New Hampshire is a dream to most producers and suppliers of super-premium spirits. With no state sales tax on spirits, and all spirits retail allocated exclusively to the 80 New Hampshire Liquor & Wine outlets, prices are ultra-competitive and tough to beat. This has fueled strong trading-up trends. “The New Hampshire Liquor Commission (NHLC) goes to great lengths to offer premium and luxury spirits,” says NHLC chairman Joseph Mollica. “Over the past two years, the NHLC has hand-selected close to 200 single barrel selections of Bourbon, whiskey, and Tequila that are offered exclusively at our stores.”
It’s not just upscale whiskies and Tequilas enjoying the party—Cognacs and vodkas are feeling the buzz, too. Three of the top five spirits brands by volume in the Granite State are super-premium offerings. Second-ranked Hennessy ($36 a 750-ml.) edged up 2.2% in 2017 to approximately 109,000 cases, and No. 4 Tito’s ($19) jumped 50% to about 96,000 cases. Meanwhile, No. 5 Absolut ($18) decreased about 7.8% last year to approximately 78,000 cases.
Other dynamic growth brands in New Hampshire include Jameson ($25 a 750-ml.), Jack Daniel’s ($23), and Johnnie Walker Red ($20) and Black ($40). “These brands have been around for a long time and work very hard to keep themselves as the frontrunners in their respective categories,” Mollica says.
In all, spirits volume increased 1.5% in New Hampshire last year to 2.42 million 9-liter cases, according to NABCA/Impact Databank. Spirits dollar sales outpaced the volume gain with a 4.1% increase in 2017 to approximately $410.18 million, according to Mark Roy, NHLC’s spirits marketing specialist. “We have seen our best growth in the $21-$30 range,” he says. “This varies based on category, however, with Bourbons hitting a higher price point, anywhere from $35-$50.”
The leading Bourbon brands in New Hampshire by volume—Jack Daniel’s and Jim Beam ($17 a 750-ml.)—both grew in 2017 and outpaced the state average. Jack Daniel’s, No. 6 in the state by volume, increased by 9% to approximately 74,000 cases. Jim Beam, No. 8, grew by about 5% to approximately 52,000 cases.
Other leading spirits brands in New Hampshire, meanwhile, experienced mixed results last year that generally mirrored national trends. While some super-premium brands grew, larger mainstream premium rum and vodka brands with big volume bases experienced slight declines in the face of stiff competition. Captain Morgan rum ($15 a 750-ml.), the No.-1 spirits brand by volume in New Hampshire, decreased about 2.4% to approximately 114,000 cases; No. 7 Bacardi rum ($14) decreased roughly 8% to about 59,000 cases; and No. 3 Smirnoff vodka ($11) declined 1.8% to 102,000 cases. Among leading premium-priced spirits brands in New Hampshire, Pinnacle ($11 a 750-ml.)—ranked ninth by volume—inched up less than 1% to about 51,000 cases.
Despite being ranked 41st by state population with 1.34 million people, according to the U.S. Census Bureau, New Hampshire sells more spirits than states with much larger populations, including control states like Iowa (30th by population/3.15 million people) and Mississippi (34th by population/2.98 million). New Hampshire’s competitive pricing fuels its spirits business with plenty of sales to out-of-state tourists and destination shoppers from bordering states like Massachusetts and Maine.
In fact, more than 50% of spirits sales in New Hampshire are made by consumers who do not live in the state, with Massachusetts residents accounting for a whopping 23% of total spirits sales. “Merchandising is a key component to both wine and spirit sales, and our efforts are constantly evolving throughout our retail outlets,” Mollica explains. “We are committed to our outlet branding, and we offer some of the most competitive pricing in the country for brands consumers know and love.”
Along those lines, the state’s liquor and wine outlets offer a “Price Busters” section that features significant reductions on selected products for one month. A recent “Price Busters” promotion offered $5-$11 discounts on spirits, ranging from a 750-ml. of Bulleit Bourbon or Bulleit Rye for $24—$5 less than the normal retail price—to a liter of Grey Goose vodka for $28 (normally $34). Larger format “Price Buster” deals included a 1.75-liter of Jameson for $38 (normally $49) and the same size Pinnacle for $15 (normally $20).
To facilitate the shopping experience, New Hampshire offers in-store iPads with access to statewide inventory as well as food pairing suggestions. Over the past three years, the NHLC launched an in-store display advertising campaign that provides brands with additional exposure to consumers. There are also multiple high-definition video screens and in-store radio featuring spirits marketing. The screens have “taken the form of eye-catching, large-format wall and banner ads, as well as floor advertising,” Mollica says.
