The Complex Dynamics of the Distiller/Enthusiast Relationship.
“I’m not in theWalter White if he worked for Macallan
methwhisky business. I’m in the empire business.”
If you’re reading this article, there’s a good chance that you consider yourself a whisky enthusiast. There are a lot of us out there, especially when you compare today’s enthusiast market to the numbers from ten years ago. We whisky nerds can be a fanatical bunch. Simply enjoying the taste of these fine, distilled spirits is not nearly enough. As enthusiasts, we undertake the unending pursuit of knowledge to immerse ourselves fully in the complex, yet rewarding world of whisky. It may start off innocuously with one particular bottle or brand but before long, one finds themselves looking for a lot more. As we try new expressions and branch out to completely different styles of whisky, we begin to understand and appreciate the complex chain of decisions that goes into actually getting an expression to market. From grain choices to cask makeup, fermentation times to distillation methods, warehouse conditions to age statements, filtration considerations to bottling strength, there are scores of decisions that are deliberately made that ultimately result in that bottle of whisky you enjoy so much.
For some of us, the “journey” becomes a literal peregrination as we traverse the physical whisky world in search of a more immersive experience: visiting distilleries, whisky bars, destination liquor stores, and tasting events. Many of us begin recording tasting notes for our own personal records and the especially enthused among us – *clears throat* – track even more detailed data sets in complex spreadsheets for the sheer fun of it. As we check bottle after bottle off our list of expressions to try, we invariably develop a preference to certain brands over others. It becomes an emotional attachment akin to the feelings one might develop for a favorite sports team.
Like professional sports franchises, though, we sometimes forget that distilleries are businesses. They have operating costs, tons (or is it tuns) of overhead, and ultimately need to remain profitable to keep the operation running. In addition to the aforementioned production decisions, distilleries also need to respond to constant changes in their supply chain, fluctuations in demand, forecasting of future demand and making production decisions accordingly, geopolitical ramifications like tariff wars, and for some distilleries, pressure from parent companies that may clash with the decisions of the whisky makers themselves. Taking all of this into consideration, it becomes fairly apparent that making production decisions to keep enthusiasts happy can move to the bottom of the priority list pretty quickly.
Let’s look at the king of the Scotch mountain as an example. You’d be hard pressed to find a whisky consumer, no matter the style, that hasn’t heard the name Macallan before. This is far from coincidental. Macallan earned every bit of the acclaim that they are currently cashing in on because for decades, they made spectacular whisky that simply could not be replicated by anyone else. Up until this recent market boom, this was in mostly due to the casks used to age most of their distillate. While Macallan has always had older, pricier, limited edition releases in their portfolio, their standard lineup also included many affordable expressions that kept consumers at every price point happy. In the not-too-distant past, I can recall happily buying bottle after bottle of Macallan 12 Year for around $40 as well as the mind-blowing Cask Strength for $55.
By 2010, however, the writing was on the wall and the ink was long dry. The Edrington Group took control of the brand in 1999 and introduced the Fine Oak range just a few years later. The Fine Oak line was the first step in Macallan’s greatly expanded use of American oak casks as well as ex-bourbon casks. In the years since this release, Macallan has shifted heavily toward the use ex-bourbon casks across their entire portfolio of whiskies. These cask types are significantly more attractive to today’s distilleries because of their prevalence as well as cost compared to “sherry casks”.1 A consumer getting into whisky in the 2020s with no point of reference for historical Macallan releases has no idea that the flavor profile has shifted so drastically. The other reference point that can’t be ignored with Macallan releases is pricing. Macallan established themselves as a luxury brand through a combination of focused efforts in key global markets, a rich history of quality whisky, and boldly implementing a premium pricing strategy long before other brands caught on to the trend. To that point, I have anecdotally witnessed the average price of Macallan 25 Year double three separate times during the course of my whisky journey. While other brands have followed suit to varying degrees, Macallan remains the shining star of the premium Scotch whisky category.
You either die a hero, or live long enough to see yourself become the villain.Harvey Dent during a fictitious internship at Glendronach
All the while, another brand was waiting in the wings and positioning themselves to become the next sweetheart brand for whisky enthusiasts. in 2008, the Glendronach distillery was acquired by the Benriach Company and the distillery’s expansive stock of sherry cask-matured whisky fell into the care of legendary master blender and serial distillery reviver Billy Walker. During the course of the next decade, Walker and the team at Glendronach released a core range of expressions aged entirely in sherry casks. Because of a lapse in production from 1996 to 2002, many of these releases were much older than the stated age on the label. In addition, the distillery released several single cask bottlings from vintage years that were heralded by whisky fans for their quality and relative affordability. The distillery was eventually sold to Brown-Forman in mid-2016 and Walker departed soon after, eventually purchasing the GlenAllachie distillery. In the years since, several notable changes have occurred at Glendronach including significant price increases and label changes to their single cask range to account for re-racking into secondary casks. More recently, labeling on the distillery’s standard range removed all reference to the whisky being “non-chill filtered”. While a Brown-Forman public relations manager assured me that no part of the current whisky making process has changed, this label change was certainly deliberate leading one to wonder what other changes are coming from Glendronach in the future. I find it a bit ironic that Glendronach firmly established themselves as the “Macallan killer” for most whisky enthusiasts only to become exactly what they set out to destroy.
