How does one truly define luxury, especially in whisky? Is it based on price? Age? Exclusivity? Investability? Is it based on a feeling, or personal connection? Or is it some assemblage of all of the above?
In reality it will be a marginally different definition for everyone. Some put value in limited-access releases from cult distilleries such as Ardbeg, or even London’s Bimber, where age statements are less of a consideration as the brand itself has built either clout or status through its production, personality, or prior releases.
Then the question of what to do with the bottle remains. Do you keep it? Do you hope to sell it one day? Do you leave it to the kids as a sort of liquid inheritance fund? Or dare you open and drink it?
Diageo surely hopes for the latter, as noted by James Mackay, the company’s global private client director: “All of Diageo’s whiskies, whether held as part of a collection or otherwise, are made with the intention that they will be consumed and enjoyed. In my interaction with our worldwide community of private clients, I am delighted to see that each one of them make a point of tasting each one of their whiskies, typically sharing such tastings with others who share their passion for rare and exceptional whisky.”
Joe Wilson at Whisky Auctioneer has his own take, believing that luxury in whisky is nothing new but that it is more prevalent in the industry now than it has ever been. “The market leader in this respect is Macallan, and they were probably the earliest to position themselves in this space,” he says. “While most single malt brands were still finding their feet in the 1980s, Macallan directly targeted the affluent after-dinner drinks setting, notably through releases such as the Anniversary Malts which were packaged with elegant labels and wooden boxes reminiscent of those used by fine wines and Cognac houses.”
According to Wilson, it is bottles such as these – which have gained elite status to the point that they may be considered “too fancy to drink” – that form the backbone of the secondary market. “As enthusiasm for whisky has exploded in recent years, so too has interest in bottles from the past and sites like Whisky Auctioneer have offered the ideal platform for this, making it more accessible than it has ever been,” he says. “What is key to the secondary market is that value is determined by what people are prepared to pay, and this is mostly informed by the whisky itself rather than how they are presented.”
There are a number of considerations for brands when selecting, sampling, bottling, packaging, and releasing whiskies that may be deemed ‘old and rare’. Not only must they deliver on flavour and pricing, they must also elevate the perception of a brand whilst acting as a halo over the core ranges (which is where the volume and most of the revenue will ultimately come from).
Jonathan Gibson is marketing director for House of Hazelwood, a new-to-market luxury whisky range from the William Grant & Sons stable. He describes the long-term thinking at the core of the brand’s release planning: “In our instance, the process goes back a very long way indeed. Many of our casks were first laid down in the middle of the last century and – notably – they were often laid down with the specific intent that they be kept back for long-term maturation.”
As Gibson explains, House of Hazelwood’s releases fall into various camps. Some are experimental in nature, such as the Blended at Birth and Cask Trials releases, held back from new make with an intention to explore how the character would develop in a given cask for a given length of time. Other casks contained liquid of great significance, such as The First Drop – the very first whisky to run off the stills at Girvan Distillery. In some cases, a whisky’s potential was identified partway through its maturation process as its flavour and character developed, and it was then set aside for further ageing and examination – this was the case for Sunshine on Speyside and A Breath of Fresh Air. And still others contain early examples of long-term marrying in cask, for example The Long Marriage, which was blended at three years old and matured for a further 53 years in a single sherry butt.
At Highlands distillery Glenglassaugh it is a very different story. Global brand ambassador Stewart Buchanan explains that Rachel Barrie, master blender for Glenglassaugh and its sister distilleries GlenDronach and Benriach, never has a final intention in mind for each cask; it is the sampling and monitoring of all casks in its coastal warehouses that generate ideas about what they might eventually be used for. Outside of its core and prestige ranges, the distillery also works collaboratively with private buyers to create old and rare expressions that will never be publicly available.
