Wednesday, September 28, 2016
Everybody knows what age statements are, but many don't understand what age statements really mean. So, some facts about age statements.
For whiskey, in the U.S., an age statement is required if the whiskey is less than four years old. After four years age statements are voluntary. In Europe, an age statement is never required but a grain distillate must be aged at least three years to be called 'whiskey.' The U.S. has no minimum age requirement. It has the age statement requirement instead.
Although age statements are voluntary, they must be true. For the statement to be true, it must give the age of the youngest whiskey in the mix. Only if a product is single barrel or bottled-in-bond will it all be the same age.
In practice, an age-stated product will mostly contain whiskey at or just over the stated age, with a little bit of older whiskey, but you never know unless the distiller tells you. That too is voluntary and typically changes over time.
As a distillery's inventory changes, along with changes in sales and product mix, the age statement once seen as a marketing advantage can handcuff the producer, preventing it from using whiskey that has the right taste because it doesn't have the minimum calendar age.
Since most age statements are voluntary, they are used only when the brand feels an age statement will help sales without hamstringing the production side. When an age statement becomes too restrictive, it is changed or, more often, dropped. This is nothing new. Wild Turkey lost its 8-year-old age statement more than 20 years ago.
Knob Creek was created 25 years ago. It was very small at first and the industry was awash with aged whiskey due to overproduction in the 70s. The Small Batch Collection of which it was part was an experiment. No one knew if there was enough demand for super-premium bourbon. They were unknown, unproven, and needed every advantage they could get. All of the Small Batch brands had age statements.
Of the four, Knob Creek was the oldest, cheapest, and most successful. Today Knob is a substantial and well-established brand. With inventories tight industry-wide due to booming sales, the Knob age statement became expendable.
The use or non-use of an age statement is always a marketing decision. When most bourbon sold was barely 4-years-old and not age-stated, a few brands decided to go with a modest statement, like Very Old Barton at 6, or Evan Williams at 7, to differentiate themselves from the NAS (non-age stated) products in the same price segment.
That was easy to do 40-50 years ago. Today it's a problem. If you have an age-stated product and more demand for it than your inventory can support, you have three choices. (1) Keep the age statement and start allocating the brand, keeping your sales and profits flat. (2) Keep the age statement and raise the price enough to raise profits despite flat sales. (3) Lose the age statement, keep the price more-or-less the same, and increase profits by producing enough (using some younger whiskey) to meet growing demand.
In the old days, brand loyalty was all. Today many bourbonistas like to drink around but brand loyalty is still very important. Producers know from experience that most loyalists have a good taste memory. They know how their regular brand tastes and you tamper with that at your peril. A price increase is the second worst thing you can do. If a price increase is modest and there are no viable alternatives, people will accept a price increase. But if the flavor changes, the people who were your best customers will abandon you in droves. Lose the age statement and, while there may be some carping, sales won't be affected.
The reassuring thing is this. Since changing the flavor is the deadliest sin, the producer will do everything it can to keep the flavor the same. That is their highest priority. Their business depends on it. So it is preposterous to suppose that the disappearance of an age statement will mean an immediate or even long term debasement of the product. The truth is exactly the opposite. The age statement was sacrificed to protect the flavor.
Businesses, more even than humans, tend to be rational animals. They act in what they perceive to be the best interest of the business. You can count on it. When that interest coincides with your interest, you have nothing to worry about.
Monday, September 26, 2016
|Their whiskey wasn't very good.|
When producers make changes, many drinkers balk reflexively. Why are we so unwilling to accept change? Because those very producers have told us for years that change is bad.
Back in 2005, when the company now known as Beam Suntory (the makers of Knob Creek) created its first major TV advertising campaign for its flagship Jim Beam Bourbon, the theme was “true to our original recipe for 209 years.”
Bulleit Bourbon, a product created within the lifetime of any person of legal drinking age, purports to be made from an ancient recipe passed down to Tom Bulleit from his great-great-grandfather, Augustus. Mr. Bulleit blushes when asked about this story. Like the Beams, he has no parchment to show you, just a ‘tradition’ passed from father to son, and who can argue with that?
The problem with these and every other claim about an ancient, unchanged bourbon recipe is twofold. (1) Bourbon today is much better in every way than what they were drinking in 1795 or 1830, and (2) the claims are untrue, because whiskeys, like most products, are constantly changing.
