YOU COULD BE FORGIVEN for thinking that the term ‘liqueurs’ is a catch-all for any alcoholic drink that is sweet and on the sticky side, relatively low in alcohol and as such not a serious alcoholic beverage. But the reality could not be more different. Globally the liqueurs category amounts to more than 85 million nine-litre cases a year and, although growth is not explosive, it is ticking over very nicely.

International growth for this year is expected to be about 5%, and that’s well up on the 1%-plus over the past four years. Within the category, fruit liqueurs have been performing well over the past few years, turning in annual growth of 3% (IWSR), and coffee liqueurs are also proving to be something of a hot spot.

Growth is higher in certain key and developing markets, and this is particularly true of the UK, where fruit liqueurs in value terms increased by 10% in the 12 months ending September (WSET). Japan and the former eastern bloc countries, where the cocktail culture is coming to the fore, are also buoyant stamping grounds, which is all good news for the likes of the high-class French producer Gabriel Boudier and Suntory’s melon contender Midori.

“2012 will be the year of the liqueur, with the importance of crafted products with a strong background in the cocktail industry taking priority in most bars where cocktails can be found,” says Manuel Terron, Midori’s global brand ambassador and mixologist. “Just as with flavoured vodkas, bitters and now spiced rums have caught the attention of bartenders and customers. The time for liqueurs’ cool status is just around the corner.”

Thanks to consistent investment and ongoing activities behind the Midori brand, global sales are ahead by 6% and the company has every intention of maintaining the momentum. “The focus for Midori is to show versatility through its use in cocktails and to educate and entice bartenders to mix original drinks,” says Terron. “We also want to promote simple mixes that can be easily recreated at home by the average consumer.”

This year, Midori will have an up-scale presence at the key industry events around the world including the Moscow Bar Show, Manhattan Cocktail Classic, and Tales of the Cocktail. “We are trying to become top-of-mind for bartenders everywhere by exposing Midori’s fresh fruit ingredients and demonstrating the virtues of mixing cocktails with fresh ingredients,” says Terron.

Bartenders generally are the prime focus for liqueur producers, but as the cocktail culture takes hold and consumers are more prepared to make their own drinks at home, retailers are beginning to sit up and take notice. This is certainly the case with Gabriel Boudier, who in the UK in conjunction with the number one multiple Tesco, has developed a six-strong range – Creme de Cassis, Curaçao Triple Sec, Apricot Brandy, Blue Curaçao, Crème de Menthe and Cherry Brandy.

Retailing in 50cl bottles from £9 to £12, each liqueur comes with a simple-serve cocktail suggestion, which will change every six months – so clearly the retailer has confidence in this initiative. Tesco’s Finest range of liqueurs went on the shelves pre-Christmas and the early signs are very promising.

“When it comes to liqueurs, retailers have not seen the potential – but there is a real opportunity out there,” says James Rackham from Emporia, the UK importer that supplies the Gabriel Boudier range. “This is clearly a development that has huge potential, as consumers are more prepared to make cocktails at home.”

This latest move marks an interesting shift in the liqueurs firmament where on the whole the bartender and mixologists have traditionally been the key target audience. This will not change, but also targeting consumers opens up a potentially massive new market for producers.

Of course, the big names in the liqueur world are the two giant Dutch companies De Kuyper and Bols, the French force Marie Brizard and the up-and-coming Dutch producer Wenneker Distillers. These operations wield huge ranges of liqueurs and in the main their target audience, by necessity, is still the on-trade rather than the consumer.

In this rather more mainstream world, competition is fierce and the need to find new flavours to maintain the competitive edge is a fundamental. Of late, Bols has demonstrated this effectively, with the launches of Bols Foam, and Bols Natural Yoghurt Liqueur.

“There are a tremendous amount of flavours being thrown at the market, but you wonder how long they will last,” says Bols CEO Huub van Doorne. “We are very active in terms of innovation, but the requirements for flavours differ from market to market.”

Available in six flavours, including Blue Curaçao and Amaretto, Bols Foam is a first for the category and at the largest Dutch on-trade fair, the Horecava, the company won the Innovation Award in the Food & Beverages category. “We are very proud of this, because it is a reward for one of the most important innovations in the centuries-old history of our brand,” says van Doorne. “It adds a whole new dimension to the cocktail and drink experience.”

Bols further reinforces its ties with the international mixologist fraternity via its Bartending Academy. Based in Amsterdam, this now boasts three full-time trainers and has recently taken a reservation for eight bartenders from the US, which underlines the growing reputation of the event.

Cocktail extravaganza

On a different tack, but with the same goal to reinforce its position with bartenders, Marie Brizard hosts an annual cocktail competition and extravaganza. This year will be the 28th International Bartending Seminar, and it “provides a great opportunity” for the company to keep abreast of current and future trends.

