Dear Client:
Yesterday, we published the first part of our interview with William Grant & Sons’ recently-appointed president & managing director of its US business, Paul Basford [see WSD 01-17-2022]. Today, we’ll pick up where we left off as Paul discusses navigating the new on-premise environment, e-commerce, his priorities for the year, and more.
NAVIGATING THE NEW ON-PREMISE. Like other industry members, the pandemic caused a “dramatic” shift between on and off-premise business. “But what we are seeing now is a very good level of return to the on [premise], which is fantastic,” says Paul.
Paul notes that as the on-premise continues to reopen, there’s been a “piece on reeducation, re-instilling some of the brand ethos” mainly because many “influencers, bartenders – the people that made the industry incredibly special – have navigated somewhere else.” To add another layer to that, “there’s also a different person that you need to influence, it’s not necessarily just the bartender now, there’s a lot more table service.”
Moreover, on-premise operators’ “ranges have gotten narrower…because bars don’t want to carry 500 SKUs anymore.”
“It’s going to be fascinating how this channel comes back,” he adds.
ON THE E-COMMERCE/ DIGITAL FRONT. We also had to ask Paul about William Grant’s e-commerce and digital strategy. “On the e-commerce piece and the social media piece, we’ve actually tailored much more of our creative money into social directly, as you would expect,” Paul explains, adding, “I think our marketing team have done such a great, agile job in switching directly into more online video, on to more creative that goes on social [media].”
Then, of course, they’re “doing a lot more on our e-commerce platform, supporting retail where possible and pushing messages of delivery and those sort of things are now just part of your strategy.” That includes working with Drizly and other key players in the space.
ON SCOTCH TARIFFS. William Grant has a strong Scotch portfolio that was impacted by the retaliatory tariffs implemented in 2019. You’ll recall, the tariffs were a result of the aircraft subsidies dispute between the US and the European Union, and the US suspended the tariffs on Scotch in June.
When the tariffs were in place, there was the worry that this was “going to price everybody out of this part of the market,” according to Paul. “Actually I would say the average price on shelf probably remained relatively stable,” he says.
“There was not a lot of discounting going on once the tariffs were removed. What we’ve done with any tariff benefit is we’ve thrown it back into marketing, so we’ve thrown it back into propelling the brands forward, reinvesting behind the brands, and the consumer is happy to pay that price point that is currently out there.”
2022 GOALS AND OPPORTUNITIES. When thinking about what he’d like to see and do in 2022, Paul said, for one, “there’s a big job to be done on reestablishing the on-premise.” He adds the team is focusing on a dual strategy of building the on-premise business back up while maintaining off-premise growth. “So I want my cake and I want to eat it, in a way,” he half-jokes.
He also notes that tequila is “one of our mainstream opportunities.” Indeed, “Milagro has a huge opportunity, a huge distribution runway ahead of it, particularly as on-premise comes back.”
And, as previously reported, innovation is key this year, particularly around ready-to-serve. Paul adds “we’ve broadened our portfolio” to now 5-7 key brands “all in high double-digit growth,” and “we aim to propel it further with innovation.”
“I think it’s a really exciting time to be a member of the William Grant team, but also to be a customer or distributor of the brands.”
VIRGINIA AND MISSISSIPPI PROPOSE PRIVATIZATION OF STATE-RUN BEV ALC OPERATIONS
Lawmakers in both Virginia and Mississippi recently proposed bills to privatize aspects of their state-run beverage alcohol systems.
Virginia Delegate Nick Freitas filed a bill that would require the Virginia Alcoholic Beverage Control Authority to eliminate “all real estate used as government stores,” per local publication. The bill also would allow private businesses to acquire licenses to sell packaged spirits. Currently, only the state is allowed to operate liquor stores.
As for Mississippi, Representative Trey Lamar proposed a bill to get the state out of the wholesale beverage alcohol business by January 1, 2023, reports a local news affiliate. The bill also proposes lowering the excise tax on alcohol from 27.5% to 18% and allows the Department of Revenue to collect taxes on gross proceeds of wholesalers rather than on individual bottles. Recall, the state has had issues keeping up with high demand for spirits during the pandemic, prompting the Mississippi House to propose a similar bill early last year [see WSD 02-02-2021].
We’ll keep an eye on these latest privatization efforts as they progress.
WSD BRIEFS:
ABSOLUT LAUNCHES “REGISTRY FOR ME” CAMPAIGN. Pernod Ricard’s Absolut announced the launch of its “The Registry for Me” campaign to celebrate singles on Valentine’s Day. Absolut launched a registry site in collaboration with Secret Santa and gift list app Elfster to allow users to curate personal wish lists to celebrate being single and bring friends together for gift exchanges on Valentine’s Day. “As a brand known for mixing – cocktails and also with each other – we love that The Registry for Me brings friends together like never before regardless of lifestyle,” says senior brand director Lara O’Brien. “The Registry for Me is our love letter to singles everywhere.” The activation runs through February 13.
BREAKTHRU APPOINTS NEW VP, BUSINESS TRANSFORMATION AND NEW FRONTIERS. Breakthru Beverage Group announced that Chad Stone has been appointed vp, business transformation & new frontiers, effective January 1. Chad previously served as lead for Breakthru’s commercial excellence team since its founding in 2016. In his previous role he helped develop Breakthru’s commercial capabilities and sales solutions and advanced its business intelligence, master data management, analytics and sales tool platforms. In his new role, Chad will focus on new and emerging areas of growth like omni-channel purchasing, e-commerce, direct-to-consumer, CBD beverages and corporate venture capital initiatives, among others. “Chad brings a wealth of experience and a proven track record of success to this creator role,” says Breakthru evp, chief growth officer Maggie Lapcewich. “He is a transformational leader who has been instrumental in the development and execution of our long-term strategic plan. His insights, understanding of evolving markets and innovative leadership put us in a great position to further expand Breakthru’s capabilities and relevance.”
ROCKY POND APPOINTS NEW WINEMAKER. Washington-based Rocky Pond Estate Winery announced that Elizabeth Keyser has been appointed winemaker, effective February 1. Elizabeth most recently was assistant winemaker at HALL Family Wines, where she created wines for all three brands in HALL’s portfolio. “We are beyond thrilled to have Elizabeth join our team,” states owners David and Michelle Dufenhorst. “Her remarkable talent and enthusiasm will help propel Rocky Pond and the region onto the national stage. We believe in the potential of this special region and Elizabeth shares in our vision.” With Elizabeth’s onboarding, former winemaker Shane Collins will take on a new role as director of viticulture for Rocky Pond Holdings, which owns and operates Rocky Pond Winery’s three estate vineyards. In his new role, Shane will lead a new venture called Cascade Valley Custom Crush.
Until tomorrow,
Your editors
Sarah Barrett, Executive Editor
Hana Kruger, Assistant Editor
“Freedom is something that dies unless it’s used.” – Hunter S. Thompson
——- Sell Day Calendar ———
Today’s Sell Day: 12
Sell days this month: 21
Sell days this month last year: 21
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: 0
