Spirits Makers Replace Bartender With Convenience

Spirits Makers Replace Bartender With Convenience
As More Americans Entertain at Home to Save Money, Liquor Companies Offer New Lines of Pre-Made CocktailsArticle

By DAVID KESMODEL
Liquor giants are rolling out pre-mixed products to entice recession-weary Americans to serve more cocktails at home.

On Thursday, Beam Global Spirits & Wine Inc. is unveiling Sauza Margarita-in-a-Box, 15 servings of pre-made margaritas containing its Sauza tequila. The party-in-a-box, scheduled to hit the market in May, will cost about $18. Brown-Forman Corp., meanwhile, plans to release two ready-to-drink cocktails in bottles this summer, including Southern Comfort Sweet Tea. And Diageo PLC has begun releasing several prepared cocktails, including Captain Morgan Long Island Iced Tea.

Distilled-spirits makers are aware that many drinkers don't want to fuss with mixing drinks themselves. At the same time, they want to address a shift by consumers toward entertaining at home more and visiting bars less. Last year, sales of spirits in bars and restaurants in the U.S. fell 2.2% by volume, the first decline since 1995, according to the Distilled Spirits Council of the U.S., a trade group. Total liquor sales rose 1.3% by volume last year, the slowest rate in a decade, according to Impact Databank, the research arm of drinks-industry publisher M. Shanken Communications Inc.

Spirits makers face a challenge in trying to court consumers in a weak economy because liquor is perceived as more expensive than beer or wine, said Anne Carlson, an analyst with market-research firm Information Resources Inc. "They are doing a lot of different things to find their way," including selling both smaller and larger bottles of liquor to give consumers more choices.

Some consumers, preferring cocktails with fresh ingredients, may balk at the pre-made drinks. These new products come at a time when restaurants and bars have introduced cocktails with fresh fruit and juices, and spirits companies have been helping train bartenders to make more sophisticated cocktails.

Beam Global, a unit of the Deerfield, Ill., conglomerate Fortune Brands Inc., says its 1.75-liter margarita boxes are made to fit into a refrigerator and to be toted to barbecues and picnics. The company says it will be the first boxed margarita cocktail in the U.S. market containing real tequila.

Beam Global decided to offer the beverage partly to compete better with beer and wine products, which typically can be carried more easily to outdoor events than various cocktail ingredients. In addition, the success of boxed wines in the U.S. "shows that convenient packaging can be a big benefit for consumers," said Gary Ross, associate brand manager for Sauza.


Beam Global Spirits & Wine Inc.
Beam Global Spirits & Wine Inc. is unveiling Sauza Margarita-in-a-Box, 15 servings of pre-made margaritas containing its Sauza tequila. The party-in-a-box, scheduled to hit the market in May, will cost about $18.
The liquor maker also will release this month several new flavors of its DeKuyper Burst Bar Shots, which are pre-mixed shots that it began selling last summer.

Brown-Forman, the Louisville, Ky., maker of Jack Daniel's whiskey, plans in late June to release two prepared cocktails made with its Southern Comfort whiskey-flavored liqueur: Southern Comfort Sweet Tea and Southern Comfort Hurricane. The 1.75-liter bottles will sell for about $20 each. The beverages mark one of the largest new product launches for Southern Comfort since Brown-Forman bought the brand 30 years ago, said Campbell Brown, director of the Americas for the brand.

Sales declines for Southern Comfort in bars in key markets such as New York and Florida "have been pretty large" in the recession, Mr. Brown said. Sales in grocery and liquor stores have "softened the landing, but we need to have new news out there about the brand."

London-based Diageo is releasing Smirnoff Tuscan Lemonade, Captain Morgan Long Island Iced Tea and Captain Morgan Parrot Bay Mojitos across the U.S. by the end of May. Diageo, the world's largest spirits producer by volume, has been pleased with the sales of other prepared cocktails, including its four-year-old Jose Cuervo Golden Margarita, sold in bottles, said Larry Schwartz, president of the U.S. arm of Diageo. The company believes the new products also help lift awareness and sales of its flagship brands, such as Smirnoff vodka, he said.

Sales of prepared cocktails have been rising faster than spirits sales overall in the U.S. over the last year. In the year to date through Feb. 22, sales of prepared cocktails at U.S. food and drug stores rose 8% in dollar terms against year-earlier levels, while total spirits sales climbed 4%, according to Chicago-based Information Resources.

Write to David Kesmodel at david.kesmodel@wsj.com

Printed in The Wall Street Journal, page B9

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