New Hampshire has a comprehensive public relations strategy designed to position its liquor and wine outlets as the premier destination to purchase spirits—especially rare and exclusive offerings such as single barrel purchases and allocated Bourbon offerings like Pappy Van Winkle ($60-$270 a 750-ml.) and Buffalo Trace Antique Collection ($90). “Even when purchasing 17 barrels of one product—such as Jack Daniel’s Single Barrel ($45)—each barrel has its own unique flavor profile and expressions,” Mollica says. “Consumers often purchase multiple bottles from multiple barrels to compare.”
Other single barrel Bourbons sold at the New Hampshire outlets include E.H. Taylor Jr. 100 proof ($60 a 750-ml.), Four Roses 100 proof ($45), Knob Creek Reserve 120 proof ($42), 1792 98.6 proof ($41), and Evan Williams 86.6 proof ($28). The state stores also carry single-barrel single malt Scotch offerings, such as Balvenie 30-year-old ($1,000) and Balvenie 12-year-old ($80).
Likes And Followers
With more than 101,000 combined followers across Facebook, Twitter, and Instagram, the NHLC has made social media a key tool in its consumer engagement strategy, working alongside traditional tactics like newspaper and radio advertising. “Social media has had a huge impact on sales,” says Nicole Brassard-Jordan, director of sales, marketing, merchandising, and warehousing at NHLC. “Consumers are able to interact online with the NHLC as well as peers, and discussions are happening around preferences, bargain prices, and new products.” The NHLC receives the most engagements from Facebook when it publishes spirit-related posts, but also receives positive responses on Twitter, especially when publishing information about limited release products. Direct-to-consumer email communications, including coupons, insider picks, and special promotions, have also had a positive impact on sales.
In-store tastings are another key component in reaching customers. “Hundreds of events take place each year, and we have begun to incorporate tasting rooms in new store designs,” Mollica says. “We have a state of the art learning center in our new, 34,000-square-foot Nashua location and an outdoor patio at our Epping location, which is in a newly developed retail plaza.”
The NHLC doesn’t rest on its laurels: Since 2012, it has relocated or renovated 28 liquor and wine outlets. “Our renovation and relocation program is a significant sales driver,” Mollica says. “We’re continuing to look for ways to optimize the consumer shopping experience.”
Top-grossing products are prominently featured on the floors of all NHLC retail stores. “Each year we undergo an extensive update to our shelf sets to adjust our product categories, giving the proper space to growing segments and reducing some of the flat or waning categories,” Mollica says.
A 20,000-square-foot store opened in Rochester in March, and new outlet locations are planned for West Lebanon, Colebrook, Portsmouth, and Somersworth. The new freestanding Rochester store in The Ridge Marketplace is strategically located on Route 11, which, as a main highway to New Hampshire’s Lakes Region and the White Mountains, sees more than 36,000 cars pass by daily. The outlet expects to attract out-of-state customers from neighboring communities in Maine. Replacing a smaller Lilac Mall outlet, the new store carries more than 6,600 sizes and varieties of wine and spirits and is anticipated to generate $9.5 million in annual sales. Elsewhere, construction has started on a 22,000-square-foot liquor and wine outlet in Portsmouth, which is accessible from Interstate-95.
The average New Hampshire Liquor & Wine store is 8,000 square feet and offers 11,000 SKUs. Prices range from $5 a 750-ml of Taaka vodka to $14,000 for a bottle of Glen Grant 50-year-old single malt Scotch. This rare offering is located at the 30,000-square-foot Salem outlet and is featured in the store’s high-end allocated product glass display case.
The smallest New Hampshire Liquor & Wine outlet is Store 3, located past the security checkpoint at Manchester/Boston Regional Airport. At just 625 square feet, it carries 193 spirits brands and 450 SKUs. Store 50 in Nashua is the state’s largest at 34,000 square feet, carrying over 7,000 wines and spirits.
Made In New Hampshire
Reflective of national trends, craft distilleries are experiencing growth in New Hampshire. There are currently 11—a low number when compared to other states—and more are on the way. “We’re still seeing the craft movement grow each year,” Roy says. “We’re expecting to see another two or three craft distilleries come online in 2018.”
State liquor and wine stores dedicate retail space to New Hampshire-made products and offer year-round incentives for purchasing them by offering 10% discounts on six or more mix-and-match bottles. Popular craft distillery brands sold at the state’s outlets include Smoky Quartz V5 Bourbon ($28 a 375-ml.), Flag Hill Straight Bourbon ($40 a 750-ml.), Krupnik Spiced Honey liqueur ($25 a 375-ml.), and Morecello Blackberry Cello liqueur ($20 a 375-ml.). “We see Bourbons and ryes really leading the way but there are also some boutique gins and vodkas doing well,” Roy says.
At The Forefront
Looking ahead, Mollica is confident about steady growth in the Granite State. “As always, we hope to see our overall spirit sales grow 6% to 8% over last year,” he says. “But we also strive to expand our offerings in all categories and keep New Hampshire at the forefront of places to shop for the best spirits, the best selection, and the best prices in the country.”