Even 100 years ago, mashbills were pretty flexible. (In a multi-grain whiskey, the 'mashbill' describes what grains are used and in what proportions.) Ingredients varied based on cost and availability. Products were often made by combining whiskeys made from different recipes at different distilleries. Today there is much more consistency, but there are still variations. Different batches of grain can vary in significant ways. Changes to the stills make a difference. When energy is costly, distilleries will run a thicker mash to reduce energy costs. Wood characteristics vary from tree to tree. Every difference, however small, makes a difference.
Because there are so many variables producers don't rely on recipes, they rely on taste. Every distillery has a library of bottles that record in liquid form how different batches have tasted over the years. Every producer has a panel of tasters whose job is to compare each new batch to the standard for that product. If the new batch doesn't measure up adjustments are made, generally by adding whiskey that possesses the missing characteristic. They are limited in this effort by labeling rules. If a product is age-stated, '9-years-old' for example, no whiskey may be used that is less than 9-years-old even if the profile calls for it.
Virtually all whiskey producers strive for consistency, as do most manufacturers regardless of the product. At the same time there is a seemingly-contradictory impulse to constant improvement. This varies with product type. Technology products have to improve or die. With other products, such as whiskey, long-term consistency seems the higher value.
Twenty to thirty years ago, when America was awash with whiskey no one wanted, many producers routinely put 8- to 10-year-old whiskey into their standard NAS products. They didn't publicize it because they knew it was temporary and no law required disclosure. There were few complaints.
Today, rapid demand growth has outstripped the industry's supply side. Because whiskey has to be aged, you inevitably over-produce or under-produce. It is almost impossible to get it just right. The challenge today is to meet as much demand as you can with the inventory you have, and to do it as profitably as possible.
Because of the demand growth, everyone today is distilling as much whiskey as they can as fast as they can. All indicators say bourbon sales will continue to grow for years to come. All indicators have been wrong before. Nothing is certain.
Marketers of all kinds know a lot about consumer behavior. With whiskey, there are two sure ways to piss off your most loyal customers, raise the price or change the taste, and between those two changing the taste is worse. Everything else, including label changes, has a lower priority.
So producers will continue to like the "nothing changes" claim, but what you should hear is "we're doing everything we can to keep everything you care about the same." That may not be snappy, but it has the virtue of being true.
Thursday, September 22, 2016
This can work because Knob actually finds itself with an over-abundance of whiskey more than 9-years old that will mix well with younger Knob to keep the profile the same. Based on inventory already in the pipeline, they will be able to grow the brand and maintain the profile but only if they are not bound by the age statement. Something had to give.
Older doesn't balance younger with any kind of mathematical precision. You don't get a 9-year-old flavor by mixing half 10-year-old with half 8-year-old, but that is a shorthand way to describe the process. More and more large distilleries are doing this, as they find themselves with various quantities of whiskey across a large and widening age range.
The age statement change only affects the standard Knob Creek expression. The Single Barrel Reserve will continue to have an age statement and the rye, which never had one, will continue unchanged. Nothing else is changing.
Inventory tightness also makes future 'special' Knob releases, like the vintage-dated 2001 expression in distribution now, unlikely.
No one likes to see an age statement go away, but it is part of the times in which we live. Beam has both the inventory and the expertise to keep making whiskey with the same flavor profile in ever larger quantities indefinitely. That is the goal, anyway.
To Knob fans, Noe makes this pledge. "I will taste every batch. It won’t be Knob Creek unless I say it’s Knob Creek.”
You might want to set aside an age-stated bottle just to see how well he does.
Wednesday, September 21, 2016
|The Donnington Priory location of Dreweatts.|
It is rare that we get a glimpse of the actual market for such 'unicorns.' In the United States, it is illegal to sell alcohol without a license so virtually the entire secondary market is underground. No one knows how big it is and there is no reliable record of prices paid. Two bottles in a distant auction do not a market make, but it's something.
At this point, the selling price for A. H. Hirsch, Van Winkle, George T. Stagg, and select others has nothing to do with their quality or drinkability. It is based entirely on the economics of scarcity and the willingness of some monied folk to spend outrageous sums to obtain something book writers say they can't have. It is much like the old joke about why dogs lick their own balls.
