Earlier this week, Dr Nick Morgan looked at what happened when United Distillers lowered the strength of Gordon’s gin. Now in the second part, he looks at the furore when Diageo, UD’s successor company, changed Cardhu from a single malt to a ‘pure malt’. Jane MacQuitty and others were not impressed.
Possibly the most significant reformulation of Scotch whiskies in the past one hundred and fifty years came about as a result of the gradual strength reductions and minimum age requirements imposed during the First World War. Although much opposed by distillers and blenders at the time, few returned to ‘pre-war strength’ once the commercial advantages of this lower strength, combined with eye-watering duty and price increases, became apparent. During the Second World War most ‘deluxe’ blends lost their age statements: it took over twenty years for many of them to be restored. Strength notwithstanding, the entire rationale of whisky blending is to enable blenders to produce a consistent product regardless of changes to ingredients – it is the end product that’s important, not necessarily the individual components. Individual whiskies come and go, their quality can vary, distilleries are sometimes permanently closed (think of the carnage of 1983) or sometimes out of production for many months for upgrades and expansions (leaving a significant hole in the inventory). All this challenges the idea of an ‘original recipe’ that some drinkers might romantically carry in their heads. Blend specifications are all about flexibility, the ability to dodge and dive when it comes to reformulations, hopefully without the consumer noticing.
The Bell’s, the Bell’s
Sometimes whisky reformulations are very public, not about shaving costs out of a brand, but rather focusing on investment and future growth. Such was the case with Bell’s Scotch whisky in 1994 when brand owners United Distillers introduced a new improved eight-year-old version of the brand to replace the ailing Bell’s Extra Special. Bell’s had grown to be a leading brand in the UK through the remorseless attention to detail (if not quality) of Raymond Miquel, and the very close ties it had built with the on-trade. Bell’s had held a 25% share of the UK market, but this had fallen to around 20%, and the brand had lost its position as the leading brand in Scotland to neighbouring Perth-based rival Famous Grouse. A whispering campaign in the trade, and amongst ‘in the know’ consumers, held that Famous Grouse was a higher quality brand, with a greater percentage of malts in the blend. Bell’s distilleries, which provided the backbone of the blend, were worked hard – short fermentations and rapid distillations – and the quality of both single malts and the blend had suffered. Following the acquisition of the brand by Guinness in 1985, who had argued in the takeover battle that the brand had failed to develop export markets, the close ties with the on-trade were lost and promised overseas sales failed to materialise. In short, the Bell’s brand was looking down the barrel of a gun.
The new eight-year-old blend, sourced from the depths of the still abundant whisky loch, was accompanied by “the largest integrated programme ever undertaken in the UK in the history of whisky marketing, both in scale and scope.” It included a £6 million investment in Scottish football, and in addition to a press campaign, the first foray into UK TV advertising for any Scotch whisky brand, breaking a long-standing ‘gentleman’s agreement’ in the whisky industry. Perhaps with the fallout from Gordon’s strength reduction in mind, great care was taken to cultivate the support of whisky writers and journalists. In a declining and ageing market, the aim of the campaign, according to The Independent, was to “target the lost generation of young drinkers who have turned to vodka and white rum”. Sadly, this bold, and some might say misguided, move failed to stem the brand’s slow decline. Over a decade later in 2008, with aged whiskies in increasingly short supply, Diageo withdrew the eight-year-old blend and introduced a new Bell’s Original, said to be based on a recipe used in the 1950s, with a cartoon caricature of Arthur Bell appearing both on the new bottle, and in press and TV advertising. It was a new improved flavour with an original recipe. However, with vodka overtaking Scotch as the UK’s favourite spirit, sales continued to stutter, with Bell’s quietly falling out of the top ten of Scotch whiskies.
Cardhu Pure Malt
Diageo’s ill-judged decision to reformulate Cardhu whisky into a ‘pure malt’ in 2003, a twelve-year-old blend of single malts from Cardhu and Glendullan distilleries, was also aimed at promoting growth, as available supplies of Cardhu single malt fell far short of predicted demand in the brand’s main market. As with Gordon’s strength reduction, there was little or no reaction from consumers (this time in Spain) to the change, but for the whisky industry, it was an existential crisis. Category leaders William Grant’s, fearing the commercial threat an unconstrained Cardhu could pose to its Glenfiddich brand, unleashed a firestorm of negative press, having allegedly given Scottish media relations veteran Jack Irvine a blank cheque to get the product withdrawn. Others feared the damage the move could do to the increasingly profitable single malt category. Mike Keiller, then of Morrison Bowmore and a spokesman for the opposing companies, recalled when we spoke that it was “150% right to oppose the threat to the integrity of the single malt category”, describing his prominent role in the eventual withdrawal of the contentious product as being “one of the best things I did in my career”.
