What’s Going on With Gin

Joey McHugh & Brendon Doran

Category Snapshot                   

TOTAL GIN (LIQUOR) 16 OZ. Total Consumption BehaviorScape Framework

      LifeStyle

BehaviorStage Cosmopolitan Centers

Affluent Suburban Spreads

Comfortable Country

Struggling Urban Cores

Modest Working Towns

Plain Rural Living Total

Start-Up FamiliesHHs with Young Children Only < 6 111 11 13 28 10 23 30

Small Scale FamiliesSmall HHs with Older Children 6+ 81 58 11 32 8 21 33

Younger Bustling FamiliesLarge HHs with Children (6+), HOH <40 58 34 7 20 6 7 18

Older Bustling FamiliesLarge HHs with Children (6+), HOH 40+ 162 135 23 33 9 14 67

Young TransitionalsAny size HHs, No Children, < 35 62 22 40 73 31 57 50

Independent Singles1 person HHs, No Children, 35-64 70 52 60 41 33 56 51

Senior Singles1 person HHs, No Children, 65+ 213 116 99 235 119 343 197

Established Couples2+ person HHs, No Children, 35-54 55 34 45 154 37 46 56

Empty Nest Couples2+ person HHs, No Children, 55-64 436 148 89 194 229 47 166

Senior Couples2+ person HHs, No Children, 65+ 252 364 263 274 218 166 249

Total 146 116 80 101 76 93 100

Total GIN Beefeater Seagrams Gordons% Volume Index % Volume Index % Volume Index % Volume Index

64.4% 93 89.6% 130 22.6% 33 82.7% 120

10.2% 85 2.7% 23 16.0% 134 3.4% 28

19.9% 161 3.8% 31 53.2% 429 7.2% 58

2.2% 51 2.6% 61 7.0% 163 4.8% 113

3.3% 153 1.2% 57 1.2% 57 1.9% 86

24.7% 91 19.0% 70 13.8% 51 31.6% 117

52.5% 162 69.1% 213 70.7% 218 52.3% 161

9.0% 56 6.0% 37 9.2% 57 5.8% 36

3.8% 28 2.7% 21 4.7% 35 3.7% 28

10.0% 90 3.2% 29 1.6% 15 6.6% 60

2.5% 32 2.2% 27 3.9% 49 3.1% 39

13.8% 119 1.8% 15 45.1% 389 3.0% 26

7.2% 63 6.4% 57 10.6% 94 7.4% 65

14.2% 135 7.1% 67 11.7% 111 15.7% 149

5.7% 62 4.0% 43 3.6% 39 8.2% 88

14.2% 79 15.1% 84 9.9% 55 18.5% 102

13.1% 112 25.5% 218 4.7% 40 11.9% 101

15.0% 132 26.3% 231 4.8% 42 13.1% 115

14.3% 178 11.6% 143 5.7% 71 19.3% 239

0.8% 19 2.4% 54 1.7% 40 2.0% 47

3.6% 24 8.3% 55 6.1% 41 7.2% 48

12.3% 70 3.0% 17 4.9% 28 6.6% 37

9.2% 45 5.1% 25 8.3% 41 3.6% 18

24.4% 128 13.3% 70 53.6% 281 10.0% 52

24.2% 188 41.0% 319 12.0% 93 32.2% 251

25.6% 240 27.0% 253 13.3% 125 38.5% 361

$50,000 - $74,999

$75,000 - $99,999

$100,000 - $149,999

5+ Persons

Household Income

Under $10,000

Number of Persons

1 Person

2 Persons

3 Persons

$40,000 - $49,999

$10,000 - $19,999

$20,000 - $29,999

Asian

Age 18 - 24

Age 25 - 34

Age 35 - 44

Age 45 - 54

Age 55 - 64

Age 65 - 74

4 Persons

$150,000 or More

Age of Head of Household

$30,000 - $39,999

Other

Age 75 or More

Demographic Variables

Race of Head of Household

White

Black

Hispanic

Category Role• We both are fans of Liquor, and heard about Gin so much in class it

was an easy decision. Also Joey Worked in a Liquor store in St. Louis so he had some experience

• Size in U.S. Sales:• 2007: $340 mill • Trend has been growth but no updated numbers• Total Alcoholic Beverages in same year over $15 Billion

• As of 2012 5.3% of total spirits category

• Low penetration (2.71% regional) (3.2% total U.S.)

