percent and 3,054 percent, respectively, since 2002. 

None of this should come as a surprise, because for the past two years other brown spirit categories, including aged rum and Canadian whisky, have seen a similar trend, in which consumers choose to spend more on a higher end or super premium spirit. 

The numbers make it clear: Now is the time to expand your Irish whiskey selection beyond a single bottle of blended whiskey. It also means that consumers now consider Irish whiskey a year-round beverage choice.

Take advantage of this category growth ahead of St. Patrick’s Day by ordering a selection of “True Irish” spirits, and then encourage your customers to trade up to a better bottle, and a higher-end pour, throughout the year.