Scotch Industry fight over single malt marketing procedures

OK, so let's import this discussion over to the ng... I for one do not see how Diageo is behaving nefariously and it has nothing to do with the Brora

1. Cardhu is a registered trademark owned by Diageo

1. Cardhu was the name of a distillery in Speyside owned by Diageo
2. Diageo has recently renamed their distillery from Cardhu to Cardow, the distillery's original name
3. Diageo are continuing to market a product under the brand name Cardhu
4. The brand name Cardhu will no longer represent a single malt whisky from the Cardhu/Cardow distillery
5. The brand name Cardhu now represents a vatted malt whisky being marketed under the name "Cardhu Pure Malt"
6. Diageo has changed the colour of the Cardhu Pure Malt bottle from its former red to black
7. Diageo has changed the label of Cardhu Pure Malt to eliminate the words "single malt whisky"
8. Diageo has taken out advertising in its primary Cardhu market, Spain, explaining that the product has changed from being a single malt to vatted malt.

The source of the ire seems to be the contention that Diageo is deliberately attempting to mislead people by labelling their new vatted malt as "Cardhu Pure Malt". It seems that the majority of these young, beautiful people do not know that Pure Malt means vatted malt which means no more single malt. But what about all the stupid, beautiful people out there who don't understand that there is nothing 'special' about "Glenfiddich Special Reserve"? Or those who read the back of Ardbeg 10 Year Old and actually add one part water to one part whisky and wish they were drinking Cardhu'n'Coke instead?

Diageo's shift of a single malt to a vatted malt is a result of their successful marketing of "Cardhu" such that it is the biggest selling whisky in Spain, the choice of the hip and beautiful club set. If I'm to properly understand the editorial whines I read from time to time in Whisky Magazine, the poor, beleaguered whisky industry needs more of this, we as consumers need to be drinking more whisky and more often, otherwise the industry will apparently never survive. How can we, WM asks, possibly get the young and beautiful to give brown spirits (eg whisky) a try? It seems their crusade has gone so far as to send a rather hapless looking Dave Broom out clubbing with young hipsters and collaborating with hotspot bartenders to concoct whisky cocktails, all the better to mask the taste of Ardbeg as one gets one's buzz on.

It seems that if vodka can mix with Red Bull then why can't it mix with some nice, light Speyside whisky... say, Cardhu? And, for those of you who go to clubs, ever wonder why there are Smirnoff Girls wandering about but no Whisky Wenches? Women in various tartan micro minis walking around with no underwear, dram in hand of course, taking turns sitting on Sean Connery's lap while he smokes a (very large) Macanudo. Every distillery could adopt its own "whisky tartan" and corresponding Whisky Wench of The Month, and distillery bottlings could come with trading cards featuring their respective Wench, all limited edition of course (there, that'd give those indpendent bottlers a run for their money). But wait, I digress and I should probably stop now before those charlatans at Diageo steal my ideas...

Back to Dave Broom, it seems his latest whisky crusade stopped short of travelling to raves in Ibiza otherwise he would have seen that they need no convincing (or Whisky Wenches) over in Spain. Whisky is very chi chi there at the moment and Cardhu is currently the chi chi-est of them all, to the point that Diageo no longer has sufficient supplies to keep up with demand. If I understand Dave Broom and Whisky Magazine correctly, this is a Good Thing in their quest to expand the world whisky market and convert young heathens from vodka and red bull to Scotch whisky... isn't it?

Apparently not. Dave Broom's new mission now seems to be one of getting the Scotch Whisky Association to regulate the industry more tightly with a myriad of new definitions, certifications and even a hallmark that would be displayed on the bottles of those whiskies that meet SWA approval. Let's hope at the very least that Ralph Steadman is contracted to design the graphics.

I'm not picking on Dave; he's a pretty good writer but his continous rants about people not drinking enough whisky (which do make him sound like some sort of RJ Reynolds shill) and the need for the industry to explore new markets now make him seem like a bit of a hypocrite with all his suggestions that the industry tighten its noose around the likes of Diageo.

It was only a few issues ago that he was promoting Compass Box's L'Orangerie, a lovely whisky infusion of orange and spices, a whisky "product" that he touted as highly creative and the sort of thing needed to move the whisky industry forward. Fast forward 6 months and now his recommendation is that the industry needs certifications, more definitions and funny little hallmarks to guarantee that the ignorant -- who don't know the difference between a single malt and a vatted malt -- are protected in their ignorance and get to remain so. Don't the British have a name for this sort of thing... "nanny state-ish"?