ITEM $ (000) DOLLAR SHARE ITEM BUYERS (000)

ITEM PENETRATION

ITEM $ PER ITEM BUYER

ITEM $ PER ITEM TRIP

ITEM UNITS PER ITEM TRIP

PURCHASE CYCLE (IN

ELAPSED DAYS)

LOYALTY (SHARE OF $

REQ.)% ITEM $ ON

DEAL% DOLLARS WITH MANUFACTURER

COUPON

DEPT- ALCOHOLIC BEVERAGES TOTAL U.S.15,075,290.0 3.7 70,129.5 60.4 215.0 17.6 2.0 18.2 100.0 22.8 0.3

WEST SOUTH CENTRAL1,534,028.3 3.5 7,335.6 56.5 209.1 18.3 2.0 17.9 100.0 15.2 0.0

GIN TOTAL U.S.340,187.4 100.0 3,690.8 3.2 92.2 22.2 1.3 32.3 100.0 18.2 0.1

WEST SOUTH CENTRAL29,014.2 100.0 349.5 2.7 83.0 20.0 1.1 35.3 100.0 8.5 0.0

BEEFEATER - GIN TOTAL U.S.53,985.3 15.9 354.6 0.3 152.2 36.7 1.5 33.8 60.1 15.5 0.3

WEST SOUTH CENTRAL

BOMBAY - GIN TOTAL U.S.11,944.1 3.5 144.4 0.1 82.7 26.7 1.1 44.9 28.7 31.0 0.1

WEST SOUTH CENTRAL

BOMBAY SAPPHIRE - GIN TOTAL U.S.39,146.7 11.5 490.1 0.4 79.9 32.5 1.1 44.3 42.7 27.5 0.0

WEST SOUTH CENTRAL

BURNETT'S - GIN TOTAL U.S.12,849.5 3.8 150.9 0.1 85.2 17.7 1.2 28.1 47.7 19.2 0.0

WEST SOUTH CENTRAL

CTL BR - GIN TOTAL U.S.5,311.6 1.6 146.0 0.1 36.4 13.9 1.3 24.9 49.0 36.5 0.0

WEST SOUTH CENTRAL

GILBEY'S - GIN TOTAL U.S.10,612.8 3.1 276.0 0.2 38.5 17.7 1.2 35.4 19.0 33.4 0.0

WEST SOUTH CENTRAL

GORDON'S - GIN TOTAL U.S.47,618.4 14.0 530.1 0.5 89.8 22.4 1.5 34.0 57.5 10.2 0.0

WEST SOUTH CENTRAL

SEAGRAM'S EXTRA DRY - GIN TOTAL U.S.45,116.9 13.3 761.5 0.7 59.3 15.5 1.1 32.9 66.3 17.8 0.0

WEST SOUTH CENTRAL

TANQUERAY - GIN TOTAL U.S.52,829.1 15.5 763.5 0.7 69.2 24.2 1.0 42.3 59.1 19.3 0.2

WEST SOUTH CENTRAL

TANQUERAY RANGPUR - GIN TOTAL U.S.3,983.1 1.2 153.3 0.1 26.0 20.6 1.0 44.4 12.5 12.7 0.0

WEST SOUTH CENTRAL\

Assigning the role

Avg Gm of almost 40%

Why Gin

• In 2012 gin accounted for 5.3% share of the liquor industry up from 4.4% in 2007.

