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 ■ www.stateways.com ■ January/February 2015 36 SW: What does the Beam acquisition mean for Japa- nese whisky in the U.S. market? NW: The deal certainly wasn't made to bring more Japanese whisky to this market – it's a little more compli- cated than that, because we didn't need a stronger route to market. Beam-Suntory is a global prospect, but that being said, it would be silly not to take advantage of the fantastic sales team and energy behind us and not expand in the U.S. I can guarantee there will be more affordable Japa- nese whisky in the U.S. soon, but I don't know what that will look like yet. SW: Which spirit category's consumers do you hope to draw to Japanese whisky? NW: We're trying to build a new market altogether, so we want to establish Japanese whisky as its own category and stop stealing from Scotch. We want to be looked at separately on menus and in retail stores. It's not that we're in competition with anyone, it's just the process of category development. SW: What differentiates Japanese whisky brands from other whiskies? NW: Considering we only have three production facili- ties with a dozen brands coming out of them with different formulas and ages, we make a ton of whiskies. We have a number of oak styles and six different still shapes. In fact, nobody varies their oak like we do in Japan. We have fi ve different size barrels made of wood from three continents. We have a lot of fl exibility in what we can produce stylistically and we're well-positioned for what's trend- ing. Blends are the future and non-age statements are the future because we want to make as many people as happy as we can by getting our products into their hands. We've put a lot of effort into making better, younger whisky – a lot of retooling and investment. There's more liquid coming out of the stills than ever before, and we're smarter with what we're doing with it than we've ever been. SW: What's the biggest misconception about Japa- nese whisky? NW: One I'd like to correct is the perception that Japanese whisky is made from rice – that's number one, two, three, four and fi ve on my list. After that, I like when people say, "What does Japan know about whisky?" and I get to tell them we've been working on it for 91 years, so we know a lot. In retail, I have to push back a little at the notion that we're craft or boutique. Because we have a small volume in the U.S., we get pegged in with American craft distillers. I don't have anything against the whiskeys in that category, but those guys are a lot younger and don't have the heritage behind them that we do. We're sometimes being put on the wrong shelf at retail, and I'd like to correct that by building out Japanese whisky as a category with its own shelf space. LEADING BRANDS OF JAPANESE WHISKY IN THE CONTROL STATES (9-Liter Cases) 12/13 Brand Supplier 2012 2013 % Chg Suntory Yamazaki Campari America 736 856 16.3% Suntory Hibiki Campari America 31 112 ++% Nikka Takets Anchor Distilling -- 100 --% The Hakushu Campari America 2 23 ++% Yoichi Anchor Distilling -- 9 --% Top Five Leading Brands 769 1,100 43.0% (%) Greater than 100%. Source: The Beverage Information & Insights Group from NABCA data. JAPAN'S MIXABLE LIQUEURS The most widely known Japanese liqueur, Midori, has seen sales decline from 125,000 cases in 2008 to 90,000 cases in 2013, the most recent year data is available, according to the Beverage Information & Insights Group. The 40 proof melon liqueur, launched by Suntory in the U.S. in 1978, redesigned its packaging in 2013 after adding two RTD brand extensions (Midori Skinny Girl Margarita and Midori Sour) in 2012. TY KU produces a citrus liqueur, a blend of Yuzu and other Asian fruits with TY KU Soju, the company's distilled spirit. The 34 proof liqueur is 65 calories per serving, designed to be used in low-calorie cocktails. The bright green bottle also comes with a built-in light in the bottom that causes the liqueur to glow when activated. SALES OF MIDORI MELON LIQUEUR Brand: Midori Origin: Japan Supplier: Campari America (Thousands of 9-Liter Cases) '12-'13 2008 2009 2010 2011 2012 2013 % Chg 125 105 90 91 93 90 -3.2% JAPANESE IMPORTS