Questions were asked in Parliament. “Mixing its malt lands distiller in whisky wars” ran a headline in The Daily Telegraph; “Diageo shatters Scotch unity” read another. Some familiar voices were heard. “In this one single move, Diageo has shown it doesn’t give a toss about the conventions it is flouting” thundered Patience Gould. Jane MacQuitty in The Times described it “as the worst case of sneaky consumer dealing that I have come across in 25 years of writing about wine and spirits.” Caught in the middle of the crossfire between Diageo and the opposing parties was the Scotch Whisky Association (SWA), and newly appointed chief executive Gavin Hewitt, trying, as he remembered, to find a way “for an industry-led solution rather than having an external solution imposed upon it as some MPs had hinted”.
The issue came to a head in December at the old SWA headquarters in Edinburgh’s normally sleepy Atholl Crescent, “the only time the SWA offices had been besieged by TV satellite trucks accompanied by the leading newspaper and broadcast business journalists of the day”, said Campbell Evans, then director of government and consumer affairs at the SWA. The world’s media, looking for blood on the floor, were disappointed. Whether cooked up over beer and sandwiches (or perhaps drams and haggis bonbons in a cigar smoke-filled room) a deal had been agreed which led to the eventual withdrawal of the new product, and the return of Cardhu single malt. Consumers in Spain, Cardhu’s biggest market, never noticed. But the industry, Diageo included, had been reminded that its cherished regulations were somewhat wanting. After ongoing discussions, “a consensus was reached in late 2004 to seek new legislation based on agreed SWA proposals to better define Scotch Whisky, including a ban on the use of the term Pure Malt.” As Hewitt reminded me “it took five years to convince the UK government to introduce legislation to that end, resulting in the Scotch Whisky Regulations 2009.” Reformulated whisky, reformulated regulations.
Sailor Jerry ain’t what he used to be
The Cardhu spat was very much an industry affair, and whilst some in the business no doubt relished seeing Diageo being given a bloody nose, it was met largely with a vacuum of silence from non-complaining consumers. Of course, that was 2003. Between 2004 and 2010 the voice of the consumer and their self-appointed ‘expert champions’ was weaponised by the proliferation of online blogs and social media platforms. Suddenly being ‘sneaky’ got a lot harder, as William Grants, the owner of spiced rum Sailor Jerry discovered when they introduced a new recipe to the UK market in 2010. The brand, created in 1999, was ‘a spirit drink of spiced Caribbean Rum blended with natural spices’, honouring the memory of tattoo artist Norman ‘Sailor Jerry’ Collins. When Grant’s acquired it in 2008 there were two different recipes, and it was decided to change the UK recipe to bring it in line with the USA. A comment on Amazon sums up the nature of the consumer response, which saw a Facebook page petitioning for the return of the old recipe quickly gain over 15,000 followers: “the day that Sailor Jerry’s changed their recipe here in the UK will live in infamy as a dark day for rum drinkers everywhere. No longer the sweet vanilla spiced treat of its past, it strove toward mediocrity with its new recipe.”
First Drinks, Grants’ distributors in the UK, defended the change, arguing that the new recipe had been thoroughly researched with consumers and the trade, adding that “the new liquid has been extremely well received by bartenders.” Despite the howls of protest, the brand owners stood their ground. The price of bottles of the old UK recipe soared on auction and resale websites – do-it-yourself recipes advised how drinkers could recreate the ‘real taste’ of Sailor Jerry by adding vanilla essence and dark sugar. In 2012 a former First Drinks employee, Tom Hurst launched ‘Admiral Vernon’s Old J’, a spiced rum that promised drinkers a taste of the old Sailor Jerry formulation. “Thankfully” wrote one grateful loyalist, “the original formula lives on in the form of Old J.” In the meantime, Sailor Jerry has been selling around million cases globally since 2017. A curious coda is that William Grants, no doubt much to their surprise, was sued by the widow and family of Norman Collins in 2019, for a variety of infringements of the tattoo artist’s IP rights. Grants had reasonably assumed they had obtained these IP rights with the purchase of the brand. The case was settled, confidentially, late the following year.
