Premium alcohol brands on the rise in South Africa

DESPITE difficult economic conditions, South Africans are not shying away from drinking premium alcohol brands.

Top whisky brands experienced substantial growth last year from the previous year and that trend is set to continue.

According to the Sunday Times Top Brands Survey 2013, the number of people consuming premium spirits increased 5% from 2011 to 2012.

Johnnie Walker was ranked first in the Alcoholic Spirits category, with Jameson in second place and Chivas Regal in third.

Pernod Ricard marketing manager Seth Pereira, who is the marketing manager for Jameson, said premium alcohol brands had benefited from the growth of the middle class, and had largely been unaffected by the economic downturn.

“The emerging middle class has opened a brand-new market for premium brands and alcohol is one of the ways people choose to show they’ve made it, or are doing well. Advertising has also been a key factor in increasing the number of whisky drinkers.

“When Jameson came into the market it wasn’t a credible brand. But we managed to harness the power of advertising ‘Triple distilled, twice as smooth’ and positioned our brand as a trendy one,” he said.

Mr Pereira said some of Jameson’s success could be attributed to the fact that you did not have to pay an “out there” amount for it: a bottle costs R219.

Statistics from the South African Liquor Traders Association show that in the premium whisky sector, Jameson sells the highest volumes, followed by Johnnie Walker Black Label and Jack Daniels.

In fact, Jameson sales grew 15% in 2012 compared to the year before, and Johnnie Walker’s sales of its Black Label brand increased more than 50% in 2012 from the previous year.

Legal threat

The Control of Marketing of Alcohol Beverages Bill will be gazetted later this week and it proposes a total ban on alcohol advertising.

Chamber of Commerce and Industry policy consultant Pietman Roos said the proposed restrictions on alcohol advertisements would be counterproductive.

“All that the restriction on alcohol advertising will achieve is that people will watch fewer alcohol adverts. Billions of rand will be lost in creative industries. The proposed restrictions will have a severe economic cost and will not achieve their (the department’s) goal,” he said.

However, Social Development Minister Bathabile Dlamini continues to defend the bill.

“In a Medical Research Council article, researcher Charles Parry writes that about 130 people a day die of alcohol-related causes.

“The resulting economic costs are enormous and the tangible and intangible costs associated are far in excess of the contributions the alcohol industry makes to the fiscus,” she said.

Mr Pereira said the law was detrimental to brands and to the country.

“The big brands that are already committed to the consumer’s memory will continue to thrive, but start-ups and upcoming brands will struggle to survive if they are unable to market themselves,” he said.

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