• Slow but steady growth• Potential with aging baby-boomers

• It is a pull marketing industry – will always be a high demand (gives power to suppliers)

• No private brands (only differentiating brands)• Legal complications with P/L’s

• Only a few distilleries willing to brew them (Mile High Spirits, Private Label Distillery)

• Not a normal category• Depending on location there is potential to increase depth

Retailers Audited

• Grapevine Wines & Cheese (Kirkwood, MO)

• Z &Z Liquor (Kirkwood, MO)

• Fossil Creek (Anna, TX)

• Goody Goody (Anna, TX)

• Liquor World (Fay)

• Wedington Liquor (Fay)

• Cheers (Fay)

• Liquor to Go (fay)

• Crossover Liquor (Fay)

• Dickson Street Liquor (fay)

• Liquor Mart and Wine Shoppe (Fay)

• The Spirits Shop (Fay)

• Midway Liquor (Fay)

• Town & Country (Fay)

• Premier Wines & Spirits (Fay)

• City Liquor (Fay)

• 69 different SKU’s

Fayetteville% HHs HHs Index % HHs HHs Index % HHs HHs Index % HHs HHs Index

Race of Head of Household White 69.0% 100 75.6% 110 78.3% 114 82.9% 120 Black 11.9% 100 9.0% 75 7.5% 63 6.0% 51 Hispanic 12.5% 100 6.0% 48 5.1% 41 4.1% 33 Asian 4.3% 100 5.8% 137 5.3% 123 3.8% 88 Other 2.2% 100 3.6% 161 3.8% 169 3.2% 141Number of Persons 1 Person 27.1% 100 48.5% 179 49.4% 182 41.8% 154 2 Persons 32.4% 100 32.0% 99 31.3% 97 33.0% 102 3 Persons 16.2% 100 11.0% 68 11.1% 69 13.4% 83 4 Persons 13.2% 100 5.4% 41 5.3% 40 7.6% 58 5+ Persons 11.1% 100 3.1% 28 2.8% 25 4.1% 37Household Income Under $10,000 7.7% 100 27.6% 361 24.9% 325 18.7% 244 $10,000 - $19,999 11.2% 100 23.8% 213 23.7% 212 18.8% 168 $20,000 - $29,999 10.9% 100 15.0% 138 14.5% 133 12.6% 115 $30,000 - $39,999 10.1% 100 10.7% 106 12.7% 125 12.4% 122 $40,000 - $49,999 9.0% 100 7.7% 86 7.0% 78 6.8% 76 $50,000 - $74,999 17.9% 100 7.7% 43 8.2% 46 9.7% 54 $75,000 - $99,999 11.9% 100 2.5% 21 3.3% 27 6.7% 56 $100,000 - $149,999 12.3% 100 3.6% 29 3.8% 31 9.0% 73 $150,000 or More 9.0% 100 1.2% 14 1.9% 22 5.4% 60Age of Head of Household Age 18 - 24 4.2% 100 29.6% 702 25.3% 601 18.8% 447 Age 25 - 34 15.1% 100 32.4% 215 30.8% 204 28.5% 189 Age 35 - 44 17.4% 100 14.2% 82 14.8% 85 16.1% 93 Age 45 - 54 20.1% 100 9.3% 46 10.3% 51 12.4% 62 Age 55 - 64 19.4% 100 8.3% 43 10.0% 52 12.3% 64 Age 65 - 74 13.2% 100 3.6% 27 4.9% 37 6.8% 52 Age 75 or More 10.7% 100 2.6% 25 3.9% 36 5.1% 47

Reference 1 mile Ring 2 mile Ring 3 mile RingDemography

Striving Suburban Mix 3.4% 100 35.2% 1038 22.2% 654 19.5% 576 Struggling Small City Mix 3.3% 100 49.9% 1536 52.7% 1621 30.5% 937 Struggling Minipolitan 4.8% 100 14.9% 310 25.1% 523 14.5% 303

