Like many retailers around the country, Buster’s Liquors & Wines has a full wall devoted to vodka brands. The Memphis, Tennessee-based retailer boosted its selection over a decade ago when suppliers ratcheted up their flavor offerings, according to manager John Vego. Today the array has changed, with fewer flavors and more local brands, but the demand for vodka still justifies its vast space in the store.

“Vodka is still so strong,” Vego says, noting that Tito’s is the overwhelming favorite at Buster’s. “Things are slowing down in flavored vodkas—and we’ve eliminated the flavors that weren’t moving—but other brands are picking up the slack. In Memphis right now we’re getting a lot of craft vodkas, brands like the local Pyramid, as well as some brands from Mississippi.”

In the on-premise, vodka fell somewhat out of favor as bartenders began favoring more complex white spirits, as well as whiskies and other brown spirits. But with consumer demand remaining strong and cocktail trends shifting, vodka is once again in the spotlight. “About eight to ten years ago, the resurgence of classic crafted cocktails brought in so many lost spirits, fortified wines, and liqueurs,” notes Marlo Gamora, lead bartender at Dante in New York City. “Now bartenders and consumers are simplifying and elevating classic cocktails.”

Gustavo Martinez, bar manager at Miami’s Bar Alter, says versatility gives vodka a prime position in any bar. “It’s no secret that vodka is an extremely versatile spirit,” he says. “From producing house-made tinctures to rapid infusions, and even to something as light and fun as a Tiki cocktail, vodka has a place in nearly everything behind our bar.”

Some producers are capitalizing on this shift. “Simplicity is a major trend at the bar right now,” notes Richard Black, vice president of marketing for vodka and cordials at Campari America, which owns Skyy vodka. “Cocktails with two or three ingredients are replacing complicated drinks. Vodka very much fits into this, allowing bartenders to create simple and great tasting cocktails.”

Grey Goose chief marketing officer Yann Marois also notes the change. “Until recently, we saw bartenders eschewing vodka in favor of brown spirits,” Marois says. “Now, we’re in the midst of a vodka resurgence as it makes its way back into cocktails on bar menus and as bartenders rediscover its subtle impact on cocktail-making. Consumers are gravitating back towards cocktails like the Martini. Bartenders are creating incredible twists on classic cocktails and using the best ingredients they can source. This is partly because consumers want to understand the ingredients and the process. It’s a macro-trend above and beyond the spirits category, but it’s deeply impacting it.”

Well-Informed Consumer

The consumer desire to know more prompted a shift in approach for Diageo with the Ketel One brand. “We’ve implemented a series of deep dives into how the category has changed over the past few years,” says Alex Tomlin, senior vice president of marketing for Ketel One. “We’ve taken to heart that drinkers aged 30 and over are driving vodka growth at the expense of wine, and that their desire to know about the sourcing of their food and beverages is no longer the exception, but the norm. We’re leveraging some of Ketel One’s most powerful attributes—its family roots and superior quality as a smooth vodka made with 100% non-GMO grain.”

Campari America is taking a similar approach for Skyy. “It’s time to connect with our core audience by focusing on our DNA: American-made vodka from American grain, with a taste and character that comes from our quadruple-distillation and triple-filtration process,” Black says.

Palm Bay International has also focused on classic simplicity and artisanal roots for its vodka portfolio. For Ravo vodka, “we’ll continue highlighting gluten-free, non-GMO, and kosher attributes,” notes Dave Singh, Palm Bay’s senior brand manager of spirits. For the company’s Chase vodka brand, an ultra-premium potato vodka, the message is about crafting artisanal, single-estate, farm-to-bottle spirits.

Numerous other brands are taking this tack, turning to their unique attributes to gain attention in a crowded, competitive field. Matthew Pechman, vice president of marketing for Deep Eddy vodka—which was acquired by Heaven Hill Brands in 2015—notes just how significantly the landscape has changed in a few years. Pechman says the move to brown spirits over the past six years left many major brands rushing to reboot their flagship labels. “Part of the shift away from on-premise vodka consumption left a lot of legacy brands scrambling to rebuild the equity of their unflavored variants,” he explains. “That resulted in price pressure and other challenges, yet vodka remains the biggest spirits category by both volume and value, and there’s still a trend toward growth and premiumization. But now it’s being led by brands that have tapped into authenticity, a great story, provenance, value, and differentiation.”

