AUSTRALIAN SPIRITS

A spirited country

Australian spirits are enjoying strong momentum right now, so Brydie Allen investigated what’s behind this trajectory to find areas of opportunity for retail.

It was only a handful of years ago that Australia had just a handful of distilleries to enjoy. Today, there are hundreds, big and small, dotted across our great vast continent, delivering internationally renowned spirits that continue to excite consumers the world over.

And the sector is not finished yet. Despite the popularity explosion in recent years, Australian spirits are still accounting for a relatively small proportion of spirits bought and consumed locally. Considering the incredibly high quality of these products, this points to a huge opportunity for local retailers.

“At the moment, Australian craft spirits amount to less than one per cent of the spirits consumed in Australia, in comparison to international markets, we’re informed this is usually 10 per cent. So, there is massive opportunity to grow the segment, and for consumers to support local product,” said Cameron Syme, Master Distiller and Founder of Limeburners, Giniversity, Tiger Snake and Dugite in WA, and a recent inaugural inductee into the Australian Distillers Hall of Fame.

Blake Vanderfield-Kramer, Founder of local eau de vie brand Feels Botanical, also sees that growth opportunity, and likens it to what other sectors have already experienced.

“I think we will see a boom in Australian manufacturers and brands, as we have seen within the wine and beer categories,” he said.

Brendan Moynihan, Marketing Director at Starward Distillery, also sees this, and said: “The Australian spirits category is on an exciting trajectory which continues to go from strength to strength.”

Spirited growth

“For me, Australian drinkers are driving the growth of Australian spirits. Aussie drinkers are choosing local in every category where it is available,” said Sebastian Reaburn, Master Distiller for Top Shelf Group, maker of Grainshaker Vodka and NED Whisky.

Reaburn is certainly right there, as local consumers continue to place an everygrowing emphasis on products that are closer to home. The pandemic is one thing that is often credited with this movement, but there is definitely more behind it.

Premiumisation and an appreciation for craft are a couple of elements that can also claim responsibility for this preference shift.

“Consumers are rewarding themselves with high quality spirits that help elevate their drinking experience, whether they’re sipping whisky neat or stirring it down in classic cocktails. Now more than ever, consumers are willing to reach into their pockets if it means they are supporting local brands, and quality products with engaging stories to tell,” said Moynihan.

“It is important that Australian distilleries continue to produce approachable highquality products to recruit a new consumer.”

When Syme was asked what is setting Aussie spirits apart from international products right now, he also said quality was key.

“I was judging the World Gin Awards recently, and a fellow judge who is a gin distiller from the UK said that Australia is making the best gins in the world and is the country to try to match,” he said.

The quality of the liquid itself is just part of it though – consumers are also looking to connect with other premium cues of the wider brands too. An example from Reaburn is about transparency and authenticity.

“People want to connect with producers, they want to know who, where and from what their spirits are made,” he said.

Vanderfield-Kramer noted this was especially prevalent in younger adult consumers, an important thing to note.

“Half the Australian drinking population will be Gen Z or younger Millennials by 2026 and they are craving variety and choice,” he said.

Australian spirits certainly deliver on the need for premium variety, tapping into drinkers’ desire to experiment.

Jon Lioulios, Director of South Australia’s 36 Short Distillery, said: “Supporting local plays such an important role within Australia and we’re finding that customers really enjoy experimenting and finding new ways to drink premium Australian spirits with their friends and family.”

Vanessa Wilton, Co-founder and Marketing Manager at Sydney’s Manly Spirits Co., believes it’s easy for drinkers to do this right now, and said: “Consumers are spoiled for choice in quality Australian spirits across multiple categories.

“With an increase in curiosity and an excitement to find and share the next big thing, we are seeing big boosts in flavoured gins/spirits.”

Make the most of Aussie spirits

Here are four top retail tips collated from producers in this story:

1. Create an ‘Australianspirits zone’ as an in-store destination hero local distillers. Keep control of this space without the use of planograms, and cycle stock seasonally to showcase more products.

2. Contact your suppliers to find out their stories so you can communicate them to customers. This will help drinkers connect more with local brands.

3. Do your research – know who you’re supporting and their standards. If they are a member of the Australian Distillers Association, they will follow an industry code of conduct and comply with relevant laws.

4. Upsell customers from other options, including in the nonalcoholic space. Show them what variety exists and what is possible with Australian spirits of all kinds.

A new taste of local, without the alcohol

Australian-made and owned brand, NakedLife, has built on the raving success of its non-alcoholic cocktail cans with the expansion into the bottled non-alcoholic spirits sector.

The new Naked Life Non-AlcoholicSpirits range is crafted with distilledbotanicals with no artificial flavours orcolours, and is low in calories. The rangeof 700ml bottles will include non-alcoholicspirits such as London Dry, ItalianAperitivo, Veneto Spritz, Tennessee Malt,Scottish Malt, Caribbean Blanco andCaribbean Spiced, all perfect for craftingnon-alcoholic versions of the cocktails weknow and love.

Naked Life is aiming for this new rangeto further expand its breadth of offer andbuild on the incredible success of the RTDrange, which sold 2.5 million cans over itsfirst seven months, and is a leader in thespace overall, with a market share of 60per cent in the non-alcoholic RTD cocktailsector in grocery.

