Master of Malt Blog

Ken Grier on what makes an investment-grade spirit

After a recent tasting of Dictador’s latest 2 Masters release, MoM caught up with affable marketing mastermind Ken Grier to find out just what makes a spirit investment grade.  

“I help people do cool stuff,” says Grier, explaining his job. “I did it for Macallan for 20 years and I had a lot of fun. Now I do it for other people. These are not just vanity projects, it’s about connecting with consumers in a highly distinctive manner: telling stories, making people dream, helping people to feel smarter, cooler and giving them more status. A moment of really special enjoyment where you go, ‘Wow, I can’t believe you’ve opened that’.

Grier helped to put The Macallan on the world stage. After retiring from the Scotch mega brand’s parent company, Edrington in 2018, he set up his own consultancy firm, De-Still, where he helps brands to reach their potential. A potential that often includes becoming an ‘investment grade spirit’. He describes investment-grade spirits as having a particular cocktail of ingredients, including provenance and often some history.

The second thing we can say is that they would normally carry some degree of distinctiveness in terms of liquid. Whether that be a rarity, a complexity within that. These things make something collectible. There is definitely something about scarcity and genuine rarity.

Investment-grade spirits also have a certain aesthetic, Grier explains, whether that’s simple elegance or an activation such as the £50,000-a-bottle Bowmore and Aston Martin collaboration.

You either want something that gives an incredible user experience or something that makes people feel there is some arbitrage there – that they feel they bought smartly, they have the respect of their friends, they feel good about it. And they might make a small return on it.

Ken Grier in his Macallan days (photo courtesy of Macallan)

Beyond whisky

While whisky is firmly on the investment-grade radar, Grier says there are other categories that are interesting. Though he also suggests it’s often more about the brand than the category.

Rather than rum per se, if we look at Dictador in particular, and the cocktail we talked about, it ticks a lot of the boxes. It has been around since 1913, third-generation master blender and the remarkable cache of very old rum that they’ve carefully curated in good wood is amazing.

He also points to collaborations such as the latest Dictador 2 Masters Niepoort. The ultra-premium limited edition is the work of Port winemaker Dirk van der Niepoort and Dictador’s master blender Hernan Parra. The £800 rum is made from four vintage Columbian rums from 1971, ‘74, ‘78 and ‘80 aged for 12-16 months in Port pipes.

Innovation in 2 Masters has created something unique. This idea of having real friendships, real collaborations in different terroirs, different climates is really exciting,” Grier adds.

Elsewhere, he mentions Mezcal and his client Amores’ Logia project, which makes use of wild agave. “The limit on the production is the amount of agave a donkey can carry,” he says. “It goes into the areas of scarcity and it’s a very different product experience because the agaves are very different.

Both Cognac and baijiu – and the Martell and Moutai brands in particular are on Grier’s investment-grade radar. But baijiu aside, he says it’s a tough area for white spirits. White spirits are more difficult,” he says. Some of them do have some provenance – Beefeater for example – but they don’t have rarity.

It’s not just whisky that makes for a sound spirit investment

Secondary market

Now we know what makes an investment grade spirit, what’s in it for the drinks companies that make them? Well, Grier agrees “100%” that selling spirits on the secondary market is a good PR exercise for the producers and he speculates that The Macallan is now 39% of the entire Scotch whisky market at auction.

“I’m a big, big fan,he says of the secondary market, which can build caché for a brand and establish price points, “which can be helpful”. He also says the secondary market helps to expose brands to a wider category of people and in a different way.

Whether people use auctions to find liquid that will create a special connection with friends or as alternative asset classes, Grier says the secondary market is “very, very useful”. “Places like Sotheby’s do a great job,” he adds. “The way that they actually publicise brands, bring them to more people, tell interesting stories… and very often that raises good money for charity.” He mentions a Macallan that raised $460,000 for Charity: water.

The Macallan Masters of Photography

To drink, collect, or both?

While there are benefits to the secondary market, there are some that believe spirits should be consumed – and not traded.

To me, it’s both,” says Grier. The liquid in the bottle is always at the centre. When I did the stuff at The Macallan, like Masters of Photography, the M Decanter, they were beautiful and interesting objet dart, but the liquid was also superb. It was put together for a specific purpose; it was aligned to the story and part of the whole objet d’art. And I’m proud of that.

“Ultimately, all of these things should be capable of being consumed and enjoyed. Because the purpose of alcoholic beverages is to consume and enjoy them,” he adds.

Grier says people chose to keep some products back because they are beautiful and because of the scarcity and intrinsic value.

“People see a value in them which is fine. And if people want to do that, that’s great. It’s when people buy them and flip them very quickly that I get worried for the industry because that means people are trying to make a very quick profit without really understanding.”

He highlights the many approaches to investment grade spirits, including the love, care and knowledge displayed by collectors as well as smart purchasers and those that open and enjoy the liquid.

“I’ve seen all sorts of things,” he says, “but if you specifically have in your mind to buy today and sell tomorrow, I’m not sure what that necessarily does for the industry.

Casks are a tricky market to get right

The potential perils of casks

At this point in our conversation, talk turns to casks. There has been a lot in the press lately about the perils of buying casks as an investment opportunity.

“If you have a wonderful cask from a great make – a Balvenie, a Bowmore, Laphroaig, then that’s to be applauded, bottled carefully, enjoyed, and savoured. I think it’s a lot of the casks from no-name companies – ‘whisky 568% growth! Outstrips any other index!’ That’s when you’ve got to be a bit worried.

Grier reminds us that good wood is the basis of good whisky – and he says that if you’re careful about the type of wood, the type of spirit from a reputable brand, and the way it’s matured, then a cask is something that can be a legacy.

He also reveals his own legacy: “I’ve got a cask of Macallan that I laid down and I prize that.” He says it will be for his own consumption with his friends and family. (Ken, can we be your friend?)

Ken Grier at the recent launch for Dictador 2 Masters Niepoort

How to get into investment-grade spirits

When it comes to offering advice on buying high-value booze, Grier has some wise words. “The first thing is: be clear on what your budget is, then look at the character of the liquid – it’s got to be something that is interesting. I’d certainly look at the brand – what do you know about it? Its heritage? Then I’d ask myself what character am I looking for from that liquid and over what time horizon? Do I want to enjoy it or keep hold of it and hope for future appreciation? Am I collecting? Be clear with your objectives. If you do that, it’s very difficult to go wrong.

Our chat winds down with a look at Grier’s own investments, which include a bottle of the 1972 Macallan Fine and Rare, which was bottled in 2002.

“I paid £500 for it, there were only 100 bottles in the cask… I saw one come up recently and it was £26,000, so that was decent,” he says.

And we part with one last story, a tale that suggests even the experts aren’t immune to the odd ‘accidentally-opened bottle’.

Grier tells the story of when his mother-in-law came to stay a few years ago, to look after the children while he went away.

“I left her a bottle of Famous Grouse – she was a Famous Grouse drinker. I came back and to my horror, my blue box bottle of 30-year-old Macallan was almost empty. That’s probably three and a half grand,” he says. Though he was happy there was a thimble left to try.

Nevertheless, an expensive babysitter.