StateWays is the only magazine exclusively covering the control state system within the beverage alcohol industry, with annual updates from liquor control commissions and alcohol control boards and yearly fiscal reporting from control jurisdictions
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StateWays Q www.stateways.com Q May/June 2014 52 in 2013, according to the Handbook Advance 2014. [In the control states, tequila was up 2.1%, to 2.11 million 9-liter cases.] For its part, tequila supplier revenues rose an impressive 7.9% nationally, ac- counting for $148 million in new supplier dollars, according to the Distilled Spirits Council of the United States (DISCUS). That sales increase was largely driven by the premium (up 9.2%) and su- perpremium (10.2%) segments. Indeed, many of the new product introductions have been in the superpremium arena, generat- ing much of the publicity ink and consumer interest in tequila. "The biggest trend is premiumization," says Stickler at Brown-Forman. "People are looking for premium quality, craftsman- ship, demanding more from tequila. We are seeing the fastest growth in the super- and ultra-premium segments, a transformation of the category toward the high end." The Brown-Forman portfolio includes the Her- radura and Don Eduardo brands, as well as El Jimador, one of the leading labels, showing 4.4% growth to 331,000 cases na- tionally in 2013, according to Beverage In- formation Group statistics. [In the control states, El Jimador gained 13.6%.] New brands are entering the market all the time. Suerte Tequila recently extended dis- tribution of small-batch, single-estate, double-distilled expressions to the Rocky Mountain Region, California, New York Metro area, New Jersey, Wyoming and Connecticut. Boulder, CO- based entrepreneurs Laurence Spiewak and Lance Sokol co-founded Suerte Tequila in 2012. "On average each year 30 to 40 new tequila brands are introduced, with over 1,200 in the U.S. market already. Most of that innovation is in the superpremium segment, which is growing the fastest," says Rene Valdez senior brand manager for Tequila Cazadores. The Bacardi USA brand is among the top 10 suppliers, at some 293,000 cases nation- ally in 2013, according to Beverage Information Group. The top 10 tequila brands accounted for some 11 million 9-liter cases nationally in 2013, according to Beverage In- formation Group statistics, up 4.4% for the year. Accounting for nearly a quarter of that volume was category leader Jose Cuervo at 3.03 million cases nation- ally (more than 574,000 9-liter cases in the control states). For over two decades, Diageo North America had han- dled Cuervo's distribution and was negotiating to buy the brand. However, last July, the Beckmann family, owners of Jose Cuervo, moved distribution to sister company, New Jersey-based Proximo Spirits. Reportedly, Proximo plans a major investment to build the brand. Currently, the im- porter's portfolio includes Maestro Dobel, Gran Centena- rio and Zarco tequilas as well as 1800 Tequila, which grew 11.6% in 2013 to 1.032 million cases nationally (up 28.1% in the control states, to over 267,000 9-liter cases). For its part, Diageo acquired two ultra-upscale tequila brands: Peligroso is a 100% blue Weber agave tequila from the highlands of Jalisco, Mexico, which was founded by two avid surfers; it is available in silver, reposado and anejo expressions, as well as a cinnamon variant, with an suggested retail of $30 to $55 per 750 ml. Additionally, Diageo is partnering with rapper Sean Combs in the luxury label DeLeon. Diageo's portfolio also includes the Don Julio brand. The biggest gainer among the top 10 brands last year was relative newcomer Familia Camarena. Launched in 2011, the E&J Distillers' brand posted gains of a whopping 36%, to 571,000 cases nation- ally last year; now it ranks sixth among the leading labels. Available in just silver and reposado expressions, Camarena is 100% blue agave, priced $20 for a 750 ml bottle. THE BIG TAHONA M any tequila houses are messaging the traditional, artisanal aspects of pro- duction, like the dexterity of jimadores in the fi elds, the use of mule-driven tahona stones to grind the agave pinas, exotic bar- rel fi nishes and the terroir differences among the growing regions. That tactic seems to be working. As con- sumers better understand the provenance of quality, they are trading up to fi ner expressions of the master distillers' art. And, especially in the anejos and extra anejos, there seem to be some affi nities and syner- gies with whiskey. The Mexican spirit is poised for further acclaim and more experimentation. Launched nationally late last year, Pernod Ricard's Olmeca Altos brand plays up its use of the volcanic millstone in the tequila's production. "We're proud of Olmeca Altos for standing out as the most affordable brand that still uses the ancient method of production, the 2-ton tahona wheel, to extract the rich character of the agave," Sauza also just added to its Sparkling Margarita lineup with a new Watermelon fl avor. The 100% agave tequila, El Jimador, recently debuted a more upscale bottle. Late last year Patron launched Gran Patron Piedra, a high-end, ex- tra anejo tequila, which uses the traditional Tahona production process.