As for Billy Walker and GlenAllachie, the distillery recently put out a standard range of sherry cask matured whisky as well as several single cask releases from vintage years that are being heralded for their quality and relative affordability. Are we eventually doomed to repeat the past with GlenAllachie? The future has yet to be written but as of the writing of this article, the secret is certainly out on the brand and certain distillery bottling expressions are already seeing sharp price increases. The brand’s long-term strategy in the wake of this new found wave of attention remains to be determined and one can only hope that pricing remains reasonable for the foreseeable future.
While only a handful of distilleries were mentioned in this article, there have been no shortage of brands aligning themselves to be less consumer friendly as the market continues to boom. Take Balblair as another example of premium pricing realignment. One of my favorite bottlings by Balblair is their 1990 Vintage. All the whisky in this release was distilled in 1990 and spent time in both ex-bourbon and ex-sherry casks for 25 years before being bottled in 2015 at 46% ABV. I paid $130 for this incredible bottle. In 2019, Balblair announced a completely revamped lineup that did away with vintage releases (aside from special editions) and replaced it with a standard core age stated range. One of the expressions in this range is a 25 year old whisky. It spent time in both ex-bourbon and ex-sherry casks for 25 years before being bottled at 46% ABV. The price of a bottle is over $650. Balblair did away with something that differentiated themselves from other distilleries in Scotland. The announcement of the new core range included a reassurance that the whisky isn’t changing. If I understand correctly, then, the whisky didn’t change…just the price.
What can we, as enthusiasts, do about the inevitable disappointing shift in product strategy that happens to brands we love? That depends on how realistic one’s expectations are. If a brand takes a Macallan-esque turn and you simply want them to change their minds and go back to the way things were before, there’s a pretty slim chance of that happening. Whether it’s dropping an age statement, changing the cask makeup, or increasing retail pricing, these disruptive, product-related decisions are not made without detailed analysis of the impact the change will have: be it on the supply chain side, the end taste of the altered product, or simply the change in margins for the brand. That’s not to say consumer feedback hasn’t worked on other brands in the past. The most notable backpedaling in recent history occurred when Maker’s Mark decided to lower the ABV of their whiskey to account for increased demand in the early 2010s. The backlash was immediate and prominent across social media and Maker’s Mark did the unthinkable: they heard the end consumer loud and clear and reversed the decision. Within context, this was very much the exception and not the rule for so many other brands that have changed their products for one reason or another. If a brand makes a change that negatively impacts your experience as an end consumer, one can safely assume that the brand knows this as well.
As end consumers, however, there is one essential decision we have complete control over: what we do with our money. If you want to show support for a brand, do so with your wallet. Sometimes it sends a message to a producer and sometimes it doesn’t but it’s the one part of the producer-consumer relationship that the distilleries can’t interfere with. Despite being a huge fan of The Balvenie, seeing higher aged Balvenie releases sitting on shelves and in display cases for years with no movement tells us something about the price sensitivity of most spirits consumers in the US. There’s a law of diminishing returns when it comes to age and pricing of single malts. From a value perspective, is a 30 year old whisky four times as good as an 18 year old expression from that same distillery? Is that 18 year old bottle twice as good as the 12 year since it’s twice the price? The answer is completely subjective can often depend on the situation (i.e., special occasions, gifts, celebratory bottles) but for my money, I typically prefer more bottles of younger expressions over a single bottle of an older release.
The whisky world is a delicate ecosystem and decisions like Glendronach’s label change have a legitimate impact on the end consumer market. Brands rise and fall over time and as enthusiasts, we know first-hand when a brand is moving in the right or wrong direction and usually respond accordingly. If your favorite brand becomes the next one to make changes that lead to better margins or worse-tasting whisky, take solace in the fact that you were able to enjoy their products when they were made with the enthusiast in mind and prepare to move on to the next distillery vying for a piece of the connoisseur market. There are plenty of fish in the sea (or in this case, the loch) and they’re all fighting for your business. Reward the companies that are doing things right.
1 To go down the rabbit hole of why “sherry cask” is a tricky term that doesn’t necessarily mean what you think it does, check out this informative set of articles at The Whisky Exchange Blog.