Because they can.
Speaking as someone who is neither wealthy nor especially limber, but who has tasted most of the rarities, you should not feel too badly if you haven't. All of these extremely desirable whiskeys are good whiskeys, but are they 40-times better than a lot of everyday pops? Not really. It's just whiskey. You're mostly paying for the ego trip.
Incidentally, most of the 80 lots are single malt scotch, many in the £100-120 range ($130-155). Bidding is online but I have no idea if residents of the USA can participate.
Wednesday, September 14, 2016
Sazerac today unveiled new packaging for the Weller bourbon line and doubled-down on the fictional claim that Weller is “The Original Wheated Bourbon,” which it debuted with the last packaging update a few years ago.
The distortion and misrepresentation gets even worse in the accompanying press release.
“Born in 1825, William Larue Weller was one of the early distilling pioneers in Kentucky. After serving with the Louisville Brigade in the 1840s, Weller returned to Louisville to join the family tradition of whiskey distilling.”
There is no evidence that William Larue Weller ever distilled a drop of whiskey, and plenty of evidence to the contrary. Nor is there any evidence that anyone in his family before him ever distilled. There is no recorded Weller family tradition of whiskey distilling.
Weller’s company did not make whiskey, it sold whiskey. Weller was a rectifier. That means he bought whiskey from distilleries; finished it through techniques such as blending, filtering and flavoring; packaged it for sale; and sold it to customers. After 1871, the Weller company had a still, which they used to re-distill poor grade whiskey into neutral spirits which they called ‘cologne spirits.’ The company even issued a statement that it did no original distilling, just this redistillation.
The press release continues with more fiction about Weller. “He developed his original bourbon recipe with wheat, rather than rye in the mash bill. Weller’s original wheated recipe bourbon became so popular he was forced to put a green thumbprint on barrels to ensure that customers were receiving the real deal.” Since Weller wasn’t distilling anything, he had no need for any recipes. The ‘green thumbprint’ is a new wrinkle and may have been a form of branding, which was just emerging at the time, but it merely would have identified Weller’s company as the product’s source. There is no reason to assume it indicated a wheated recipe.
“His namesake company eventually went on to merge with Pappy Van Winkle’s A. Ph. Stitzel Distillery to form the Stitzel-Weller Distillery, one of the most iconic and beloved distilleries in Kentucky.”
This may be the most distorted claim of the bunch. In 1893, ‘Pappy’ Van Winkle went to work for Weller as a whiskey salesman. When Weller retired in 1896, Pappy and another salesman, Alex Farnsley, bought his share and gained controlling interest in the company. When Prohibition came they obtained a medicinal whiskey license. Pappy also had an ownership interest in one of the Weller company’s primary suppliers, the A. Ph. Stitzel Distillery. In 1933, he merged the two companies to form Stitzel-Weller.
The source for most of this is And Always Fine Bourbon, Pappy Van Winkle and the Story of Old Fitzgerald, written by Pappy’s granddaughter, Sally Van Winkle Campbell, and published in 1999.
When Prohibition ended, Pappy built a new distillery and decided to make a wheated bourbon there. It was the only recipe that distillery made, which they sold as Old Fitzgerald, Old Weller, and several other brands. It is not recorded why they chose a wheated recipe, but the prevailing theory is that they believed a wheated bourbon would be palatable at a younger age, which was important in those early years when no one had very much aged whiskey.
Although recipes for wheated bourbon appear in some pre-Prohibition records, Stitzel-Weller was the first distillery to promote its wheated recipe. In earlier days, wheat was commonly substituted for rye in bourbon recipes based on availability, cost, and personal preference but rye was the dominant ‘flavor grain.’
No one ever claimed the ‘invention’ of wheated bourbon until Maker’s Mark came along. They, too, were indulging in fiction since their wheater followed Stitzel-Weller’s by at least 20 years. It may be that what Sazerac is really trying to say with this claim is that Weller was a wheater before Maker’s Mark. That is true.
As always, the problem for bourbon distilleries with these forays into fiction writing is that they diminish the real history of the people, companies, and brands. All of the major producers, and many of the small ones, are guilty of it in one way or another. Marketing will always be with us, but there is still such a thing as truth. Now you know Weller’s true story.