Whiskey Brands Have Forgotten Their Best Customers. Now, They're Paying the Price

[El Presidente]

Oh the parallels 

https://www.mensjournal.com/food-drink/rare-whiskey-brands-losing-customers

Whiskey Brands Have Forgotten Their Best Customers. Now, They're Paying the Price

Why would drinkers reach for allocated expressions when Jack Daniel's and Jim Beam are always available for a reasonable price?

Jake Emen

Jan 13, 2025 10:39 AM EST

The whiskey industry is close to a perilous precipice, inching away from a peak and close to a contraction. Insiders dread the prospect of “glut,” an overabundance of production that leads to a collapse in value as consumers begin filling their glasses elsewhere. Niche bottles and brands are the first to feel it.

Take Ireland's Waterford Whisky. It has one of the most impressive, singular visions found anywhere in the whiskey world. By producing single farm, single varietal, and single malt whiskeys, the distillery has developed the idea of terroir in spirits while also showcasing the flavor differences and nuances found between different types of malted barley. Waterford has been lauded far and wide by the whiskey cognoscenti—this author included—as a torchbearer for the industry.

Yet Waterford's now in receivership. While founder and figurehead Mark Reynier vows to gather the funds to keep the brand alive, it's a telling shot across the bow. Whiskey geeks view the category differently than the vast majority of everyday consumers. While there are many financial pitfalls and complications to running a world-class whiskey distillery, what does it say about the state of the industry that a producer seen as one of its brightest lights may be snuffed out?

It's not as if Waterford is the only example, either. According to former American Craft Spirits Association (ACSA) president Becky Harris, the co-founder of Virginia's Catoctin Creek distillery, about 45 craft distilleries have closed in the U.S. in the past two years. Earlier this month, Stoli Group, owner of Kentucky Owl bourbon, filed for bankruptcy protection as well.

 

“The whiskey is great,” Lew Bryson, journalist and author of Whiskey Master Class, says of Waterford. “But it's so damned granular in presentation. Total transparency is an overload for most drinkers, they don't really care, understand, or care to understand.”

“A brilliant idea is one thing, execution of it in the marketplace is another,” says Robin Robinson, educator, brand consultant, and author of The Complete Whiskey Course. 

Robinson believes that whiskey, as with any fashionable consumer good, has gone through three stages over the past several decades: one, early adoption and avant-garde buzz; two, expansion and advancement; and finally three, becoming part of the national conversation. 

“We're currently in stage three, and when Mark Reynier opened Bruichladdich, he helped create stage one," Robinson says. "When he opened Waterford, we had moved to stage three but he was still in stage one.”

Allocated bottles may get all of the journalist and geek attention, but it's the Jim Beams and Jack Daniel's of the world that move bottles by the millions, after all. For Bryson, who became a believer in Waterford's ethos upon the brand's initial forays, things became muddied soon after.

“The message started to get lost, and I began to suspect that this was about creating collector buzz. 'Only so much of this, a few more of that, gotta get 'em,'” Bryson says. “I mean, it's not like it should be a surprise. Reynier created a new expression at Bruichladdich every time he turned around, why would we think this would be different?”

Despite layers of righteousness in the whiskey-sphere, the entire market exists amid an environment where much-maligned vodka is still the big dog in town. According to the most recent sales figures from the Distilled Spirits Council of the United States, vodka sales totaled 75 million cases in the U.S. in 2023, accounting for 30 percent of all spirits volume. That's more than American whiskey, Canadian whisky, Scotch whisky, and Irish whiskey combined (62.4 million cases).

While Robinson is a noted critic of the notion of spirits terroir, he makes a point that the mere notion of it proved to be more of a hindrance than a lure. 

“Instead of bringing people to it, it helped alienate them from it, and geeks don't count, because geeks only buy one bottle and then look for something new,” Robinson says. “People are intimidated by things like 'cuisine' and the language of flavors. They all feel they're inadequately equipped to understand it. So they didn't understand the marketplace, helping consumers to find it and own it.”

Waterford also suffered from the lack of a core or flagship bottling, the type of consistent, always-available label that consumers could find with ease and come to know and love. Instead, the distillery offered a continuous onslaught of new, limited releases that required a great deal of explanation to understand, let alone to create a sale.

