An interesting article about an upcoming new release of Haig Club was published on the media and marketing website The Drum yesterday. It is said that the new whisky would be cheaper than the current bottling which has an RRP of £45.
The Drum suspects that Haig Club is not selling overly well, so Diageo is trying to get the brand back on track with a downward brand extension. I am not really surprised here; I already expressed my doubts about the potential for Haig Club on the whisky market in my review of Haig Club back in 2014.
Haig club is quite expensive for a cocktail spirit that is sitting halfway between vodka and traditional blended whisky. And now there is also Absolut Oak from Diageo’s rival Pernod Ricard, a major brand oak aged vodka that is much cheaper and explores this category from the other side of the spectrum. We can watch how the line between whisky and vodka is becoming more and more blurred. I am convinced that the new Haig Club release is also a reaction to Absolut Oak.
Apart from the lower price, Absolut Oak also has a psychological advantage over Haig Club. It is “vodka plus” whereas Haig Club with its lack of traditional whisky character can only be described as “whisky minus”. And since this will be a new release and not just a rebranding of the old Haig Club – that of course would be like openly admitting a failure – the new, cheaper, liquid might be even more characterless than the original release.
A large portion of the Drum article focuses on David Beckham endorsing Haig Club. What the article does not mention is the fact that David Beckham was specifically chosen because he is very popular in China. In fact Haig Club was explicitly created for the Asian market where Diageo apparently saw an abundance of well-earning young people eagerly waiting to spend the equivalent of £45 on a bottle of young grain whisky. To quote Diageo CEO Ivan Menezes:
“The blend [sic] was created to match with food and seafood in China and our choice of David Beckham as the face of Haig Club was down to the extraordinary name recognition he has in China and across the world.”
Haig Club is symptomatic for the focus on Asia in general and on China in particular that has been guiding the actions of the whisky industry in the last years to an extent that entire distilleries were built from scratch because of booming demand there.
Whisky producers have been competing for the silliest marketing stunts with anything from from special bottlings for Chinese New Year to an obscenely priced “lucky number 8” cask at the newly opened Annandale distillery. Some of these make you wonder how stupid some whisky producers believe the rich Asians actually are. Motivations range from optimism in the growth potential of the Asian market to pure greed.
But Asia is a very volatile market and the boom has already reverted. So far only distillery expansions have been put on hold. But who knows what might happen if the whisky buisness gets even worse in Asia. It is obvious that this Asian rollercaoster ride is not without consequences for the rest of the market, and one wonders if it is really the right thing to put so much focus on exports to a region that still only earns the industry a fraction of the combined Western markets.
It takes a lot more than celebrity endorsements and bling bottles to implant such a quintessetially Western tradition as whisky into Asia beyond short-lived fads. The better way to do this is to make whisky on location, but this is a slow process.
In Japan it has taken decades to convince people that there is a world beyond sake and shochu, but now the Japanese whisky industry is thriving. In Taiwan and India this process has just started, but the success of particularly Kavalan and Amrut has shown that they are on a good path. Diageo’s acquisition of India’s United Spirits so far was entirely focused on the molasses-based rotgut that makes India the world’s biggest “whisky” producer. But establishing a serious whisky culture needs a different approach.
The great advantage of creating a whisky tradition from inside is that people can also see such a development with a dose of national pride. This has the potential to create a much stronger bond between producer and customer than selling the illusion of luxury by exporting overpriced liquid in fancy packaging.