Johanna

PS: And, I like Cardhu! There I've said it. For me this is the Mona Lisa of whiskies, a perfect study in the art of distilling malted barley, not as challenging or interesting as Dali or Picasso in his Cubist period, not as colourful as Manet, not as intricate and complex as Michelangelo's David, just very clean, very pleasing, very faultless drinking whisky, like a good blend this is made for social dramming rather than study or analysis. Read John Hansell's past article about Drinking in The Zone and you'll understand when to reach for the Cardhu.

Little wonder it should be the biggest selling whisky in Spain -- great on its own but can also mix with just about anything and no surprise there: Cardhu is one of the most popular "canvases" used in the industry for blended whiskies, part of the reason I'm sure that Diageo can't afford to keep sending so much of it to Spain as a single malt.

Johanna

Just want to add some more information... have a look here:

Andreas

I hope you sent that to Whisky Mag... and if so I really hope they print it...

BTW I've lost you're mailing address .. and I finally cracked that bottle.

Johanna wrote

The Mona Lisa of whisky? I'm not sure the art world would accept the above as a good analogy. I say that as someone who graduated cum laude with a fine arts degree, summa cum laude with an art education degree,

Versatile, ordinary, accessible, for the people? Perhaps *Diego* Rivera would be the artist to mention? Or in a more contemporary sense, maybe Judy Chicago? ;-)

Sorry, I couldn't resist. You make an excellent point nonetheless.

John

I think that the problem is that the "new" Cardhu looks exactly like the old, "single" Cardhu, and is priced about the same.........(and tastes pretty similar, probably)

The industry for the last twenty five years (since drunken driving stopped being a fun game to play) has been quietly pushing "drink less but better (and more expensive)" for legitimate commercial reasons.

Now Diageo, surprised by their success in Spain with Cardhu, and unable to crank up production of the 12 year old single in less than, er, twelve years, has filled the gap with a vatted malt, a (probably) very nice vatted malt. The packaging has hardly changed - same age statement, same bottle, and very, very similar label. Delete "single", insert "pure". Now, fear the non-Diageo producers, once the punters out there work out that a skilled blender can produce much what most punters want, at a substantially lower cost, maybe the cheaper vatted malts are going to pull the rug out from under the singles, with consequent loss of sales?

The (scottish) Scotch Whisky industry is also a little pissed off that Diageo now sells and markets Scotch Whisky, together with Gordon's Gin & Malibu (a strange product which is more get-up and packaging than content) from a base in south east England, without the slightest apparent concern for Scotland or Scots.

Richard

Richard Spencer sgrìobh,

Well we all know the promises made by Guinness when they made, to my mind, their illegal take-over of Distillers Ltd. I do not suppose since the merger with GM that their business practices have become any less sharp?

In article , I had previously written regarding the advertisements Diageo had taken out...

Thanks for sending me the scanned advertisement. I've read a lot of opinions from people whose opinions I respect, including your own, but this is the first piece of real evidence I've seen.

I don't have the knack for languages but from living near Mexico Spanish is the one I can usually puzzle out even if I can't understand it fluently. (I could use some help on the second paragraph.)

The advertisement is pretty straightforward. Without looking up the ASCII codes to use the proper accent marks and such (which won't display accurately across all systems anyway) here's the text which begins:

Cardhu Single Malt cambia a Cardhu Pure Malt

Cardhu Single Malt hasta ahora elaborado en una unica destilera de Speyside, ha cambiado a Cardhu Pure Malt elaborado en algunas de las destileras mas legendarias de Speyside manteniendo el proceso de elaboracion totalmente artesanal.

My attempt at translating...

Cardhu Single Malt is changing to Cardhu Pure Malt

Cardhu Single Malt until now made in a single Speyside distillery is changing to Cardhu Pure Malt made in (or from) several of the most famous Speyside distilleries, maintaining the > method of production.

and that largely spells it out. If >>

According to the news articles available on

the design of the label may still be undergoing some revision, but on the one shown in the advertisement "Pure Malt" is *more* prominent on the new label than "Single Malt" was on the old. The type is larger and the color is different. It looks white or light grey - previously "single" was in goldleaf which actually has a lower contrast with the ruddy brown background. And it's moved from above the name Cardhu to below it. So Diageo didn't just slip the word "pure" where "single" was before.

I would have to conclude that Diageo is not trying to decieve the customer outright. But I still think they're trying to thread the needle - to let the customer know that the product has changed yet encourage them to still believe it's somehow the same. That is a delicate balance between deception on the one hand and on the other failure to capitalize on the brand - the first if the customer believes it hasn't really changed and the second if he understands that it has. And threading that needle required renaming the distillery so that "Cardhu" would no longer refer to a particular place.

