Prestige Alcohol Brands Are Difficult to Build — and All Too Easy to Ruin

It was the evening after my wedding in New Orleans — ages ago — and the core crew of our leftover revelers had descended upon a relaxing Marigny haunt to unwind in style before the impending crash back to our respective realities.

“Johnnie Black on the rocks,” I said to the barkeep. “Scratch that,” my brother quickly interrupted. “He’ll take the Macallan 25, neat.” The barman stretched for the gloriously toffee-hued bottle lording over the back bar as my brother turned his sly signature grin my direction. “Relax! It’s on me. You only get married once, right? Well, hopefully, at least.”

Despite both of us identifying as aficionados of fine beverages, it wasn’t really the luxury of the particular whisky that meant something for the two of us. Ostentatious posturing is not in the family DNA. It was the prestige — the difference between gaudy, diamond-ensconced fashion accessories and a fine pair of Italian leather shoes.

Luxury in and of itself often rings hollow, but prestige has soul to it: a sort of timeless essence of cultural meaningfulness, as well as elevation without alienation. And sure, there’s undeniably a luxury element to a 25-year whisky, but that correlation isn’t universal. “Prestige is built on legacy, but not all prestige is built on luxury,” says Sydney-based veteran brand ambassador James Buntin, formerly of William Grant & Sons (Glenfiddich, The Balvenie, Hendrick’s) and House of Suntory.

Whether possessing a dash of luxury or not, that elevation into the near-universally respected prestige level is an ultimate goal for many alcohol producers and marketers, an aspirational pot of gold at the end of the brand-building rainbow that many continue to find eternally just over the next hill.

But cautionary tales abound, and even if smart and lucky enough to hunt down true brand prestige, mucking it all up and squandering the hard-won treasure is far too easy.

The Alchemy of Beverage Prestige

Single malt Scotch whisky is simply drenched in historical legacy, and that Macallan 25 would almost certainly be reverentially welcomed by just about any whisky drinker — from country club retiree to urban cocktail hipster. “Whisky is a portal to the past. It’s really indicative of memories,” Buntin says. “People really identify spirits with themselves. They identify with that distillery and what that distillery is about.”

The story of a place and culture can draw in newcomers and create devotees, and in that regard, Scotch whisky has leveraged its innate advantage to spectacular success. That’s legacy at work. And while having a historical legacy on your side isn’t the be all and end all of prestige — as evidenced by the far more recent but fanatical embrace of Japanese whisky — it sure helps in this age of brand and lifestyle storytelling. “The perception of brands and their consumers has changed a great deal,” Buntin says. “People now choose products based on their belief set and whether they identify with it.”

But not everything has been puppy dogs and ice cream for single malt Scotch lately. A sales slump has hit the category and caused some concern. There’s speculation that the growing availability of single malt releases lacking an age statement, as well as the marketing push to use single malts as a cocktail component, could harm the single malt prestige reputation.

“Things slow down, you panic, you try to push more volume, and you sacrifice your prestige.”

However, as branding wizard Steven Grasse — founder and owner of drinks marketing house Quaker City Mercantile — points out, prestige is separate from pure sales numbers, and a deficit in the latter hasn’t caused a decline in the former… yet. “Yeah, they took the age statements off, but man, they can still get away with it,” he says. “That’s interesting!”

Pan out to a longer time scale, and there’s a recurrent theme to the sales woes: continuing post-pandemic rebalancing in a moment of economic worry. “Whisky is historically cyclical,” says James Simpson, managing director for the Pol Roger Portfolio in the U.K. “It’s starting to balance itself out again.”

There’s a similar tale unfolding with that most celebratory of wines, Champagne.

More than any other wine region, Champagne exists as a prestige brand in its own right, as even non-vintage bottlings retain a sense of gravitas. It, too, has sagged into a sales slump recently, but well, Champagne is still Champagne. “[It] kind of straddles wine and also spirits-type brandish-ness,” Simpson says. “Champagne is lucky that even its [non-vintage] entry level is prestigious.”

But the liberties that even branding icons like single malt Scotch and Champagne can take with their prestige images during a downturn aren’t unlimited. Go too far, and prestige perception can become watered down.

Cautionary Tales From Cognac and Gucci

There’s a moment of shock when a slump hits. Anyone involved in the game long enough has gone through it, and according to Grasse, that “oh, shit” reaction can inspire bad decisions yielding long-term headaches. “Things slow down, you panic, you try to push more volume, and you sacrifice your prestige,” he explains.