“It has always been a key moment for the brand as more than 100 bartenders join us in Bordeaux to compete but also to understand Marie Brizard liqueurs, see our production facility and work with our product,” says Marie Brizard’s group marketing chief Aurélie Lory.

The company is currently celebrating the fact that Marie Brizard liqueurs were used in four of the five winning cocktails at last year’s IBA convention, which was staged in Warsaw. Of particular pleasure was the fact that its Essence liqueur range, which comprises cinnamon, spicy mix, tea, jasmine, rosemary and violet, took centre stage and not surprisingly this is where the focus will be for the coming year.

“We are looking to concentrate on our new Essence range which got a great welcome from bartenders,” says Lory. “We got a silver medal at the IWSC 2011, and it clearly has great potential. We are also starting to appear on some cocktail menus in high-end bars.”

Other plans for the year include the launch of three more liqueurs, Litchi, Passion Fruit and Green Melon, underlining the importance of adding new flavours. “It is key to our strategy as we have to fit constantly with trends and provide bartenders with liqueurs that will allow them to express their creativity,” says Lory.

Dutch producer Wenneker is finding pockets of growth as it expands into new markets, but the going is none too easy. “There are a limited number of premium ranges and therefore a limited number of distributors,” says the company’s export director Richard Ridley. “As a result the going is quite competitive.”

Wenneker boasts a 41-strong liqueur range and is now available in around 50 markets, with the UK and Thailand topping its export league. “Considering there are about 120 markets we should be in – we have a long way still to go – it’s daunting but still a big opportunity,” says Ridley.

Emerging markets

Key developing stamping grounds for cocktails include Kazakhstan, Belarus, Ukraine and Russia where, aided by good distributors and training programmes, Wenneker liqueurs are making good headway. “Kazakhstan is very new to the cocktail but indicators are good – consumers are wealthy enough to get involved – and bartenders, though relatively inexperienced, are keen to learn,” says Ridley. “In a presentation we held last November, we had a 100% turnout.”

Another company finding the going tough is the Italian producer Rossi d’Asiago and its Volare range of liqueurs, which feature integral bottle pourers. “It is very competitive because in recent years a lot of new producers have entered this market,” says Rossi d’Asiago’s marketing manager Anna Capuzzo.

But in something of a coup, the company recently secured a distribution contract with US importer Kobrand and, not surprisingly, is now “investing heavily in the US market”. Volare is also constantly on the look-out for opportunities to meet demands on the flavour front, “from partners around the world”.

Most recently it has joined forces with Angostura bitters which will see the development of 20 cocktail recipes made using both brands, among other ingredients, and these recipes will be published in Drinks International – which was the magazine selected as its media partner last September.

“The aim of this project is to develop a recipe collection that represents the latest trends in the world of mixology,” says Capuzzo. “One of the coolest aspects of the project will be its interactivity as each recipe will be connected, via a QR [quick response] code, to a video tutorial that shows its execution.”

These videos are then posted on Volare’s YouTube channel, Volare In The Mix, which made its debut last September and has received “great feedback” from around the world. In addition, an online cocktail competition using YouTube Volare and Angostura will be launched this year.

While overall it’s intensely competitive on the liqueur front, some pockets of the category are storming ahead, especially coffee liqueurs. While this segment is dominated by the Pernod-owned Kahlua, two relative newcomers are making headlines. Most recently Bols has entered the fray under its Galliano label with its recent line extension Ristretto – a coffee espresso liqueur. Initially concentrating on its home market Italy, the brand is already proving to be a success.

However, in terms of development, the plaudits have to commend the American Tequila force, the Patrón Spirits Company, which is enjoying growing success with its XO Cafe, a Patrón Silver Tequila-based coffee liqueur that is very more-ish and (mercifully) not too sweet.

“Patrón XO Cafe performed extremely well in 2011, with very substantial growth in markets outside the US,” says the company’s director of corporate communications Greg Cohen. “In total, the brand was up 29% in 2011 against the previous year. And internationally, including duty free, Patrón XO Cafe was up more than 83%.”

Patrón XO Cafe’s best developing markets are, in addition to duty free, South Africa, Australia, the UK, Canada, Malaysia, Bahamas, the Philippines and Trinidad – and it is gaining the attention of bartenders. “Because of its taste profile, the brand is quite versatile – it’s delicious on its own, over ice, or as a chilled shot, or in any number of cocktails,” says Cohen. “Use in cocktails is definitely growing, as mixologists across the globe are increasingly discovering all they can create with it.”