Rank Movements

The biggest growth brands within the vodka sector typically aren’t the brands that drove the spirit to remarkable volume heights a decade ago. Instead, the most dynamic brands today either didn’t exist back then or were barely a blip on the radar. Tito’s, for example, has been produced for more than 20 years, but it’s only been in the past five or six years that the brand has really taken off. Its volume has nearly tripled since 2014, with last year’s depletions estimated at 5.83 million 9-liter cases.

While Smirnoff remains the top vodka by volume, Tito’s leapfrogged over New Amsterdam in 2017 to become the second-largest brand. New Amsterdam is also a relative newcomer to the high-volume field. Like Tito’s, New Amsterdam was one of Impact’s Hot Brands in 2017 following its remarkable recent growth. The brand showed double-digit increases in from 2012 to 2016, before slowing to 5% growth in 2017 to 5.26 million cases. Other vodka standouts include Svedka, which increased by 2% to 4.4 million cases; Platinum 7X, up 14% to an estimated 1.31 million cases; and Deep Eddy, which grew 17.5% to an estimated 1.18 million cases.

“It’s interesting to see the shift in the top brands, even in the past 10 years,” notes Reid Hafer, group product manager at Heaven Hill Distilleries. The company recently undertook a major packaging change for Burnett’s vodka. “The big thing for us is how to continue to keep our place in the category and maintain or build share in the face of brands that five years ago weren’t as important as they are now,” she explains. “The new Burnett’s packaging will allow us to better compete with these more premium products. We know that we’ve been a leader and our core product is a great entry brand. A lot of consumers have been with us for a long time, but we want to set ourselves up for the future.”

While Impact’s Hot Brands list in 2017 didn’t include any imported vodkas, Svedka, which now leads the import field, is another brand that has upset long-held positions. For most of the 2000s, Absolut vodka led among imported brands, followed by Grey Goose. But Svedka, typically priced lower than Absolut and Grey Goose, has shown consistent strong growth over the past decade while the other two brands had mixed performances, resulting in Svedka reaching the top spot in 2015 and holding that position in 2016 and 2017, while also ranking as the fourth-largest vodka brand overall in the U.S. market.

Carl Evans, vice president of marketing for spirits at Svedka’s parent company, Constellation Brands, says price and positioning have been a factor. “The vodka category is extremely competitive, and Svedka remains a top choice for consumers due in large part to the quality/value proposition it represents,” he says. Meanwhile, despite recent challenges, Absolut is gearing up for growth, says Joao Rozario, vice president of marketing for the brand. “We know it’s a crowded category, but we also know that vodka as a whole is continuing to move in an upward trajectory and Absolut is well positioned,” he says.

Flavor Factor

Absolut and other brands continue to invest in new flavor extensions to spark interest, even as they pare back other flavors. Absolut Lime, launched in early 2017, was a big success, according to Rozario, and it will be front and center going forward, alongside the unflavored Original and Absolut Citron and Mandarin. “There’s still a strong market and appetite for flavors in the U.S. and we are confident consumers will continue to gravitate toward our entire citrus portfolio,” Rozario says. Svedka’s latest flavor push is Blue Raspberry, which Evans says was “inspired by the extreme flavor trend, a trend seen across the food and beverage space in sour candies, spicy snacks, and electric energy drinks coveted by Generation Y.”

Keenan Towns, vice president of influencer brands at Diageo, says Cîroc is also firmly on the flavor bandwagon. “Cîroc is constantly innovating within the realm of ultra-premium vodka,” he notes. “In 2017, Cîroc released Summer Colada and French Vanilla, its newest flavor varietal, signaling the brand’s ongoing commitment to innovation within the flavored vodka space. In 2018, Cîroc looks forward to bringing more exciting innovation to market.”