“Everything is cyclical. Something has to go all the way through the cycle for the cool kids to want to pick it up and think they discovered it.”

Cognac’s overall image may still be one of prestige, but as the region’s big four have continued to saturate the market, some industry insiders are feeling a bit over the major players. When combined with a recent plunge in demand from China — a market that has become mission-critical for the brandy — “Big Cognac” is in danger of eroding its former clout. “In Cognac, the quality really isn’t what it used to be,” Grasse says. “When Cognac was at its height of popularity, they went after the demographic that was buying it up, and then that group moved on. But they built up all this capacity, so they still have to sell a lot.”

He likens the comparison to that of overplayed fashion brands such as Gucci. “When they were doing well, they did too much of it,” he says. In contrast, he compares Gucci’s issues with that of a still-revered competitor. “Hermès, they’re very consistent, and they don’t saturate the market, [or] have too many stores,” he says.

Similarly, there’s the temptation to engage in awkward cross-generational pandering in hopes of shoring up sinking sales during a downturn. “We all want to pretend we’re cool, and it’s always much cooler to be liked by the cool kids,” Simpson says. “[But] they aren’t going to come spend $200 on a bottle of Champagne.”

Nevertheless, both Cognac and Gucci have taken the bait, with large Cognac interests engaging in an image makeover and promotional price war while displaying an apparent overreliance on the China market — only to have geopolitical machinations throw a massive wrench in the works. The consequences? Both find themselves flirting with unique identity crises. And while Cognac’s economic slide hasn’t exactly mirrored Gucci’s freefall, any excessive dilution of its prestige could have long-term ramifications.

“We simply focus on playing the premium prestige side. Since its founding in 1880 … this strategy has proven successful, and given current consumer trends, is expected to remain so.”

Grasse cautions that if brands want their prestige to appeal to the youngest available generation, chasing them down is probably a bad approach. “Everything is cyclical,” he says. “Something has to go all the way through the cycle for the cool kids to want to pick it up and think they discovered it.” The current trend of designer baggy jeans — the very ones many of us now regret wearing in the ’90s — offers a case in point.

According to Grasse, doing the opposite, riding out a downturn with the mantra of “focus on less, do less,” can often preserve prestige for future boom years. “If you stay the course, you retain [it],” he says. “The [prestige] brands that endure are the brands that know who they are.”

New Prestige Winners and the Magical Beverage Unicorn Playing Both Sides

Single malts and Champagne may be the long-time prestige icons, but other categories and brands have found their way to the promised land.

Unlike single malt Scotch and Champagne — whose pullbacks have been recent — Port sales have suffered a literal decades-long slide in volume. But what have Port producers done? Less. “Our production is voluntarily limited,” says Jorge Rosas, CEO of highly regarded Port house Ramos Pinto. “We simply focus on playing the premium prestige side. Since its founding in 1880 … this strategy has proven successful, and given current consumer trends, is expected to remain so.” Consequently, despite sales volume being down, prices are up, and prestige reputation is not just intact, but growing.

Likewise, mezcal is currently riding high by most measures. Perhaps it’s benefiting to some degree from a growing aversion to the tiresome parade of celebrity tequila, but storytelling, highlighting a distinct sense of place and cultural history, unquestionably has something to do with mezcal’s moment. “Tequila is so played out right now, but mezcal hasn’t yet tipped over into the oversaturated category,” Grasse says. Similarly, American whiskey is still cresting on the prestige wave unleashed by the small batch revolution. “For such a long time American whiskey was dominated by the big boys,” Simpson says. “The profusion of smaller players has been great.”

There is one particular brand, though — a beer, no less — that appears to have effortlessly managed the dangerous tightrope walk of being “everything to everyone” with a chimera-like combination of timeless prestige and chummy, High Life-esque casual cool: Guinness. It’s become a beer like no other; essentially carving out an inimitable category all its own. “Pubs are being rationed, great! That’s free publicity,” Simpson says. “[And] Guinness 0. They can’t make it fast enough.”

The current decade’s muddy economic and geopolitical waters offer a fertile medium for prestige transitions in both directions. “Is sparkling tea the next big prestige product in the non-alc space?” Simpson muses. “It’s basically going to be Champagne for the non-drinker. That’s great! Why not?”

Regardless, we’ll eventually bear witness to whether that and other new princes can eventually evolve into prestige players — and which panicking older kings bury their crowns. As for my first marriage, may it rest in peace. But that Macallan 25? Something tells me it’s gonna be just fine.

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