Saying that "Cardhu" doesn't refer to the place now known as Cardow is like saying that Constantinople doesn't refer to the place now known as Istanbul. (Except, of course, that the names "Constantinople" and "Istanbul" are not the property of a corporation...)

Hindsight is always easier than foresight, but wouldn't Diageo have done better to leave the name of Cardhu Distillery alone and introduced "CARDOW Pure Malt, from the makers of Cardhu" in the same distinctive bottle and in similar packaging as their flagship Cardhu? I wonder if that move would have generated as much opposition? I wonder if it could have attracted the customer base that is now hot for Cardhu?

Bart

Here's the current story on the Scotsman:

Very clever! I love the play on Diego and Diageo.

Bart

Johanna,

Okay, if you insist here are my cross-postings:

On the proposal to intitiate voluntary regulations within the SWA on nomenclature and content (see Dave Broom's article in Whisky Magazine):

"Regulation in any field rarely stops the bad actors and inevitably results in consolidation by financially squeezing out the small guys. Regulation without enforcement is a farce and the owners are never going to agree to inspections, monitoring and reporting. The Emperor has no clothes and no amount of regulation can mandate him to act with scruples. You either trust him or you don't.

I have always been critical of "the industry" because it seems that innovation, creativity and the ability to respond quickly and decisively to a changing marketplace has not been its forte. If the SWA acted upon the proposals, such as the ones here and Dave Broom's, it would serve only to further stifle what little spark exists within the producer's imaginations. The small producers and independents particularly need some wiggle room to produce and market creatively without the onus of ponderous definitions, certifications and expensive eye candy hallmarks, kitemarks or what-not.

The fictitious and historical monikers allow the niche producers to bring a product to the shelves that might otherwise be unavailable. The risk of the consumer buying junk whisky with an unfamiliar label is sometimes no higher than a "respectable" label. At least the buyer's expectations are in line with the price they pay and the mystery of its identity. If it is junk, they won't buy that brand again, if they like it the brand will thrive. Believe it or not there are actually some of us out there that enjoy the guessing game of identifying the distillery(ies) represented by these no-namers. There have been some very nice whiskies that have hit the market in this way and I, for one, would be sad to see them regulated out of existence.

If the owners' marketeers believe that this is an important enough distinction, they will develop their own "guarantee of authenticity" or some such nonsense. Imposing the restrictions as proposed, is like the proverbial "swatting a fly with a sledgehammer" knee jerk reaction to one bad player, (albeit a major one). While I'm not advocating the sort of free-for-all Canadian Whisky model, there needs to be room for entrepreneurship to keep the industry vital. While I think the way Diageo is doing this is despicable, the IDEA is nonetheless a good one.

I am really sick and tired of this artificial hierarchy of single malt whisky somehow having more intrinsic value than a "mere" blended whisky, or a vatted. If you accept the corollary that there is crap whisky in every category, then converse must also be true. Unfortunately in the tiny population of vatted malts, the clunkers probably outweigh the standouts. I actually applaud Diageo for trying to promote another vatted malt. It is unfortunate that they decided to do it in such an underhanded manner. Of course if there weren't this stigma about vatted malts being intrinsically inferior, it wouldn't be an issue to begin with. What is so damn wrong about producing a consistent-tasting product that people enjoy?

(edit) What makes the single malt sector so strong, is also that which makes it so weak, limited production. Vatted malts can overcome this by pooling the on and off years of several distilleries to remain true to the established "house style" they are trying to promote. Single malts have a much more difficult time doing this, so the industry has promoted the mythology of the process rather than focus on the "character drift" that they suffer.

Maybe, just maybe, a vatted malt is more suited to the sensibilities of the average Cardhu drinker. No surprises, no distinctiveness, just predictable and (to them) enjoyable whisky. The blended whisky sector has built a dynasty on this concept, but the expense of promoting vatted malts as a "new" kind of Scotch whisky has relegated it to a fringe concept. Again, maybe if more producers spent the time and effort to produce quality vatted malts, then the entire sector as whole would be "legitimized" as a blend alternative.

Instead of devoting the expense and effort to further box in a fairly conservative industry, the SWA should consider the possibilities of following Diageo's lead by promoting the virtues of vatted malt whisky and ensuring that quality standards are upheld. Arbitrary labels and little emblems have little substance compared to the bottom line to shareholders and consumer acceptance. If the SWA were to turn this into a positive by helping its members to exploit a new market, rather than a negative by more and more ponderous bureaucracy, the consumer might just come out the better for it."