Portfoliomate Smirnoff has a wide range of flavors already, but more are in the works, according to Jay Sethi, vice president of brand marketing for Smirnoff and emerging brands. “Flavors continue to be a priority for us,” says Sethi. “Two of our most popular seasonal flavors, Red, White & Berry and Peppermint Twist, both grew year over year in 2017, along with our No.-1 flavor, Smirnoff Raspberry. Though we have a diverse flavor lineup today, we know that we must continue to innovate and push the boundaries in the flavors category in order to stay relevant with our target consumers and evolve with their taste buds.” Campari America, meanwhile, is launching Skyy Infusions Sun-Ripened Watermelon this spring. “Watermelon is a huge trending flavor and is particularly perfect for the summer season,” Black notes.

As much as the market has relied on and embraced new flavors to help drive vodka’s momentum, some marketers are reassessing. Absolut is focusing on its citrus range, and Heaven Hill is paring down its portfolio. “Right now we’re not adding new flavors,” Hafer says. “We actually discontinued a handful. We’re really focused on the core flavors—cherry, citrus, orange, vanilla, raspberry, peach, strawberry, and a handful of others that are in our top ten.”

Innovation in vodka doesn’t always have to be about flavors. In recent years several labels have offered upscale line extensions to their standard range. Absolut, for example, has Absolut 100 and the new Absolut Raw, billed as a “blender’s raw cut.” Grey Goose has a VX expression that includes a small amount of Cognac. The brand’s latest expression, Grey Goose Interpreted by Ducasse, was created through a collaborative process between Grey Goose Cellar Master François Thibault and Michelin-starred chef Alain Ducasse. The recipe incorporates three different levels of toasted soft winter wheat—light, medium, and dark—from Picardie, the same wheat that’s used in the production of Grey Goose vodka.

Bar Alter’s Martinez notes that new vodka expressions are making a difference. “Grey Goose has released its first gastronomic vodka called Grey Goose Interpreted by Ducasse,” he says. “New iterations like this are, on a larger scale, inspiring bartenders to remake classics and create new cocktails that ultimately generate a better experience for the consumer.” Bar Alter’s Guava of my Heart cocktail ($14) calls for Ducasse Grey Goose, fresh guava nectar, toasted cashew orgeat, fresh lemon juice, tiki bitters and fresh basil.

Targeted Audiences

In addition to the new expressions that marketers hope will keep consumers interested and engaged, there are new strategies underway by brands seeking to differentiate themselves in a crowded field. For smaller brands, experiences are often key to expanding their consumer base. Pechman, for example, notes that Deep Eddy is “very much a discovery brand outside the state of Texas. We want to drive our brand to new consumers and we know that liquid-to-lips is key for us.”

Pernod Ricard-owned Smithworks is another brand looking to push beyond its home region of the American Midwest. Country singer Blake Shelton is part of that effort, and Smithworks is tapping into his fan base to drive acceptance to a wider audience, according to brand director Troy Gorczyca. He says American-made craft brands are “bringing new drinkers to the category who may not have considered vodka before.”

Some larger brands are targeting specific communities in their marketing efforts. Smirnoff, for example, has made inclusion a central theme. “Inclusivity and bringing people together are central to Smirnoff’s brand purpose,” Sethi says. “Last year, as a continuation of Smirnoff’s long-standing support for the LGBTQ community, the brand launched limited edition ‘Love Wins’ bottle packaging for Smirnoff No. 21 vodka, which honored love in all its forms and featured real LGBTQ couples on the bottles.” The Smirnoff “Love Wins” bottles were the most-searched Diageo product of all time, notes Sethi, adding that the campaign will continue to evolve in 2018.

Cîroc, another Diageo product, sees opportunity with a different demographic. “As Cîroc looks to expand its consumer base, our eye is on the urban millennial consumer who shares the brand’s core values of celebration, hustle and excellence,” Towns says. “Within the larger millennial market, we find that there is great opportunity to expand within the Latin community. Cîroc is actively pursuing large-scale initiatives to drive awareness and growth in these targeted demographics.”

No matter the specific demographic, it’s widely believed that today’s younger consumers are embracing variety and looking for new experiences rather than sticking with the status quo. “Today’s consumer is more adventurous and inclined to try something new, whether at a bar or serving friends in their home,” says Evans. “This experimentation will continue to translate into on- and off-premise opportunities.”