Truth is, the average whiskey drinker is as far removed from the hoity-toity whiskey geek discourse as you'd imagine. Perhaps even further—and that's the crux of the issue. The bulk of whiskey drinkers describe their bourbon as “smooth” and douse it with Coke, and that's just as valid a consumption method as sipping a rare whiskey neat. The inability to bridge that gap—sizable as it is—may be where a brand such as Waterford lost its way.

[BrightonCorgi]

I never got the crazy on Bourbon like people have. Not saying they're in the wrong, but I can barely tell the difference or tell enough to care.

Craft beers, wine, rum, and tequila are easier to showcase one brand vs. another to a regular consumer.

[JohnS]

So keep your product simple and keep it a reasonable price? Sounds like sage advice!

[SCgarman]

So yeah, when will the title of this article be replaced with the word "Habanos S.A."??!! Oh the parallels 🤣

[Puros Y Vino]

1 hour ago, BrightonCorgi said:

I never got the crazy on Bourbon like people have. Not saying they're in the wrong, but I can barely tell the difference or tell enough to care.

Craft beers, wine, rum, and tequila are easier to showcase one brand vs. another to a regular consumer.

It's a problem across many luxury goods where someone thinks they can cash in on hot items whether it be Bourbon, PS5, Habanos, etc and make a quick buck. "Flipping" became the hot new business venture. Where someone who doesn't add value to the chain makes a profit. A "middle, middle, man" what have you. Add in a little corporate greed and you have an even bigger mess. 

[riderpride]

I think this is where Four Roses succeeded. 2 Nashville (hi and low rye) with 5 yeast strains totalling 10 recipes. Their standard bottle is a blend of 7-10 of them to achieve the desired taste, the Small Batch is a blend of 4 recipes, and the single barrel is primarily one recipe, though the other 9 are made available in limited quantities. They ain't Skittles, but you can taste the rainbow. 

Cheers!

[MagicalBikeRide]

Waterford is a good example. An amazing idea, thought, concept - call it whatever you want - but experimenting with terroir in whiskey was a brave venture. It worked to some extent. But if you ask me, they released their spirit too soon and that is what put the customer off.

They were selling 4yo single malt for €90 and it was frequently noted as unready, youthful, spirit forward, etc.. On the same off license shelf, the customer had access to world class whiskey for up to half that price - Green Spot CLB, Redbreast 12, Powers John’s Lane, Redbreast Cask Strength, Jameson Black Barrel, Bushmills Black Bush, Dunvilles 12 - the list goes on and on. And only then do you start to looking outside Ireland - Glenfarclas 10, Laphroaig 10, Aaran 10, Monkey Shoulder, Kilkerran 12, Longrow, Kilkerran 16, Glenfarclas 15, etc etc 

Anyway - you hopefully get my point. Regardless of parallel criteria, Waterford represented bad value objectively and for most customers, it delivered a poor experience. 

[riderpride]

7 hours ago, MagicalBikeRide said:

Waterford is a good example. An amazing idea, thought, concept - call it whatever you want - but experimenting with terroir in whiskey was a brave venture. It worked to some extent. But if you ask me, they released their spirit too soon and that is what put the customer off.

They were selling 4yo single malt for €90 and it was frequently noted as unready, youthful, spirit forward, etc.. On the same off license shelf, the customer had access to world class whiskey for up to half that price - Green Spot CLB, Redbreast 12, Powers John’s Lane, Redbreast Cask Strength, Jameson Black Barrel, Bushmills Black Bush, Dunvilles 12 - the list goes on and on. And only then do you start to looking outside Ireland - Glenfarclas 10, Laphroaig 10, Aaran 10, Monkey Shoulder, Kilkerran 12, Longrow, Kilkerran 16, Glenfarclas 15, etc etc 

Anyway - you hopefully get my point. Regardless of parallel criteria, Waterford represented bad value objectively and for most customers, it delivered a poor experience. 

Ouch. I hadn't heard it was that young.

At that price, I'd look elsewhere too.

Cheers!

[Tinny]

At least in CA it’s the liquor stores doing this. They will have shelves full of “allocated” spirits but they hardly sell because they mark up the price on some cases 200% or more. It’s ridiculous.

[anacostiakat]

Because there are much better offerings available than Jack Daniels and Beam. Good Lord.