Buchanan explains, “Regional or private cask sales are special as they allow the buyer to take a more active role in the type of expression they will receive. Visiting the distillery to sample the cask, adding packaging customisation, and building a direct relationship with the distillery are all bespoke opportunities offered with this type of purchase. Consumer motivation varies and ultimately it is their decision on what to do with their purchase.” Like Wilson and Gibson, Buchanan notes the importance of flavour as well as value in these purchases. “Individual cask selection is done to preserve the liquid at the ultimate moment in its maturation so in that sense, yes, we do hope they will be enjoyed at some point.”
Pricing is a hugely sensitive part of releasing a whisky in the old and rare category. Get it wrong and it could
sit on shelves gathering dust for decades, looking overpriced and out of touch; get it right and the pace of sales could be brisk, adding even more desirability to the next release. “Age, number of bottles, packaging, and awareness of the distillery in the market are some of the key factors when pricing these releases,” Buchanan says. “Buyers of luxury single malts are shopping globally, so being transparent with consistent global pricing is very important.”
For Gibson at House of Hazelwood it is more about the expression’s premium nature and rarity, given the connection between each cask and the Grant family who own the brand and inventory to this day. “These are amongst the oldest and rarest whiskies of their kind – casks that had previously been held back for family ownership and personal consumption. There is in many instances a personal connection to the liquid itself, with each one representing a link back to a different era and memories associated with that,” he says. “When pricing the whiskies, we set out to respect the rarity and provenance of the liquid – to bring them to market in a manner that does them justice. That said, we also look to price these in a way that makes sense to whisky enthusiasts and collectors, that encourages them to buy into the collection.
“The decision has been made to open up what was until now a private family collection of aged whisky for public consumption – with that in mind we want people to feel empowered to purchase a bottle, to feel that it is fair value, and in due course, when the time is right, to open it and enjoy the whisky inside.”
Mackay at Diageo concurs, adding that a combination of factors go into the end pricing model. “Quality is fundamental. All of our clients taste before buying – this is subjective, but unless they consider a whisky to be outstanding they are very unlikely to add it to their collection. Provenance is key; our clients value whisky that comes from a particular place and time, and the more special that place the better, hence single malts like Talisker, Mortlach, Port Ellen, and Brora tend to be valued more highly than others, and Johnnie Walker above all other blends. Again, this is highly subjective. Lastly, rarity is the next most important factor, and there’s no doubt it can make the occasion of opening and sharing a bottle that much more special, if it is known to be one of only a few left in the world.”
Looking at the juggernauts of the seconardy market, there are specific expressions from brands such as The Macallan, The Dalmore, and Ardbeg that hold perhaps the greatest sway among both consumers and collectors. But what leads a brand to become so sought after? Wilson believes the answer depends on the brand in question: “While modern output from distillers like Macallan, Bowmore, and Dalmore [has] increasingly leaned into their luxury status through elaborate packaging or high-profile collaborations with artists, fashion houses, or car makers, the secondary market has also elevated names like Springbank, Laphroaig, and Ardbeg that have historically been less flashy in their marketing. At the heart of the issue is that all of these big names have an earned legacy of high-quality production.” Wilson points to Macallan’s highly sought-after Fine & Rare series, a collection of more than 50 vintage releases that eschews fussy packaging in favour of the “simple and now classic bottle-in-a-woden-box” aesthetic. He says interest in the collection, particularly among collectors, helped pushed average prices from £8,000 a bottle in 2016 to £14,000 in 2020.
But other brands have manoeuvred their way into this elite, too. GlenDronach, for instance, has created a proposition for the luxury category through the introduction of its Grandeur series and the release of an ultra-premium 50-year-old. “It is, however, the understated presentation of its annual single cask batches that holds the key to its popularity,” Wilson notes. “The distillery is now well known for its steadfast dedication to sherry cask maturation and has become one of the top 10 brands at Whisky Auctioneer, where the single casks range experienced a 500 per cent-plus average lot value increase from 2016 to 2020.”