Indeed, the coffee liqueur has been so successful that the company is already planning a line extension – Patrón XO Cafe Dark Cocoa, a chocolate liqueur, which is also made with Patrón Silver Tequila. This will be initially introduced in the US, but the hope is to expand into international markets.

“Until then, we’re focused on building distribution of the base Patrón XO Cafe brand into additional bars, restaurants, hotels and high-end retail establishments,” says Cohen. “We’re also focused on growing our other liqueur brand, Patrón Citrónge, a high quality orange liqueur. As margaritas gain in popularity across the world, our message to trade and consumers is to use an authentic Mexican orange liqueur in their cocktail.” 

Liqueurs from Galliano and Patrón are arguably easier to market due the simple fact that they have appeal both to the on-trade as well as the consumer – in short they have the best of both worlds.

Indeed this was always the case with brands such as the triple sec Cointreau, the cognac supremo Grand Marnier, the Irish whiskey contender Irish Mist and the scotch whisky-based liqueur Drambuie, which are deemed traditional liqueurs – largely because their alcohol strength is equivalent to a spirit (40%).

These were the brands packaged in their decanter style bottles which reigned supreme on the after-drinks trolley. However, drinking habits have changed: tougher drink-driving laws have made the after-meal drink slot less attractive, thus eroding the position of liqueurs in consumers’ drinking repertoire. 

But something had to happen to improve prospects, and once again it was the cocktail which proved to be the catalyst for growth. But while Grand Marnier forged a bridge into the world of cocktails and a place in the bartender’s mind without changing its presentation, both Irish Mist and most notably Drambuie have had dramatic about-turns. Through new packaging, both now straddle their respective spirits categories as well as their liqueur heritage.

Trading places

With its latest round of advertising, Drambuie has cemented its dramatic rebirth. “Over the past 15 months, it’s been a radical change, which has been very successful,” says Drambuie’s global marketing director Tim Dewey. “We needed to take the same radical step with our communication. Previously it was not hard-wired enough.”

The new global ad campaign under the banner “A Taste of the Extraordinary”, primed for 25 to 44-year-old professionals, will front a fully integrated marketing support package that will challenge consumers to re-evaluate the brand and change drinking habits. Unveiled pre-Christmas in the UK, Greece and Chile, the campaign will roll out nationally in the US this year.

“In terms of drinking habits, the brand is in transition,” says Dewey. “But research after a presence at key music festivals has shown that consumers are getting the message and are going out to buy a bottle. It’s not a battle you win in one day, but we are getting there.” 

The second raft of advertising will focus on ways to drink the liqueur. To this end the company has a three-tier strategy, which kicks off with the simple/long serve such as Drambuie & Ginger or Coke, or in Latin America Drambuie Lime & Soda. 

In the US, the company is concentrating on a range of Rusty cocktails which offers a spin on traditional mixed drinks – ergo the Rusty Margarita. “This is a matter of concentrating on traditional old-style cocktails but with a new spin, and it gives us a way of getting involved,” says Dewey. The third tier is primed for the high end of the on-trade – where mixologists are encouraged to produce bespoke cocktails using the brand – “these of course will be harder for consumers to make at home,” says Dewey.

This significant Drambuie sea-change has to be managed without offending “a host” of older and traditional Drambuie users. “All we’re saying is that it’s the same Drambuie – and it doesn’t matter how you drink it,” says Dewey. 

Additionally, the company has fielded a serious line extension, Drambuie 15 Year Old – again emphasising its scotch whisky roots – while offering the more traditional Drambuie user a step up the quality ladder. The 15 Year Old joins the The Royal Legacy of 1745 – a single malt whisky version of Drambuie which was launched in 2009 to mark the centenary of the first commercial bottling of the liqueur, which took place in Edinburgh in 1909. 

So it’s all go in the Drambuie camp, and the priorities in terms of investment for the coming year will be Chile and Brazil; Chile because the liqueur sector is “very open” and Brazil because it is “a powerhouse for scotch”. 

The Drambuie story underlines the scope for liqueurs in today’s drinking world, as indeed does the success story of Baileys, the all-pioneering Irish cream liqueur. But even this cream icon – which sells in excess of 7 million cases a year – has been forced to broaden its options, and since 2008 has introduced Hint of Mint Chocolate, Hint of Coffee, Hazelnut and most recently in the UK Biscotti flavour. In the US, a pre-mix cocktail has made its debut, the Baileys Mudslide.

Without a doubt, the liqueurs category is hugely fragmented, more so than any other in the alcoholic beverage industry – but that’s not a bad thing as there are opportunities around the world to be seized. It’s definitely not a category to overlook, but as Bols’ CEO Huub van Doorne says: “It’s a very busy category – and one that’s underestimated because it is so fragmented.”