According to CGA by NIQ’s latest On Premise Measurement report, sales of rum in Australia’s on-premise have continued to grow by both volume and value over the past 12 months despite overall spirits contracting by 8.1%. Cost of living pressures have been widely identified as primary catalyst.
“Spirits drinkers, like many other people, are feeling the cost of living and the cost of spirits,” said Amanda Lampe, Director of Corporate Relations at Diageo Australia and Chair of Bundaberg Distilling Company.
“I think the number one issue for lots of people at the moment is paying their mortgage, paying their rent, getting the grocery bill, paying their energy costs.”
While Lampe was reflecting on both on-premise and off-premise spirits consumer spending, CGA by NIQ’s Client Solutions Director James Phillips has noticed the same trends in on-premise trade.
“With many consumers still facing pressure on their spending, it’s clear that trading conditions in Australia’s spirits market are tough at the moment,” he said.
“However, it’s a very nuanced picture with pockets of growth opportunities for venues and suppliers—especially in rum.”
This on-premise growth opportunity for rum has already seen sales increase 2.5% by value over the past 12 months, with prices climbing 8.7%. Interestingly, this new growth comes from the golden rum sector, which rose 7.6%, whereas white rum dropped 9.3%. While the CGA by NIQ On Premise Measurement report doesn’t mention specific brands, it is likely that the sales performance of Australia’s leading golden rum producer, Bundaberg Distilling Co, would have had some contribution.
One initiative that could have indirectly contributed is Bundaberg’s Raise the Bar program that provided support to Australia’s on-premise during the pandemic. Reflecting on this, Amanda Lampe said, “Bundy’s an incredible brand that’s done some amazing great things over the decades. I remember we did the Raising the Bar: [that raised] $15 million dollars during COVID. We used Bundy in that, supporting the on-premise hospitality industry during COVID.”
Drinks Trade initially reached out to Bundaberg’s Chair Amanda Lampe to discuss Diageo’s recent pride initiatives, which can be read about in this Drinks Trade article. During the chat, Lampe also explained the various Bundaberg-led pride initiatives.
“Everybody up [at Bundaberg] celebrates diversity. They have their own activities in terms of Pride Month and those sorts of things, and they’re tied in with Mardi Gras… Bundaberg absolutely celebrates diversity!” she said.
“Bundaberg is an iconic Australian brand and we think that we have a leadership role to play in our industry, and so we will be using our brand to do that.”
The CGA by NIQ analysis follows on from data published by the IWSR last year that showed that rum grew by 9% between 2021 and 2022, ahead of the 5% of global spirits overall. Despite this, Australia’s on-premise rum category growth has not been uniform nationwide, dropping 7.6% in New South Wales and growing 8.8% in Queensland.
According to James Phillips, “businesses need an expert understanding of these areas, and our insights into sales trends and market share are vital to success in this challenging, contracting and complex area of the On Premise.”
To learn more, visit the CGA by NIQ website.
