Dive Brief:
- Diageo is debuting "Whiskey Union," on target with the company's mission to further explore the Scotch whisky category as it goes head to head with growth in the American and New World markets.
- It is based on a new business model directed at a new segment of drinkers.
- To start, this includes releasing two products on a trial basis in Berlin, Hamburg, Munich, and Vienna before their global launch, with a third to follow not long after.
Dive Insight:
"Our ... creations are about exploration of flavour and pushing the 55 boundaries of blending," said David Gates, head of premium core spirits at Diageo during Diageo's investors conference last week. "They are unorthodox, weird and wonderful and possibly like nothing you’ve ever tasted before."
Some of "Whiskey Union's" varieties will be labeled as Scotch whisky in adherence with strict regulations, but others that are more experimental with "room to play" will not bear the official Scotch whisky designation.
Diageo announced in March that it aimed to innovate its products over the next five years, and this project is in line with that goal. To bring together innovation with the whiskey market is even more crucial as competition heats up in the most popular spirit segment in the U.S., which saw 7.3% growth and a 40-year high in inventory for Kentucky bourbon in 2014. Diageo may also focus on producing more rye whiskey varieties, like its Bulleit brand, as that category saw 536% volume growth over the past 5 years.
The "Whiskey Union" project is in stark contrast to Diageo's move just over a year ago to cancel plans for expansion of its whisky capacity due to a drop in global demand for its products.