As international travel resumed post-pandemic, rum brands saw an opportunity for growth in Global Travel Retail (GTR). Historically, rum lagged behind other brown spirits in this sector, with its presence in duty-free stores not matching its domestic market popularity. However, the pandemic's aftermath brought a resurgence, with sales growing 52% to about 770,000 cases in 2021, according to the IWSR Drinks Market Analysis.
Surge in Premium Rum Demand
Rum brand owners believed the category was ready for further premiumization in GTR. With millennials around the world increasingly traveling, there's a growing demand for unique experiences and premium products. The premium and super-premium segments, which have been underrepresented in duty-free stores, are now gaining traction, mirroring the trends seen in domestic markets. This shift reflects the evolving preferences of travelers, who are seeking variety and sophistication in their choices. The rising interest in premium rums among millennials indicates that rum is well-positioned to compete with other high-end dark spirits, catering to the diverse tastes of today's global travelers.
Challenges in Duty-Free Stores
Despite the optimism, many duty-free stores offered limited rum selections. Internationally renowned rum experts criticized the narrow range, particularly the dominance of spiced and flavored rums. Such limited offerings prevented consumers from seeing the variety in the rum category. However, regional duty-free stores in the Caribbean and South America provided a better variety, though still somewhat limited.
Strategic Moves by Rum Brands
Equiano Rum, an African-Caribbean blend, made its debut in GTR through a partnership with GMAX Travel Retail. The brand has been very successful in acquiring Barbados Airport by aligning its muscle production at the Foursquare Distillery in Barbados. Cuba's Sao Can and Ron Cubay, produced by Corporación Cuba Ron, entered GTR through ERC Sun Spirits, boasting high-quality products and a journey through their Denominación de Origen Protegida status.
Bacardi, the market leader in GTR, maintained a 24% category share, with a 12% premium tier share. Bacardi's rum division, which includes vintage rums, aims to ease the customer's journey through clear design and quality offerings. The brand also launched a new omnichannel campaign called "Depth in Every Drop" to engage customers throughout the travel experience. If you are curious to know more about Equiano Rum, read me.
Recovery and New Listings
The pandemic significantly impacted rum sales in GTR, with a 70% drop in 2020. However, the easing of restrictions brought a notable rebound. Diplomático Rum saw a return to near pre-2019 sales levels, driven by increased travel and consumer interest. The brand focused on premium offerings in GTR, introducing lines like Diplomático Reserva Exclusiva and more premium selections like Pedro Ximénez Sherry cask-finished Ambassador. Several brands reported new listings in GTR, including Dead Man's Fingers, which gained major listings with Dufry UK and Heinemann internationally. Venezuela's Ron Carúpano also expanded its reach, earning top ratings in the Caribbean, North America, and the US. Airports.
Final Remarks
These major industry developments gave rum brand owners hope. As international traffic rebounded several times, the potential for rum to achieve greater success in the GTR business seemed increasingly possible. It marked a new chapter for the masters of malt in the global market.
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