EDITORIAL: Whisky innovation mustn't be at cost of existing values

Jane Bainbridge, Deputy editor, Marketing, Thursday, 11 December 2003, 12:00am,

Whisky is a subject dear to my heart. Not only is it coming up to Christmas and therefore ample reason to indulge in a wee tot, but I was brought up in a household where a hot toddy was the first form of medicine I encountered, and at an age that would probably have Social Services round these days. Of course, the addition of honey and lemon - or indeed, anything bar a splash of water, and only then with the right malt - is sacrilege to the whisky connoisseur.

And that's part of the problem. Marketers want to expand this sector to attract drinkers below the age of retirement, but they can't afford to alienate their core market, for whom mixers and any such modern frippery are an anathema. Tradition is everything in this market, which is why Diageo has backed down in its wrangle with the rest of the Scotch distilling fraternity over the subtle alteration of its Cardhu whisky brand.

When Diageo ran short of the malt whisky, ironically due in part to the success of its affordable malt marketing strategy for the label in Spain, it did not follow the course normally used by the sector. When a product takes 12 years to mature, there's no simple remedy to a shortfall.

Where others have limited distribution or used younger malts and changed the age claim on the label, Diageo decided to blend a range of malts from its Speyside distilleries and change the name from single malt to 'pure malt' without further modifying the packaging.

Even though it is the biggest producer of Scotch, Diageo could not escape the wrath and very public outrage of its rivals. The compromise agreed last week is that it will keep the pure malt name, but change the colour of its label and packaging. While this matter is clearly very important to the Scottish Whisky Association, is it really of consequence to the whisky-buying public if a slight alteration to the recipe of one brand doesn't comply with tradition?

In a word, yes. Diageo might have done the industry a favour in forcing it to address the lack of legal definitions of its categories - its own form of appellation controlee must surely follow - but it has hardly bolstered the global reputation of Scotch.

In an already confusing market to the uninitiated, Diageo has only confused further. Whisky manufacturers are basing their expansion of the £2.9bn market on growing the premium end and tampering with its malt is not going to further the cause with either existing or yet-to-be-converted customers.

Diageo partly defended its adapted recipe as innovation, which is to be applauded, as this will be a key to introducing drinkers to the category.

But surely innovation means new products, packaging design and targeting, not undermining an existing brand's positioning to satisfy supply problems.

This article was first published on Marketing