The innovation nation

One of the great Australian spirit success stories is Four Pillars from Victoria, which has just opened its brand new distillery in its home of Healesville after a $7m investment. According to Co-founder Stu Gregor, one of the things that sets both Four Pillars and the wider local spirits scene apart right now is innovation.

“We’re known as a country of innovation, a country of produce,” he said.

“The thing that sets us apart at Four Pillars I guess is a relentless pursuit of improvement and innovation. We’re constantly experimenting with new flavours and combinations.”

As Moynihan said, this is growing the appeal of the sector at many levels.

“Australian brands are not afraid to push the boundaries whilst highlighting the best of what we have to offer, creating an appeal to both local and international audiences,” he said.

Syme said the unique abilities of Australian spirits to explore in new and unusual ways has certainly served the sector well, and fostered this innovative approach.

“There has always been a trend in pushing boundaries, incorporating more unique Australian botanicals, and even green ants in gin, to using Australian hardwoods in barrels. Australia’s laws around spirit definitions give more room for manoeuvring and developing great spirits with unique tastes,” Syme said.

Gin is a category of Australian spirit that is known to have started a lot of innovation, through the use of native local botanicals and other interesting flavour infusions, like Four Pillars’ new Yuzu Gin, Manly Spirits’ Lilly Pilly Pink Gin or a number of local Shiraz or rosé wine gin combinations, for example.

Gregor said: “The Aussie distilling scene is red hot right now; there are more than 200 distilleries making gin and so many of them are absolutely world class.

“We have some amazing native botanicals like lemon myrtle, finger limes, Davidson plums, Tasmanian mountain pepper... the list just goes on and on. Nowhere tastes like Australia! Aussie gins are growing faster, at almost double the pace of all other gins in a market where gin is growing incredibly quickly.”

But there is also now more and more innovation across the board too, both in categories like whisky and rum, which are tipped to grow at the rate that gin has, and also in emerging categories where producers are reinventing spirits with an Australian twist.

Some examples can be found in NED Whisky’s Sour Mash SKU, alongside Top Shelf ’s upcoming foray into the agave sector; 36 Short’s handcrafted take on the Eastern European spirit of Rakia; nonalcoholic spirits created by non-alcoholic distillers like Naked Life and also extending lines from existing alcoholic brands like Manly Spirits; and a focus on the eau de vie category from Feels Botanical.

At the heart of these boundary-pushing products, and the wider Australian spirits industry, is flavour experimentation.

Lioulios noted: “The liquor industry is always screaming for more, and we truly love experimenting with different flavour combinations at our distillery.

“We’re passionate about quality ingredients and believe that’s why our spirits provide a real point of difference to customers. Most of our ingredients are sourced from our farm, otherwise we ensure to source it locally. We have amazing produce that is grown all around our distillery and this enables us to experiment with different flavour profiles.”

For Vanderfield-Kramer this is also a point of difference, both with using Australian grapes and also interesting botanicals such as hemp (in Feels Botanical BASK) and horny goat weed (in Feels Botanical ROUSE).

Reaburn added: “Our climate is unique, the earth our raw materials are grown in is unique and that Australian want to never sit still and forever innovate is entrenched in everything we do. Right now there is a huge local movement; people want local jobs, local farmers, local distillers. But it is more than that as well. People want to connect with authentic spirits that are made with care and passion.”

The local movement is not only causing existing Australian distillers to innovate, but also innovating new companies into existence to meet emerging trends, such as that of no and low alcohol.

David Andrew, Founder of Naked LifeNon-Alcoholic Spirits, said: “The nonalcoholictrend is definitely very visible. IWSRforecasts that the no and low alcohol volumein Australia will grow by +16 per cent 2020to 2024. This is no different for spirits as wesee a continued interest from consumer (60per cent of the consumers indicate to want todrink less) and we see more brands launchingin the market.

“As Naked Life is Australian made andowned, the brand has been able to reallyanswer to the local consumer need which isa need for a non-alcoholic drink that looksand tastes like an alcoholic drink.”

The future is certainly bright in a numberof ways for local distillers, and its a futurethey want to protect. Many of the brandsin this story noted sustainability as a hugepoint of focus for this year and beyond, asproducers seek to up their environmentalcredentials and get behind to ‘greenmovement.’ As the industry finds newavenues to thrive in, this will become evenmore important, driven both by consumers and the industry itself.

Introducing NED Sour Mash Australian Whisky

A whisky for all occasions, NEDis a clean, smooth and powerfulwhisky – a whisky that uses thebest of bourbon and single maltproduction to create somethingquintessentially Aussie.

Distilled from a mash billthat is predominately corn, withsupporting wheat and maltedbarley, all of the grains areAustralian grown and fermentedusing lautering and sour mashtechniques. Matured in AmericanOak, Melbourne’s dynamic climateprovides the perfect stage forNED to develop into a bold, richfinished whisky.

The new make spirit showcasescaramel, dark chocolate andsubtle vanilla, flavours checked inevery run with all spirit cuts madeby sensory assessment. Thosearomas beautifully integrate withmocha and dried fruits when fullymature, the local grains giving asoft and viscous texture. Createdfor sharing, celebrating andenjoying whether that be neator mixed.