A short history of alcopops

Is the alcopop phenomenon just an isolated and controversial piece of tabloid fodder, or is it likely to change our drinking habits in the long term? Tony Scouller of IDV UK discusses the developments so far, and the future he sees for this dynamic market

Tony Scouller

THE LAST 18 months or so have seen two quite extraordinary events in the usually unruffled calm of the drinks trade: events that have changed the normal equilibrium. First, there is the breakthrough to television advertising for mainstream spirits such as Smirnoff, Bell's and Gordon's. Then there is the phenomenon of 'alcopops'. These two events have coincided. In the staid, supposedly unchangeable world of wines and spirits - not of course what the industry thinks it is, but how people perceive it to be - this is an exceptional coincidence.

This paper is not concerned with spirits on TV, but with the highly controversial and dynamic market for alcopops.


In 1993, a company called MacGillivray launched a brand in Australia called - improbably and scurrilously - Two Dogs.

Then a number of events came together. Bass Brewers had a product on the market called Hooper's Ginger Brew, and it decided to use this brand name for the launch of Hooper's Hooch. Bass has not said a lot on the subject, but it looks as if it watched the spectacular success of Two Dogs in Australia and decided to enter this new market itself. It worked with Greenall Whitley in the north to get something off the ground, and that something was Hooper's Hooch.

IDV had also been working in the whole ready-to-drink area. The ready-to-drink category (also called 'pre-mixes' or packaged cocktails) was not new. Bacardi Breezers were well-known in the United States; Martini had had a good product called Any Time - a Martini and lemonade combination - on the market for many years; Burroughs Mixed Doubles were modestly successful on the market, together with Gordon's Gin and Tonic. But nothing very much had happened with any of these products.

IDV had a product line in the US called Ritas, which was a range of Margaritas and other cocktails made from Jose Cuervo Tequila, the highly successful brand that we distribute in the US. This triggered our interest, and we began testing Ritas in Newcastle. Although that test was successful we decided not to go further, for reasons outside the scope of this paper. Meanwhile, however, we decided to launch Malibu Caribbean Cocktails, and these are still successful in the marketplace.

In parallel with this we looked at the phenomenon of 'hand-badging' drinks. These days, a lot of people drink their beer from the bottle - heavens knows why (what's wrong with a glass?). The fact is, though, that they do. The advantage for the producer is that when you are holding the bottle you are handling the brand name, while the disadvantage of brands like Smirnoff and Gordon's is that people do not know what you have in the glass once it has been poured. If, on the other hand, you can get people to handle a product that is very clearly branded on the bottle, then that product is obviously Smirnoff (or whatever), and nothing else.

What is more, if the bottles remain on the table in the outlets where they are drunk, other customers may pick them up, examine them, and discover them for themselves.

For all of these reasons, we decided to have a go with Smirnoff Moscow Mule. Originally, this was a cocktail produced in a copper mug; hence the copper coloured packaging. It was used in a series of advertisements featuring Woody Allen among others in the United States in the 1960s. The cocktail itself was invented in the 1940s, and it was only in the 1960s that it was promoted and advertised, initially in the Cock & Bull Bar!

All of these diverse streams of thought lead into a single, specific funnel.


1995 was the hottest summer since 1976. Bass launched Hooper's Hooch in April; Merrydown launched Two Dogs in July, after overcoming supply problems; Gordons launched Ginzing on test in Nottingham; and Sainsburys produced an own label version.

In November, Hooch advertising was withdrawn after complaints to the Advertising Standards Authority. Here lies the major source of the problems we have all experienced with these brands. The line 'One taste and you're Hooched' was, to say the least, unfortunate.

In spring 1996, the Portman Group drew up a code of practice for alcopops - and promptly drew the wrath of the Office of Fair Trading, who said that the large groups were imposing solutions on the small, that this was a restrictive practice, and that it should not be permitted. As a result, the code remains voluntary, and the only signatories to it are the large groups.

In August, Allied's Thickhead was withdrawn, apparently permanently, in response to a ruling from Portman. By September, Sainsburys delisted (or said they were delisting) the 'failed' Two Dogs.


At this stage a few definitions are probably in order.

We define the 'ready-to-drink market' as 'all single-serve alcoholic drinks excluding premium packaged lagers and ciders', and within this there are three main segments, effectively defined and driven by the consumer, on the evidence of research. First, we have alcoholic carbonates: Hooch; Two Dogs; Jamming; Sub Zero; and so on. Then there are premium packaged spirits: Smirnoff Mule; Ginzing; and Metz. Finally, there are premix drinks, which divide into two sub-groups: fruits and traditional mixed doubles. Fruits are Bacardi Breezers and Malibu Cocktails, while the traditionals include Bacardi & Coke and Gordons & Tonic.

If we focus on alcoholic carbonates, these are those drinks that have fruit or soft-drink flavours as a base, with the addition of pure ethanol as the spirit. They are usually in single-serve packs of 250 or 300ml, and are around five per cent alcohol by volume in the 'made wine' excise duty band (since the November budget, this section of the made wines band has been subjected to a 42 per cent increase in duty). They have been called a number of different things - alcacarbs, alcocarbs, alcopops - and alcopops has stuck.

How big is the market? In summer 1996, we estimated it to be about six million nine-litre cases annually, and expected that to increase to some ten million by the end of the year. Depending on how you do the sums, and how you estimate the split of the retail market between on and off-trade, the market is worth at least £250 million, and quite possibly double that. It splits approximately 55:45 between on and off trades respectively, though the on trade has led the category. By the end of 1996, upwards of 100 brands had been launched into the sector, though relatively few have received substantial marketing support.

