Scotch is bouncing back; more modern spirits are flourishing; women are key to growth T he UK off-trade spirits market is proving resilient in the face of tough pricing competition in the multiple grocers. Last year, with the help of the millennium, volumes grew by 5% and this year growth is estimated at 3% [AC Nielsen], but the battle to keep customers and increase traffic in the stores means that the average price for a 70cl bottle of spirits is continuing to drop. The suppliers have found it difficult to raise prices in the face of Every Day Low Pricing and the high/low promotions have led to a drop in activity, but what activity there is, is more hard hitting. Other trade channels are feeling the impact. Sarah Clarke, First Drinks Brands brand manager says: "It is difficult for the independents to keep up with the price wars because they do not have the buying power and margin to sustain price cutting. They will be further pushed out of the market as supermarkets continue to move to the one stop shopping concept. "But the specialists and the convenience stores are about a different shopping experience and they present the opportunity for distributors to tailor their offers and allow greater differentiation between brands." The market is dominated by Scotch whisky which has been in decline but the latest figures show it is now growing 2%. The main activity is in the more modern spirits which have greater potential for mixing and for occasions. Tequila is growing rapidly (+34% in the 12 months to June), liqueurs and specialities are registering 17% growth and vodka is up 10%. Richard Hayes, brand director for spirits at Allied Domecq, says women are a key factor in these categories. "The women's drinking market is becoming more and more sophisticated, driven by women aged between 35 and 44 who are pushing the boundaries. There is a real opportunity for the trade. Women have greater disposable income and are drinking in greater numbers than in the past." He points out the liqueurs market is worth £34m more this year than last and its off-trade retail sales value is £196m. The category has benefited from consistent investment in brand equity with advertising from key brands such as Baileys, Tia Maria and Southern Comfort. "Liqueurs seen as after dinner drinks have limited potential. We are trying to convince people they can be drunk long and mixed. This means consumers purchase more often." He says ranges should be reviewed and more space given to those brands which sell "over the odds". Julie Page, marketing director at Seagram, is also keen to develop the rapid growth categories in the spirits market. "We are focusing on brands which appeal to those under the age of 34 and the young at heart," she says. The company's leading brand Martell has 42% of the UK cognac market and is performing ahead of it but rapid growth is coming from Morgan Spiced, Plymouth gin, Absolut vodka and the newest lines Bulleit premium bourbon and Olmeca tequila. {{FOCUS SPECIALS }}