A CLOSER LOOK AT JAMESON IRISH WHISKEY

Wine & Spirits Daily
December 6, 2010

Jameson Irish Whiskey has reached the 1 million case mark in the US, with annuals sales of 3 million cases globally.  Today we spoke with Wayne Hartunian, vp of marketing for whiskies and cognac, Pernod Ricard USA, who gave us some insight on the brand along with wider industry issues.  He previously served as Jameson's marketing director and has watched the brand grow over the past several years. Here's what Wayne had to say as you, dear reader, are a fly on the wall:

WINE & SPIRITS DAILY:  Congratulations on reaching the 1-million case mark.

WAYNE HARTUNIAN:  Thanks.  Obviously this is a huge milestone for the brand.  And not only that, the growth rate is still extremely strong.   Jameson sales in the US are up 29.3% in volume and 28.6% in value in the 4-weeks end November 13, according to Nielsen food, drug and liquor store scans.  In the 13-weeks, volume grew 26.1% and value gained 25.9%.  And in the 26-weeks, volume increased 20.7% and value gained 20.9%, so you can see that its momentum is accelerating.

Throughout the entire recessionary period, the brand really wasn't affected.  The growth rate maintained a very strong rate over 20% at the off-premise and the on-premise, which as you know was hit hard by the economic downturn.

WSD: Why do you think Jameson has been so successful?

WAYNE:  There are a few key drivers.  For one, a lot of the growth is organic, which is nice.  We haven't had the need or the desire to price promote this brand at all.  A lot of that organic growth stems from bartenders.  There are only a handful of brands that bartenders are passionate about, and Jameson is one of them.  When we do research in a lot of cities, a lot of bartenders call Jameson the bartenders' brand.  In fact they're so passionate about it that quite a few of them tattoo themselves with elements of the brand or the logo, which is obviously the ultimate expression of advocacy.

Another factor is creative marketing initiatives.  We launched the 'Lost Barrel' campaign on TV about a year ago.  It's the first time we've done television advertising on the brand in the US, and it's extremely creative and different from spirits advertising, or really any advertising that you see out there, because it looks more like an excerpt from an epic movie.  A lot of spirits advertising takes place around a bar and friends together, so this is a totally different approach.  Also, the marketing investment each year keeps increasing significantly.

Also our on-premise promotions are very unique in terms of how they support the brand equity. This year we introduced Jameson's 'Truth of Folklore' game for the iPad just to bring it more to life and more interactive.  And another key marketing initiative from a trade standpoint is the 'Bartender Ball' because, again, we have such a strong advocacy with bartenders.  We started this probably about 4 years ago. It continues to bring more bartenders into the fold, and continues to reinforce relationships with the ones we already have strong relationships with.

Furthermore, the 'Tipping Point Category Management' initiative is something we kicked off a couple of years ago, recognizing there is a strong story for the Irish whiskey category - primarily with Jameson driving it.  So we put together an initiative with category management tools for our sales force and distributors to go into both the on-premise and the off-premise, where they talk about the success of the category and also more importantly the future potential for significant additional growth.

And finally, another driver of growth that cannot be underplayed is the product's taste.  It is a very smooth and accessible whiskey.  So it's a combination of both brand equity and product aptitudes that are driving it.

WSD:  Does the success of the Irish whiskey category drive Jameson or vice versa?

WAYNE:  Jameson represents nearly three-quarters of the category's market share, so given the scale of the brand within the category, it's going to be a driver.  And yes, it's always consistently growing at a faster rate than the category itself if you look at Nielsen or NABCA.

As much as Jameson is a part of the Irish whiskey category, which is the fastest growing category in the industry, we also feel it has transcended the category.  So we are tracking with a lot of other categories that are outside of Irish whiskey, like North American whiskey for example. The 'Tipping Point Category Management' initiative is all about Irish whiskey.  That benefits us because as retailers recognize the strength and growth of the category, they will focus more on Jameson, give it more space, place it in the right area in stores, promote it more often and things like that.  But from our own internal target we look at it as a much broader competitive set than just Irish whiskey.

WSD:  How is the on-premise environment currently?

WAYNE: We see it definitely improving in general.  With Jameson specifically, it has never really been impacted on-premise by more than a couple of percentage points over the past couple of years, and the growth rate is still over 20% on-premise.

WSD:  How is holiday pricing so far?

WAYNE:  It hasn't been as aggressive in general as it was in the past as far as what I've seen.  And we don't price promote Jameson because it's something that grows on its own - it's not necessary.

There are some early indicators out there that things are off to a pretty good start for consumer package goods in general, such as retail sales and internet commerce during the Black Friday weekend.

WSD:  Is there anything else you would like to add?

WAYNE:  Even though we have hit this milestone, I think the message that is as big, if not bigger in terms of importance, is the future potential of the brand in terms of significant additional growth. It is extremely healthy in terms of its growth and we will continue to grow it in a healthy manner.  To avoid price promotion and focus more on the other marketing levers that will drive long term, healthy growth.  I'm just very excited about the future of the brand.

WSD:  Thank you for speaking with us.