Johanna,

Okay, if you insist here are my cross-postings:

On the debacle of "pure" versus "vatted" when describing non-single malt whisky:

"I believe that there may be more than subterfuge behind Diageo's decision, although I still think they are the devil incarnate of the whisky world. Even though I have not been able to independently verify the claim, I have been told by many industry people that the term "vatted malt" cannot be used in the United States. Apparently there is no definition in the BATF labeling regulations or some such nonsense. This precept was put to the test by Vintage Hallmark who unabashedly labeled their 25yo "Vatted Malt" in the US. Perhaps there are similarly arcane laws in other lands that prevent the use of the term vatted malt on a global basis?

I say caveat emptor to any unwary customer who plonks down their cash without being even slightly educated about the product that they are about to consume. I would be very interested to see a list of all vatted malts compared against the subset where the words "vatted malt" actually appear on the label. A quick perusal of the vaults yielded two out of fourteen that actually had "vatted" somewhere on the label. One of these, John Glaser's Eleuthera is confusingly labeled "Scotch Whisky - A Blend" and in teensy letters it says "Vatted Malt".

To keep all of the traditionalists happy, perhaps it would have been better to call the new vatted "Cardow" and leave the distillery name alone. (edit)"

Johanna,

Okay, if you insist here are my cross-postings:

On the topic of "what's the beef?":

"I think the guts of the issue is that the packaging and label look exactly the same as the product it is replacing. Tobermory did the exact same thing many years ago, but it was a 'reversal' from a vatted whisky to a single, so I guess nobody cared. That and the fact that Tobermory's annual sales are probably equal to Cardhu's daily.

Imagine if you will however, the surprise you would get if Diageo decided to put White Horse in a Lagavulin bottle and just changed the label from 'Single Islay Malt Whisky' to 'Scotch Whisky with a heart of Islay' or 'Scotch Whisky Blended with Islay Malt'. By the way, those labels are not fantasy; that is exactly how Burn Stewart and Morrison Bowmore label their blended whiskies.

Of course the present case is much more insidious, changing just a single word on the label, while everything else remains exactly the same and even vatting to simulate the character of the eponymous single malt. I am not particularly put off by the euphemism 'pure' meaning 'vatted', as I wrote earlier, this is common industry practice.

However, there is an overlap where both a single malt and a vatted can 'legitimately' use the marketing term pure, so I could see how that might potentially cause confusion among the punters. I see no incentive for the purveyors of single malt to use that term, but it certainly is not deception.

With regard to 'distillery names', it is easy to forget that many are also geographical names. This was the gravamen of the Murray, McDavid / Allied debacle over the use of the term 'Laphroaig'."

Again proving what must already be very obvious: three Bushido posts are better than one!

Yeah, good question; I've had enough of this pathetic non-issue. If Cardhu-lovers looking for a single malt (and nothing but a single malt) aren't aware of the differences between the terms "single malt" and "pure malt", then they deserve to be parted from their money. From what I understand of Cardhu's core market (those that go beyond the blasphemy of adding ice to a single malt by mixing it with Coke), I have no doubt that Diageo could keep the bottle the same but substitute Cutty Sark for Cardhu as the contents and 99% of the bar-hoppers wouldn't notice.

But in the end, the bottom-line is this: Diageo owns the frocking distillery, and can change its name and the product in any way they want, so long as they don't call a vatted malt a single. They are well within their rights to keep the bottle and colour of the bloody label looking exactly the same as before, regardless of motive, because in the end it's *your choice* whether or not to pay for it, and if you can't bother to read the fine print on the label to make sure you're actually buying a single, tough s*it. Why do people care whether others get deceived through their own laziness? Let them be.

Go ahead and push for myriad government regulations and the industry in Scotland will come to the same end as it did here in Canada: two major distilleries and little else.

Matthew

Even the gullible deserve protection from a swindle. Arguably the gullible deserve more protection than the canny. If it is a swindle. Having now seen the advertising I'm less inclined to believe anybody is being swindled. The argument seems to retreat to whether this will damage the reputation of scotch whisky (especially single malts) as a whole. Will the compadres say, "That Lagavulin shortage is all contrived! To jack up the price! If they wanted to, they could make Lagavulin anywhere, just like they did with Cardhu."?

The difference between "Pure Malt" and "Single Malt" seems obvious to me.

