Will absinthe become a major category this time around? Presented at Canadean 2013

1. Uncovering the opportunities and threats
resulting from emerging categories and media,
highlighting how to maximise future potential.
Alan Moss December 2013

2. My background
13 years with Remy/
Maxxium: UK, India, S.E.
Asia/Korea.
Consultancy for Campari
International.
9 years in absinthe
category, selling to over
30 countries.

3. Investigating the recent re-emergence of
absinthe to determine whether the category
will achieve critical mass this time around.
How emerging categories and sub-categories
impact your innovation pipelines

4. Investigating the recent re-emergence of
absinthe to determine whether the category
will achieve critical mass this time around.

5. Savoy
Cocktails
All cocktails
Ingredients
%
Absinthe drinks
Ingredients
%
Gin 421 48 58 54
Vermouth 286 33 47 44
Brandy 134 15 16 15
Whisky 117 13 19 18
Absinthe 108 12 108 100
Rum 91 16 18 17
Cointreau 48 12 18 17
Sherry 29 13 14 13
Vodka 4 27 9 8
Total 878 1,603 108

6. Achieving critical mass?
Not yet, at least not by "big company" standards.
Less than 250,000 x 9 litre cases in total (Source: IWSR 2012). c.
40% in USA.
At $60+ a bottle, however, it is an interesting "craft spirits" category.
With improvements in product quality (following the Swiss and US
examples), and better product marketing, the category IS growing in
most markets, especially in large cities, and in top new bars.
Critical mass is being achieved in key sectors, especially in USA.

7. Canon
Seattle
Absinthes
Page 1

12. Critical Mass?
No. of US bars with more than 10 higher quality absinthes (i.e.
ones with no artificial colours) in many States, especially NY,
California, Nevada, Illinois, Washington DC, Florida, Texas,
Louisiana, Colorado. No. = 100+
Similar UK bars? No. = 5?
No. of US liquor store groups (20+ outlets) with more than 5
higher quality absinthes in CA, Illinois, Texas , Nevada etc. No. = 5+
Similar UK liquor store groups? No. = 0.

13. Typical Absinthe Sales Chart (years)
0
25
50
75
100
1 2 3 4 5 6 7 8 9 10
The Misinformed
Minus the
Disappointed
The Well Educated

14. Absinthe 2000 - 2013
2000 La Fée Versinthe *
2001 Pernod Absente * Francois Guy
2002
2003
2004 Jade
2005 Kubler La Clandestine
2006
2007 Lucid St. George Mansinthe
2008 USA Flood! St. Antoine
2009
2010 USA Casualties
2011 France resolved
2012
2013 Pernod re-launch La Fée re-launch

17. Absinthe constraint factors
100 years of misunderstanding.
15 years of sub-standard products and questionable
marketing outside the control of Portman etc.
Emphasis on, or innuendoes about "the absinthe
effect."
Burning.
No definition (except in Switzerland).

23. Absinthe growth factors
Move to all-natural, distilled absinthes.
Moving from "absinthe effects" and burning to "terroir" and heritage.
Growth of cocktails.
Big company interest.
Costs and pricing.
Opportunities in E. Europe, Asia, and S. America.
Potential market size: 1 million x 9 litre cases within 5 years.

24. How emerging categories and sub-categories
impact your innovation pipelines

25. Some top industry trends
Global growth of cocktails,
both classic and modern. YES
Premium/super premium
spirits share growth. YES
Move to craft drinks with
authenticity/heritage and
localised appeal. YES
Low alcohol/low calorie. NO
Category blurring, e.g.
Flavoured Tequila, Ciroc
Amaretto. NO

27. Innovation in Absinthe?
The category remains very new for most consumers: so is innovation
appropriate?
Flavoured and RTD absinthe mixes have been tried in the US,
unsuccessfully so far.
Higher strength products.
Lower strength products, including cream, egg and chocolate bases.
Barrel-aged absinthes.
Packaging, especially 200 ml.

30. Product Development
Like most Swiss companies, we re-entered with a "blanche" style: we
decided early on to get into the bigger "verte" sector, with two
brands, including an absinthe first made in the USA in 1902 (a 12
month project).
We are testing an ultra-premium expression: six year barrel-aged
absinthe. Rather "niche."
Dessert style absinthe drinks being marketed. We have an Absinthe
Egg Nog; another company has a chocolate flavoured absinthe.
Smaller bottles are good for trial and/or affordability.

32. Summary
Critical mass is being achieved,
especially in the USA. Much
more to come.
Social media can allow smaller
brands to compete with the
bigger brands.
Innovation may be less
important for a market that is
still young (the second time
around!), and that is still so
widely misunderstood.