Kirkwood MO% HHs HHs Index % HHs HHs Index % HHs HHs Index % HHs HHs Index

Race of Head of Household White 69.0% 100 87.6% 127 92.5% 134 93.3% 135 Black 11.9% 100 8.0% 67 3.8% 32 2.8% 24 Hispanic 12.5% 100 2.0% 16 1.6% 13 1.5% 12 Asian 4.3% 100 1.5% 36 1.1% 27 1.6% 37 Other 2.2% 100 0.9% 40 0.9% 42 0.8% 37Number of Persons 1 Person 27.1% 100 45.0% 166 31.7% 117 28.7% 106 2 Persons 32.4% 100 27.5% 85 32.9% 102 34.9% 108 3 Persons 16.2% 100 12.6% 78 15.7% 97 15.5% 96 4 Persons 13.2% 100 8.8% 67 12.5% 95 13.0% 99 5+ Persons 11.1% 100 6.1% 55 7.2% 65 7.9% 71Household Income Under $10,000 7.7% 100 5.7% 75 4.5% 58 3.9% 51 $10,000 - $19,999 11.2% 100 10.8% 97 6.1% 55 5.8% 52 $20,000 - $29,999 10.9% 100 12.5% 115 7.9% 72 7.3% 67 $30,000 - $39,999 10.1% 100 6.7% 66 6.9% 68 7.1% 70 $40,000 - $49,999 9.0% 100 8.8% 98 7.5% 83 6.9% 77 $50,000 - $74,999 17.9% 100 15.5% 86 17.3% 96 16.6% 93 $75,000 - $99,999 11.9% 100 11.5% 97 13.6% 114 13.7% 115 $100,000 - $149,999 12.3% 100 13.5% 109 16.9% 137 17.4% 142 $150,000 or More 9.0% 100 15.0% 167 19.4% 216 21.2% 236Age of Head of Household Age 18 - 24 4.2% 100 2.5% 59 2.0% 46 1.7% 40 Age 25 - 34 15.1% 100 13.7% 91 11.4% 76 10.0% 66 Age 35 - 44 17.4% 100 14.6% 84 15.6% 90 14.3% 82 Age 45 - 54 20.1% 100 16.8% 84 20.0% 100 20.5% 102 Age 55 - 64 19.4% 100 18.2% 94 21.8% 113 22.8% 118 Age 65 - 74 13.2% 100 13.6% 103 15.0% 113 15.5% 118 Age 75 or More 10.7% 100 20.6% 192 14.2% 133 15.3% 142

Reference 1 mile Ring 2 mile Ring 3 mile RingDemography

Prosperous Suburbs 4.2% 100 22.9% 545 29.3% 696 23.4% 557 Affluent Suburbs 4.2% 100 19.5% 464 14.3% 339 9.3% 220 Affluent Minipolitan Sprawl 5.3% 100 11.5% 215 23.3% 437 34.0% 638