Maker’s Mark goes down and then back up again
Let’s finish with a very twenty-first-century brand reformulation, and at the same time return to the running sore of strength reductions. It could be that Maker’s Mark owners, Beam Inc, were emboldened by the relative ease with which Jack Daniel’s had reduced its strength in two steps from 45% ABV to 40% ABV between 1988 and 2004. Whilst the first reduction from 45% to 43% seems to have provoked no comment, the second saw syndicated newspaper articles published across the USA voicing consumer dissatisfaction and promoting an internet petition organised by the Modern Drunkard magazine which eventually gained over 13,000 signatures. Competitors like Jim Beam claimed Daniel’s had reneged on its ‘original recipe’ claim; Daniels responded with the now very familiar set of platitudes about the taste being unaffected, and of consumers’ preference for lower-proof drinks. “We don’t think it’s appropriate to have a magazine called Modern Drunkard dictate how we make our whiskey”, said a spokesman in September. In November 2004 the Louisville Courier Journal reported that Jack Daniel’s sales were booming in the USA and export markets despite “a recent flap over the lowering of the alcohol content”. The following year Advertising Age claimed “virtually no one” had noticed the change.
On 9 February 2013 Bill Samuels Jnr and Rob Samuels sent an email to all members of Maker’s Mark online loyalty programme, explaining that in the face of diminishing stocks the strength of Maker’s would be reduced from 45% ABV to 42% ABV to “enable us to maintain the same taste profile and increase our limited supply so there is enough Maker’s Mark to go around, while we continue to expand the distillery and increase our production capacity.” Taste tests, they claimed, had demonstrated that the reduced strength spirit was still true to Bill Samuel’s original recipe. “We’ve made sure,” they said, “we didn’t screw up your whisky.” “The first thing I did when I heard the unsettling news,” wrote Jack Bettridge in Cigar Aficionado, “was to run out to the liquor store and buy a 1.75 litre bottle of Maker’s Mark —not because I needed a drink at 9:30 a.m., but because I wanted to secure some of the original proof Bourbon from Loretto, Kentucky before it sold out.” Some shopped; many howled in anguish on any and every social media platform they could find.
Quicker than you could say ‘Kwasi Kwarteng’, and after a relentless round of interviews defending and explaining their strategy, father and son (no doubt prompted by owners Beam, who one imagines had also championed the short-sighted change) hit the handbrake and performed a U-turn worthy of a British prime minister. “While we thought we were doing what’s right”, they wrote “this is your brand – and you told us in large numbers to change our decision. You spoke. We listened. And we’re sincerely sorry we let you down.’ Some, like Chuck Cowdery and some of his blog readers thought they smelled a rat. Was it just a marketing ploy and publicity stunt, aimed to empty the shelves of Maker’s? Possibly – over the past twenty years Heinz has played fast and loose with the mental health of lovers of that peculiarly British condiment, Salad Cream. First by threatening to withdraw it from the market, and then to change its name, only for both threats to be withdrawn on the eve of new marketing campaigns for the brand, followed by a revival in sales.
“Your trust, loyalty and passion are what’s most important”
Cynicism aside, the Maker’s Mark fiasco was more likely the consequence of muddled thinking on the part of accountants and marketeers, and a lack of understanding of the loyalty of consumers, and the power of their voice in a new social media age. It would never have happened in 1992, but it could in 2013. “Your trust, loyalty and passion are what’s most important,” said the Samuels, “we realise we can’t lose sight of that. Thanks for your honesty and for reminding us what makes Maker’s Mark, and its fans, so special.” The change back to 45% ABV began with the very first bottling of the very next day.
All things must change, and the brand reformulations discussed here are merely the tip of a very large iceberg of modifications known, and many more modifications unknown. The lessons learned by many from the Maker’s Mark volte-face should have been that consumers really do care, that they really do have deep-seated relationships with brands, and that a little too much transparency is not necessarily a good thing for brand owners. You can be sure that as you read this someone, somewhere, is trying to fuck with one of your favourite spirit brands. Likely as not they’ll try and do it without telling you this time.