The key players include most of the leading drinks marketers and there are a host of others: Bass with Hooper's Hooch, Merrydown with Two Dogs, Whitbread's Shotts, Carlsberg-Tetley's Lemonhead and Orangehead; and smaller producers like Spilt Drinks with Jamming, Maison Caurette with Mrs Puckers and Beverage Brands with Woody's which has been a great success in Ireland.

While this has mainly been about spirit-based drinks, it is not only these that have flourished. Whitbread have launched a spirit beer called Archangel; Bud Ice has appeared; ciders like Zest are on the market, and premium packaged spirits are also proliferating - Smirnoff Mule, Gordon's Ginzing, and Bell's and Cola.

Among premix spirits and coolers, it is worth noting that Scottish Courage have managed to maintain sales of a brand called Castaway, which is a relic of the wine cooler fad of the mid-1980s, and the only significant survivor of this category.

What is the retailer's view of the ready-to-drink market? It is clear that new product development will be the lifeblood of the marketing of the sector. The trade expects some brand support, innovative packaging and - of course - a brisk rate of sale. For specialists in particular, the opportunity to revitalise and deseasonalise the spirits business is going to be very important. At the same time, too, the consumer profile is very attractive: young and female. For the off-trade, the opportunity lies in recruiting users who have acquired the taste in the on trade. Below-the-line support is crucial, and so far the own-label phenomenon is no more than a threat.


Among 18-34 year-olds, research shows that over 60 per cent have tried an alcopop, and 35 per cent have tried a premium packaged spirit or premix, and this is pretty much the same for both men and women. The really dynamic action, however, is among the 18-24 year-olds, where 80 per cent of 18-20s have tried alcopops, and 75 per cent of 21-24s; while the corresponding figures for premixes are 48 and 38 per cent respectively. What this means for brand development, of course, is that if you launch a new line to this younger segment, you will almost certainly end up cannibalising your own brand.

There are lots of theories as to why the alcopop phenomenon took off so rapidly. Boredom with beer seems to be a major factor, partly because of the massive success of the bland-tasting Budweiser. Favourable duty levels, with the products being classified in the made wine sector, certainly helped: these are very affordable drinks, and the trade is able to earn a good margin. The weather, in summer 1995 especially, is important. Finally, the emergence of the economy from the recession has provided an essential spur.

It is true, too, that the imagery of these brands appeals to the growing anti-establishment among young people, and the negative pr output of the tabloid press has actually helped to fuel the market's growth - something they would never admit. Finally, the legitimation of drinking from the bottle, drinking ice cold beers and so forth, and the development - at last - of lots of ice and fridges in the great British pub have all contributed to the success of alcopops.

Alcopops also seem to be meeting an untapped need, which raises some awkward questions for the future. If you ask men to agree or disagree with the statement 'I really don't like the taste of beer', only 6 per cent strongly agree, and 54 per cent strongly disagree. With women, however, the figures are reversed: 22 per cent strongly agree and only 15 per cent strongly disagree. If you are a woman, and you do not like beer, what do you drink in the pub? But will it always be alcopops, or will another fashion take over?

This is crucial because our research suggests that people say they are drinking these products 'for a change': perhaps this is simply female beer. The figures from the market suggest that alcopops are stealing market share from premium packaged lager and from cider in the on-trade (hence the recent poor results from Matthew Clark); and from speciality and mixable spirits, and a range of other wines and vermouths in the off-trade. There is no sign that they are growing the alcohol market, though the jury is still out on that. Consumers say that they are substituting for beers, both draught and packaged, and also for mixed spirits.

What happens next is, of course, the crucial question for anyone in the market. There simply has to be some rationalisation: there are too many brands chasing tiny shares of the market. There is enormous pressure on fridge space in outlets of all kinds, both on and off, as well as pressure on display space. There have to develop more credible, long-lived brand propositions, and it is up to people like Bass and IDV to create them and build them. Also, the government has taken steps in the budget to increase duty on alcopops, and so raise prices, which makes the overall proposition somewhat less attractive.

What, too, are the implications for the spirits business? Clearly, there is pressure on fridge space, but the key is the effect on service in the on trade. It is far simpler for both customer and bar staff if you ask for six bottles of Mule: you pick them up, whip off the crown corks, and off you go, instead of waiting for six Smirnoff and tonics to be made up. Brand values for these ready-to-drinks are going to be critical: will they simply feed on the mother brand, will they add new values to it, or what?

What about competitors in the market? United Distillers appear to have made their position very clear. They are going to use this sector to get their older brands in touch with younger target groups - hence Bell's & Irn Bru, Bell's & Cola, and so on. Westbay have always been active in this category, and it is an odds-on bet that this will continue. Allied have burnt their fingers with the Thickhead controversy, but seem sure to continue in the market in one way or another. Clearly competition will not go away. As for IDV, our intention is certainly to stay in the market for the long term and to do so by creating sound long-term propositions and advertising them effectively.

In conclusion, it is very easy to look at the alcopop phenomenon and see it as an isolated, controversial piece of tabloid fodder, which may well go the way of many crazes before it. This is, as we have seen, a vast over-simplification: the ready-to-drink single-serve market is broader, more complex, and a great deal more alive than that, feeding as it does both on novelty and on long-established traditions. What is more, it seems to be in tune with the changing drinking habits and requirements of the younger generation of drinkers; and although there will be a whole range of shifts and turns in the marketplace as years go by we can, I think, be confident that there is a long-term market for this type of drink. It is up to people in the trade to identify and develop the brands and the products that will have staying power.


Tony Scouller

Tony Scouller

Tony Scouller is marketing director of IDV UK. Prior to this he worked at Wyvern International on brands such as Malibu, Le Piat d'Or and Croft. He worked for a number of years for J Walter Thompson, becoming director of their London office in 1974. He began his marketing career with Beecham Foods in 1960.