Anna Texas% HHs HHs Index % HHs HHs Index % HHs HHs Index % HHs HHs Index

Race of Head of Household White 69.0% 100 8.6% 13 17.7% 26 36.8% 53 Black 11.9% 100 4.8% 40 4.9% 41 5.4% 45 Hispanic 12.5% 100 85.6% 682 74.7% 596 52.0% 415 Asian 4.3% 100 0.4% 9 1.7% 40 4.3% 100 Other 2.2% 100 0.6% 25 1.0% 43 1.5% 67Number of Persons 1 Person 27.1% 100 16.2% 60 22.1% 81 28.8% 106 2 Persons 32.4% 100 17.5% 54 22.0% 68 26.2% 81 3 Persons 16.2% 100 19.7% 122 17.2% 106 14.8% 92 4 Persons 13.2% 100 18.0% 137 15.7% 119 13.1% 99 5+ Persons 11.1% 100 28.6% 257 23.1% 207 17.0% 153Household Income Under $10,000 7.7% 100 8.5% 111 7.5% 98 6.3% 83 $10,000 - $19,999 11.2% 100 17.6% 157 17.2% 154 13.1% 117 $20,000 - $29,999 10.9% 100 21.1% 194 20.3% 187 16.0% 147 $30,000 - $39,999 10.1% 100 16.4% 162 15.5% 153 13.3% 131 $40,000 - $49,999 9.0% 100 9.8% 109 9.0% 100 9.1% 101 $50,000 - $74,999 17.9% 100 17.6% 98 16.8% 94 16.9% 94 $75,000 - $99,999 11.9% 100 5.0% 42 5.8% 49 7.5% 63 $100,000 - $149,999 12.3% 100 3.0% 24 4.7% 38 8.2% 66 $150,000 or More 9.0% 100 1.0% 12 3.3% 36 9.5% 106Age of Head of Household Age 18 - 24 4.2% 100 8.1% 192 6.9% 163 5.8% 138 Age 25 - 34 15.1% 100 30.3% 201 26.2% 173 24.6% 163 Age 35 - 44 17.4% 100 28.3% 163 26.0% 150 23.2% 133 Age 45 - 54 20.1% 100 18.5% 92 19.2% 96 19.0% 95 Age 55 - 64 19.4% 100 9.0% 47 11.9% 61 13.8% 71 Age 65 - 74 13.2% 100 3.8% 29 5.6% 43 7.2% 55 Age 75 or More 10.7% 100 1.9% 18 4.2% 39 6.4% 60

Reference 1 mile Ring 2 mile Ring 3 mile RingDemography

Store SKUs Percent FacingsGrapvine Wine & Cheese, Kirkwood, MO, F

21 10.9% 21

Z&Z Liquor, Kirkwood, Mo, F 13 6.7% 13

Cheers, Fayetteville, AR, F 42 21.8% 44

liquor to go, Fayetteville, Ar, F 37 19.2% 40

Crossover Liquor, Fayetteville, Ar, F 54 28.0% 65

Dickson St. Liquor, Fayetteville, Ar, F 34 17.6% 35

Liquor Mart and Wine Shoppe, Fayetteville, Ar, F

44 22.8% 45

The Spirit Shop, Fayetteville, Ar, F 24 12.4% 29

Liquor World, Fayetteville, Ar, F 41 21.2% 68

Wedington Liquor, Fayetteville, Ar, F 33 17.1% 45

Midway Liquor, Fayetteville,Ar, F 16 8.3% 22

Fossil Creek, Anna,Tx, F 31 16.1% 45

Goody Goody Liquor, Anna,Tx, F 35 18.1% 82

Town &Country, Fayetteville, Ar, F 24 12.4% 26

Premier Wine & Spirits, Fayetteville, Ar, F

24 12.4% 31

City Liquor, Fayetteville, Ar, F 21 10.9% 22

Changes

• 2006 there were 63 different SKUs• 2010 there were over 100 different SKUs• 2013 there were 66 different SKUs• We found 69 Different SKUs

• It all depends on the region and demographics

• Prices of the Big names have gone up slightly in some places but are mostly the same

• Prices varied based on location

• Facings and display share have remained constant for the most part• Share for boutique brands varies the most• Some changes in differentiation brands in stores

The Big Names

• Beefeater Distilleries (5.8% SKUs)• Bombay Spirits Company (8.7%)• Heaven Hill Distilleries (8.7%)• Schenley Diageo Global (4.3%)• Seagram Company Limited (17.4%)• Tanqueray Gordon and Company

(11.6%)• We lumped all the differentiating

bands together as “Others” (30) accounting for 43.5% of the total SKUs

• Beefeater• Beefeater 24• Bombay London Dry• Bombay Sapphire• Gilbey’s Extra Dry• Seagram’s apple twisted (Grape, Lime, orange,

raspberry)• Seagram’s Distillers Reserve• Seagram’s Extra Dry• Tanqueray London Dry• Tanqueray No. 10• Tanqueray Rangpur• Burnett’s London Dry• Heaven Hill London Dry

Supplier Share of Facings

Gross Margin ($) by Store and Manufacturer

Gross Margin (%) by Store and Manufacturer

Thank You!

Questions?