Time to spice up your Rum offer

Time to spice up your Rum offer

Gemma Cooper

In my household, it is a story of two halves; I, like many others, have enjoyed the variety the gin boom has offered lately, however, my partner is a rum enthusiast, collecting, displaying and consuming the different offerings from around the world. It looks like rum could be next spirit to experience a boom and choice has already begun to widen in the off trade, meaning rum connoisseurs and casual drinkers alike are in for a treat.

Rum has grown +£25m over the last few years and is now worth £362m in the off trade. Giving it a #5 spirits ranking, ahead of Imported Whiskey and behind Liqueurs & Specialities. With rum tipped for a resurgence, let’s take a look at the segments that are likely to drive so you can plan ahead. Flavoured/spiced rum is the standout segment and the one you should keep your eye on as it’s grown +£25.1m (+21%) over the last 3 years, contributing 84% of the overall off trade rum value growth seen. This means flavoured/spiced rum holds nearly 40% share of overall rum sales, overtaking white rum, which has experienced annual declines, as the #1 sector within the off trade rum category.

The flavoured/spiced rum category is well established, but has only just seen real movement over the past couple of years. There are a few key drivers of this: it has benefited from the premiumisation trend, as shoppers trade up to more expensive offerings; it now appears in more spirits baskets as an additional purchase to the regular alcohol purchases as shoppers look to experiment; and the repeat purchase is at an all time high in the off trade.

There are two key shopper demographics driving this surge: the older households (65yrs+) and the 35-44year age bracket. Both of these groups have significantly increased the amount they spend on flavoured/spiced rum, and are more likely to trade up to a more premium offering. However, the two groups differ on the propensity for repeat purchase with the younger group likely to purchase again once and the older households likely to purchase again on twice. These older households control just over a third of FMCG spend, and nearly 40% of overall spirits spend, and the amount they spend continues to increase each year. So, it is crucial that you understand this shopper group and have the right offerings on shelf to appeal to them for this key age group and an important factor here when it comes to capitalising on the rum trend is catering to them with smaller pack sizes.

The Gin boom has benefited from craft, heritage and provenance and the rum category could benefit from a focus on these areas as well in order to continue the growth momentum and to resonate with those lighter shoppers whom we know are eager to try something new and have been a large contributor to Gin’s success.

Rum is definitely charting the course to experience a resurgence in the near future. If you haven’t already, it’s definitely time to have a fresh look at your current rum offering and adapt it to cater for those key shopper groups. With summer fast approaching, this is the time to make sure that you’re in on the right side of the trend.

Originally published in Drinks Retailing News, June 2019