So let’s take a look at how brands are talking to the emerging middle classes and upwardly mobile whisky drinkers of one of the potentially important rising markets for whisky – China.
As we all know, whisky is becoming an ever-increasingly globalised drink. It is already distilled all over the world in around 40 different countries, so it makes sense that its consumer base would span the globe with varying wealth, needs and desires. Because of this, every country or area will engage differently with whisky brands as drinking cultures vary so much from place to place.
In order for a brand to maintain a hold on their market share across the globe, they have to know how to speak to people in each place on a level that will draw them in and keep them interested. But the big thing all whisky brands are facing is the question of who the Chinese whisky drinker really is; what they like doing in their lives away from whisky, where whisky fits in to their world, what establishments do they drink at, what other spirits are of interest to them and why do they want to drink whisky? A lot of questions for brand ambassadors and marketing teams, sure, but a world of opportunity awaits for each and every Scotch, Irish and world whisky brand once they unlock this precious understanding of who they are trying to get their product in front of.
Producers are approaching the Chinese market with caution, respect and optimism. In China, the culture is to drink and toast. And when you’re done drinking and toasting, you top up your glass and do it all again. Many brands are experimenting, including Benromach with their exclusive single cask for China, Teeling with a limited edition product that was finished in ex-Chinese red wine casks and a host of limited-edition packaging releases for Chinese New Year each year.
“The Chinese whisky market potential is huge,” says Ian Taylor, global brand director, malts at Barcardi. “It’s the new generation of whisky drinkers in China whisky brands need to be mindful of, as there’s massive potential here. Some of the big players in China are focused on ‘elitist’ luxury – they bottle at 40% and add colouring – are they doing enough? Is it not now the time to go in, to be distinct and, more importantly, to educate?”
This creates an air of exclusivity, elevating Scotch to be perceived as precious and a drink that should be used to celebrate. This is the crux of how brands have been approaching the building of their presence – launching and pumping money into the luxury, limited-edition end of ranges, as demonstrated by whisky brands such as The Dalmore, The Macallan, Yamazaki, Hakushu, Craigellachie, Glenfarclas and Glenmorangie.
This is a classic marketing and product release strategy whereby the higher-end products create a halo for their more accessible products as consumers entering the range at the lower tiers will buy in to the aspiration of owning something special at a price point they are comfortable with. The aim here is that once these consumers are more economically enabled, they will buy the higher-end products from these exact same ranges to symbolise their growing wealth and status and to build a sense of self around reward.
So that has been the strategy so far, but there is definitely more to be said for going after a broader market and targeting a less wealthy but younger demographic. These consumers will eventually be promoted, earn more and want to show off their new-found socioeconomic relevance, so there is an argument to be had for brands to target these whisky drinkers on the way up so that they stay with them and advocate their more premium products once they have achieved what they want to achieve in their careers.
By dressing Scotch up as exclusive and expensive there is the risk of alienating other consumers, but on the flip side of this, by reaching out to everybody you run the risk of not really hitting the mark anywhere. That’s the challenge for brand owners in such a lucrative new world market.
Culture in China is very focussed on status and where you stand within society, and if Scotch is perceived as a luxury it will draw more customers as an aspirational premium spirit to be associated with.
The advertising blog Marketing in China explains, “The drink is fast becoming a strong indicator of status in a country pre-occupied with social standing and ‘face’, that is appearance and reputation. ‘Face’ is an important concept to understand for any business expanding into China. The Chinese prioritise their status and how they communicate this amongst friends and family. The branding of whisky labels is effectively tapping into this Chinese attitude. The label on the bottle is the real indicator of wealth and prestige, in China bottles will certainly be centre stage.”
So while the ultimate market might be younger, brands are more likely to be able to tap into this market by building a reputation as a premium, aspirational drink and people will flock, especially if they think it gives them status.
Scotch brands still have a lot to do in China to get their names known, but they are having success and are building a platform for sustained growth in the near, medium and long term in a market where consumers are thirsty for information, knowledge, understanding and to form connections with luxury foreign brands.