Demand for Tequila is increasing year on year and the future for the category looks bright. But what’s behind the boom? We talk to Proximo Spirits Tequila educator Oli Pergl to find out.
While gin continues to dominate headlines and rum muscles its way into the spotlight, the rise of Tequila consumption hasn’t gone unnoticed here at Master of Malt. More and more people are waking up to the versatility and deliciousness of Mexico’s national spirit and a raft of new producers have sensed the potential, building premium brands on a bedrock history, tradition and craft.
The stats make for pretty good reading, too. Waitrose reported in May this year that its Tequila sales boomed by 175% since the lockdown in March and new Nielsen data revealed that in the US, Tequila sales were up 55.5% in September and October 2020 in the off-trade. Becle, a Mexican company whose flagship brand is Jose Cuervo Tequila, reported better-than-expected results for the July to September quarter this year, with net global volumes growing by 26% compared to the same three months last year and shipments rising by 28% to 3.38 million cases. Wall Street analysts called the figures both “outstanding” and “amazing” when they were announced last month.
But what’s driving this growth? To find out, it’s worth talking to somebody who knows the spirit inside-out, like Tequila educator Oli Pergl. He spends his time enlightening and delighting folks on the pleasures of the agave-based spirit for Jose Cuervo, a Tequila brand which is not only the world’s best-selling but the oldest, having been granted the first license by King Carlos IV of Spain to produce and distribute Tequila in 1795.
For Pergl, the desire for ‘craft’ spirits and the heritage, provenance and character of Tequila has galvanised the industry and is responsible for the boom. “This is an era in which people want to look beyond the label. They want to know who the producer is, how the spirit is made. Tequila is perfect in that respect. It’s got such a rich and deep history and the craft of Tequila is unique and specific to Mexico,” Pergl explains. “And people are now discovering it in new ways. We’ve seen so many new brands come over the last few years and Tequila is one of the fastest-growing categories of spirits at the moment. Vodka has been on the decline for a little while. There’s an oversaturation of gin in the UK which has prompted people to look elsewhere. I believe Tequila is on its way to being the next big player in the market”.
The pandemic did little to halt this impressive rise. “We’ve seen a lot of people enjoy Tequila over lockdown. They want to be reminded of summer holidays, having fun, and Tequila fits the bill. Virtual Mexican nights and cocktail hours have been hugely popular and driven demand” says Pergl. “With quality, premium Tequilas being much more widely available, and easy to work with when making cocktails at home, we think this trend will continue to grow for a good while yet”.
In light of the increased interest in the category, it’s little surprise to see that celebrities have jumped on the bandwagon, including George Clooney, Dwanye Johnson, Michael Jordan. Pergl acknowledges that celebrity endorsement has plenty of advantages, but can be a double-edged sword. “You don’t want millions of celebrity endorsements to saturate the market,” Pergl explains. “But, overall, it’s a good thing. It’s created more awareness and has broadened the premium market because that’s typically where celebrities get involved. Thankfully there hasn’t been too much cheesy product placement or gimmicky marketing. They’re often almost romantic about their businesses and are just as in love with the spirit as the people making it. That, in turn, tells the consumers ‘maybe I should fall in love with it as well’”.
The biggest cultural shift, however, has been the movement away from identifying Tequila purely as the rough and tumble party spirit that you knock back with salt and citrus. Education in this regard is still needed, but increasingly consumers are sipping and appreciating. “We want people to understand the passion involved. We’re targeting events towards consumers to ensure that tequila isn’t just seen as a party shooter or a Margarita ingredient,” Pergl says. “We promote the versatility and mixability of Tequila. We want people to dive deeper and realise you can have Old Fashioneds, Mojitos, Piña Coladas etc. I personally believe any cocktail can be twisted with Tequila and we want to demonstrate that it has a diverse enough character to replace rum, whisky, gin or vodka”.
The growth of premium Tequilas (which are usually made with 100% blue weber agave) casts an inauspicious light on ‘mixto Tequilas’, a term given to more economical expressions made from the mandated minimum of 51% agave, with the other 49% coming from sugarcane or another sugar source. However, Pergl says this style still has its merits and a future. “That type of Tequila still has a massive part to play because it introduces people to the fun and light-hearted side of the category,” he explains. “There’s always going to be times for celebration in our lives and the need for a mixable spirit and it’s great that consumers have options because not everyone has the budget for premium Tequila. Producers also have to be very careful about what they are going to be making their Tequila from because 100% blue agave isn’t necessarily the most sustainable option”.
This is one of the challenges the industry faces. While things are looking good for Tequila, the increased demand for agave-based products has raised concerns about sustainability. “It’s not just Tequila, there’s a huge demand for agave syrup. It’s putting serious pressure on a lot of brands. We’re constantly assessing our role in this and creating solutions. We have a laboratory onsite to analyse different conditions and how they affect the crop to ensure that our agaves are treated as best as they can. We have about 4,000 jimadors, all of them are generational-led experts, in the field every day tending to millions of plants who prioritise the safety of the crop,” Pergl explains. “We’re also working to make sure that our agaves, after turning into Tequila, have a much longer life as well. We recycle its fibrous materials, for example, and donate them to local businesses to be turned into straws, rope, aprons or kitchenware. It’s not just a case of using the agave purely for Tequila, we want to extend the life of it”.
Looking forward to how Tequila can maintain consistent and sustainable growth, Pergl says that companies like Jose Cuervo have a responsibility as a leading brand to ensure that the traditions and the culture of Mexico remain respected and that the quality of new expressions adheres to a certain standard. “We always feel a responsibility to the industry. We’re never trying to trample over anyone. Our position allows us to innovate, to take that next big leap and show the other companies we can be brave together. Once we do that and master certain techniques then we can share that knowledge so Tequila doesn’t have to be this one thing,” Pergl says. “We also have a responsibility to our farmers, our neighbours and to the town of Tequila, to represent Mexico with integrity. Jose Cuervo himself was the mayor and he introduced a lot of measures to ensure that people had the right facilities. Those values paved the way and the eleventh generation members still ensure that those traditions are met”.
The question is, will the demand for Tequila continue to rise in 2021? Pergl has no doubt that it will. “Rum and Tequila are yet to have their heyday in terms of the popularity that gin and vodka have enjoyed. I think that’s about to change. We want more of the world to fall in love with our spirits and, lockdowns permitting, we’ll be getting out there educating and working to increase the appreciation and adoration of this great spirit. 2021 is going to be a big year for us”. And if you’d like to see it in with a quality Tequila in-hand, you can pick some up right here.