There are only two kinds of whisky made in Scotland: grain whisky and malt whisky.

(Why there isn't a third - or more - kinds, like "Pure Pot Still" whisky as with the Irish is an interesting question for another time.)

A mixture of grain and malt whiskies is a "Blend". If there is not a drop of grain whisky in a bottle of scotch whisky it's a Pure Malt whisky. So all single malts *are* pure malts, but not all pure malts are singles.

Pure malt doesn't mean vatted malt. It's only a reverse deduction: "If [a given whisky] could be called a single malt the producers would have done so and not labeled it a 'Pure Malt'. Therefore it's a vattted malt." But the above distinctions are not legislated; the use of "blend", "pure malt", and "single malt" are a matter of custom and the general provisions of truth in advertising. Glenfiddich is an example of a whisky that has labeled its single malt "Pure Malt". Another case is Tambowie: this whisky, named after an extinct distillery, is labeled a "Pure Malt" - so it's a vatted right? - but the back label describes the particular un-named distillery (singular) that made it - so it's a single?

You wouldn't want to see vatted malts labeled as singles. You want the labels to be truthful. Then you are already in support of some regulation of the industry, whether by legislation or by acceptance of custom.

There is a modern trend against government regulation - and I for one think that's a good thing and healthy for our respective economies and personal lives.

But if you think carefully it becomes very obvious that *good* regulations are good for an industry - while bad or excessive regulation is harmful. It's a call for judgement, and wisdom.

I don't know anything about the history of distilling in Canada. Did government regulation doom competition for Canadian whisky producers? I thought Canadian regulations were quite generous for the producers, allowing even a substantial amount of non-whisky flavoring to be added if a producer wanted to adjust the flavor of their product?

The same consolidation happened in Irish whisky without special onerous regulation, leaving only two distilleries: Bushmills and Midleton. That's why Cooley was big news when it opened. It is a bit of good fortune that the same consolidation didn't happen in Scotland. And that Scottish diversity is worth supporting, if only as a cheerleader.

Bart

Off topic, but apparently Raymond Armstrong, of Bladnoch Distillery, is looking into it and there seems to be historic precedence for this being done in Scotland... But yeah, off topic.

Johanna

Well the industry dispute over Cardhu seems to have settled with the compromise announced by the Scotch Whisky Association, which was reported in the Friday, 5th of December issuee of the Scotsman.

The essence of which is:

As revealed in The Scotsman yesterday, Diageo has agreed to alter the labelling and colour of the packaging of "pure malt" Cardhu from brown to green.

It also promised not to make any similar changes to any of its other single malts and to run promotional campaigns in countries where the brand sells well to clear up any confusion about the product.

It will work with the rest of the industry to set out definitions for the different categories of whisky, starting with single malts.

Like any good compromise, both sides can claim victory - or if they prefer, both side can complain about the unjust decision and how the SWA caved in to the other side. There's been a bit of both.

From my viewpoint, it seems the matter was rightly decided. I expressed concern that the new Cardhu (TM) might look too much like the old Cardhu and people would not notice it had changed; and I wanted to see the matter explained to the consumer.

The new packaging, which uses the old bottle but with a green label and box instead of the reddish brown one should be enough to get any regular consumer to look at the label. (Sorry, I don't have a URL for a picture of the new green label but I've seen it on the web)

And Diageo is committed to more advertising to explain what the change entails.

Most of the details were available the day before, in another article in the Scotsman:

which is also interesting because they had Michael Jackson taste the Pure Malt Cardhu (TM). Without refering to his notes on the single malt he rated it a 74 - which was two points higher than the Single Malt Cardhu which he has rates at 72. Time and reflection may alter those scores though, of course.

He said: "Obviously, Diageo wanted to match the old and the new as closely as possible. The two whiskies are a very good match. In so far as there are differences, perhaps the new version is fractionally bigger: darker, oilier, nuttier and drier."

Also interesting was this exchange from the story on Sunday, 7th of December, where Jack Irvine, a media adviser for those opposing the new pure malt claimed

"The Americans were even more upset about it than the Scots because they are very knowledgeable about Scotch,"

after which the Scotsman reports that an un-named industry source

"poured cold water on the claims about "angry Americans", pointing out that Cardhu is not available there."

The matter isn't entirely over with though, since the SWA will later deal with the issue of providing more definitions of key terms like "pure malt" and perhaps some of the other issues swirling around this contraversy like the use of extinct and existing distillery names, etc... With luck some of the passions will have subsided by then. But at least for now the issue seems to be out of the courts, parliment, and the EC.

Bart