Liquor manufacturers are using rungs of premiumisation to move consumers from low-end products to high-end offerings. Apart from getting better revenues from customers, this is also helping them with customer loyalty.

One of the drivers for consumers is status. “You want to show that you can afford a better drink,” pointed out Mr Ashok Capoor, President and Managing Director, United Spirits Ltd. Mr Ankur Bisen, Associate Director, Retail and Consumer Products, Technopak Advisors, agreed and said, “Consumers are more aware of the brands and are moving up in the price points.”

A variety of factors, like higher disposable income and vanishing taboos concerning liquor consumption, is propelling sale of alcohol in the country. According to a report by AM Mindpower Solutions, India is the world's largest whisky market, and companies in this segment are adding more premium products to get customers to spend more.

One issue that companies are facing is that customers typically move up one step at a time. For instance, many would think twice before moving from whisky priced at Rs 500 a bottle to something that costs Rs 1,000.

Ms Sunitha Barlota, Research Analyst, Euromonitor International, said, “People who drink on the most frequent basis rarely jump from a Rs 500 to a Rs 1,000 for a bottle of whisky at one shot.” This is why, she said, companies such as USL and Pernod Ricard have many products in the Rs 200 to Rs 1,000 segment.

And as consumers move up the chain, companies are adding more products to help them in their journey. For example, later this year, USL will announce John Barr, a value scotch from the Whyte & Mackay stable, which will be priced a few hundred rupees above Antiquity Blue, which Mr Capoor said was the top Indian whisky from USL.

>balaji.n@thehindu.co.in

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